1949-11-22

Mr. George A. Drew (Leader of the Opposition):: On a question of privilege
Mr. Speaker, on reading Hansard of November 21 at page 2000, just after I had presented certain views to you in regard to a discussion which took place yesterday on a point of order I find that words are included which I did not hear. If I had heard them, I would have dealt with them immediately.
Following the presentation of a quotation from Beauchesne's Parliamentary Rules and Forms, Hansard reports the Minister of Trade and Commerce, (Mr. Howe) as saying: "Always the slanderer." Since that incident is past, I do not propose to do more than to say that had I heard that statement at the time it was made, I would have taken appropriate action.


Mr. Stanley Knowles (Winnipeg North Centre):: Mr. Speaker, I rise on a question of privilege. Yesterday in the course of one of the debates I asked whether or not a Mr. John Aird, associated with a certain bill, was the same John Aird who had been called in the Beauharnois investigation in 1931. At the time I asked my question I had been led to believe that such was the case. I now find that it is not the same man, and I feel that it is my duty to withdraw any inference against the Mr. John Aird associated with the pipe line bill in question.
ILater: 1


Mr. Speaker:: When the house assembled at eleven o'clock this morning the leader of the opposition (Mr. Drew) brought to my attention certain words which, according to Hansard, were used by the Minister of Trade and Commerce (Mr. Howe). He did not hear the words; I do not think any other hon. members of the house heard them, and in any event I did not hear them. I recall that there was considerable confusion at the time, and the debate was quite heated. Of course the words are unparliamentary. The leader of the opposition did not ask to have them withdrawn, but in the circumstances-


Right Hon. C. D. Howe (Minister of Trade and Commerce):: Mr. Speaker, in view of the fact that the leader of the opposition withdrew his insinuation that I knew something I said I did not know, I am happy to withdraw the words in question.


Mr. Speaker:: Then this will close the incident.



QUESTION OF TRANSPORTATION FOR WESTERN MEMBERS AT END OF SESSION

[Stage Direction]
On the orders of the day:
Mr. G. A. Cruickshank (Fraser Valley):: should like to direct a question to the Acting Minister of Transport about arrangements for transportation home for western members at the end of the session. The reason I ask the question, Mr. Speaker, is that many of us have reservations for the 4th and 5th of December. Obviously the house will not finish its business on December 3. We have been informed by both railways that if we cancel our present reservations we shall get no transportation on either railroad until December 26. We should like to stay here until the end of the session-although I think some members of the government might like to see me go home this afternoon.


Mr. Speaker:: Order.


George Alexander Cruickshank: This is important to the western members, Mr. Speaker. Through you, sir, I should like to ask the Minister of Transport whether arrangements can be made. I presume that the government and the leader of the opposition want their members to remain until the end of the session.


Mr. Sinnoit:: Ride the rods.


George Alexander Cruickshank: That may be all right for some hon. members from Manitoba; the hon. member for Springfield may have had the experience of riding the rods, but I have not.
We asked this question once before and arrangements were made. No member should have to leave before the end of the session. If a member cancels his reservations he has to stay here until December 26, and no one is going to do that. I should like an expression of opinion from the acting minister.


Clarence Decatur Howe: Mr. Speaker, I shall be glad to have the officers of the Department of

Inquiries of the Ministry Transport discuss with the two railways the possibility of putting on additional equipment to take care of transportation for hon. members at the close of the session.



BUSINESS OF THE HOUSE

[Stage Direction]
On the orders of the day:
Hon. Alphonse Fournier (Minister of Public
Works): Before you call the order, Mr. Speaker, which was announced last night as the first business for today, I wish to tell the house that the Minister of Reconstruction and Supply (Mr. Winters) will not be here this morning. He is not very well. We would, however, ask the house to proceed, in his absence, with the resolution respecting the trans-Canada highway. I understand that the debate was nearly concluded last night, and we wish to have the bill introduced so that hon. members may study it and have a discussion on the second reading, if there is no objection to that course. I have spoken to representatives of the various parties, and they seem to agree.
Mr. Green:: May I ask whether a minister will be available who can answer questions when the resolution goes into committee?


Mr. Fournier (Hull):: The minister has no parliamentary assistant, but the debate yesterday ran part of the afternoon and during the evening. The intention is that the bill be read the first time, and members will then have the details of the bill before them. If we do not adopt that procedure,
I do not know just what course we can take.
I do not know when the minister will be back.


Mr. Harris (Danforih):: Perhaps in the meantime the leader of the house will answer the questions.


Alphonse Fournier: I will do my best.


Howard Charles Green: May I ask the Minister of Public Works another question? Last night the Minister of Reconstruction and Supply (Mr. Winters) undertook to table today further correspondence between the dominion and the provinces concerning the trans-Canada highway. Can the Minister of Public Works make arrangements to have it tabled in the course of the debate this morning?


Alphonse Fournier: I shall get in touch with my colleague's office, Mr. Speaker, and see whether the correspondence is ready. If it is, I will table it.



QUESTION AS TO RECOGNITION OF COMMUNIST GOVERNMENT

[Stage Direction]
On the orders of the day:
Hon. Brooke Claxion (Minister of National Defence):: Yesterday the leader of the opposition (Mr. Drew) asked a question about a meeting of commonwealth high commissioners in London which was said in a newspaper report to be related to the recognition of communist China. Such a meeting took place between the high commissioners in London, as meetings frequently do. At that meeting preliminary views were canvassed regarding the situation in China. The government here was not specially asked to be there. It was a meeting to exchange views in accordance with the practice. Those views were exchanged, but there was no agreement on any common line, and the Canadian attitude would only be made known in consequence of action taken here.


George Alexander Drew: In view of the circumstances, Mr. Speaker, and the importance of the subject, I may be permitted to express an opinion which I feel is appropriate in relation to what has been said.
The statement which has just been made indicates that there was a meeting of high commissioners last Tuesday, as the report stated. The consequences of recognition of the Moscow-dominated communist government of China are so important that before that action is taken the members of this house should be afforded an opportunity to express their opinions as to the course Canada should follow. This might well be a turning point in the whole history of our relationships in the Pacific and with the nations which find themselves in this same position. In view of the statement which has now been made on behalf of the Secretary of State for External Affairs (Mr. Pearson), will the Prime Minister (Mr. St. Laurent), before a decision is made, consider giving the house an opportunity to express its opinion on this subject.


Right Hon. L. S. Si. Laurent (Prime Minister):: That will depend upon the way in which events develop, Mr. Speaker. We should not like to fix a date for the discussion of the matter until we have more factual background to put before the house than we have at the present time. The situation is still that which was expressed by the Secretary of State for External Affairs. We regard recognition de facto of a government as something which can be done only

if certain conditions appear to exist; and at the present time we are not in a position to say which, if any, of these conditions are satisfactorily established. I do not think we should be accomplishing much that would be useful if we were merely to deal with hypothetical cases. At the time we have this discussion we should be in a position to make a positive statement as to what we regard the situation to be. As soon as we have what appears to us to be sufficient factual background, we shall be glad to make that known to the house; and if at that moment it appears to be the desire of the house to have a discussion about it, we shall be glad to arrange for that discussion.


George Alexander Drew: I do not wish to precipitate a debate, but I should like to indicate to the Prime Minister why I am raising this question. The occupation of so large a country by a certain type of government, even in what appears to be a civil war, may be an important turning point in the attitude of other nations to one of the big five at San Francisco. I am simply urging that in so important a matter, before Canada is committed to a course from which it cannot turn back, the house should, if possible, have an opportunity to express its opinion.


Louis Stephen St-Laurent: We shall endeavour to do that if it is possible; but I should not like to make any firm commitment, because I do not expect that before the session prorogues there will be sufficient background to justify an attempt to bring before the house the material for a debate, and I should not like to undertake formally that nothing will be done during the recess of parliament if circumstances do develop more rapidly than we expect at the present time.



TRANS-CANADA HIGHWAY PROVISION FOR FEDERAL CONTRIBUTIONS TO PROVINCES

[Stage Direction]
The house resumed from Monday, November 21, consideration of the motion of Mr. Winters that the house go into committee to consider the following resolution:
That it is expedient to introdupe a measure to encourage and assist in the construction of a trans-Canada highway and to provide for this purpose that the Minister of Reconstruction and Supply may enter into agreements with any provinces providing for the payment by Canada to those provinces of contributions in respect of the cost of a trans-Canada highway: with provision also for the employment of temporary engineers, technical officers and other employees for the purposes of the act.
Mr. Robert Fair (Baitle River):: Mr. Speaker, it was not my intention to take part in this debate until I heard some of the speeches last night and arguments on the different routes
Trans-Canada Highway suggested. The fact that the hon. member for Fraser Valley (Mr. Cruickshank) raised the question which he did a few moments ago makes it all the more necessary that the trans-Canada highway be constructed at the earliest possible moment.
During past weeks there seems to have been quite a good deal of lobbying done on behalf of some of the other routes, particularly the Crowsnest pass route. I notice that circulars have been distributed, and a number of speeches were made last night in favour of that route. Near the end of the discussion last night in favour of that route, the speech of the hon. member for Lethbridge (Mr. Black-more) buried the argument he had attempted to make. The hon. member buried his argument in snow, where his highway has been for the past number of years and will continue to be in the future. The hon. member said, as reported at page 2049 of Hansard:
The route that I suggest is close to the United States border and in case any particular section of it should be blocked by snow for three or four days it would not be a difficult matter to drop down across the line, go along the United States highway, come up the other side of the snow obstruction and go right on through. That advantage is not to be found in connection with any of the other routes.
I suggest to the hon. member for Lethbridge that when he made that statement he defeated any argument he might possibly have made during his detailed address, because he forgot to find out where that possible route is to get down south, and, again, where the possible route is to get back to his proposed highway. We understand that that highway would be very hard to build, and that for many months of the year it would be impassable because of snow. Therefore we can give that south highway a knockout blow and come to the Kicking Horse pass, for which the hon. member for Calgary West (Mr. Smith) put up an argument last night.
The hon. member for Calgary West started out by advising the Minister of Reconstruction and Supply that under no circumstances should he agree to a commission on the route of the trans-Canada highway. Mr. Speaker, in my opinion this is one of the most important matters that should be discussed at the present time, because I do not think that money belonging to the people of Canada will be spent in the wisest way by having things as the hon. member for Calgary West would have them. He said that the highway could go through Calgary. Later he said that the matter had been settled some time ago. He referred to the former minister of trade and
Trans-Canada Highway commerce, who has now gone to the other place. Later he said, as reported at page 2051 of Hansard:
I greatly sympathize with the hon. member for Edmonton East (Mr. Macdonald) in his endeavour to have the highway built over those swamps extending for 200 miles between Edmonton and Jasper. I have the greatest sympathy with him.
I now say that there are no swamps there, or none so far as the road is concerned. We have a highway between Jasper and Edmonton. I have travelled over it in my car. I know. Therefore that argument seems to fall to pieces. Then he said, as reported on the tame page of Hansard:
The difficulty is that in the city of Edmonton and the northern part of Alberta members of my party, as well as other hon. members, all ran their election campaigns on one ground, namely, that the highway should not go through Calgary.
I have told my people right along that we should have a national highway commission made up of experts in the building of roads. The commission should include engineers who would know exactly what they were doing, instead of, as some other people have said, two-bit politicians who in many cases do not know the first thing about road building. I am still of the opinion that we should have a highway commission made up not of politicians but of roadbuilding engineers who know their business. I think Canada would get great benefit from that.
A little later, again at page 2051, the hon. member, speaking of a certain organization, said:
You can start at Winnipeg on any good-sized map and draw a line from Winnipeg through Saskatoon and on to Edmonton. They have an organization there which travelled from Winnipeg to Vancouver by road. They did it to prove it could happen. I must say the basis of their whole equipment was pull-outs and shovels, but they finally got through. I have no idea how long they travelled on the ties of the railroad, but they made it in the final analysis.
Again I think that statement is just as foolish as anybody could make it, because we do know that we have travelled from Winnipeg to Edmonton and Jasper on the highway. I have been over it myself. I know that the road is good. I did not have to travel on ties. I do know also that a caravan of fifty cars travelled from Jasper to Vancouver, leaving Jasper on Wednesday and arriving at Vancouver on Friday. I did not hear about any shovels being used on that trip, either. The hon. member for Edmonton East (Mr. Macdonald) can give us the information on that, if necessary, and we can find out if there were any shovels used.
The argument put up by the hon. member for Calgary West (Mr. Smith) fades away into thin air. I say again we should have a commission, made up of competent persons,


to survey all the proposed routes, a commission which could make use of the best possible information. The Yellowhead route reaches an elevation of 3,717 at the highest point; the Kicking Horse, 5,337, and the Crowsnest pass, 4,450. Snowfall must be one of the drawbacks on any route chosen. As to the Yellowhead, I understand the greatest danger is at Blue river. On the Kicking Horse I believe there is a stretch of approximately 350 miles which is subject to very heavy snow in the winter months. No matter how well a highway is built; if it is under snow slides or heavy snowfall it is of very little use.
Construction costs on the Kicking Horse route would be higher than those on the other routes. I am doubtful whether it would be possible to have a four-lane highway over this route. The Yellowhead would pass mostly through wide valleys and the cost of construction and maintenance would be much less than on the southern route.
I believe a greater percentage of population would be found on the Yellowhead route than on either of the others. There are many purposes for which the highway should be used, and consideration should be given to these before any route is chosen. We have been told in recent days that we must spend hundreds of millions of dollars for defence. The Alaska highway would appear to be one of the great highways which could be used for purposes of protection in the event of attack. A highway through the Yellowhead pass would give access to the Alaska highway. At the present time we have a connecting route from south to north, and this could be used rather than the one suggested by hon. members who favour the southern routes.
Then again, the Yellowhead route would connect with the two ports of Vancouver and Prince Rupert. That is an important consideration, too. From the point of view of scenery we would have access to four national parks and five provincial parks. This would certainly be worth while from the point of view of tourist traffic.
An investigation into distances discloses that the Yellowhead pass route from Vancouver to Winnipeg is 1,747 miles, whereas by the Kicking Horse it is only 1,695, or 52 miles less than the route which is much easier to construct.
I do not feel that it is necessary for me to say anything further in this connection. In my view a start should be made. I do not think the government's proposal to pay fifty per cent is at all sufficient. I favour the suggestion made by the hon. member for Peace River (Mr. Low) that national

credit should be used for this project. By doing so the government would get away from much of the difficulty to which we have been objecting in the past.
I repeat that I am not advocating acceptance of the Yellowhead route without first having the decision of competent engineers appointed for the purpose.


Mr. Speaker:: Is it the pleasure of the house to adopt the motion?


Alphonse Fournier: Mr. Speaker, one word before the motion carries. The moment the hon. member for Vancouver-Quadra (Mr. Green) made the request for the tabling of correspondence I sent a note to my colleague's office in which I stated:
X understand the minister undertook to file this morning correspondence with the provinces. Would you be kind enough to have these documents sent to me in the house immediately so that I may table them.
I received this reply from the minister's office:
Upon Mr. Higgins' request for the tabling of up-to-date correspondence the minister agreed it would be tabled today. The correspondence is still in process of being prepared, and will be tabled as soon as it can possibly be prepared.
This note is signed by the secretary. I will undertake at some time today, as soon as the documents are prepared, to table them, so that the hon. member for Vancouver-Quadra will have them for the discussion of the bill.


Mr. Black (Cumberland):: I wonder if the minister would check on the correspondence with Nova Scotia. There is correspondence with that province, but the minister has not yet had authority to make it public. This correspondence is important to us, and it is important to all hon. members that it be made available. I would ask that it be checked up, even to the extent of communicating with Nova Scotia to see if they would not consent to release.


Alphonse Fournier: I shall check the matter with the minister's office. I understood, however, that the correspondence to be tabled would be that to which the provinces had agreed. If they do not agree, I would not wish to commit the minister to the tabling of it.


Percy Chapman Black: My request is that a further check be made with Nova Scotia to see if they will not release the correspondence in connection with the trans-Canada highway.


Alphonse Fournier: 
George Alexander Drew: Mr. Chairman, I understand the proposal made is that the discussion be deferred, in view of the fact that the minister is unable to be here today. There are, however, certain points which have not yet been covered, and concerning which questions could have been asked at this committee stage, before considering the bill on second reading.
I suggest that on the motion for second reading of the bill the minister should make a statement which would contain, in addition to anything else he may have to say, information as to provisions for maintenance; any information he has in regard to the route to be followed; any information as to other arrangements, if any, beyond the provision of fifty per cent of the cost of construction, and the decisions, if any, which have been made as to payment for past work.
I make this statement now so that it may be communicated to the minister, thus avoiding the necessity of delay later, or the asking of questions on the motion for second reading. An examination of the correspondence demonstrates that no positive decision has been made in this matter. The situation can be fairly well summed up in the letter of September 9 from Premier Smallwood of Newfoundland, who writes briefly that they are desirous of proceeding with this matter and closes by stating:
This is merely to acknowledge your letter, and to say that we are anxious to be in on any arrangements made at the very outset.
This letter indicates just about how far this matter has actually gone. I urge, therefore, that on the second reading of the bill the minister answer the questions that so far have not been answered.


Alphonse Fournier: I shall draw the attention of the minister to the remarks of the leader of the opposition. I understood that the minister was to make a statement this morning and answer the questions that had been put yesterday. I shall ask him to make that statement on the second reading and give all the information that was asked for in the course of debate.


Mr. Gillis:: I judge from the question asked by the hon. member for Cumberland that the correspondence between the department and the province of Nova Scotia is on the secret list. I certainly would like to know what are the views of that province, and I should like to know further what right the premier of that province or anyone else has to designate as secret, correspondence dealing with a matter of national public importance. In the final analysis this is where the decision must remain.

Trans-Canada Highway The provinces, have been dealing with the matter of the trans-Canada highway since the thirties. Large amounts of money have been spent in Nova Scotia, and I think we have a right to know whether the federal government will reimburse that province or whether they consider the relief payments made at that time as part of the financial arrangement. I am prepared to let this resolution go through, because I should like to see the bill; but I want to know what the province has said to this government in connection with the trans-Canada highway, and I shall have a lot to say on the second reading if we have not that information.


Alphonse Fournier: Up until now I understood that the hon. member for Vancouver-Quadra wanted to have tabled the correspondence up to date between the dominion and the provinces that have given consent to the tabling. Another request was made by the hon. member for Cumberland, who insisted that we endeavour to get the consent of Nova Scotia to the tabling of the correspondence with that province. I do not know in what position the correspondence with Nova Scotia is at the present time, and I do not know whether it will be tabled.
Replying to the hon. member who has just taken his seat, I have always understood that correspondence between governments was tabled only after the parties concerned had agreed to the tabling. I shall call the attention of the minister to the remarks of the hon. gentleman. I would not want to say that if the province does not agree we will table the correspondence. The hon. member has referred to the difficulties of the people of that province with their government, but I do not know that I can add anything to what I have said.


Clarence Gillis: My understanding is that in the case of certain interdepartmental correspondence it is considered to be a courtesy to withhold it. I understand also that the only rule as to secrecy of correspondence applies to that between foi'eign governments and this government. This is not an interdepartmental matter; this is a matter dealing with public funds to be expended on a national project. A minister of the province may wish to keep his negotiations secret, but I submit that he has no right to do so. There is no law that gives him that right. He is dealing with public funds, and there is no law or rule that this government would be breaking if they tabled that correspondence. The information is necessary if we are to make an intelligent decision.


Alphonse Fournier: Will the hon. member agree that if we ask the province once again 
for permission to table the correspondence, that is about as far as this government can go?


Clarence Gillis: Tell them you are going to table it anyway, even though you do not get permission.


Some hon. Members:: No.


Clarence Gillis: It is public property.


Alphonse Fournier: I should like to consult the leader of the opposition to see if he would agree that we should table correspondence with a premier of a province without his permission. For my part, I think that would be going too far.


George Alexander Drew: I cannot recall a single occasion on which I was asked to consent to the tabling of correspondence where that consent was not given.


Alphonse Fournier: Perhaps there was not much correspondence.


George Alexander Drew: There was extensive correspondence, and a great deal of it found its way into this house. This is a matter of more than casual interest. The point made by the hon. member is an important one. As between national governments, obviously there is a type of correspondence that must be regarded as secret, but as between governments within a federal system there can be no secrecy, because it would all relate to the combined business of government about which the legislative bodies have a right to be informed.
We are dealing here with an attempt to reach a joint agreement in regard to the development of a trans-Canada highway. The discussion which has taken place serves to emphasize the need of getting the dominion and provincial governments together instead of attempting to do this by correspondence, with part of the correspondence being under some limitation as to publication.


Percy Chapman Black: I thank the hon. member for Cape Breton South and the leader of the opposition for supporting the view I expressed with regard to this correspondence. I agree with the hon. member for Cape Breton South when he says that we cannot deal intelligently with this matter unless we have the correspondence. Unless the government of Nova Scotia is able to justify its stand, I do not think I would be warranted in giving my approval to the legislation now before the committee with regard to a trans-Canada highway. Without that information I cannot intelligently come to a conclusion as to what is desirable or practicable in the interests of Nova Scotia. I again ask the

minister to check as quickly as possible to see whether the province of Nova Scotia will not do what seven other provinces have done and release this correspondence so that it will be available to the members of the house.


Alphonse Fournier: I am quite ready to suggest to the Minister of Reconstruction and Supply that when he writes to the province of Nova Scotia he send along a copy of the record of the debate on this matter so that there will be no misunderstanding as to what has been said by hon. members who have spoken. We are just at the resolution stage, and I am not familiar with all the facts. As I said a moment ago, when the bill is up for second reading, answers will be made to the questions asked this morning. When we get second reading of the bill and go into committee, members will be able to secure all the information they want. As to the correspondence between the provinces and the federal government, we will once again ask whether permission can be given for its being tabled.


Percy Chapman Black: I want to thank the minister. I am going to ask that second reading of the bill be postponed until we have the correspondence with all the provinces.


Mr. Fraser:: When the Minister of Reconstruction and Supply is answering the other questions, will he also tell us who will have the final say in regard to contracts for construction of the highway?


An hon. Member:: The province.


Gordon Knapman Fraser: Some people may say the province, but the federal government is contributing fifty per cent of the cost, according to what the minister stated, and it will likely have some say. I do not know that, but I want to find out. Will the federal government have any say about the awarding of contracts?


Alphonse Fournier: I will draw the minister's attention to the question, and see if an answer can be given.


Mr. Blackmore:: I was not able to hear all that the leader of the opposition asked, and I should like to have the situation clarified, if the minister does not mind. It is well known that at this stage we could ask numerous questions and elicit information we would all like to have. If the minister sees fit, he can give us permission to ask these questions on the first section of the bill when it is going through committee. Did the leader of the opposition ask the minister if he was willing to grant that privilege? If
Trans-Canada Highivay he is, I see no reason why we should not let this stage go by, because we shall be able to get all the information we need when the bill is going through committee if a certain amount of latitude is permitted on section 1.


Alphonse Fournier: I do not see any
objection to that procedure. At this time we are considering the resolution and the expediency of introducing a measure. I know that members could ask many questions. Up to the moment they have asked certain questions, which the Minister of Reconstruction and Supply will endeavour to answer. I do not see why we should try to curtail any debate or cross-examination of the minister on a project of this magnitude. All latitude should be given to hon. members and, if possible, answers should be made to all questions asked.


John Horne Blackmore: Perhaps I did not make it clear to the minister what I have in mind. Is the minister willing to agree that we should have latitude on section 1 when the bill is going through committee, so that we can then have the whole discussion we would ordinarily have at this stage?


Alphonse Fournier: I understand that when the first section of a bill is called there is usually a general discussion, and I do not see any reason why on this bill we should depart from that procedure.


Gordon Knapman Fraser: Have we the minister's assurance that we may do that?


An hon. Member:: Sit down.


Gordon Knapman Fraser: We want to be certain we have that assurance. We have sat down before, and I want to make sure about that point.


Alphonse Fournier: I was taken by surprise this morning when I was asked to see if I could have the resolutidn put through. I know my good friend from Peterborough West is quite reasonable in everything he does in the house. I think he will say that I am reasonable, and I am ready to suggest to the minister that he should be reasonable in his conduct of the proceedings on this bill.


Gordon Knapman Fraser: Very well.
Resolution reported,' read the second time and concurred in.
Mr. Fournier, Hull (for Mr. Winters)
thereupon moved for leave to introduce Bill No. 194, to encourage and to assist in the construction of a trans-Canada highway.
Motion agreed to and bill read the first time.
20S0

Bankruptcy Act BANKRUPTCY ACT



GENERAL REVISION AND CONSOLIDATION- VARIOUS AMENDMENTS

[Stage Direction]
Hon, Siuart S. Garson (Minister of Justice) moved the second reading of Bill No. 149, respecting bankruptcy.
He said: Mr. Speaker, this is a bill which was prepared about a year ago and introduced in the Senate in the last session of the preceding parliament. It was passed there and then died on our order paper when the house was dissolved. The bill was introduced again in the Senate during the present session, has been passed by that body, and comes to us as a Senate bill.
I have suggested to the leader of the opposition (Mr. Drew), the leader of one of the other two parties, one of the lieutenants of the other leader, and one or two other private members of the house who are particularly interested in the measure, that we may make better progress if we give second reading to the bill without too much discussion, and then, on the report of the standing committee on banking and commerce, which will consider the measure, have any debate in which it might be the desire of hon. members to participate. I may say that all those to whom I spoke were agreed that was the proper course.
I think, however, I should say a few words about the bill. The purpose of it is to revise and consolidate the Bankruptcy Act. It is a matter of putting it into somewhat better drafting form, and consolidating various amendments.
The bill arises out of the invocation by this parliament of its jurisdiction under category 21 of section 91 of the British North America Act, which turns over to federal jurisdiction the subject of bankruptcy and insolvency. The first dominion act was passed in 1869, being entitled An Act Respecting Insolvency. It covered voluntary and compulsory bankruptcies, provided for compositions, and applied only to traders.
In 1875 the law was revised and consolidated in a new act, the Insolvent Act of 1875, which was made applicable to the new as well as the original provinces. This act did not work out satisfactorily, and it was repealed in 1880, following which there was, for a period of some forty years, no general bankruptcy law in force throughout the whole of Canada, and the field was left to such legislation as it was competent for the provincial legislatures to provide. In 1919, however, parliament passed the Bankruptcy Act, modelled on the English statute of 1914. Some amendments have since been made in the Bankruptcy Act to remedy defects that have

appeared in practice from time to time. The act now in force is chapter 11 of the Revised Statutes of 1927 as it has from time to time been amended.
In addition I think special attention should be called to the fact that important amendments were made by chapter 39 of the acts of 1932, which established the position of superintendent of bankruptcy and provided for the licensing of trustees by the minister.
It is for the purpose of revising and consolidating chapter 11 of the Revised Statutes of 1927 that the present bill is before us. The main improvements or changes that are being effected by the bill can be listed as follows:
1.	The bill provides a system of "summary" administration for small estates, whereby the formalities and expenses are reduced below those considered necessary to safeguard the administration of larger estates.
2.	The bill permits a debtor to offer and the creditors to accept a proposal without the debtor going into or being put into bankruptcy. This, in a proper case, is more convenient and cheaper and obviously more desirable for the debtor than the previous situation when the composition had to be preceded by bankruptcy before it could go forward.
3.	The bill makes an effort to clarify at least to some extent the vexed question of the priorities to be accorded different classes of claims when distributing the debtor's assets.
4.	The bill increases "creditor control" over an estate by vesting directly in the creditors and the inspectors a number of responsibilities and obligations in respect of which they were previously required to resort to the court.
5.	The bill is an improvement in respect of drafting and arrangement of sections over the present act, as one would of course expect in the case of any consolidation if it is properly handled.
Mr. J. G. Diefenbaker (Lake Centre):: 
Mr. Carroll:: Hear, hear.


John George Diefenbaker: I appreciate the support indicated by the hon. member for Inverness-Richmond (Mr. Carroll), who has a long and distinguished record of service on the bench of this country. If there ever was a time when assistance could be given by the other place, it is now in connection with the work being done by the commission set up for the purpose of revising the Criminal Code. Indeed I suggested on two or three occasions that, having regard to the ability of all members of the legal profession in the House of Commons, they would have been only too happy to have an opportunity to serve on a select committee of the house to deal with recommendations for revision of the Criminal Code. Such a committee would not interfere in any way with the work being done now by the commission, but there could be placed
Bankruptcy Act
before it such provisions as the legal members of the house from their experience might believe it to be desirable to embody in the Criminal Code.
Before I sit down I want to say one further word. The step that has been taken of submitting the Bankruptcy Act to a committee of the other place will, I hope, be a precedent, so as to enable outstanding members there to make the contribution to the jurisprudence of Canada they are qualified to make and would be only too glad to make if they were given an opportunity to do so as they were in connection with the measure now before us.


Mr. Donald M. Fleming (Eglinion):: There are two points I should like to raise. Happily this is one occasion on which the length of the debate on second reading can usefully be directly in inverse ratio to the length of the bill.
First of all I should like to deal with the principle of the bill. My understanding of the principle, which presumably will be affirmed when the bill is given second reading, is that the Bankruptcy Act should be revised. The principle is just as broad as that. It is not that the act should be revised with a view to facilitating the five immediate purposes that the Minister of Justice (Mr. Garson) cited. In other words, when the bill goes before the banking and commerce committee, as one member of that committee I should like to feel that there is no limitation on the opportunity of members of that committee to put forward any suggestions they may consider profitable for the revision of the Bankruptcy Act in any particular.
I think this is a matter of importance at this stage, because it would be unfortunate if any ruling should be made in the committee dealing with the Bankruptcy Act as to the nature or extent of the principle of the bill agreed to on second reading. Therefore I ask the Minister of Justice if he will give the assurance that the principle of this bill is that the Bankruptcy Act should be revised, and that it is just as broad as that.
The second point I should like to make is this. It has to do with the task that will confront the standing committee on banking and commerce. I join with my colleague the hon. member for Lake Centre (Mr. Diefenbaker) in the tribute he has paid to the work that has been done on this measure in the other place. Nevertheless I think the banking and commerce committee of this house will have to undertake an independent review of the measure.
It is unfortunate that the measure comes before us at such a late stage in the session. The members of the house are carrying an exceedingly heavy load at the present time;

Bankruptcy Act
with three meetings a day of the house, and with the heavy volume of work yet to be done, attendance at extended meetings of committees is made difficult. If we are to do justice to this measure and are to conduct the detailed review of it that it seems to me the committee ought to conduct, a great deal of time will be required and a considerable concentration of sittings, the kind of concentration that may keep members in attendance at such committee meetings day in and day out so that the thread of discussion may not be lost. That concentration of sittings will be difficult at this belated stage of the session. I am just mentioning this matter, Mr. Speaker, because frankly at the moment I doubt whether before prorogation there will be time available to make the detailed review of this measure which its importance and complexity warrant and necessitate.
I am sure there will be the utmost disposition on the part of members of the house, regardless of party, to expedite the matter at this time; and in the committee I have no doubt that the members will do all they can to expedite consideration of the bill. I just want to say, though, that I doubt whether there is available in the present session sufficient time within which to make the review of the measure that I think the committee is obliged to undertake.


Mr. Angus Maclnnis (Vancouver East):: rise, Mr. Speaker, merely to emphasize the point made by the hon. member for Eglinton (Mr. Fleming). This bill is a lengthy one, and in the fifteen days or so that we are likely to be here I do not think it is possible to give to this bill the attention that it requires. It would be just as well for the government to state now that this is one of the measures they are going to leave over until the next session of parliament, unless we are to remain here and to carry on until the next session is called.
The point made by the hon. member for Eglinton I think is this. At this stage of the session there are so many things coming up all at once-and it was never more true than it is today, with about twenty-eight items on the order paper, each one of which is of importance-that almost all members will wish to be in the house during some part of the sittings. It is impossible for hon. members to be at the same time in the house and in committee on an important bill of this kind. As to those who are members of the committee it will not only take the time that they are in the committee but also time when they are outside of it, if they are to give the necessary study to matters relating to the bill. I suggest to the minister that rather than taking up the time of the house the government

might well set this matter aside until the next session and refer it to the committee as soon as parliament opens.


John Horne Blackmore: I rise, Mr. Speaker, to associate myself with the words of the hon. member (Mr. Maclnnis) who has just taken his seat. It is my impression that the government has committed a serious blunder this session in endeavouring to bring on too many measures of great importance. I should like to request that the minister hold this bill over until the next session. While he is at it, may I suggest that he ask the government to look around for as many more of these bills as could similarly be held over. We cannot cover all these bills if we are to give to them the attention which a house such as this ought to give to them. I have no desire to hold up the business of the house, but as a member of parliament I feel ashamed of myself when I agree, either by actually acting or by not acting, to allow important measures to pass without receiving the attention which I believe their importance warrants.


William F. Carroll: was going to ask the Minister of Justice (Mr. Garson) if there is any real hurry about having this act amended. If there is not, I agree with hon. members who have suggested that the bill should be held over until the next session of parliament. In my opinion the Bankruptcy Act is the most important one we have on the statute books of this country, inasmuch as it deals not only with bankruptcy itself but with the regulation of business transactions. Unless the members of the committee to which this bill goes are fairly familiar with the Bankruptcy Act as it is at the present time, it will take them at least a solid month of hard work to do justice to the consolidation of this act.
More than that job will come before this committee. I can see that the committee will have to deal with various amendments and delays will inevitably result.
I am not objecting at all to the second reading of the bill, or to the matter going to a committee. But it would be difficult to have the bill reported back to the house this session after full consideration by the committee to which it is to be referred. I should think there would be little time for the committee to deal effectively and efficiently with a consolidation such as this.


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


Hon. Stuart S. Garson (Minister of Justice):: I find myself in agreement, Mr. Speaker, with nearly all the views which have been expressed by those who have taken part in

this debate, in spite of the fact that it is the taking of the advice of some of them which results in the criticism of others.
Most of us will agree that the work which the Senate has done on this bill, and which it does on all the measures that are introduced in that body, is of an exemplary character. We are greatly indebted to the Senate for the work which it has done. But we see what happens in a short parliamentary session if we follow the advice of the hon. member for Lake Centre and have a large bill such as the Bankruptcy Act amendment bill introduced in the Senate which has more time to consider these matters than we have, and particularly at the end of the session. Their deliberations resulted in what has happened in the present case, namely, in the bill coming from the Senate to the House of Commons toward the end of the short session. The presentation of the bill in the Senate could hardly have had any other result than that which it has had, because they have given it careful consideration. That has taken time. The bill comes to the House of Commons and is dealt with as soon as a congested order paper will permit. From this house it will go to the banking and commerce committee and be considered by that committee in due course. This result I think was unavoidable because of the introduction of the bill in the Senate. It indicates that with a bill as large as this one proves to be, it may be impossible to get it cleared up in both houses in one short session unless it is introduced first in the House of Commons at a time when hon. members have more time to consider a matter of this kind, so that later consideration may be given to it in the Senate.
Under the present circumstances the government is quite disposed to heed the suggestions that have been made by the hon. members for Vancouver East (Mr. Maclnnis), Lethbridge (Mr. Blackmore) and Inverness-Richmond (Mr. Carroll) that the passing of the bill be not pressed. We have no thought that it should be pressed. It is our desire that the duties of the house with respect to the bill be properly discharged, and that the bill be sent on to the banking and commerce committee for careful and adequate consideration. If it cannot be carefully and adequately considered there, it will not be reported back but will be reintroduced at the next session of parliament.
In view of the full and careful consideration which the Senate gave to this bill in its committee, where they heard various delegations, and the fact that many of the difficult points in connection with the bill were threshed out and disposed of, I should think, 45781-131
Bankruptcy Act
sir, it might be surprising to hon. members how quickly it can be dealt with in the House of Commons committee. Hon. members, particularly those who are lawyers, will agree that what is required in measures of this kind in connection with difficult points that arise is clear thinking. Once that clear thought has been applied to these difficult problems, the disposition of them at some later stage, even by another body, is facilitated. A great deal of thought has been applied to these difficult problems in the Senate. A great deal of clear thought has been indicated by the various delegations which appeared before the committee of that body. I would hope that in view of the careful consideration which has been given to it by the Senate, and the fact that there are no important changes in the law other than those which I have stated-a matter really of four important changes-it might be possible to dispose of the bill in the House of Commons committee in a much shorter time than the hon. member for Eglinton (Mr. Fleming) thinks will be necessary. If it is not possible to dispose of it properly- and for that the committee will assume responsibility-then of course we have no desire to insist that it be passed at this session.
In conclusion I should like to make a comment on a matter which was referred to by the hon. member for Lake Centre (Mr. Diefenbaker). He said there was nothing that could be done in the Department of Justice at the present time that would be of greater benefit to the country than to revise the statutes of Canada, which have not been revised for upwards of twenty years. He also referred to the necessity of revising the Criminal Code, which has not been properly revised for a much longer period than that. I should like to say, as I am sure that he himself upon reflection knows, that we have been seized of the desirability of the course which he urges, and that in the Department of Justice we have had for some time a committee revising and consolidating the Criminal Code, under the chairmanship of Chief Justice Martin of the province of Saskatchewan. We also have a committee considering the revision of the entire body of statutes of Canada, under the chairmanship of the Chief Justice of Canada, and considerable progress has been made. Indeed the bankruptcy bill is one of the steps in that general revision; because we are trying to have the Bankruptcy Act consolidated and revised with a view to its being then included in a new volume of the revised statutes.
I entirely agree with the suggestion that the hon. member for Lake Centre has made-

Combines Investigation Act so much so that several months ago we initiated action along the lines that he is now suggesting.


Donald Methuen Fleming: Is the minister going to deal with the point I raised? I asked for some assurance about an understanding as to the scope of the principle of the bill.


Stuart Sinclair Garson: If I failed to deal with that, it was because I thought the point was so obvious that everyone would agree with it. Of course we are here considering the principle of this bill on second reading-as my hon. friend so succinctly put it, that the act be revised. It is a matter almost of coincidence that in the course of that revision the changes which I am speaking about come in. They come in because they are changes which arise out of the attention which is given to revision. I entirely agree with my hon. friend that because these have been included in the opinion of the draftsman as being the changes which are essential, they by no means exclude any changes which hon. members of the committee may see fit to suggest. I think that covers my hon. friend's point.


[Stage Direction]
Motion agreed to, bill read the second time and referred to the standing committee on banking and commerce.


Mr. Hughes Cleaver (Halton) moved:: That the standing committee on banking and commerce be empowered to sit while the house is sitting.


[Stage Direction]
Motion agreed to.


[Stage Direction]
The house resumed, from Monday, November 14, consideration of the motion of Mr. Garson for the second reading of Bill No. 144, to amend the Combines Investigation Act, and the amendment thereto of Mr. Drew.
Mr. J. M. Macdonnell (Greenwood):: Mr. Speaker, I should like to detain the house, I hope only for a few minutes, on one aspect of this situation. During the time that I have had the honour to sit in this house I have tried to use moderate language, and I hope that nothing I shall say today will indicate that I have changed since I was here last. But it does seem to me that in what has happened in connection with this act we have nothing less than a conspiracy against our constitution, and, as I shall try to show later,

conspiracies are much more dangerous when they are carried on by men whom we all know and like and who in the ordinary discharge of their duties are quite free from any suggestion of this kind.
I wish to confine myself entirely to one aspect of what has happened in this situation, namely, what is described in the Bill of Rights as a suspension of the execution of the law.
There have been grave and wise criticisms made in this house already on this point, and I do not intend to repeat them. It seems to me, however, that the public has not registered these criticisms as they should have done. So far as I can see, the press has been very lenient; and while I am not in the position of the great Churchill who in one of his speeches said, "My words will carry far,"-and I do not flatter myself that mine will-nevertheless I wish to put in my word, for what it is worth, in the hope that what I regard as a conspiracy against our constitution may not be lightly passed over by the people of this country.
There is great danger that it should be, because the Minister of Justice (Mr. Garson) and the Minister of Trade and Commerce (Mr. Howe) have been very skilful, may I say, in leading us up blind alleys, and in discussing all other aspects of this situation. We have not, in my opinion, concentrated our minds upon that aspect which to me seems so grave and so serious.
It has already been pointed out by other speakers that what has been done, with one leap of the mind, carries us back to the Stuarts, particularly to the one Stuart who lost his head for suspending the law without parliament. It carries us back also to the declaration of the Bill of Rights, which, we should remind ourselves, is part of the law of this country.
I suppose it is true to say that what this government has done has no precedent since the Stuarts. I have not been able to verify that, but I believe there is little if any precedent in the centuries which have elapsed for what the government has done. It is wise for us to remember the words already used in this chamber by a former Liberal leader, that it does not matter to a free people whether their liberties are invaded by a king or by a cabinet.
I think it would be possible to imagine times so quiet, times so peaceful that subversive ideas could hardly impinge upon our lives at all, and there would seem to be no threatening dangers-times when we might say: Yes, there was a breach of the law, but probably it does not matter much. I can

imagine that if anything like this had happened in the tranquil Victorian days of sixty or seventy years ago-though one could hardly imagine that it could happen then- it would have been difficult to stir up very much interest. People might have said: Yes, that was done; but what is the use of worrying about it? We are living in quiet and peaceful days. There is no real danger to our constitution.
But is that the kind of world we live in today? In this house the other evening we had demonstrated to us the ironical situation of one government department telling us that it could not trust another government department, because the personnel of that other government department had not been "screened" to see whether they were clear of subversive ideas. We approved the necessity of doing that. The minister told us quite frankly that the Department of National Defence was not able to entrust some of its secret work, the making of secret films, to the national film board.
It strikes me there is a certain irony in this screening of civil servants to find out whether they have certain views which might lead them to do something subversive, when this government has itself suspended the execution of the law. I can imagine one of these people saying:	Why are you trying to find
out whether in certain circumstances I might break the law of this country, when the Minister of Justice, the custodian of the law, has broken it; why ask me what I might do in certain circumstances when he has already done it?
Let me broaden that picture a little. It is impossible to live many hours nowadays without hearing criticism of communism, and the dangers we face. We know those dangers are real enough. Some very wise writers have pointed out that communism, which we regard as bad and diabolical, has in it something that people believe in. One well-known writer in this country not long ago pointed out that we, who confront communism, cannot successfully confront it for long unless we have something to answer it. He said that if we have not some answering faith we are confronting the communist "something" with a "nothing". That was said by a well-known journalist in a speech delivered before the St. Andrew's society in Winnipeg a year ago. I refer to Mr. Bruce Hutchison.
What is our "something"? Well, of course we say that it is Christianity and the Christian way of life. We say that glibly, and I wonder if sometimes in an age of doubt it does not sound hollow to us when we say it. I wonder if people feel so confident, and if they feel that that is a complete answer.
Combines Investigation Act
But I would remind the house there is one thing we have which is essentially Christian, one thing which is the very cornerstone of our democratic civilization, and that is the rule of law. It is essentially Christian, because under our system all men are equal before the law, just as the Christian says that all men are equal before God.
We have this principle, and I suggest to the house that it is the very cornerstone of our way of life which we are so fond of talking about. Let me read to the house a few words by a great authority, Dicey, in "The Law of the Constitution", ninth edition, page 193-and I would ask ministers to listen to this, because it applies to them especially. What Dicey says is this:
With us every official, from the prime minister down to a constable or a collector of taxes, is under the same responsibility for every act done without legal justification as any other citizen.
Let me digress to say that that was very different from the condition in some of the European countries. And when Voltaire visited England two hundred years ago his comment was that while the laws were harsh, they were the same for everybody. That was not true in many parts of Europe. I go on:
The reports abound with cases in which officials have been brought before the courts, and may, in their personal capacity, be liable to punishment, or to the payment of damages, for acts done in their official character but in excess of their lawful authority.
Will anyone tell me by what lawful authority it was that this act was set aside? I would ask the ministers to read that passage and to consider what their personal liability might be. I do not know what it is; but it is stated there that when a minister breaks the law he has a personal liability.
Let me remind hon. members that in respect of the ordinary citizen the law moves automatically, and it calls him to account for what he has done. But, so far as I understand the constitution, the only bodies that can move against ministers when they break the law is, first of all, public opinion- and I shall come to that later-and, second, this House of Commons, which rejoices in the title of the High Court of Parliament.
Yet I suggest that in spite of all, in spite of the wise things that have been said here, the public of this country has not yet registered what has happened. I said a moment ago it is hard to believe that men whom we like and meet happily and who have much good to their credit could do this wrong thing. And it may be that in some curious way they did not quite intend to do what was wrong.
2036	HOUSE OF
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I have said that the rule of law is the very cornerstone of our civilization. Let us be honest about it. When, as I said a moment ago, we talked so glibly about being Christian, let us look in on ourselves and find out how many of the real principles of Christianity we are prepared to back. But one thing we have-the rule of law established by the wisdom of our ancestors. This we have inherited, and to this we should cling. If the rule of law is gone, what have we left? What is the use of "screening" government employees to see whether or not they might under certain circumstances break the law when at the same time the government has broken the law-and without excuse and without any promise of doing any better in the future?
Let me have a word more about this rule of law. It seems to me it is the binder, the cement of our civilization. What is it that enables us to solve problems which often become bitter, which often become acrimonious-labour problems, racial problems, even religious problems at times? What is it that enables us to solve those problems? In spite of the criticisms and sneers that are made against the courts, the fact remains that there is a deep-rooted feeling in our country that there is a rule of law which is the same for one person as for another. Hon. members will recall that if a poor man comes before the courts faced with something serious such as a criminal charge the court will assign counsel to him. Even those who have as little acquaintance with the courts as I have know that judges are particularly tender and solicitous toward those who come into court without lawyers, to defend their own cases. I think it is one of the glories of our law that that is true.
It is well for us to remember what would happen to a judge if in the administration of his office he undertook to disregard or to break the law. M.v answer is that the Minister of Justice would deal with him harshly, and properly so. But now the custodian of the law has been found doing this, and what is to be done about it? During the debate the Minister of Justice gave various reasons for doing what had been done. I do not propose to examine them, because they were all irrelevant. Not one of them faced the question that the law had been broken. He discussed the reasonableness of this or that, and eventually wound up at a point which I thought was disappointing. I hardly think it is a travesty to say that the only real reason he gave for breaking the law was that the Minister of Trade and Commerce (Mr. Howe) told him to do it. I do not want to be unfair, but that seems to me to be the
'Mr. Macdonnell (Greenwood).]

real answer. Of course I should add that it was all discussed by the cabinet, so they are all head over heels in it; but I think we can give the honours of the day to the Minister of Trade and Commerce.
There was one other thing the Minister of Justice said that troubled me more than any of the other things he said, although they all troubled me quite a lot. Eventually he got almost to the point of saying that anyway they had a large majority. It is always comfortable for a government to be able to say that, and this government does have a large majority. Unfortunately he seemed to imply that somehow or other what happened last June was an endorsement of this government action, but it has already been witheringly pointed out that last June the electors were in the unfortunate position of not knowing about this. I shall not say any more about it.
The minister also suggested that as long as the government had the comfortable feeling that there was still a majority with them in the country, they need not worry. Will you consider what that means? It means that when the people elect 262 members to the House of Commons they are just wasting their time; there is no point in our being here at all, because the government will not pay any attention to us. They offer the suggestion that eventually there will be an election and that will settle the matter. What does that mean? It means in effect that we are to have government by plebiscite which will take place every four years, and in the meantime the House of Commons might just as well shut up shop because it is wasting its time. There is no suggestion by any minister I can find anywhere in the debate that this house has any rights.
For one thing I am very sorry. I think 190 members of this house are going to find it difficult to express their views in this matter. We have not heard from any of them yet, and I am still hoping we shall hear from at least one. I thought perhaps if the hon. member for Quebec South (Mr. Power) were here he might have a word to say for the law, but as he is not, we cannot help it.
One other cynical remark was made the other day-and I suggest that the government need not be too much surprised that these cynical things are said. This, I may say, was said with approval. It was suggested that the government could not afford to make the report public until they had discredited Mr. McGregor.


Stuart Sinclair Garson: Why does the hon. member give further publicity to a thing he disapproves?


James MacKerras Macdonnell: I do not
understand the question.


Stuart Sinclair Garson: Why does my hon. friend quote something he disagrees with?


James MacKerras Macdonnell: I do not
always just quote the things I agree with. I believe in telling what other people think as well as myself. I do not understand the question.


Angus MacInnis: I think the Minister of Justice is asking why the hon. member is drawing attention to the fact that the government broke the law when he disagrees with it.


Clarence Decatur Howe: No, no.


James MacKerras Macdonnell: Perhaps the minister will explain later what he means.
I want to come now to the Minister of Trade and Commerce, because his part in all this is quite interesting. We could call him the villain of the piece, but if the minister regards that as objectionable, we will call him the hero of the piece.
The minister treated this statute as though it were non-existent; but we need not be surprised at the Minister of Trade and Commerce doing that. We all have great respect for the Minister of Trade and Commerce when he operates in his proper line. We all respect the things he did during the war, and we do not think that all the things he has done since the war are wrong-only a percentage of them.
But let us have no illusions about the attitude of the Minister of Trade and Commerce toward this house. He has made it quite clear. First of all he has said that he did not know what the opposition is for, and in saying that I think he expressed his exact feeling. I do not think he does know what the opposition is for, because the minister does not really believe in his heart that the minority should have that chance to express itself which is the glory of our parliamentary system. The opposition is given a chance again and again. The minister really is a man who likes to live in a world where he can say unto one, "Go, and he goeth; and to another, Come, and he cometh". The minister is an authoritarian. If the minister will not object to my saying it, I would say that he is a fascist, a nice fascist, who by chance has got into a democratic assembly.


Clarence Decatur Howe: Now that the hon. member has said it, perhaps he had better withdraw it.


James MacKerras Macdonnell: I shall make any withdrawal the minister wishes, because I do not want to say anything that is in the least offensive to him.


Stuart Sinclair Garson: Say it and withdraw it.
Combines Investigation Act


James MacKerras Macdonnell: Well, I shall describe the minister as an authoritarian whose mind inclines to a dictatorship form of government. I think the minister clearly indicated that when he said that he did not know what the opposition was for. Indeed I am surprised that the minister questioned what I said, because I thought he would agree with it-not only agree with it, but probably almost boast of it. As I say, we must not complain that the Minister of Trade and Commerce was not worried about breaking the law, because I think he regards the cabinet as a body which goes ahead and does pretty well what it likes and then comes here occasionally and tells us what it is doing. We just have to go on with that as well as we can.
It would not matter so much that we have a Minister of Trade and Commerce who does not understand the processes of democracy, but what really does matter, so far as we can see, is that he is leading this government around by the nose. That is the only thing you can take out of this debate; that is the only thing you can take out of the resolution we had yesterday, which came after the pleasant threat the minister made the other night. The minister does not threaten much; he threatens only when he thinks it is necessary to get his way. I suppose we should be grateful to him for threatening us no more than he does.
Coming back to this legislation, it is interesting to note that all those who have taken part in its preparation were just wasting their time. I think the former prime minister had a good deal to do with this legislation, but he was just wasting his time. When it comes to the point, the legislation which has to do with publication is disregarded.
Now let us look for a moment at this section. I can imagine a section so technical and narrow, and dealing with something so trivial, that the government might well have some justification for saying they would disregard it. Let us assume, for example, that the section provided for publication in one way and the minister decided that publication should be carried out in another way. I think we would have said that did not matter much. But what about this section? Is it trivial? Let me just recall to your minds one thing which has been brought to the attention of the house already; I refer to a remark made in this house by the previous prime minister, when he pointed out-and I think with great truth-that the publicity requirement here was one of the very cornerstones of the act. His words, as I remember them, were that publicity can often be more valuable than penalty. How true that is; yet this

Combines Investigation Act section, which, I think, should be considered as the very cornerstone of the act, is now disregarded.
Now I come to the present Prime Minister (Mr. St. Laurent). If anyone had told me that a great lawyer and great jurist-sometimes the two are different-with his experience as Minister of Justice and all the other qualities we like and admire in him, would do this sort of thing, I would have scoffed at it; I would have said, "Don't be silly; go roll your hoop". But what do we find? Not only does the Prime Minister not join in the criticism, but there is no suggestion of an apology for what has been done. I should like to read what he said, indicating his generous attitude toward the Minister of Justice in sharing responsibility with him. I like that attitude; but I should like the Prime Minister to think something about the people of Canada as well as about the Minister of Justice. What consideration was given them when all this was going on? What does the Prime Minister say, at page 1526 of Hansard:
And I now feel it is only fair to the Minister of Justice that I should inform the house that he had discussed these matters with me, and I had concurred in the line of conduct he was adopting. I should bear, therefore, a portion of the responsibility, if there is responsibility-
That is good; get that.
-if there is responsibility, for attempting to carry cut the implied or expressed undertaking given to Canadian industries.
That was the Prime Minister. These people have been caught red-handed; and when I say "caught" perhaps that is the right word, because it is suggested that if it had not been for Mr. McGregor we might not have known about this even yet. No one can prove that is so, but neither can anyone prove it is not so.


Stuart Sinclair Garson: That does not stop you from saying it, because it cannot be proved.


James MacKerras Macdonnell: It is said by serious people; and that is not surprising, because when people see the sort of thing that has been done here inevitably it gives rise to certain suspicion. I regret to say that to the Minister of Justice, because I might add here that I never would have believed he would be a party to this sort of thing. As I said, I feel that this has been a great conspiracy against the constitution; and do not let us regard "constitution" as a long, abstract word. I mean this has been a conspiracy against our way of life, against the method we have adopted of living together. When this breach of the law, this suspension of the execution of the law, is carried out without excuse and without apology-I should not say without excuse, but without reason-it gives rise to suspicion.
[Mr. Macdonnell (Greenwood) .1

So far as I can see, there really has been no attempt to meet the real question. The ministers went up various blind alleys, but they did not deal with the real point. I think I am correct in saying that no serious attempt has been made to answer the accusation of suspension of the execution of the law. That is what I mean when I say that I consider there has been a conspiracy against the law; and the worst of it is that the conspiracy has been carried out by men whom we like and want to trust, men of reputation. One of the few Latin quotations I remember from the many hours I spent studying that language is corruptio optimi pessima, which means that there is nothing so bad as a very good thing when it is corrupted.
So I say this has been a conspiracy against the constitution. I do not think we would have been so much worried if it had been carried on by a lot of men with no reputation, who could have been easily disregarded by the public, who would have carried no weight. What bothers me is that men of high reputation-and deservedly so-come into this house with no apology to offer for doing what Charles I lost his head for.
Now, Mr. Speaker, I have spoken longer than I had intended; I am afraid perhaps my feelings have run away with me a little, but I do feel very deeply about this. I do not think it is any joke. I thought many of the things that were said in defence of the government's action were trivial in the extreme. As I have said, I believe we are living in a time of danger. The other day I read a book by one of the greatest living scholars in which the future of parliament was discussed. He felt that it was an open question whether parliament and parliamentary government as we have it could survive for very long. He pointed out that it had given indigestion to nearly all the European countries that had tried to absorb it, and that it is in effect over a very small portion of the earth's surface; and I recall once more what I said about communism and the answer to it.
I cannot hope that my words will carry far, but I express the earnest hope that the press, the pulpit and the universities of this country will not let this matter rest, that leaders of public opinion will so deal with it that no government ever again will dare take similar action. This government has given no assurance, no apology, no promise for the future. I hope what has been done here will become sufficiently registered in the public mind so that the expression of public opinion will be such that no government in future will dare repeat what has been done here.


Stuart Sinclair Garson: Mr. Speaker, I have listened with a great deal of interest to the remarks of the last speaker (Mr. Macdonnell) in which he re-echoed, perhaps with somewhat greater skill, remarks made previously in this debate. Before resuming my seat I hope I may deal with this matter in a way that my friend will at least regard as serious. If he did not regard my previous effort as serious, it may have been in part because I was constrained to answer, extemporaneously, criticisms which had been made by members of the opposition after the Minister of Trade and Commerce (Mr. Howe) had succeeded in making, on the motion to go into supply, the statement which from the beginning he thought should be made, coincident with the tabling of the flour report. At that stage members of the opposition entered into the debate, as was their right. That debate required a reply, which it was my task to deliver in the course of some forty minutes. As I then said, it was a difficult thing to do, because several hon. members had spoken; each had presented different arguments, and in forty minutes it was impossible to answer effectively all the arguments they had advanced. Had it not been for the good temper of the house in permitting me some additional time I should not have been able to deal, even inadequately, with the matter of the report itself.
But, sir, I apprehend that I am under no such disability this morning, because on this occasion I am the minister replying to what in substance is a motion of want of confidence in this government, and I am not restricted as to time. Not being so restricted, before I resume my seat I hope to be able to answer my hon. friend's accusations point by point and to convince him, sceptical though he may be, that there will have been a serious attempt to cover all the points which have been raised by various opposition speakers.
In the course of dealing with the way in which this matter has been handled by myself as Minister of Justice, however, I do not want to avoid coming to grips with the real issue presented to the house by the amendment which has been moved by my hon. friend the leader of the opposition (Mr. Drew); and if I may I should like to deal with that matter first.
We have here, first of all, a motion for the second reading of a bill to amend the Combines Investigation Act. One gratifying feature about the proposed amendments to the act is that while members of the opposition have attacked the government on all sorts of other grounds, such as those advanced by the hon. gentleman who has just taken his seat, few if any have criticized government
Combines Investigation Act policy as set out in the bill now before the house. Indeed, most of the references in the speeches of members of the opposition would indicate that they are in favour of these amendments. Yet some of them have said they will not support the motion for second reading of this bill but will support the amendment of the leader of the opposition, under which its subject matter would be referred to the standing committee on banking and commerce for recommendations upon what can only be government policy, and also for criticisms of the actions of the government in this connection. Therefore I should like to come directly to the heart of the controversy concerning the flour report itself.
Everyone is agreed, I think, that the report discloses no offence or alleged offence by the milling companies following decontrol. It is true that, coincident with decontrol, right at the time of decontrol, the flour report alleges that an offence was committed against the act; that was in September, 1947.
On the one hand we have the version contained in the flour report prepared by Mr. McGregor. He has said later that he does not place particular emphasis upon this 1947 decontrol agreement; that while it was the uniform increases in prices which he attributed to that agreement which first caused his suspicion that there had been some sort of agreement contrary to the Combines Investigation Act, nevertheless this alleged agreement was regarded by him only one of a series of agreements.
On the other hand, in connection with that same alleged agreement, in my office on October 22 of this year, in the presence of Mr. McGregor, Mr. Donald Gordon and myself, Mr. K. W. Taylor, the present chairman of the wartime prices and trade board, pointed out that at the approach of decontrol this government was greatly concerned about the large increase in the prices of flour and millfeed that had taken place in the United States, and was as anxious as it could be that in this country we should avoid equally large increases. Therefore, though at that time the government had suspended the price ceiling in that industry, Mr. Taylor was instructed to go to Mr. Short, the flour administrator, and tell him that the government would look with extreme disfavour on any undue increase in the price of flour and millfeed then in the process of decontrol, and that the government desired that increases following decontrol in the prices of those commodities, which every informed person regarded as inevitable, should be kept to an absolute minimum.
With that in view, Mr. Taylor, on the initiative of the government and of no one else,

Combines Investigation Act went to Mr. Short and got him to prevail upon his own company, Lake of the Woods Milling Company, to agree to an increase in the price of flour and millfeed substantially below any increase that was under consideration at that time, and of course very much less than the increase which had taken place in the United States and which we were trying to avoid in this country. The suggestion which was conveyed to the industry at that time-


John George Diefenbaker: By whom?


Stuart Sinclair Garson: By Mr. Taylor-was that although the ceiling on flour and millfeed had been suspended, if there were not reasonable co-operation in adhering to the precise prices for both flour and millfeed which had been named by Mr. Taylor, then the government would have to consider restoring the ceiling in order to produce the same result by compulsion, if it could not be secured by the co-operation of the industry.
This request was accepted by the milling industry under protest. My information, coming from people who are competent to express it, is that, as was revealed by the discussions which took place in connection with Mr. Taylor's ultimatum, there was not a firm in the industry at that time which did not intend to increase its prices. Further, my information is to the effect that the increases were not going to be uniform at all, that they all had different ideas as to how much they should get. But not one firm intended to increase its prices by as little as the amounts specified in Mr. Taylor's statement.
At one o'clock the house took recess.
The house resumed at three o'clock.


Mr. Coldwell:: On a question of privilege, Mr. Speaker, may I point out that sessional paper No. 53-1, tabled this morning, states at page 3:
In a file of one of the senior officials of the prices division, I find a note dated June 21, 1943 (copy attached hereto) recording a discussion I had with him dealing with an interview. . . .
And so on. The copy of the document referred to is not attached.


Stuart Sinclair Garson: I think it was by inadvertence that it was not attached in the office of the Secretary of State. I have a copy here that I will table during the course of my speech. My hon. friend may have this copy.


Major James William Coldwell: Thank you.


Stuart Sinclair Garson: 
John George Diefenbaker: Will the minister permit a question? Would he not think that the then Minister of Justice who had been Minister of Finance would have brought that to the attention of Mr. McGregor?


Stuart Sinclair Garson: Mr. Speaker, I think it is hardly proper for me to undertake the rather large responsibility of explaining the mental processes of some other gentleman who preceded me in this office. But I might point out in that connection, as my hon. friend perhaps well knows, that under the Combines Investigation Act the commissioner, with regard to the preparation of his report, has the power to initiate it, to conduct the preliminary investigation, and if he thinks it is warranted, to go on and to take every

Combines Investigation Act step right up to the final delivery of his report to the minister without any approval whatever from the minister of the department.


John George Diefenbaker: He says that Mr. Ilsley knew.


Stuart Sinclair Garson: Therefore, it was not necessary for Mr. McGregor to consult the minister. In the strict interpretation of the act it was certainly not the responsibility, and in the strictest sense it might not have been proper for the minister to interfere with the preparation of that report or with the steps which the combines commissioner thought were proper for him to take in connection with the preparation of it.
We are inclined to think that as a consequence of the fact that Mr. McGregor never went near Mr. Gordon in connection with the preparation of the report there are certain references in the report to wartime prices and trade board policy, which it is not the particular function of the commissioner under the Combines Investigation Act to state, and to which Mr. Gordon takes very strong exception. Of course Mr. Gordon also completely dissents from most of the conclusions of the report.
What does Mr. Gordon himself say with regard to the subsidy and proper control arrangements which prevailed in the milling industry that we are discussing? Before I quote Mr. Gordon perhaps I should say a word or two in introduction. The necessity for the subsidy arose because during the time when there was a price ceiling upon most products in Canada the government, for reasons which it thought proper, and which any wheat farmer can readily explain to the curious, thought it was proper to refrain from putting a ceiling on the price of wheat. Therefore the price of wheat was permitted to rise at that time while the price of flour was still under a ceiling. Of course, if the cost of the millers' raw materials rises and the price of their finished product, flour or millfeed, still remains under a ceiling, the millers are bound to be squeezed against that ceiling. I am informed that the milling companies had no objection to the price of wheat being permitted to rise. Their solution for the problem which that rise created was to let the price of flour rise as well. They said they thought that in the circumstances it was only fair to the farmers that there should be a rise in the price of wheat. I think most hon. members would agree with that view. They said that if there could only be a corresponding rise in the price of the products like flour manufactured from wheat, why, it would be fair all round. But the difficulty, sir, was this. I was going to say it is extremely difficult but it is more accurate


Major James William Coldwell: Would the minister permit a question? Why is it that there is no memorandum or document supporting that statement to be found in the return-and no minute?


Stuart Sinclair Garson: I would prefer if my hon. friend would permit me to deal with that as I go along. However I might make casual reference to it at the present time: for the simple reason that it was inherent in this arrangement, and was well known to everyone who participated in it that it was inherent, that if the milling industry provided with this subsidy did not sell their products at very near the ceiling price the government would be involved in very large amounts of money, on top of the subsidy which it was already decided they were going to pay.
I go on with the quotation from Mr. Donald Gordon's statement:
As I have already stated there were a great many discussions not only with the flour administrator and other board officials, the industry and myself, but as well, there were many meetings with the appropriate ministers, other departmental officials and myself on the whole controversial subject of wheat and related prices. In the rush of events, few of these discussions were committed to writing, or if they were I cannot now trace them in the files of the board.
As soon as it became apparent that a drawback or subsidy was essential to maintain the price ceiling on flour and other subsidiary wheat products, it was obvious that millers should not be free to cut prices but should rather maintain existing ceilings in as practicable a manner as market conditions permitted. In due course this understanding was formalized when the "profit control" feature of the subsidy plan was adopted since it then became self-evident that habitual sales below the ceiling could only increase the subsidy. Moreover, by the imposition of this "profit control" clause, all milling profits (i.e. including profits on export business) -
Upon which, I may interject, there was no ceiling. That was the most profitable end of the business, but the government compelled them to pool the profitable export business into its profit-controlled pool in connection with the subsidy to provide wheat at low prices for domestic consumption. Then, to continue with the report it states that all milling profits, including those on export business-
-were brought into the calculation with the result that no agreement in regard to price could have yielded the millers additional profits.
And that is taking into consideration export as well as domestic profits.
In a file of one of the senior officials of the prices division, I find a note dated June 21, 1943 (copy attached hereto) -
Combines Investigation Act
And this is the one about which the hon. member for Rosetown-Biggar (Mr. Coldwell) asked his question a few moments ago-
-and recording a discussion I had with him dealing with an interview between the Minister of Finance, Mr. C. H. G. Short, then honorary chairman of the Canadian National Millers Association and later flour administrator of the wartime prices and trade board, in which the obvious need for an understanding on minimum prices was discussed and Mr. Short was requested to present such an understanding to the millers for their consideration. At that time I assured Mr. Short that an agreement of this kind was not in contravention of the Combines Investigation Act.
And, if I may interject: How does one suppose it would be possible to secure the co-operation of an industry in regard to a wartime prices and trade board arrangement if you were telling them that at the same time they would be contravening the Combines Investigation Act? Mr. Gordon's report continues:
(In parenthesis I should perhaps also explain that the structure of ceiling prices in this industry did not lend itself to the mechanics of formal orders for the reason that different ceilings were applicable to different companies in different districts and to different classes of buyers. The "ceiling" principle froze all prices as they existed on the date specified in the wartime prices and trade board regulations. Therefore, the supervision of the actual ceiling prices in the different districts and to different classes of buyers for each district was left to the flour administrator with the general understanding that formulas for agreements were permissible.)
He goes on now to deal with this immensely complicated matter. I go on with the report:
It should be understood that the flour milling industry was always hostile to the administrative procedure whereby the subsidy was paid through them, claiming, quite properly, that the payment was for the benefit of the wheat farmer and domestic consumer and not for the millers. They accepted the procedure which was worked out at the special request of the Minister of Finance. If they had not co-operated, any other procedure would have been so clumsy that I was afraid it could not have been made to work and a damaging breach of the price ceiling on essential supplies would have resulted. It is necessary to re-emphasize, however, that the subsidy or drawback procedure accepted by the millers meant that they were expected by the board to sell at or reasonably close to ceiling prices at all times, since any price cutting would have been at the expense of the public treasury.
The calculations Involved in this particular subsidy were of a most complicated nature and frequent revisions of the arrangement were required. The particulars are fully set forth in the following orders in council:
And then he sets out in the report a list of the various orders in council, which hon. members may see.


Major James William Coldwell: Will the minister put on record the other document, because it is a material part of this matter?


Stuart Sinclair Garson: No, I do not think so, because I have covered-

Combines Investigation Act


Major James William Coldwell: This was to be regarded as confidential by both the administration and-


Stuart Sinclair Garson: Well, perhaps I had better deal with it. My hon. friend questions it, so perhaps I had better. I hold in my hand that to which the hon. member for Rosetown-Biggar has just referred in his interjection. This is a memorandum of a talk which took place with the Minister of Finance, with Mr. Gordon as chairman, and Mr. Short; and to avoid any possible misunderstanding perhaps I should put the whole thing on record.


Major James William Coldwell: Yes.


Stuart Sinclair Garson: This is the memorandum dated June 21, 1943:
Mr. Short, president of the flour millers association for many years, has been talking to the Minister of Finance and the chairman on the subject of flour millers' profits and stabilization of prices, et cetera:
The chairman-
That is, Mr. Gordon-
-agreed:
(1)	that the industry is not being subsidized-
That is, at that time; and-
(2)	that it is not his desire to ask the industry to reduce prices or to reduce the amount of drawback which it is presently receiving from the treasury.
As a result of the wheat board's action in stabilizing the cost of wheat for flour millers at 77| cents per bushel, basis No. 1 Northern, Fort William, it appears that the flour millers are obtaining cheap wheat at the expense of the treasury.
It is the chairman's desire-
And in this he was stating the government's desire-
-that the millers should consider seriously refunding to the treasury profits in excess of say 116g per cent of standard profits. By so doing the industry if and when criticized could then say that it was not making excess profits at the expense of the government.
As the present arrangement does not include the W.P.T.B. or the C.P.S.C. it is preferable that any revision should be made through the presently established channels.
Mr. Short is to present the case unofficially to the large millers for their consideration.
I ask you, sir, and through you the hon. members of the house to pay special attention to the next paragraph:
If it is agreed to refund all or a portion of the drawback dependent upon earnings, it is considered that it may be desirable or necessary to place a minimum price on sales of flour in order to prevent any miller from taking undue advantage of the arrangement to reduce domestic flour prices at the expense of the government.
If I may interject for a moment I would say that with a government's ceiling price on flour and with the milling companies' profits under the rigid control that was visualized in this proposed arrangement the

milling industry's profits were fixed, and it could not make or lose money no matter at what level its prices were fixed. But what the milling companies could do was to drop their prices lower and lower either to make good fellows of themselves with the consumers or to build up their markets at the expense of the other fellow's market; and the whole of this process could be carried out at the cost of the federal treasury. In peace time if a miller wanted to drop the price of his product in order to get some business away from his competitor he had to pay the shot out of his own pocket. Under a profit control arrangement he could engage in a price war, and finance it at the expense of the federal treasury. Therefore it was to the interest of the treasury that prices should not be cut. One suggestion that was made was that the cutting would be stopped by putting a floor under prices below which they could not go. I refer to that because I intend to come back to it in just a moment. Meanwhile I shall go on with the rest of this statement which reads:
Mr. Sharp of the minister's office is thoroughly conversant with the problem and the chairman has requested Mr. Hart to get in touch with Mr. Sharp to ascertain the background and to develop a suitable formula for application of profit control.
The foregoing is to be treated very confidentially and not made known to either the administration or to the industry at this time.
I asked about that last statement and was told that its significance lay entirely in the circumstances prevailing at that time, that it was desirable at that stage of the conception of a new policy, shall we say, to avoid any misunderstandings through premature disclosures until both sides were able to deal with their own principals.


Major James William Coldwell: But the floor was never established.


Stuart Sinclair Garson: No, and I am coming to that very point. As the hon. member for Rosetown-Biggar says, the floor was not established, and a great deal has been made out of that fact by my hon. friend, by his colleagues, by the flour report and by other critics of the government. It has been argued that if the government had desired to really impose a limitation in this matter they could have done it quite simply by putting in a floor.
But it was not quite as simple as that. There is a tendency for the layman when dealing with technical matters to look at the outside and assume that, after all, the problem is quite easy and that some apparently simple device like a floor price could cure it without much trouble. I am sure that those who were beset by a number of worries and problems in their duties as

administrators of the wartime prices and trade board would have been glad to have had a simple device like that if it could have been effective. I pointed out, and quoted Mr. Gordon in doing so, that when this ceiling was put on it was not a flat ceiling that would apply to the sales of flour of a certain grade across the country. The ceiling was such that it had the same effect upon the whole complicated price structure of the different companies in the different zones and for different types of customers, even of the same company, as the eruption of Vesuvius had upon the citizens and buildings of ancient Pompeii. Just as that eruption overtook the buildings and citizens of Pompeii as they stood at a certain point of time so the price ceiling in the milling industry "froze" the whole complex price structure in the milling industry as it stood at a certain point of time.
The result was that the highest price at which Lake of the Woods Milling Company was selling to a certain type of customer in, say, Winnipeg was established as the ceiling price for that type of customer in that zone. If that price were unfortunate from that point on it remained unfortunate. In that way a ceiling was frozen on all prices as they stood in the various freight zones, for the various qualities of flour of the various companies to various classes of customers. The effect was that all anomalies-it requires no imagination to realize that there would be many in a price structure of that sort-were frozen.
In this respect the milling industry was different from some of the other industries in that its price structure was an unusually complex one. On its face this freezing order might seem to be a rather extraordinary, anomalous action, by the government. This was explained to me by Mr. Taylor, the present chairman of wartime prices and trade board, when he said that after a great deal of examination they came to the conclusion that by taking any other action they would create more problems for the bakers and other consumers of flour than they would solve for the millers, and that extraordinary as it may seem this price "freezing" device was the proper one to adopt.
Then a word with regard to the suggestion of the hon. member for Rosetown-Biggar, that the proper thing to do was to put on a floor. Let us take a concrete case. Supposing that in a certain zone for a certain type of flour sold to a certain type of customer-


Major James William Coldwell: I did not suggest that they should have put on a floor, I said that they did not put on a floor.


Stuart Sinclair Garson: I think there is an implication in my hon. friend's argument that-
Combines Investigation Act


Major James William Coldwell: No.


Stuart Sinclair Garson: I want to be fair to my hon. friend and I shall put this to him in the form of a question. Is there not any implication in his argument that the government, if it had wished, could have solved this difficulty at a less cost to the federal treasury for increased subsidies by putting a floor under the price of flour?


Major James William Coldwell: That implication could be taken, but that is not the point I was making. I assume that the government could have protected itself in that way, but it was not done. That was my point.


Stuart Sinclair Garson: My hon. friend admits the implication. Let us now deal with why it was not done. Let us take a concrete case. Supposing, as I said, that Lake of the Woods' price was $6.50 per barrel at the time of the freezing order, and that Robin Hood's price in the same area was $6.10. I suggest that after the freezing order went into effect the only way in which Lake of the Woods Milling Company could get its share of the business in that district would be by running its price down to the $6.10. It was that process of adjustment all through the industry which in a large part explains the fact that there were substantial sales somewhat below the ceiling.
The wartime prices and trade board had to allow that freedom, otherwise business could not have gone on. One of the main objectives of the wartime prices and trade board policy was that in spite of the fact that they were putting on these controls business still had to go on. The purpose of the whole arrangement was to have business go on. That meant that if there were no floor prices in effect, then such adjustments could take place so that the milling companies could continue to do business along with their competitors. But suppose you put in an order that the minimum floor price for that type of wheat was to be 40 cents under the ceiling price. Since the 40 cents would apply to the ceiling price as it was when the price was frozen, you would then produce a new crop of anomalies at the lower level, and in the course of doing so make it impossible for the Lake of the Woods Milling Company to ever get any share of that business because they could not go through their floor which would be 40 cents under their ceiling in order to compete with the Robin Hood floor price.
I am told and I believe-I think it is a reasonable thing for any group of people to believe-that that is one of the main reasons why the floor price device was not adopted. In the absence of some such practical device as a floor price the administrator and the

Combines Investigation Act chairman were thrown back upon instructions, exhortations and directions to the milling industry to this general effect: We admit there must be some flexibility under an arrangement of this sort or otherwise business cannot go on, but we tell you quite frankly and give you notice that if you systematically sell beneath the ceiling price by unreasonable margins, and thereby involve the treasury in additional expenditures for subsidies in large sums of money we will step in and take some action, probably by reducing the subsidy or increasing the price of wheat.
The hon. member for Rosetown-Biggar (Mr. Coldwell) scored many of the points made by the opposition in this debate, at least the ones which I thought were worthy of rebuttal. Reference was made by him for example to the fact that these milling companies sold ships' stores to government departments at fixed prices. He intimated that was a most reprehensible thing, and in itself was a breach of the Combines Investigation Act because it indicated an agreement to fix prices which was contrary to that act.
In relation to my hon. friend's argument I put to the house what seems to me to be a very simple proposition. If the milling companies, in concert if you like, sold flour to the department of munitions and supply, we will say, at the ceiling price, that department would pay the ceiling price and it would cost the treasury nothing by way of extra subsidy. But suppose the milling companies had followed the course, which the hon. member either stated or certainly clearly implied they should have followed, of selling flour to the department of munitions and supply for the ceiling price less $100,000. Then the position would have been simply that the department of munitions and supply would be in $100,000 and the treasury would be out $100,000 for additional subsidy. If you like you can put it in terms of a bookkeeping entry, debit treasury, credit department of munitions and supply, $100,000. The department's righthand pocket would be out $100,000 and its left-hand pocket would be in $100,000. The milling companies would not make or lose a penny because of the nature of the profit control arrangement which the government through the wartime prices and trade board had imposed on them.
But if these ships' stores were sold to other than the Canadian government, then the situation would not be that treasury would be out $100,000 and the department of munitions and supply would be in $100,000. In such a case the treasury would be out $100,000 and the purchaser of the ships' stores be in $100,000; and the result of my hon. friend's
[Mr. Garson.l
suggestion would be that we the taxpayers of Canada through the federal treasury would be subsidizing this purchaser.
Listening to the uncomplimentary remarks in this matter which have been made concerning the government in general and to a certain extent about myself in particular, I must say I think that anyone with any discernment at all, who had placed on his desk a report in respect of which there were widely divergent views amongst the highest levels of the civil service, would make reasonable attempts to reconcile those views. May I say I have put forth great efforts in that direction. I should like to place before the house today some of the materials which I think clarify to some extent the issues arising out of the conflicting views to which I have referred.
In order to comply with the order for return in the name of the hon. member for Rosetown-Biggar, we have had quite a time going back through the old files of the wartime prices and trade board, to try to get the documentary evidence that we have produced. We found there were serious gaps in some of these voluminous files. In order to check against the wartime prices and trade board flies, I asked Mr. McGregor to produce to me from his file copies of any and all memoranda which he wrote, prepared or received in his capacity as an official of the wartime prices and trade board, as commissioner of the Combines Investigation Act, or in any other capacity.
The material I received in reply to my request is most illuminating. It shows not only what was the policy of the wartime prices and trade board, but that Mr. McGregor himself, as the person in whose possession these documents were and from whom they came, must have known what it was. I should like to read into the record first of all extracts from Mr. McGregor's evidence as found in the minutes of proceedings and evidence of the special committee on prices on February 16, 1948, at page 158.
The first selection I wish to read is upon the point that the government encouraged companies in any given industry to organize and to agree amongst themselves in order to deal more effectively with the wartime prices and trade board for control purposes. The excerpt reads:
Throughout the war years concerted action on the part of producers and distributors was encouraged rather than discouraged by government agencies, and quite properly.
Under a direct control system, quicker and more effective action can be secured if the one controlling agency can deal with a single organization representing a whole section of a trade or industry rather than with a multitude of independent units.

These groups played an important and highly useful part in the wartime control of their respective industries; but the last word, the ultimate control, lay not with them but with government.
That statement by Mr. McGregor is quite correct, of course. Agreements as to prices and so on, which in peacetime were contrary to the Combines Investigation Act, became in wartime desirable rather than undesirable instruments of wartime control and integration under the wartime prices and trade board. As we all know, war is essentially a totalitarian business. You integrate your whole economy for the purpose of delivering the greatest possible blow against the enemy. And the wartime prices and trade board approved, rather than disapproved, of companies in the same industry forming committees to work in conjunction with the wartime prices and trade board officials. I should like now to quote from a letter from the secretary of the commission to H. E. Manning, K.C., of Toronto, dated June 20, 1942:
While it is not possible to state definitely whether any such orders do sanction agreements of the whole trade, it is true that in most instances to date they have met with the approval of a representative group of the trade involved. This follows from the fact that the board has adopted the practice of establishing advisory committees from each trade and industry whose contribution is to make suggestions for economies, standardization and simplifications and to discuss and criticize recommendations of the board or of the administrators. Thus, while many of the orders which have introduced restrictions of competitive practices have originated with or had the approval of a large section of the industry or trade concerned-
And may I interject that they could not have had that approval, the restrictions could not have originated with the industry, unless those in the industry had got together to discuss and agree on what they were to originate or approve.
-it could not be said that they are merely giving recognition to agreements within the industry or trade to restrain competition.
Again I quote from Mr. McGregor's testimony before the prices committee, on the point as to whether direct war control had replaced discipline under the Combines Investigation Act, as follows:
During the latter years of the war, activities under the combines act were largely suspended in view of the establishment of direct wartime emergency controls over practically all branches of industry and trade.
As to the effectiveness of these controls, I quote Mr. McGregor again:
While indirect control by price competition can never be expected to be completely effective, neither can a system of direct price control, even in wartime. Wartime price controls in Canada, direct controls, were singularly successful in spite of stupendous difficulties.
Combines Investigation Act
I quote that because it is in direct corroboration of the position Mr. Donald Gordon took in Mr. McGregor's presence at the interview in my office on October 22. Then with respect to the wartime prices and trade board administration succeeding the Combines Investigation Act as the appropriate method of wartime control, in reply to a question by the hon. member for Eglinton (Mr. Fleming) Mr. McGregor told the committee:
The objective of the prices board and the objective of the Combines Investigation Act was the same; to protect the public from improper prices. When the prices board was established it was given such complete powers and such wide powers in the emergency period that it could stop high prices just over night. A directive could be issued as soon as an undesirable condition was found out. Now, we could not take that direct action under the combines act. That is not the appropriate safeguard for a wartime economy.
Then I should like to quote from some of the annual reports of the commissioner under the Combines Investigation Act, with regard to the wartime controls superseding that act. I quote from the report for the year ending March 31, 1942.
Other cases which in the absence of wartime regulations would have been dealt with under the Combines Investigation Act have been dealt with by the appropriate wartime agency.
You will find similar references in the reports for 1943 and 1944. Mr. Donald Gordon told us that one of the reasons why the wartime prices and trade board did not leave behind a trail of orders in council and written directives of one kind and another was that the prime object, to which every other consideration was sacrificed, was more and more production; and that to this end assurances were given-in some cases, where they were demanded, of a formal character but many of which were informal and oral; that anything done by an industry in furtherance of the substance of the wartime prices and trade board legislation would not be subject to prosecution under the Combines Investigation Act.
As far as the milling industry was concerned I suggest that the real test as to whether action by any milling company was in compliance with the objectives of the wartime prices and trade board and therefore privileged under the Combines Investigation Act would be whether it was in substantial furtherance of the substance of the policy of the board. What was the policy of the board? It was to pay a subsidy of a planned amount, which was based upon the investigation made by this firm of chartered accountants. The policy was to fix a ceiling price and, by having the industry sell at or near that price,

Combines Investigation Act to make sure the government would not have to pay any subsidy in addition to that which had been fixed alter the most careful calculation. Mr. Gordon says, and the government accepts, because it is obvious, that anything done to this end would be privileged under the Combines Investigation Act. As to whether or not Mr. McGregor was aware of this, I quote from a memorandum from Mr. H. D. Anger, solicitor of the board, to Mr. McGregor, dated February 18, 1942, in reply to a letter from Mr. McGregor:
As you say, the Combines Investigation Act only prevents persons from combining to set prices or take other action detrimental to the public. When prices are fixed or specified restriction or standardization is required by or under the authority of this board, the fixation or requirement has statutory effect and the Combines Investigation Act does not apply, as no combine whatsoever has taken place.


Major James William Coldwell: Has the minister Mr. McGregor's letter, to which this is a reply?


Stuart Sinclair Garson: Yes, and I will table it with the others. I do not want to read too many extracts. There has been a tendency, more by implication than by direct challenge, to suggest that Mr. Gordon was exaggerating, shall I say, as to the necessity for a large number of oral directions and so on. I should like to read from a letter from Mr. W. H. Howard, who was co-ordinator of the pulp and paper products administration, to Mr. Donald Gordon, setting out the conditions in the industry that he had in charge, which letter I think will make very clear the sort of pressure and the kind of conditions and circumstances under which the administration of the wartime prices and trade board had to be carried on. The letter is dated March 3, 1942, and states:
This is the first occasion on which this matter of conflict with the Combines Investigation Act and No. 489 of the Criminal Code has been put forward in such a formal manner although as I have already indicated to you, the question is constantly being raised by the pulp and paper manufacturers generally.
And further:
In this connection, you must bear in mind that what you now want manufacturers to do, by voluntary agreement among themselves and with your administrators, are precisely those things for which they, or others in similar positions, have been prosecuted in the past by Mr. McGregor and his minions.
Then he goes on to say:
I assume that, by process of blanketing by formal rulings, every agreement reached and action taken in respect of concerted elimination of frills, standardization and simplification, the administrators could provide protection to all concerned,-
We could do this all by a great series of agreements, blanketing the whole thing "but", he said:
-this would involve not only a formidable amount of detail work but would slow things down and

impair, if not destroy, the present co-operative spirit and general desire to attain your objectives.
It is surely infinitely better, under existing conditions, to arrive at our objectives by voluntary co-operation than to formalize the program by an elaborate series of orders, directions and rulings issued by the administrators and your board.
In any case, I am not certain in my own mind,-
And Mr. Howard is an able lawyer.
-not having found time or inclination to study the intricate legal questions involved, that a series of administrative rulings or orders would provide an absolute barrier against prosecutions at some time in the future.	[DOT]
In any case, the businessmen concerned are not going to assume avoidable risks and there is no reason why they should be expected to when all that is involved is a conflict of authority between departments of government.
Some suggestion has been made that in questioning the willingness of any company to co-operate in this matter, we are questioning their patriotism. No one would question that. But when the government was stepping into a picture and directing these concerns as to what the government wanted them to do, why should they have to run the risk of being prosecuted by some other department of the same government in respect of the very thing that they did under that direction?


John George Diefenbaker: Will the minister allow a question?


Stuart Sinclair Garson: Yes.


John George Diefenbaker: Who could possibly give Mr. Gordon the power to promise anyone immunity from the law? That is just a question seeking information.


Stuart Sinclair Garson: If my hon. friend will let me leave the answer of that question until later, I shall be obliged to him; I have a letter right on that very point.


John George Diefenbaker: All right.


Stuart Sinclair Garson: There is further discussion on the same point and two separate letters were written. The first one was by Mr. McGregor who, as you remember, was an enforcement officer of the wartime prices and trade board. He dictated this letter for signature by Mr. Gordon as chairman. Then within two or three months afterwards there was another letter on the same point by Mr. H. D. Anger, the solicitor, also written for Mr. Gordon's signature. I am going back to the same correspondence. Mr. McGregor, in the letter which he drafted-and I think perhaps I had better read it so as not to interpret it in any way-says this:
It seems to me that any significant possibility of difficulties such as you suggest-
That is, such as suggested in the letter that I have just finished reading.

-can best be obviated by enactment of duly authorized administrators' orders directing such action as may be required in respect of standardization, simplification and related matters. Under the machinery now set up, such orders can be handled without delay. Action taken by an industrial or trade group pursuant to such orders would not be subject to prosecution as against the public interest. Provision for their formal authorization would seem to be a reasonable precaution to prevent inadvisable arrangements being made in the name of the board without its knowledge and sanction.
In other words, in this letter for Mr. Gordon to sign, he was taking much the same rather technical position that is taken in the flour report that was tabled the other day.


Major James William Coldwell: Were those orders ever formalized?


Stuart Sinclair Garson: No. This letter was followed up by another letter from Mr. Gordon in the same sequence, written by Mr. Anger and which I will now read. I will not read it all, but merely the relevant parts of it. This is Mr. Anger's statement of the position and I direct this particularly to my hon. friend for Lake Centre (Mr. Diefenbaker).


John George Diefenbaker: What is the date?


Stuart Sinclair Garson: The date of that letter?


John George Diefenbaker: Please.


Stuart Sinclair Garson: The date of it is June 17, 1942. The date of the former letter was April 16, 1942. I direct the attention of my friend, the hon. member for Lake Centre, to this letter because I think it contains the answer to his question as to whether Mr. Gordon could promise any immunity and so on. Of course he could not. But the law could. When a man states the law, he does not promise immunity. It is the law that grants the immunity. This is what Mr. Anger said in his letter:
The regulations have always provided that contravention or failure to observe any regulation or any order is an offence.
That is, any regulation or order under the wartime prices and trade board.
From the foregoing it is seen that it is not only a formal order of the board or of an administrator that must be obeyed, but also any general or specific requirement or instruction of an administrator. It being clear that failure to comply with an order as defined is an offence, it is equally clear that obedience of such an order would be a good defence to any possible action brought under the Combines Investigation Act or the Criminal Code, if there were, in fact, any conflict between such statutes and an order. As has been stated before, however, our legal department and the commissioner of the Combines Investigation Act-
That is Mr. McGregor.
-concur in the view that there can be no such conflict, because orders are in the public interest and there is no liability under the above statutes except in respect of acts which are against the public interest or to the detriment of the public, which is the same thing.
Combines Investigation Act


Major James William Coldwell: But no order was issued.


Stuart Sinclair Garson: Or in other words, Mr. Speaker,
where you have an arrangement in connection with the whole milling industry arrived at after a long series of negotiations, based upon an exhaustive inquiry by a firm of chartered accountants, formalized in a succession of orders in council, one of the fundamental principles of which is that the government is not prepared to be mulcted -I think that is not an improper term-in the amount of tens of millions of dollars in terms of extra subsidies to milling companies selling down below the price ceiling, surely under these circumstances you have an obligation in the matter of whether they choose or not to call upon the milling companies to comply with that arrangement; and if they do comply with it, who is going to say, in the face of the letters I have quoted, that they are guilty of any kind of infraction of the Combines Investigation Act? When Mr. Taylor, Mr. Gordon or the administrators, as they did many times, directed these concerns to comply with the arrangements which had been entered into after the fullest consideration, they were not granting any immunity. They were disciplining the industry and telling them that they had to comply with the orders of the wartime prices and trade board. But once they did comply with the orders of the wartime prices and trade board, they should not be prosecuted for doing so.


Major James William Coldwell: But there is no evidence of any orders. That is the thing we are puzzled about.


Stuart Sinclair Garson: Mr. Speaker, I do not know what orders my hon. friend is referring to.


Major James William Coldwell: Orders with respect to legislative or statutory authority.


Stuart Sinclair Garson: I do not think that he is challenging for a moment the statements of these men. Not having been in Ottawa myself during wartime I cannot personally vouch for these facts but the arrangements in connection with the milling industry were so well known that I do not think that anyone would challenge them. If my hon. friend wants to know what the legislative and statutory authority was, let him examine these orders in council and he will see the subsidy arrangement set out there. If he has any doubts about that I can lend him the report of this firm of chartered accountants, which shows the basis upon which the amount of the ceiling price for flour was established, and how the millions of dollars of subsidies that this would involve was calculated, how the government would have to pay the amount of

Combines Investigation Act subsidy that they agreed upon in order to hold flour at that price. The government did not want flour to be sold for less than this ceiling price because that would have involved the payment of more subsidies. If the government had intended that flour was to be sold for less than the ceiling price it would have planned to pay more subsidy in the first place; but having fixed both its subsidies and its ceiling price it was basic from that time on that it wanted the industry to sell at, or as close as it was practically possible, to that ceiling level.
I want to lay before hon. members, some of whom have been so extremely critical of our position, the dilemma that this public service disagreement presented to the government. For the sake of argument let us assume that Mr. McGregor is right in his view. But even if he were, this disagreement as to basic facts would place the Department of Justice in an impossible position in the event of our prosecuting. How could we prosecute such a charge if we proceeded to put in the case based upon the flour report and then were confronted with the evidence of Mr. Gordon and Mr. Taylor who could very easily have been subpoenaed for that purpose, and who in their dealings with the flour industry, according to what they inform me, and I believe them implicitly, had time and time again told the milling companies what their position was under the law.
The hon. member for Rosetown-Biggar (Mr. Coldwell) has been questioning our position. I should like to question his for a minute. He says, or inevitably implies, that the course which the milling companies should have followed was not to have sold at or near the ceiling and thereby protected the treasury, but that they should have engaged in competitive price cutting to drive down the price of flour to whatever level to which free competition would take it. Is that a reasonable statement of my hon. friend's position?


Major James William Coldwell: That is a reasonable statement.


Stuart Sinclair Garson: If it is a reasonable statement, as my hon. friend admits, I suggest that there could be nothing more contrary to government policy and nothing more advantageous to the millers than this very procedure recommended by the hon. member for Rosetown-Biggar. He seems to misunderstand or forget the nature of this arrangement.


Mr, Coldwell:: No, I remember very well.


Stuart Sinclair Garson: The arrangement was that regardless of the price at which they sold their products they could neither make nor lose any money; hence any reasons that they might have had, for example, in peacetime,

for reaching an agreement, illegal under the Combines Investigation Act, to make money, simply could not exist under this subsidy arrangement, because they could not make any more money by selling for a higher rather than a lower price. As long as that arrangement obtained the only advantage that they could get was an altogether different one. Not having to foot the bill for any cuts in prices that they would put in effect themselves, they could build up markets at one another's expense, they could make good fellows of themselves with the consumers, entirely at the cost of the public treasury. What my hon. friend and those who take the same position as he does argue is that that is what the millers should have done. Let us look at this proposition for a minute. Let us suppose the companies had followed that course. Suppose they had reduced the price on flour to a much lower level. The consumers would have been quite happy and I suppose my hon. friend would have been happy to see them happy, and the milling companies would have earned his approval by that course of conduct. But in the end, Mr. Speaker, these same happy consumers who got their cheap flour would, in their capacity as taxpayers, have helped to pay the subsidy put up by the federal treasury which made the whole arrangement possible.
That was not done. The milling companies dared not take such a course. They were warned that, if they did, punishment would be visited upon them in the form of a decrease in subsidy or an increase in the price of their wheat. Because they cooperated with the board in not attempting to create good will for themselves with the consumers at the expense of the taxpayers of Canada the flour report says that they should be prosecuted. My hon. friend from Rosetown-Biggar argues that we should reward them for doing what the wartime prices and trade board directed them to do by prosecuting them for an offence under the Combines Investigation Act. Well, sir, we do not think that that would be a conscionable attitude for the government to take, and we are not going to take it. We are not going to prosecute the milling companies for doing what they did in accordance with the subsidy and rigid profit control administered through the wartime prices and trade board.


Major James William Coldwell: That is what the commissioner recommended, not the member for Rosetown-Biggar. The commissioner recommended that they be proceeded against.


Stuart Sinclair Garson: I am sorry; I accept the correction. I thought that my hon. friend-


Major James William Coldwell: I agree with the commissioner's recommendation. I am pointing out that I did not recommend it.


Stuart Sinclair Garson: I see; but my hon. friend agreed with the recommendation. Mr. Speaker, I undertook with the hon. member for Toronto Greenwood to deal with the flour report itself in a way that he would regard as serious. I want to do so with all the candor that I can muster. I want to begin by saying that in some twenty odd years of public life I cannot remember ever having encountered a problem in which the combination of circumstances was more unfortunate, unfortunate at the beginning and as it developed. My position was this. After having taken part in two winter by-election campaigns, one in my present federal constituency and the other one in my own provincial seat in support of my successor, I arrived in Ottawa on January 3, 1949, to take up my duties. Three weeks later parliament was to open. In that interval, in addition to familiarizing myself with the operations of the department, including the penitentiaries administration, the Royal Canadian Mounted Police, the Combines Investigation Act and the other branches of the department, and reading the reports of these branches in order to bring myself up to date, there were in the way of legislation to be attended to the Continuation of the Transitional Measures Act, which had a time limit on it because it had to be introduced before existing measures expired, the bill to amend the Supreme Court Act by abolishing appeals to the privy council, amendments to the Exchequer Court Act, revision and consolidation of the Bankruptcy Act, various amendments to the Criminal Code, and the statute law amendments arising out of the terms of union of Newfoundland and Canada, and also amendments to the Judges Act.
Instead of this report being brought to me in person after I turned up in Ottawa it was delivered to my office in Ottawa while I was still in Winnipeg on December 29. Then on December 31, while I was still in Winnipeg- and may I say quite unavoidably in Winnipeg; there is no way that I could have avoided it-and I was not holidaying, or anything of that kind-on December 31, while I was still absent in Winnipeg, the commissioner sent a memorandum to my office in Ottawa. And the time within which publication had to take place had started to run. I was like the sprinter who had the starting gun fired before he had got out of the dressing room. The race was well on before I got to Ottawa at all.
Combines Investigation Act
On December 31, still in my absence, I got this memorandum from Mr. McGregor:
Your reading of the entire report is now out of the question, but I hope you may have an opportunity to run through the concluding chapter which starts at page 263. A summary, such as we usually release to the press when the report is made public, will be prepared shortly.
Section 27(5) of the act requires that the report be made public within fifteen days after its receipt by the minister.
This is all put in to me, with time running on.
It will not be possible to have it printed within the fifteen days, but we hope to have copies from the printing bureau before the end of January. May I have your authority to have 5,000 copies printed in English and 1,000 copies in French. I would like to have a word with you regarding our practice in printing other similar reports.
Thus, by the time I got to Ottawa, five out of the fifteen days had already elapsed before I was able to see the report physically, let alone to have any time, in the press of other duties, to read it. It came to me in the form of a bulky manuscript consisting of about rather less than three hundred pages of loose sheets of carbon copy, in a loose-leaf binder. There were no copies available; that was the only copy that was ever delivered to me of the manuscript. If I wanted to discuss it with anybody I could not do so until I had read the whole report and had mastered it, so that I could present an intelligent summary-although later on, long after the time for publication had elapsed, I was furnished with the first draft of a press report, which was a summary.


John George Diefenbaker: When was that?


Stuart Sinclair Garson: The draft, do you mean?


John George Diefenbaker: Yes.


Stuart Sinclair Garson: January 24, 1949.


Stanley Howard Knowles: Was that the draft which was released to the press on November 7?


Stuart Sinclair Garson: No, and I am coming to that. It was not. That is the point. My hon. friend, with his usual discernment, has put his finger right on the point. But his colleagues, and I believe he himself, have been arguing that if I were like the other Stuart, Charles Stuart, I should have my head cut off for not getting this report published by January 13, 1949.
And I am going to lay before hon. members information to indicate that it could not possibly have been done in that time. And when January 13 came along, if I wanted to keep my head-because there was nothing I could do after January 13, 1949, to comply with the law regarding publication-


Stanley Howard Knowles: Hear, hear.

Combines Investigation Act


Stuart Sinclair Garson: My hon. friend says "hear, hear"; I hope he is referring to the accuracy of my statement rather than the sentiment I expressed.


Stanley Howard Knowles: I referred to your head.


Major James William Coldwell: We would have given you reprieve to April 1.


Stuart Sinclair Garson: When I came here there was a great accumulation of matters awaiting my attention on my desk. I had been sworn in in November 1948, and it was my duty to attend to these matters. I could not expect anybody else to look after them. I had been away for some considerable time in these by-election campaigns. So I addressed myself to dealing with these matters on the basis of their relative urgency-and many of them were exceedingly urgent-and disposed of them as quickly as possible.
I am not going to suggest that, working at very high pressure in a number of fields for long hours every day, I can at this time remember with any accuracy at all what I did on any day or even any week in January 1949. But I think that it is highly probable that the time for publication under the statute had already expired before I ever got to the point of reading the report at all. And I say that because Mr. McGregor, upon whom I have to rely for these matters, and who is a very competent and methodical man, kept a record of the various steps which show that the first date upon which he and I discussed the matter of publication was January 22, 1949, some nine days after the time limit for publication. And my head was already worthless by that time. The offence of not publishing by January 13, 1949, had been committed.


Stanley Howard Knowles: You thought you might as well have it cut off for a sheep as a lamb.


Stuart Sinclair Garson: No, I do not agree with my hon. friend's unprincipled suggestion. I am going to outline the reasons which were to me-they may not seem to my hon. friends to be conscientious reasons-but they still seem that way to me, even in retrospect. And it was not because I thought I might as well be hanged for a sheep as a lamb.
I would like to say-and I think most hon. members would agree-that I had had nothing whatever to do with this flour report before. I was not in Ottawa when the inquiry was started. I did not know that there was such a thing as a flour report until I came here, and probably until after the time for publishing it had expired. Under those circumstances I do not think it was fair to expect that I would rush away and sign an authorization to publish, without wanting to know

what it was that the government was publishing over my signature. And if it had been possible-


Stanley Howard Knowles: May I ask a question?


Some hon. Members:: No.


Stuart Sinclair Garson: Yes, all right.


Stanley Howard Knowles: The commissioner's memorandum which the minister read asked for the minister's authority, not to publish it, but just to print it.


Stuart Sinclair Garson: No, no; it must be published.


Major James William Coldwell: The publishing is automatic.


Stanley Howard Knowles: The law requires the minister to publish it. The only point in the commissioner's memorandum was to get authority to have it printed.


Stuart Sinclair Garson: No; Hansard will speak for itself. He was referring to section 27 (5) which is the section in question requiring publication.


Major James William Coldwell: But it does not require ministerial authority to publish, does it? Under the statute it must be published within fifteen days.


Stuart Sinclair Garson: I hope my hon. friend is right, because if it does not require ministerial authority there is no responsibility upon me.


Major James William Coldwell: Except that it was held over until this month.


Stuart Sinclair Garson: No; well, if my hon. friend will just let me develop my own argument as I go along-


Major James William Coldwell: All right.


Stuart Sinclair Garson: In respect of a report, of which everyone must have known I had no previous knowledge, if it had been possible for it to have been delivered for me to read, after I had got over the press of this accumulation of duties when I got back to Ottawa, so that I would know what I was doing, I would then be quite willing to accept all the criticism levelled against me.
But here was a matter with which I had nothing to do before; I knew nothing at all about it. I came down here to a heavy accumulation of work, much of it extremely urgent; and in the mass of this material, buried somewhere, was a report and this memorandum of December 31. And when I got to the report which, as I say I am morally certain was after the time for publication had already expired, I felt: Well we could not then comply with the act and I had the feeling that I would like to read the report in order to get some sort of idea as to what it was that I was publishing. Moreover having regard to the fact that I had not

been in the government during any period covered by the report, I thought that it was reasonable that I should take it in to some of my colleagues who had been and get their views on it. If hon. members who have been criticizing me have read the report, which I think in some cases is perhaps doubtful, they will have some idea of what a chore it was for a man extremely busy in other respects to read some three hundred pages of carbon copy.


John George Diefenbaker: There is no provision for reading it, just a provision for publishing.


Stuart Sinclair Garson: I know and I could have blindly signed the authority for the publication and let it go at that.


Stanley Howard Knowles: Would the minister say whether at any point when he was thinking about this matter in January he saw anything in the law that gave him any authority not to publish it?


Stuart Sinclair Garson: No. Let us take some particular point of time, let us take January 22 when according to his memorandum the publication was first discussed by the commissioner and myself. I think both hon. members will agree that on that date it was no longer possible to comply with the act.


Stanley Howard Knowles: Your head was gone.


Stuart Sinclair Garson: My head was gone. I still think I was right, but perhaps I was wrong, when I felt that before I made a move at all I should discuss with my colleagues this report which was produced in wartime. I think the wisdom of that course made itself apparent for reasons which I shall disclose as we go along. That is what I did. Here is some of the vindication for the course that I followed. The hon. member for Winnipeg North Centre asked if this was the same report that was tabled and I said it was not.
After I got the report certain changes had been made. May I say as emphatically as I can that they were made without any instigation or suggestion of any kind by me. I did not suggest them; I did not initiate them; I had nothing to do with them. They were made by Mr. McGregor as commissioner.


John George Diefenbaker: When?


Stuart Sinclair Garson: Those that were made on page 36 of the report were made between January 3 and January 7; on January 18 three paragraphs were deleted from the manuscript that had been sent to me; on January 18, 1949, five paragraphs were added and these appear at pages 115 and 116 of the printed report; on February 23, 1949, there was an insertion which appears on page 113 of two additional paragraphs in the brief of the Maple Leaf
Combines Investigation Act Milling Company; on February 23, 1949, there was an addition of a paragraph (f) as marked in the copy and as appearing on pages 114 and 115 of the printed report.


George Alexander Drew: I should like to ask a question which may clarify things. Were these changes made as the result of discussions with and suggestions by the commissioner?


Stuart Sinclair Garson: These changes were made by the commissioner. In fairness to him I should say that when he made them he told me that it was the practice in these cases to have changes of this character made between the time the report was delivered and the time it was printed. I could understand that, with regard to some of the changes, such as those on page 36 which are more or less word changes.
But one of the changes, as it happened, was a matter of great importance because it inserted in the report a section dealing with this whole subsidy and price control arrangement which is the absolute basis of the controversy between Mr. Gordon and the commissioner under the Combines Investigation Act. That is the paragraph to which the hon. member for Rosetown-Biggar referred and which he quoted so triumphantly when he said that it was the answer to the minister's objection, meaning- myself. That was added.
The report which is the topic of discussion in this house is not the report that was sent to my office on December 29. Changes had been made, some of them being exceedingly material.


John George Diefenbaker: What was the change on page 36 to which the minister has referred?


Stuart Sinclair Garson: The words "it can only be concluded" were struck out and the words "there is justification for at least a strong presumption" were substituted. It was a watering down of the deduction.
In the first draft of the report Mr. McGregor had left out a reference to the subsidy and profit control arrangement. As the leader of the opposition correctly surmised, as a result of discussions which I had with him, based in part upon observations that were made to me by my colleagues in cabinet council as to what had taken place during the war period and of which I knew nothing, he inserted that paragraph in the conclusions dealing with the subsidy and profit control arrangement. They will be found where the hon. member indicated at page 114.
I suggest that the report was not complete; there were important omissions from it at the time that it was delivered to my office in my absence. If I had wanted to adopt an uncandid attitude, if I had wanted to mislead the
2084	HOUSE OF
Combines Investigation Act house in any way it would have been possible for me to have put the interpretation upon what had happened that I had not got the report at all on December 29, that the report had come along at some later date, as in fact is the actual case. When the question was asked in the house to be perfectly frank with the house I did not remember when it had come in. But the formal covering letter on my file indicated the date as December 29.
I passed on that information because I believed it was absolutely correct, and so it was in the sense that this letter did enclose what purported to be a flour report.


Stanley Howard Knowles: Would the minister indicate the date that he would regard for his purposes as being the date on which the report was finally received?


Stuart Sinclair Garson: I intend to do that as I go along. There were the changes that I spoke of. Other discussions took place at various times during the spring and summer months in connection with the report. Again I want to emphasize that at no time have I ever made the slightest suggestion to Mr. McGregor that he change the report, that he play anything down, that he play anything up, that he add anything to it or that he withdraw.
I have not made that suggestion directly and I have taken good care that I did not make it indirectly to be passed on to him through somebody else. By this time I was beginning to have some apprehension about this matter.


Mr. Harkness:: Rightly so.


Stuart Sinclair Garson: While I was most anxious, as I think any hon. member would be if he had been in my shoes, that these divergences of opinion at a high civil service level should be reconciled in some way in a report wherein there would be no disagreement evidenced by two divergent opinions, I did not attempt to suggest to anybody that that should be accomplished in any other way than by the free exercise by Mr. McGregor of the absolute discretion which is vested in him by the statute in respect of this report.


John George Diefenbaker: Did he never suggest publication?


Stuart Sinclair Garson: Of course he did. I have just finished telling my hon. friend we discussed that on January 22. I may say that, notwithstanding Mr. McGregor's observing that we had already passed the time for publication, the fact that we did not publish at least enabled him to make amendments to the report.


Major James William Coldwell: When was the last amendment?


Stuart Sinclair Garson: February 23, 1949.


Stanley Howard Knowles: While parliament was in session.


Stuart Sinclair Garson: That is right.


George Alexander Drew: That was after the dental judgment, was it not?


Stuart Sinclair Garson: No, the dental judgment was on February 28, and we did not hear about it until a few days afterwards.


John George Diefenbaker: Mr. Speaker, if that be so, I would just ask the minister this-


Clarence Decatur Howe: What is this?


John George Diefenbaker: I have not asked the Minister of Trade and Commerce (Mr. Howe) anything.


Clarence Decatur Howe: I happen to be leading the house at the moment. Suppose my hon. friend asks his question.


John George Diefenbaker: I was going to, but you
interrupted, and apparently interrupted my hon. friend before. The question I want to ask concerns the explanation the Minister of Justice (Mr. Garson) gave for not publishing the report, namely, the outcome of the dental case in Ontario. Why did he give that explanation when the dental case had been concluded at that time?


Stuart Sinclair Garson: If my hon. friend will just contain himself, in due course I will trespass upon his attention to bring out that very point. This is by no means a simple matter, and I think that I would make better progress if questions were not quite so frequent.


Stanley Howard Knowles: Or so pointed.


John George Diefenbaker: You might make a better explanation.


Stuart Sinclair Garson: I was hopeful until the very end, and perhaps wrongly so, that Mr. McGregor would at least record, in an addendum to the report if not in the report itself, the views of the wartime prices and trade board officials, Mr. Gordon and Mr. Taylor, which were so inconsistent with his own, in order that the report with an addendum of that sort would be a document setting forth completely all of the relevant facts concerning the matter with which it dealt. The final attempt at reconciliation of these viewpoints took the form of a lengthy three hour meeting held in my office on Saturday, October 22, attended by Mr. McGregor, Mr. Gordon and Mr. Taylor. I have been informed within the last few days that subsequent to this meeting Mr. Taylor-and again may I emphasize absolutely on his own responsibility and without the slightest suggestion from myself -went to Mr. McGregor on October 26 and urged that he should at least insert in the report an additional page or two setting forth

clearly the considered explanations and the categorical statements to Mr. McGregor by Mr. Gordon, in the meeting of October 22.
I am told Mr. McGregor was reluctant to do this, but he said he would think it over. On Saturday, October 29, Mr. McGregor telephoned Mr. Taylor and said that he was not prepared to make any changes or additions. It was only after this event that it was clear that Mr. McGregor desired to make no further changes, and I tabled the report on Monday, November 7, 1949.


Major James William Coldwell: At the request of my colleague and myself. It was not tabled spontaneously by the minister but at the request of members of the house.


Stuart Sinclair Garson: I think technically my hon. friend is right, but I hope he will accept my statement that we certainly would have tabled it in any event, because that is the case. My hon. friend is right in saying that his request preceded the tabling, but this is not a case of post hoc ergo propter hoc. At the same time we introduced the amendments to the Combines Investigation Act now before the house.
Let us now go back and cover some of the points raised by previous speakers. Let us deal first of all with the matter of the offence with which I am charged of not seeing that the report was published within fifteen days from the time it was delivered to my office cn December 29, 1948. As I have already indicated, this was physically impossible under the circumstances which I have outlined.
Nevertheless the point was raised by other discerning speakers as to why it was not published as soon as possible after January 13. That is a question which deserves the full and serious answer which I shall now try to give it.
As soon as I took the report to cabinet council, I encountered at once, as has already been made apparent in the exchanges which have taken place concerning this matter, strong disagreement not as to policy but about the facts relating to whether the acts done by the milling companies under the direction of the wartime prices and trade board were exempt from prosecution under the Combines Investigation Act. Strong exception was taken to Mr. McGregor's contention in the report that the milling companies had been guilty of an infraction of the Combines Investigation Act during wartime control. Those who professed that view seemed, in my opinion, to have good grounds to know the facts as to what the milling companies had done during this period under the direction of the wartime prices and trade board.
Combines Investigation Act They felt that it was most unfair for one department of the government to be recommending prosecution of citizens of the country in respect of what they had done to comply with regulations and requirements of another department.
When I placed the matter before cabinet council I had only one copy of the manuscript, and, although I am not certain, I think I had the press report to which I have referred before, which was not made available until later on, certainly well beyond the publication period. I loaned either of those documents- I am not sure which-to the Minister of Trade and Commerce (Mr. Howe) in order that he could check it with his officials.


John George Diefenbaker: What date was that?


Stuart Sinclair Garson: I could not even give the week, but I would think it would be around the latter part of January or in February. In due course my colleague reported that he had consulted his officials and they had strongly confirmed his own recollection of the facts.
Once this cleavage of opinion became apparent and was established it seemed to us we could have done one of three things. We could have published the manuscript at once as an official report, without comment, though of course that would not have complied with the act because the time for publication had already expired. Moreover, it seemed to us this would not be a proper course because the publication without comment would have implied an endorsation of the report by the government, which would have been quite inconsistent with the view held by some members of the cabinet that as to its facts the report was incomplete and misleading.
This course was particularly unacceptable to the Minister of Trade and Commerce (Mr. Howe), who insisted upon making a statement coincident with the publication of the report repudiating it as far as he personally was concerned. He felt that if he did do this he would appear to the whole business community of Canada, whose co-operation he had sought and received in full measure during the period of war control, as a treacherous double dealer who had led them into a course of conduct only to turn around and betray them. If a statement of that sort had been made obviously it would have made prosecution difficult if not impossible and, incidentally, would have left the combines investigation commission rather under a cloud.
On my part, while I fully appreciated the difficulty of my colleague, I did not feel
2086	HOUSE OF
Combines Investigation Act prepared, in the face of my own responsibilities as Minister of Justice, to have the report publicly condemned in this way until we had made a most careful check to determine whether or not the government should accept it and prosecute on it. I have to confess with some embarrassment now that the facts, which we have checked, proved to my satisfaction at least that the Minister of Trade and Commerce was quite right in the position he took at that time; and if we had followed the course he recommended, of publishing the report and having him make this statement, we would have avoided some of the difficulties that have ensued, though I believe we might have met with others. But with the knowledge I had before me at that time I felt my duty was to support the report of my officials until it was proved to be incomplete. That was what I did; and my colleagues, including the Minister of Trade and Commerce, backed me up in this course. It is regrettable that my action in standing up for this report has proved so embarrassing, but one can only be wise in the light of facts known at a particular point of time. Even in retrospect it still seems to me that it was my duty to support the report, on the information I had at that time, especially when there was no chance then of complying strictly with the requirement as to publication.
The second course we could have followed was to publish the report with a statement- a true statement, if you like-that the government was sceptical about certain aspects of it; that we were going to check those aspects and that in due course, when we had finished our checking and had found out what were the true and complete facts, we would publish them and report to the house. If we had made such a disclaimer, does anyone suppose it would have strengthened the hands of the combines investigation commission or added to its prestige? No matter whether our checking had proved the commissioner in the right, the fact that we had advertised to the world our doubt concerning it and concerning him would have had an adverse effect upon the combines investigation commission.
The third alternative was the course we followed, to delay publication-which had already passed the statutory period of fifteen days-until we could check the facts so that when the report was published the government would be able to state definitely its position in regard to it. Moreover, and I think most hon. members will sympathize with this view, we were naturally most anxious to adopt a course which all members


of cabinet would feel they could support; and we agreed that the first requisite was to learn whether the full facts, when ascertained, would support the views held by some members of council, or whether they would support the report, in which event we could publish it and prosecute.


Stanley Howard Knowles: At about what time was that agreement reached by cabinet?


Stuart Sinclair Garson: Well, I could not pretend to tell my hon. friend.


Stanley Howard Knowles: February? March?


Stuart Sinclair Garson: I could not say even roughly. There were several meetings, and I would not be telling the truth if I even attempted to say at which meeting this precise position was reached.


Stanley Howard Knowles: But it was probably while parliament was in session and before the election campaign?


Stuart Sinclair Garson: I would not say as to that. Well, Mr. Speaker, it took some time to get at those facts, but again I contend there was no lack of diligence on my part. Consistent with the other duties which had to be performed, we brought this matter to a conclusion as soon as possible. We wanted to reconcile the conflicting views of our public servants if that could be done. If it had been possible to handle the matter in any other way I did not want to do what I was finally forced to do, have high-ranking public officials confront each other in a highly controversial way, which could have had an adverse effect upon the morale of a department of government. So we took a good deal of time trying to resolve the matter without resorting to this hazard.
A few moments ago the hon. member for Lake Centre (Mr. Diefenbaker) raised the question of the bearing of the court of appeal judgment in the dental supplies case upon this whole matter. I said I would deal with that question, and I propose to do so now. One of the facts which influenced me in giving priority to other matters than bringing this particular question to a conclusion was that the combines investigation administration had suffered a severe defeat-there is no gainsaying that fact-in the dental supplies case in March, 1948. The case had been withdrawn from the jury by the trial judge on the ground that the crown had not even made out a prima facie case. In course of time, on February 28, 1949, the Ontario court of appeal rendered a unanimous judgment against the crown, which was a body blow to the enforcement of the act in respect of any future reports, including the flour report. In this or in other debates some hon.

members, including the hon. member for Lake Centre, the hon. member for Calgary West (Mr. Smith) and others, have asked why the crown did not appeal this case. The reason was that since the affirmation of the acquittal by the appeal court was unanimous, under the Criminal Code as it stood at that time it was not possible to carry an appeal to the Supreme Court of Canada.


John George Diefenbaker: Is it not a fact that an appeal would be allowed in the event that there was any other judgment of a superior court, such as the minister said the other day there was, under which evidence had been admitted under similar circumstances?


Stuart Sinclair Garson: I think my hon. friend is confusing the principle of the dental supplies case with that of the tobacco case. That was the basis of the refusal of leave to appeal in the tobacco case, on application to the Supreme Court of Canada. In the dental supplies case there was at that time-it has since been changed-a provision in the Criminal Code which explicitly stated that where the appeal court affirmed an acquittal unanimously it was not possible to appeal. So we were blocked off from any appeal.
The result was that the dental supplies case was lost; but that was not all. Worst of all the court of appeal, in affirming the acquittal, enunciated what I must contend, notwithstanding the views of the hon. member for Lake Centre, was a somewhat new doctrine of corporate possession, which in cases under other reports, such as the flour report, would make it extremely difficult to use effectively the documents seized in possession of the accused corporation in order to make out a case against it. Until the effect of this judgment had been cured by legislation, our position in respect of the flour report was one of uncertainty not only as regards the facts as to which the public servants were in dispute, but as regards also the law applicable to those facts as well. Had we been challenged to prosecute-and regardless of what may be said, the fact is that I was credibly informed by a most reliable informant that we would be-then to say the least we would be in a most awkward position to accept such a challenge either before or after the date of the judgment of the Ontario court of appeal. Before that judgment of the court of appeal was delivered, the judgment of the trial court was against us; and after the judgment of the court of appeal was delivered, the judgment of the court of appeal itself was unanimously against us and we could not appeal. It is of course the effect of this judgment that we are trying to cure by the amendment now before the house.
Combines Investigation Act
We tried to get this amendment prepared in time for presentation to the session last spring; and as I have already stated in another debate, the first draft that the combines investigation commission were able to lay before me was dated April 7, 1949. The matter is of considerably more difficulty than appears on the surface. We considered no less than ten drafts before we brought down the bill which is now before the house. Thus it was quite impossible to get the final draft ready until some time after the beginning of the present session. As matters then stood there was no advantage to the public interest in publishing the report until we could clear up the disputed facts and introduce into the House of Commons this amendment to the Combines Investigation Act in order to neutralize the effect of the judgment of the Ontario court of appeal in this dental supplies case. Accordingly we decided to bring down our amendment to the act, to publish the report and to make the government's statement concerning it at about the same time; and that is what we have done.
Incidentally, Mr. Speaker,-and this deals with another question which has been raised -the tabling of the report on the flour-milling industry on November 7, 1949, complies with technical strictness with the requirements of section 27, subsection 5, in that the report which is now before the house was tabled within less than fifteen days from the time I received it from the commissioner in its final form. I did not have it at that interview on October 22; I remember that quite distinctly because Mr. McGregor had a copy there with him and offered to leave it with me; I suggested to him that there was no purpose in his leaving it at that time and he made a quip about it. I want to be perfectly candid with the house. I was under the impression that I had not had it before. To make doubly sure, I telephoned Mr. McGregor today and he later advised my secretary by telephone that he thinks he sent me a printed copy because he has a memo to the effect in his own handwriting on his own file. I did not have time, before the house met this afternoon, to check upon that fact. Certainly I received no formal letter forwarding the printed report to me and certainly the report which I laid on the table of the house was placed there by me within fifteen days after I received it, as one as to which I was sure that there would be no further amendments by Mr. McGregor.
In this whole matter we deny that we recklessly disregarded parliament and the statutory requirement of publication within fifteen days. On the contrary, we took both of these matters into the most careful consideration,
457S1-132

Combines Investigation Act not discounting their importance in any way. When I listened this morning to the interpretation which the hon. member for Greenwood (Mr. Macdonnell) put upon our actions, that this was a dastardly conspiracy against the very constitution of our country, I thought that in giving such a judgment as that, he might perhaps have been charitable enough to wait until I had had an opportunity, with sufficient time at my disposal, to give an extended explanation of the position in which we found ourselves. I think that he would agree, in respect of the actions that have been taken honestly, conscientiously and with great concern as to their nature and effect in connection with this matter that, whatever they may be, they do not constitute a dastardly conspiracy to attack the constitution of the country.


James MacKerras Macdonnell: I am sure the minister wants to be fair. I would ask him not to use the word "dastardly". I did not use the word "dastardly".


Stuart Sinclair Garson: My hon. friend does not withdraw the word "conspiracy".


James MacKerras Macdonnell: No.


Stuart Sinclair Garson: I suggest that most conspiracies are dastardly.


James MacKerras Macdonnell: You can
speak as an expert.


Stuart Sinclair Garson: Any delay in publication here was not, as has been suggested, any secretive or cynical disregarding of the law or of parliament by two or three ministers. Whatever delay there has been has ensued after it was no longer possible to comply with the provisions of the act. It was a most conscientious balancing by the whole cabinet in several cabinet meetings of these considerations that I have been endeavouring to lay before the members of the house. The truth of the matter is that if Mr. McGregor meant to change his report in the material particulars in which he did change it, he should not have delivered it to my office officially, in my absence, until he had got it into the form in which it was to be when published. What we were concerned with was to get in the report a complete statement of the facts, to clarify the law by the amendment now before the house and to be able, in connection with this particular report, and when publishing it and tabling it, to state what the position of the government was upon it.
This was no routine Combines Investigation Act report at all. The issue here was whether the government, on the first occasion on which this matter has arisen since the cessation of the war, was going to pillory and indict businessmen in the milling industry, under the

Combines Investigation Act, for doing what some members of the government believed, and what both chairmen of the wartime prices and trade board believed, that the government had directed them to do under that board. More than that it was a question whether we were going to pillory and indict these men blindly without checking the completeness of Mr. McGregor's statement of the facts which he himself, as it now appears, has partially corrected. Here was an industry in which the government had intervened during the period of wartime control. The government had fixed the ceiling price of its finished products while letting the price of its raw material, wheat, rise.
To offset this, the government proposed a subsidy, based in part upon a rigid control of the milling industries profits. The government insisted that in that connection the industry would have to leave not only its domestic profits in the pool but that it also would have to pool all of its export profits. The government called upon this industry to supply ships' stores and other government departments with its products. For these purposes government through the wartime prices and trade board had exercised continuous supervision and direction of its activities. The objectives to which its actions were directed could not possibly have been achieved without the most ungrudging cooperation and without complete confidence of the industry in. the good faith of this government. Therefore it seems to us that as long as the industry had complied with the directions of the wartime prices and trade board it would be an irresponsible and unfair action by the government, without the most careful consideration, to publish a report representing what the industry had done while operating under that board as a systematic series of breaches of another statute, namely, the Combines Investigation Act. This impression would be heightened by the fact that during this time Mr. McGregor remained the Combines Investigation Act commissioner and also acted at the same time as the enforcement officer of the wartime prices and trade board. Those of us who know Mr. McGregor know perfectly well that he would be the last man ever to take advantage of any such dual capacity. But you could not blame people in the business from thinking that some advantage might have been taken of that fact; just as those who impute to us motives in the discharge of this unpleasant responsibility have mentioned a variety of incredible motives. They say-it was said this afternoon by the horn member for Greenwood

(Mr. Macdonnell)-that but for the resignation of Mr. McGregor we would have suppressed the report entirely.


James MacKerras Macdonnell: I want to correct the minister. I said that that was reported, and the government need not be surprised if all kinds of reports were made in view of the action that they took. I did not say it myself. I said it had been said.


Stuart Sinclair Garson: My hon. friend quoted it with disapproval, but quoted it.


James MacKerras Macdonnell: That is
correct.


Stuart Sinclair Garson: Let us look at this suggestion. If we were going to suppress the report entirely why would I go to the hon. member for Vancouver East (Mr. Maclnnis), as he quite rightly said that I did, and ask him to withdraw his question concerning the flour report-thereby admitting that such a report existed-until I was in a position to bring down the report and this amending legislation at the same time. True, my estimate as to the time in which it could be brought down was, shall I say, unduly optimistic; but why would I ask him that question at all if we were going to suppress the report? Moreover, sir, the fact that the flour report was in the offing was no secret. Mr. McGregor referred to it in his evidence before the prices committee in 1948 and there were references in the press to this report as far back as the spring of 1948. To suppress it would have been an utter impossibility.


John George Diefenbaker: Was not the reference to the investigation, not the report, in February or March of 1948?


Stuart Sinclair Garson: No, it was a reference to the flour report itself in preparation. As I say, to suppress it would be impossible. But, sir, that was not the point. The point was that before the government published what could very well be regarded as a serious attack upon business confidence in the good faith of the government-and when I say "government" I do not mean just this government, I mean government generally-it was under an obligation in the public interest to know its own position and coincident with that publication announce that position so that no person would be pilloried and indicted in respect, of co-operating with the government in wartime controls which owed their success in large measure to that very co-operation.
During this debate it has been asserted that the government is responsible to parliament and that it should in its action take proper cognizance of this point. No person will quarrel with that view-certainly we do
Combines Investigation Act not. True, there was some delay. Delay in respect of what? Delay in respect of what turned out to be-I am talking about the statutory delay now in getting it printed in time-a manuscript which was changed five times by the commissioner himself before it became the report that we have before the house at the present time.


Major James William Coldwell: What was the last date on which it was changed?


Stuart Sinclair Garson: February 23, 1949, which, if I may point out, was a matter of about a month and a half after the date on which my head should have rolled in the sand, because the report was not published.


Major James William Coldwell: And eight months before it was tabled?


Stuart Sinclair Garson: Yes, that is right. I have explained the reason for the delay in the intervening period. We have published the report. We have made our statement concerning it at the time that it was always intended that it should be made, coincident with the publication of the report, and at the same time we have placed this amending legislation before parliament. It was on the second reading of this amendment that my hon. friend, the leader of the opposition (Mr. Drew), moved his amendment to the motion for second reading which I suggest is, in its substance, a motion of want of confidence in this government. While it is important, sir, that the government should be responsible to parliament and should respect parliament, parliament should respect the functions of government. One of the most important of these functions is that the government, as long as it remains the government and continues to retain the confidence of the House of Commons, should have the right to make government policy.


George Alexander Drew: But not change the law?


Stuart Sinclair Garson: No. My hon. friend is quite right. When parliament, lacking confidence in the government, interferes with the government's making of government policy, then the only course that the government can follow is to resign.
The bill now before the house represents government policy. The leader of the opposition made what I regarded as an attempt to indicate that it did not represent government policy; but by interjection I think I made it quite clear that the bill now before the house represents the government policy and the whole of government policy in this matter of the Combines Investigation Act amendment now before us.

Combines Investigation Act
In respect of this motion for second reading my hon. friend moved:
That the said bill be not now read the second time but that the subject matter thereof be referred to the standing committee on banking and commerce with instructions that they have power to send for persons, papers and records and that in addition to other recommendations with respect to the subject matter of the bill they shall also have power to report upon the extent to which the effective administration of legislation relating to restrictive trade practices has been, or is being, prejudiced by the action of the government . . .
And so on. The point that I make there is that when it is proposed to send the subject matter of this bill to a committee of parliament it means that a committee of parliament is being directed to make policy for this government. If that is not a motion of want of confidence then, sir, I do not know what it is.


George Alexander Drew: Mr. Speaker, perhaps it might assist us to understand this extraordinary argument if we were told in what way this differs from the reference of any other matter to any other committee of parliament.


Stuart Sinclair Garson: Well, I am not suggesting for a moment, Mr. Speaker, that it does differ from sending any other matter to a committee. What I do suggest is that when the government of the day brings down a bill in which is set out government policy in respect of the subject matter of that bill, a motion to send the subject matter of the bill to a committee of parliament in order that a committee of parliament may work out policy in respect to that subject matter it is in substance, if not in form, a motion of want of confidence.
I have detained the house at great length. I have done so, amongst other reasons, in order to convince the hon. member for Greenwood (Mr. Macdonnell), and some of his colleagues, that we were attempting to make a serious answer. He was objecting to the fact that we had not made a serious answer to any of the charges.


James MacKerras Macdonnell: To the point I raised.


Stuart Sinclair Garson: And I have spoken at some length on that account, attempting to deal, point by point, with those which have been raised.
I should like to close with the suggestion that I think there is nothing the parliamentary committee could bring forth with regard to this matter that we do not already know. The flour report speaks for itself. The memoranda of Mr. Gordon speak for themselves. There has been a very full disclosure of all the relevant facts. I do not think for one moment that the divergence of opinion between high-ranking public servants can be
'Mr. Garson.]
resolved by the committee. That being so the only purpose a reference would accomplish would be to delay the matter. And, sir, for our part we are anxious to get on with the prosecution of the bakeries report, and we would urge that the motion in amendment be voted down.


George Alexander Cruickshank: I was paired with the hon, member for Medicine Hat (Mr. Wylie). Had I voted, I would have voted against the amendment.


Mr. Homuth:: I was paired with the Minister of Labour (Mr. Mitchell). Had I voted, I would have voted for the amendment.


John George Diefenbaker: Mr. Speaker, in the few minutes before six o'clock I intend to deal with the defence raised by the Minister of Justice (Mr. Garson) for his failure, which is shared by the government, to carry out the provisions of section 27 of the Combines Investigation Act. The minister spent well over two hours in a courteous discussion of the issues, and after the two hours had elapsed all one could conclude was that the minister pleaded guilty, with extenuating circumstances. It was fairly obvious,-and as I listened to him I sympathized with him,-that he realized what he had done was unjustifiable, inexcusable and a contravention of principles going back to the Bill of Rights, which declared among 45781-133
Combines Investigation Act other things that no government or executive can suspend the law of the realm in any particular without parliament.
While it was the voice of the Minister of Justice that spoke to the house, the failure of the government to carry out the provisions of the statute was clearly indicated to have been by reason of the directing hand of the Minister of Trade and Commerce (Mr. Howe). We have had a revised version of explanations given to us, as an addition to a number given previously. It is a strange thing that a new type of explanation should be produced, namely, there were so many revisions of the report of the commissioner of combines and that because of that fact while there was an appearance of failure to live up to the law, in actuality the law was complied with. That is the revised version; that is the last version.
We have had several prior to the latest, and first explanations are often closer to the facts than later ones. On October 29, 1949, Mr. McGregor wrote in part as follows:
One of the principal remedial measures provided by the Combines Investigation Act is the publication of reports of investigations. The withholding for so many months of publication of a report which the act requires shall be made public as soon as possible after its receipt ... is one illustration of the tendencies I have in mind.
Would you not have expected the minister to have given the explanation he gave in his reply? That was not his explanation on November 4 in his letter to Mr. McGregor. His explanation on that date was:
The government decided not to publish the report or act upon it until the doubts raised had been cleared up. Moreover in view of these doubts and of substantial increases in the difficulties of prosecuting created by the judgment of the Ontario court of appeal . . . we felt that if we published the report and' were challenged to prosecute upon it, we might not be able to make out a case . . . The government therefore took the responsibility of withholding publication of your report pending the amendment of the Combines Investigation Act . . .
He was challenged in the house by the hon. member for Winnipeg North Centre (Mr. Knowles) as to what justification he had for failing to carry out the law. I had asked the same question not long before, and the minister had replied that he could not give me any further information than he had already given. Finally he answered the hon. member for Winnipeg North Centre by saying, in effect, "Well, we got elected, didn't we?"


Stuart Sinclair Garson: Oh, no. If my hon. friend wants to quote me, let him do it accurately.


John George Diefenbaker: Pardon?


Stuart Sinclair Garson: If the hon. member wants :o put words in my mouth, let him put t) e right ones.

Combines Investigation Act


John George Diefenbaker: The hon. member for Winnipeg North Centre asked, at page 1524 of Hansard:
Will the minister tell the house on what authority the government relied when it made the decision to violate the provisions of section 27 (5) of the act?
The reply of the minister was:
Well, Mr. Speaker, it relied upon the fact that any democratic government is answerable to the people of the country for its acts.


Stuart Sinclair Garson: Has that anything to do with an election?


John George Diefenbaker: Pardon?


Stuart Sinclair Garson: Go ahead.


John George Diefenbaker: I am going ahead. I trust my hon. friend is not going to offer a revised version of what he said on November 7. He went on:
I am going to answer my hon. friend's question, if he will give me a chance. It is perfectly clear that if an election were held tomorrow, as there will be an election in due course, we would have to go before the free people of this country and answer for our actions. I have no doubt my hon. friend would get up and anathematize us.
That was a good word. Later he went on:
And we would have to answer; then the people would decide. As long as that condition exists I do not think we need worry very much.
What a proposition to advance; what a statement for a minister of the crown to make as a reason for breaking the law, that under our democratic system ultimately there will be an election! That is no justification. Indeed, if anyone in this country had known during the ten months' period that the minister had broken the law, as he did, His Majesty's courts could have been applied to in order to protect His Majesty's subjects, under a writ of mandamus, which would direct the minister to live up to the law. He concealed the report, and one explanation is this: we did not agree with the terms of the report. Is there anything in section 27 of the act that gives the government discretion to say they may break the law because they do not agree with the terms of a report; that they may break the law because after consideration, even honest consideration, they feel it should be broken? If that be an excuse for breaking the law, how many people in this country would feel like breaking the income tax law, or any other laws passed by parliament? Expediency, or the desire to prevent argument between high civil servants, afford no excuse in extenuation or otherwise for what has taken place in connection with this report.
No answer was given the question of who gave Mr. Gordon authority to place any body


of people in this country above the law. What minister gave that authority? Certainly it could not have been Mr. Ilsley, the then minister of finance, who was in charge of Mr. Gordon's department; for Mr. Ilsley knew that these proceedings and investigations were going on under the combines act. He knew what Mr. McGregor was doing, and there is no suggestion that he told Mr. McGregor he ought not to proceed as he was proceeding. The law provides that any report of the commissioner, other than a preliminary report, shall within fifteen days after its receipt by the minister be made public, unless the commissioner states in writing to the minister that he believes the public interest would be better served if this were not done.
My hon. friend says he waited until the facts were investigated. He waited from January to October, to bring together Mr. McGregor and Mr. Gordon, the holders of divergent points of view. Why that long wait? And in nothing that has been said has there been even the suggestion of an apology to parliament for this most serious disregard of the law. There has been no apology either by the minister or by any other member of the government, including the Prime Minister (Mr. St. Laurent). How often has the right hon. gentleman, speaking to the Canadian Bar Association, referred to the rule of law with all the power of advocacy of a great counsel. How often has he referred to the rule that assures equality of all under and before the law? Where was that equality between January and November, 1949?
This is not a question of the guilt or innocence of these companies. No government had to punish anyone, or to proceed against anyone on the report of a combines commissioner. When I asked Mr. Ilsley that question in 1948 he replied in effect that the minister when he receives a report is not bound to prosecute. The minister says one reason the government did not publish the report was that they thought the facts were wrong. Well, were the facts wrong in the international cartels report? Some members of the house thought they were, but the report was published. They may say what they will, Mr. Speaker, but no one on the part of the government has yet explained what authority justified the action of the government in saying in effect that: "There is one law for those on the front benches. That is the law of expediency, a law which applies to no one else. We can break the law; we can refuse to carry out those duties we are required to carry out under a mandatory provision."
At six o'clock the house took recess.


[Stage Direction]
AFTER RECESS

The house resumed at eight o'clock.


[Stage Direction]
The house resumed from Tuesday, November 15, consideration of the motion of Mr. Benidickson for the second reading of Bill No. 119, to incorporate Prairie Transmission Lines Limited, and the amendment thereto of Mr. Church.
Douglas Scott Harkness: Yesterday, Mr. Speaker, we had a considerable amount of debate in connection with whether the time should be extended at this sitting to consider this bill and another one which calls for the granting of a charter to a pipe line company. A considerable number of reasons were put forward yesterday as to why this should be done. To a plain man like myself, the thing that stands out is that the basic and essential reason why a change in the rules of the house was proposed by the government was a definite desire on their part that these two bills should go through.


Mr. Speaker:: Order. Yesterday the house decided to extend the time for private and public bills. That is a decision of the house and it cannot be debated again. The question now is on the amendment of the hon. member for Broadview (Mr. Church).


Douglas Scott Harkness: I was not questioning the decision of the house, Mr. Speaker. I was merely observing that to one like myself who is not, and does not pretend to be, particularly well versed in the works of Beauchesne, Bourinot, May and the other authorities on parliamentary procedure, in spite of the rather fancy reasons which were put forward as to why that action was taken to change the rules of the house in this particular case, a thing which had not been done within the memory of anyone in the house, as far as I know-


Mr. Speaker:: Order. I must remind the hon. member that it is not in order to discuss that ruling, and he is discussing the ruling. I would ask him to direct his remarks to the amendment which is now before the house.


Douglas Scott Harkness: I am sorry, Mr. Speaker, if I was discussing the ruling. I did not think that I was doing so. As a matter of fact, I was addressing my remarks really to the purpose for which this change in rules has been brought in.


Mr. Speaker:: That, of course, is not in order. It is not in order for the hon. member to do so.
Prairie Transmission Lines


Douglas Scott Harkness: I bow to Your Honour's ruling, and I will say no more on that particular subject.
To address myself more specifically to this particular bill, during the debate on this bill and the similar one, the idea has been put forward by the Minister of Trade and Commerce (Mr. Howe) and others that it does not really matter how many charters we grant to build pipe lines, that we might as well grant a charter to any company that applies for the right to do so as long as they can prove bona fides and that they can raise the money to do so. I disagree entirely with that idea. I think that we in this parliament have a responsibility in the matter of granting these pipe line charters. If the general Pipe Lines Act under which we are granting these charters had not been drawn up with the express idea that it was necessary for a company who wishes to build a pipe line to apply to this house for a charter, and if that act had not been put through with the provision in it, then it would not be necessary for these pipe line companies to come to this house to secure a charter. But the act is through, and these companies are obliged to come here to secure a charter. I therefore do not think that we can adopt the point of view or the attitude that any group of men who apply for a charter should be granted it as long as they can show financial background for the thing. As a matter of fact, I think we must look upon any application for a charter from the point of view of whether the granting of that charter is going to be in the best interests of the country as a whole, of the particular area in which the gas is produced, and the area which is going to be served by the pipe line which it is projected will be built.
The purpose of this particular bill is the same as that of the other one on the order paper, on which I spoke for some forty minutes two or three weeks ago. I do not want to repeat the arguments which I advanced at that time against the granting of a charter to that particular company. There are, however, a few other matters to which I should like to draw the attention of the house.
Having regard to the granting of a charter to any company, I think one of the most important considerations is the route which is going to be followed. The sponsor of this particular bill, when he moved its adoption, at page 1344 of Hansard, is reported to have said:
I wish to make it clear that the passing of this bill does not in any way establish routes for the transmission lines for this company. As I say, as far as federal jurisdiction is concerned, under the

Prairie Transmission Lines direction of this parliament it was ordered in the last session that routes must be decided upon by the board of transport commissioners. I think hon. members are also aware that public interest is additionally protected in that the province of Alberta has established most effective control now of its natural resources in the form of oil and natural gas.
Then at page 1345 he is reported to have said:
I should like to inform the house that the bill has nothing to do with routes.
In that connection I should like to put on record what this company had to say in the matter of routes when it first applied for its charter. I have here a small clipping from the Calgary Herald of August 11, 1949, which reads as follows:
Notice of application to the parliament of Canada for a private bill.
Notice is hereby given that an application will be made to the parliament of Canada at the next or the following session thereof for a private bill incorporating a company under the name of Prairie Pipe Lines Limited or in the alternative Prairie Transmission Lines Limited or such other name as parliament may grant for the purpose of acquiring, constructing and operating pipe lines to transport or transmit natural and artificial gas and oil in the provinces of Alberta and British Columbia commencing at a point in the general Calgary area in the province of Alberta and thence to a point in the vicinity of Blairmore in the said province and thence to a point in the vicinity of Kingsgate in the province of British Columbia and thence to the United States of America, leaving Canada at a point at or near Kingsgate in the said province of British Columbia and re-entering Canada in the vicinity of Blaine in the state of Washington and proceeding north to Vancouver area in the province of British Columbia, subject to the provisions of the Pipe Lines Act.
Dated at Toronto, Ontario, this 4th day of June, 1949.
J. G. Edison,
Solicitor for the applicants, 907 Victory Building, Toronto, Ontario.
I should just like to say further that Blaine, which is mentioned there, is straight south of Vancouver. In other words, this company, whose charter is now up for us to pass upon, as far as this house is concerned, in their original application to this parliament outlined the route, and they left no doubt whatever what that route was. The route was to go into the United States really at the nearest point possible to take it into the United States from the Pincher Creek gas field in southern Alberta, thence to travel through the United States, and then they were going to have a branch line up to Vancouver from Blaine immediately south of Vancouver.
It is quite true that the route was not mentioned when the bill actually came before us in the house, but I think a reading of this notice of application which the company made in the first instance is sufficient proof
that their purpose and their idea is to build a pipe line which is going to travel through the greater part of its length in the United States of America.
In spite of what the mover said to the effect that the granting of this charter had nothing to do with this route, we have to keep very much in mind the matter of what route the company does propose to build its line over. It seems, Mr. Speaker, as a matter of fact, that the question of route is perhaps the most important consideration so far as the pipe line charter is concerned.
A considerable number of arguments have already been put forward in the house along this line, that a pipe line company should include in its application the route which it is to follow in the same way as a railway company does. With that I agree most completely. I do not think that this parliament should pass any pipe line bill, or grant any charter, unless the route or approximate route is outlined.
Essentially the situation is this. At the last session of parliament a pipe line or a pipe line charter to take gas to the Pacific coast was granted. It is quite true that that charter contained approximately the same words as the one now before us. The route was not outlined. However, when that charter was discussed in the committee at that time- and it is quite true that it was given a cursory examination there-it was late in the session. There was no time to go into the matter in the detail that it should have been gone into. In any event, the projected plans of that company were outlined to the committee. It was definitely established that that company intended to put, and it secured the charter for the purpose of putting, a pipe line from the Peace river country down through the interior of British Columbia to Vancouver, and extending a line from there on to the Pacific coast cities of the United States.
Probably if we had not been in such a rush at that time the considerations which have been brought forward in the debate on this bill and the other pipe line bill would have come out then. Probably no charter would have been granted unless the route had been included in the application of the company. The fact that that was not done is no good reason why it should not be done now and in the future. As I have indicated, this company actually did establish before the committee that their purpose was to build a route entirely within Canada. As far as the company with which we are dealing is concerned, as the notice of application which I have read indicates, their purpose is not to build it in Canada; it is to build the main part of the route within the United States.

I understand the company has indicated that they are prepared to build a line through the southern part of British Columbia entirely within Canada if it is necessary to get the charter. It seems to me, Mr. Speaker, in view of their original application, their purpose is to build a line as they have indicated. From what I have been able to gather I do not think they have surveyed any route in the southern part of Canada close to the United States-British Columbia border. I doubt very much whether the building of a pipe line through that area is a practical proposition. I think that it would have to go considerably north of that to get country through which they could go with any degree of ease. In this connection I should like to point out that you cannot build a pipe line without a road. Judging from the two or three summers that I spent in that area of southern British Columbia I do not think any roads exist along the lines that I understand this company have said they would build their line. I do not think it would be a practical proposition for them, or for any other company, to construct roads there, which again is necessary, to enable them to build a pipe line. Therefore it seems to me that this is an application essentially for a pipe line to run its greater length through the United States, and to that there are serious objections.
Discussing this bill or the other bill-I do not know which it was-the Minister of Trade and Commerce (Mr. Howe) said that he was all in favour of a pipe line which ran through Canadian territory and that he would ensure that Canadian interests were served first in granting a permit to any company to export gas and so on along that line. I do not think that an assurance of that kind is sufficient for us who are granting the charter to set aside the considerations I have mentioned and then let the thing slide. After all, the Minister of Trade and Commerce is not going to be in his present position forever. It should not be a matter of accepting his assurance that he will see that no permit is granted unless Canadian interests are served first. The general objections to a pipe line, the greater part of whose length runs through the United States from Alberta out to the Pacific coast of Canada or the Pacific coast of the United States, I outlined when I was speaking on the other pipe line bill some time ago, and I do not want to repeat what I said then or go over the matter in detail; but I should like to summarize some of the reasons. The first is that with such a pipe line the minimum number of people will be served in British Columbia and Alberta. That of course is self-evident. If you run a line through only
Prairie Transmission Lines a small section of Alberta, the southern part of it, and a small section of British Columbia so that it crosses to the United States, and then run it back up straight south of Vancouver, it is quite clear that you are going to serve far fewer people than if you ran its entire length on Canadian territory.
Second, it will not result in any development of the northern parts of Alberta and British Columbia. In northern Alberta and in northern British Columbia there are large regions which are sparsely settled and require roads and power.


Mr. Murray (Cariboo):: And railways.


Douglas Scott Harkness: And railways, somebody said. One of the ways in which those areas can be developed is by building a pipe line there. The construction of a pipe line from the Peace river area in Alberta through the Peace river block in British Columbia, and thence on down to Vancouver, would open up a large track of land which at the present time needs development. It would provide power in that area, and as a result would attract large numbers of settlers.
The very building of the pipe line would cause the construction of roads, one of the great necessities in that area. I think probably it would lead eventually to the construction of a railway, or railways. The third important consideration is that if the main part of the construction were in the United States a great deal of the wages and employment for the construction of the pipe line would be paid to American workmen in American funds. In other words it would mean a great deal less employment in this country and less money in circulation. And after a line is built, of course there must be people to maintain it. Similarly if the greatest length of the pipe line is in the United States the people maintaining it will be Americans. The wages paid will be spent in the United States, and we shall derive no benefit at all.
Another consideration is that no impetus is given to the development of manufacturing industries in this country by the construction of a pipe line, most of the length of which lies in another country. I am given to understand that if the line is built chiefly in Canada it will cause the construction of at least one steel rolling plant and one plant for the manufacture of fittings and various sorts of valves. All of this would increase the amount of employment and the amount of money in circulation here, in addition to which it would save large sums in American exchange.
One other important consideration is that if the pipe line is built entirely in this country

Prairie Transmission Lines until it reaches a point beyond Vancouver, the surplus gas will go on to Seattle, Tacoma, Portland and other points. The cost of the gas would be less in Vancouver and other Canadian points than in American points because they, at the end of the line, would have to pay a greater transportation cost. If the main line is built through the United States the opposite is the result. The cost of the gas would be greater in Vancouver and adjacent points in British Columbia than in American points to the south.
Allied to that is another fact. If the entire cost of transportation is added to the cost of the gas, so far as American consumers are concerned, in this way there is provided a certain amount of protection for Canadian manufacturers. They get their gas at a cheaper rate and therefore can manufacture more cheaply. The most outstanding example of that, one which I mentioned before, is the nitrogen or ammonia plant at Calgary, which is the greatest user of natural gas in that city, using as much as the entire city uses. At the present time it manufactures fertilizers which are sold in the United States. If a gas line could be built there, from the projected main source of supply, the Pincher Creek area, immediately across the border a similar plant could be constructed, just a short distance across the boundary line on the American side.' They could manufacture ammonia as cheaply as we can at the plant in Calgary, and perhaps more cheaply. Naturally they would have no duty on their product.
For all these reasons it seems to me that this and the other pipe line bill should not be passed by parliament until we have had written into those bills the routes they are to follow. And if those routes so written in are not all-Canadian routes, then I believe the bills should be turned down.
I would reiterate what was said by the hon. member for Calgary West (Mr. Smith) a few nights ago when he said that so far as he was concerned any bill which contains within it a route which is an all-Canadian route he is prepared to support. I am in exactly the same position. I am prepared to vote to give a charter to any company which shows that it is able to go ahead and construct a pipe line, and which is going to follow an all-Canadian route. They have surveyed it and have given some indication that it can be followed successfully.


George Matheson Murray: Mr. Speaker, as a representative from the Peace river area of British Columbia I believe I have a right to make some comments at this time. Within the boundaries of that riding are many gas wells, and fair prospects for the development

of oil wells. Be it said for one of these companies that it has shown enough confidence in the country to go in there and set up drilling outfits, and to establish great resources of natural gas.
The interest, therefore, of our people is, first, that these resources be used right in the vicinity, in the towns of that neighbourhood-Dawson Creek, Fort St. John and Prince George, all of which are flourishing centres. We live in the north where the winters are long and the weather is cold. We need cheap fuel. Nature has been generous in giving the Peace river country these resources of oil, natural gas and coal.
It seems to me the House of Commons is wasting a great deal of time in the discussion of these bills. I am reminded of the hunter who sold the hide of the bear while the animal was still at large in the woods. Our time here should be spent not in incorporating this or that company for the purpose of establishing pipe lines, but rather to encourage the drilling for oil and gas up in that northern part of British Columbia, so as to create new payrolls, new industries and new resources for the Canadian people.
I hate to say that people would seek a monopoly in Canada, because we know monopolies are not good for a country. We have seen what has happened in connection with our railways. It is only fair that there should be an open field for those capitalists who have the courage to go into these enterprises. I am going to say that, so far as voting in connection with the measure before the house is concerned, I will vote for what will serve my own community first, the province of British Columbia second, and the Dominion of Canada third.
I would hate to be classified as one who has encouraged filibustering. I know the people in Calgary who put their money into the Westcoast Transmission Company Limited. They are splendid fellows with a great deal of courage. They have gone ahead and developed these oil wells. I am sure there are good men back of these other companies; and we need development of that kind, having in mind the best interests of the Canadian people.


Stanley Howard Knowles: Mr. Speaker, when the debate on these pipe line bills started some time ago many of us did not know much about them, but so much has been said in the meantime that we have become familiar with them. In addition to what we have heard inside the house, people outside the house have talked

to us about this matter. It would appear that the reason hon. members are reluctant to support these bills is related principally to the route to be followed by the pipe lines. I have been told, I admit, by someone at second or third removed, so I cannot guarantee that it expresses the opinion of this particular company-but nevertheless it makes sense-that this company would not mind routing its pipe line through Canadian soil if the other company which was incorporated last year were put in a position where it would have to do likewise.
I do not know how parliament or the government or the board of transport commissioners could deal with that situation, but if that is the position it does seem to me that steps should be taken to meet it. This raises the question of whether or not the overriding Pipe Lines Act is properly drawn in its present form. I sometimes wonder if it would not have been better for the government- rather than pursuing the course it has-to have brought in amendments to that overriding act. That might have been a better way to facilitate the passing of these bills.
I should like to quote a standing order, not as a point of order but just as a matter of argument. Standing order 97 reads:
No petition praying for the incorporation of a railway company, or of a canal company, or for an extension of the line of any existing or authorized railway or canal, or for the construction of branches thereto, shall be considered by the examiner, or by the committee on standing orders, until there has been filed with the said examiner a map or plan, showing the proposed location of the works, and each county, township, municipality or district through which the proposed railway or canal or any branch or extension thereof, is to be constructed.
It seems to me that parliament is not being fair if we require from companies seeking to build railroads or canals a map showing their proposed route when at the same time we do not require anything like that from a company proposing to build a pipe line. That applies to the bill now before us as well as to any other pipe line company. Surely there is a close analogy between railways and canals on the one hand, and pipe lines on the other.
The hon. member for Cariboo (Mr. Murray) has indicated his support of the principle which some of my colleagues have enunciated, namely, that the line should go through Canadian soil. That is good. I believe the government would do well, in fairness to all companies concerned-if I may put it that way- as well as in fairness to the Canadian people to find some way by which it could be laid down as a basic principle that all our pipe lines should serve Canadian requirements first before being routed out of Canada. That is one of the main issues now before us.
Prairie Transmission Lines


Joseph Henry Harris: Mr. Speaker, I should like to make one or two observations with regard to this particular matter. I do not think we should be narrow or small in our attitude toward these bills for the construction of pipe lines to traverse our territory. However, consideration should be given to the elements contained in these products. The hon. member for Calgary East (Mr. Harkness) referred to ammoniates which are found in these products. Canada is short of this commodity which is so necessary in our agricultural development. If these pipe lines are going to carry into the United States oil and gas which are charged with ammoniates then I feel disposed to oppose this particular bill. We must keep in Canada every pound, gallon or cubic foot of ammoniates which are presently here. Any hon. members who are farmers know that we have an abundance of phosphates while we are very short of ammoniates. Any move which will permit the taking out of this country of ammoniates in the form of gas or oil will in the final analysis be bad business for Canada.
It has been my privilege to investigate the pipe lines in Iraq, Iran and other places in Asia and Europe. I am trying to dream this picture through in an effort to see what might happen here in the next 25 or 50 years should we denude ourselves of this God-given heritage in the form of this element and let it slip through our fingers by way of these pipe lines in order to benefit our friends south of the border.
Thinking of the generations to come, I think that at this stage we should wait until we have more information about what we are doing. Let us know what it is all about. We should not go into this thing blindly. We should consider what Providence has given us in the way of natural resources and analyse the situation and then make up our minds what we ought to do. We should not make snap judgments. I should like to see these bills held over for a little while. We are a young country and we can afford to wait to see just what we are giving away by permitting these products to be transported through a pipe line that will traverse another country. We may be bereaved of this important commodity in the days to come.
I was amazed to hear the hon. member for Calgary East refer to the possibility of railroad lines following the pipe lines. As I say, I saw the pipe lines in Iraq, Iran and other points in Asia and Europe, and no railroad lines followed those pipe lines. No railroad lines will follow these pipe lines. There will be little development. But for
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Prairie Transmission Lines the sake of what development there will be let us in the interests of the prestige of this House of Commons not be in too great a hurry to give away the resources we have at the present time. Let us stop, think and consider what the natural resources are which we have at our hands, and what we are going to do with them in the future, not for those of this day and generation but for those of the generations which are to come.


Mr. G. R. Pearkes (Nanaimo):: Mr. Speaker, I feel we are all indebted to the Prime Minister (Mr. St. Laurent) for giving us ample time to discuss these two important bills. They are of the greatest importance to the province from which I come, British Columbia. I venture to take a few moments of the time of the house because over a number of years I have had some personal connection with this natural product. I remember leaving the city of Edmonton over forty years ago when I was a youngster and travelling by stage coach to Athabasca landing. At Athabasca landing we got into Hudson bay scows and drifted down the Athabasca river. That is not the means of travel today. People wanting to go to the north country now travel in comfort by railway to Waterways, which used to be called Fort McMurray. In travelling by railway, however, they miss one of the most spectacular sights that can be seen in the northwest, namely, a great spout of flame coming from a gas well which, to my knowledge, was burning in 1909, and according to rumours amongst the Indians and the early inhabitants of that country had been burning for twenty years before that date. It was a most impressive sight. I saw it as a youngster for the first time, but it will remain fresh in my memory as long as I live.
That was my first introduction to the wonderful power of the natural gas which is available in the Northwest Territories and Alberta. I recall vividly visiting Medicine Hat. Towards the end of the last century gas had been discovered at Medicine Hat. Ranchers in that district found it possible to dig a small hole in the ground a few feet deep and find gases coming off which could be lighted by a match. Over these fires they were able to cook their midday and evening meals. They were able to fry their buffalo steaks, their eggs, or whatever it might be, with the natural gas coming up from the sands around Medicine Hat. In the course of the years it has been developed, and in the early years of the present century one could see prosperous industries being developed around Medicine Hat. I recall vividly the bottling works at Redcliff, the potteries in the vicinity of Medicine Hat, and the greenhouses in which


vegetables including tomatoes were grown in the early months of the year. That is an indication of what natural gas can do to help Canadian industries.
It was only a few years after that when they started to drill wells. Wells were drilled at Bow River and from there the gas was piped to Calgary. I lived in Calgary at the time. I have cooked and had my house heated by that natural product. As the years went by other gas wells were discovered in the Turner valley. Gas wells were drilled and developed at Viking not far to the east of Edmonton, and in recent years it has been piped from there into Edmonton and down as far as Red Deer. There is in fact a gap of only 100 miles between Calgary and Red Deer where the villages of Alberta are not supplied with natural gas and they do not have the opportunity of heating their homes by that means of providing warmth for their farm houses.
It is so different today. When I was in Red Deer we used to have to travel thirty miles by sleigh up towards Stettler, dig coal out of the river bank and haul it back to the farm at Red Deer in order to be able to keep warm during the winter months. With gas now piped to Red Deer there is no reason why all the homesteads and farms should not be heated by this very clean, efficient and economical means. I see the possibility of that type of power, heat and energy being delivered to the towns of the interior of British Columbia and the great metropolitan area of Vancouver and New Westminster.
So far as I can understand from the bill now before us, the proposal is that this means of providing comfort to countless homes in British Columbia is to be diverted across the border and carried to the states of the northwestern United States. I suggest that, so far as we can see now, there is in the foreseeable future an unlimited quantity of gas in the great oil and gas fields of Alberta, the Peace river block and Pincher creek. I suggest it would be just as economical to pipe that supply from northern Alberta and the Peace river district down through central British Columbia feeding all the towns of the interior and carrying the gas to the city of Vancouver. In the same way that the industries I have described are carried on at Medicine Hat, the bottling plant, the potteries and the greenhouses, there is no reason why all along the central British Columbia route similar industries could not be carried on at innumerable little towns provided they can get this cheap form of heat.

If on the other hand this cheap heat and power is to be diverted and sent across the border, then all these small towns of the northwest states, where they produce fruits and vegetables which compete with fruits and vegetables produced in British Columbia, are apt to flood the Vancouver market with these products to the detriment of the tomato growers, particularly, not only in the interior but on the gulf islands, that archipelago which lies between Vancouver and Vancouver island. There many returned veterans have gone into the production of tomatoes, and they look to Vancouver for a market. They will be deprived of an opportunity of selling their seconds and their dessert grades in that market at this season of the year, because it will be glutted with tomatoes grown in Washington and Oregon. Are we going to give these competitors of our fruit growers an added advantage by diverting Canada's gas to the northwest states, so that they will have an even cheaper type of fuel than they have at the present time? Surely we should first consider our Canadian horticulturists; surely we should take advantage of this opportunity to give our small towns and villages throughout British Columbia this economical heat, before we consider the advantages that will accrue to similar towns in the United States if this pipe line goes in that direction.
I do feel that it is important for many reasons that we should encourage the location of industry in British Columbia towns. It is quite obvious at the moment that the flood of immigrants to British Columbia from other parts of Canada and from the old land is being concentrated in the metropolitan area of Vancouver. Anything we can do to have those newcomers move into the smaller villages, say up the Fraser valley, will benefit the economy of that province. Many small industries could be developed. One of these is pottery, for which clay is available at Clayburn in Sumas valley and which could be developed if the necessary power and heat were provided.
Then I remember vividly what was taking place at this time last year on Vancouver island. Due to an exceptionally bad winter and due to the loss of British markets for our forest products, many thousands of men were out of employment. According to the official returns there is more unemployment in British Columbia today than there was a year ago, and there is no likelihood that those camps will be kept open all winter. So hundreds of men who are accustomed to working in the mills and in the forest camps will find themselves out of employment, and will be looking to this government to provide them with something to do. The government is fond
Prairie Transmission Lines of referring to a number of projects which are being delayed until there is general unemployment, when certain works will be undertaken. It seems to me that if this pipe line could be diverted and made an all-Canadian line, running through British Columbia, it would be of immense value not only in the future but immediately, during this very winter, in providing employment for men who otherwise are going to be out of work.
It is not merely the question of a pipe line. One is apt to think that only involves digging a hole in the ground and laying the pipe. This is not drain pipe; it is big pipe, 24 or 26 inches in diameter. A big construction project is involved, not only in laying the pipe but in surveying, cutting through the forests and developing roads over which heavy transports can carry this pipe, which must be placed at a sufficient depth so it will not be harmed by any frosts which may occur in the mountains.
From time to time we have been considering the possibility of building a trans-Canada highway. We want more than one route across Canada. From the remarks that have been made it is quite obvious that several routes are required through British Columbia; and there is no reason why a road originally built for the construction and maintenance of this pipe line should not be developed by the province into an alternative route which would feed various portions of that province from Alberta to the prairie country. Let us say the trans-Canada highway were to follow what is sometimes called the southern route, going from Calgary and Banff to Golden and Revelstoke, and so on. Might it not be possible that this pipe line, tapping the northern Alberta fields, could be run down the Blue river or the Canoe river, on down to the Thompson and so on, feeding an entirely different part of British Columbia?
For these reasons, and because of my firm belief that this Alberta natural gas can provide heating and cooking facilities for innumerable homesteads, villages and towns throughout the province of British Columbia, and also may be used to start new industries,
I feel it is important that this line should be routed through British Columbia. In order to ensure that this is done, these bills should be so amended as to include definite instructions that this is to be an all-Canadian line.
As far as the immediate future is concerned,
I feel that something must be done this winter. We must be warned now that there is going to be unemployment in British Columbia; that thousands of people will move to British Columbia this winter from other
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Prairie Transmission Lines parts of Canada, perhaps seeking employment, perhaps in order to take advantage of our milder climate.
It has been traditional that the people from the prairie provinces move from there to British Columbia during the wintertime. They will be looking for jobs because they will not bring sufficient capital with them to be able to keep themselves decently during those months, and they will be competing with our own British Columbians for what few jobs there are. Organized labour, the Canadian Legion and the mayors of the various municipalities will be appealing to this government to provide jobs for these people who are out of work.
Here is a grand opportunity whereby a large number of men could be employed, in the immediate future, surveying the various routes, and in blazing down through the forests of British Columbia trails which may eventually be developed into great highways. Then not only will an impetus be given to the industries in these small towns, but hundreds of men will be employed in the maintenance of a pipe line if we will only say that it must take an all-Canadian route. For the life of me I cannot see why this Canadian natural product should be diverted across the border to feed towns in the northwestern states whose very industry is in competition with the industries of British Columbia, and in which there is not the same urgent need for providing jobs that there is today in British Columbia. Surely we should look after our own provinces first of all. Therefore I feel keenly that this bill should not be passed without having the most careful consideration given to it.
As I said when I started, I appreciate the opportunity which the Prime Minister has given to this house to discuss these bills thoroughly. I hope that members who have experience with these parts of the country, and who know something about this great natural product of ours, will be prepared to express their points of view, because I think it is a problem which should be thoroughly discussed and debated. There is no immediate emergency to rush these bills through or to gain a decision. I have tried to give to the house the benefit of what little experience I had. I have some knowledge of that country both in Alberta and in British Columbia. I am in fairly close touch with conditions in my own part of British Columbia, and I urge that the most careful consideration be given before this bill is passed.


Mr. Speaker:: I declare the amendment lost. The question is-


Angus MacInnis: Mr. Speaker, like the hon. member for Nanaimo (Mr. Pearkes), I too wish to thank the government for the opportunity of giving us extended time to debate this bill. I also wish to thank the Minister of Trade and Commerce (Mr. Howe) who is not tonight in his seat- at least at the moment he is not-for my entry into this debate at all.
On November 15, when the bill was under discussion, he said, as reported at page 1806 of Hansard:
I might say the house has granted one franchise for a pipe line for gas in a western direction and a pipe line for gas in an eastern direction. As the situation stands today, the incorporators of each of those two bills have a monopoly, so far as gas moving in either direction is concerned.
I shall refer to that later. It is the rest of the paragraph with which I wish to deal now.
My hon. friends of the C.C.F. party have a good deal to say about monopolies, and yet we find them very busy filibustering so that the monopoly on the pipe line situation can be maintained.
I was quick to reply to the minister when ne made that statement, because up to that moment only one member of this party had spoken to the question, and that member is from the south central part of British Columbia, the part of the country vitally affected by which particular route this pipe line may take.
Prairie Transmission Lines
Yet the Minister of Trade and Commerce was so anxious to make a point, a smearing point for the bills that he is supporting, that he had to bring the C.C.F. in as filibustering with a ten-minute speech. In view of the filibuster we had yesterday in order to get this extended debate, I would say that one filibuster deserves another.
As a matter of fact up until the time the Minister of Trade and Commerce made his statement I had given very little thought to these bills. Perhaps I am to be censured for that; but, like so many other private members, particularly those on the opposition side of the house, I have a great many things to attend to. I am not even like most of the ministers-and I say "most" of the ministers -who have only one department. We private members have to keep our eyes on all departments; and there is perhaps only one minister who does that.
Therefore we are very busy people, and if we cannot keep our eye on everything that happens or on all the bills which come before the house, then perhaps we are subject to censure-but at least there is just as good an excuse for us as the excuse the Minister of Justice (Mr. Garson) made for himself today.
When the hon. member for Calgary West (Mr. Smith) spoke on one of these bills-I do not know which one it was; it does not matter, because they both deal with the same subject-he decided for me that I should do some little studying of the bills. I have told the hon. member privately that I think he made the best point that has been made in these debates to date, and I want to say the same now. He drew attention to two or three things which in my opinion are vital. He pointed out something, I do not know whether it is correct, but if it is not we should be told. We should be told in terms that will leave no room for doubt. The hon. member said that no matter how many charters were issued there would be only one pipe line built anyway.


Mr. Smith (Calgary West):: Correct.


Angus MacInnis: If only one pipe line will be built anyway, what is the sense of issuing charters? What value is a charter going to be to these people if a pipe line is not built? Somebody is going to have to be paid for the money spent in presenting the petition to parliament. Somebody will have to be paid for the cost of all the lobbying that has been done around here during the past several weeks. I should like to know who is paying for those things and how they are going to recoup themselves if they do not ultimately build a pipe line. That is something the sponsors of these bills should
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Prairie Transmission Lines tell us. That is something the British Columbia members who have so little regard for the welfare of British Columbia that they vote for these bills should tell us. They should make it quite clear to the house just whom they are supporting in this matter, British Columbia or some pipe line promoters. On the fifteenth of November the Minister of Trade and Commerce said, as reported on page 1806 of Hansard:
As the situation stands today, the incorporators of each of those two bills have a monopoly, so far as gas moving in either direction is concerned.
I have asked if there is to be only one pipe line in each direction and if each company is to have the monopoly. If one company is to have the monopoly then there is only one way in which the interests of the people of Canada can be properly protected and that is by the pipe lines being publicly owned.
This country has been a real paradise for charter promoters. I remember when I first went to the west, around 1908 every politician no matter to which party he belonged would not dare to appeal on a public platform unless he had a railway policy. I had formulated a railway policy of my own. It was based on the fact that the workers built the railways but the only use they had for them after they were built was to walk the ties looking for another job, another railway to build. I found that the ties were not spaced properly for easy walking. My policy was a revolutionary one; it proposed that the ties should be spaced so that one could take three at a time. As ties are spaced the distance between two ties is too short and the distance between three too long. It is easy to see that few people accepted my policy because the people that wanted charters did not walk the ties.
Everyone was getting charters. I go back to an even earlier period, and I should like to draw the attention of hon. members to something which is apropos of the situation with which we are now confronted. I should like to quote from page 1272 of Hansard of June 23, 1887. Mr. Scriver was speaking. The house was discussing the rules respecting private bills which would make it necessary that plans of routes be filed before a charter was granted. Mr. Scriver said:
My limited experience in the railway committee satisfies me that a great deal of time has been lost through the want of such a bill, and that we have chartered a great many companies when we had no plans presented to satisfy the committee that those projects were anything more than paper projects.
Is there anything in the bill we are now debating to show that it is not merely a paper project? We may be told that if there were two or more companies it would be better for

the province of Alberta, that they could make a better deal if there were competitors in the field. Surely that is poor reasoning because Alberta has the gas. That province has the thing that these pipe line owners want and they can hold the gas until the pipe line people pay their price if that ig the way they want to do things. It is certainly a poor argument to say that Alberta is going to do better if we issue charters to three, four, five or six companies.
Why stop there? Why not issue as many charters as are asked for? I suppose they would go out selling stock and there may still be a few suckers around with a little money.


An hon. Member:: Page the Minister of Fisheries (Mr. Mayhew).


Angus MacInnis: I am surprised the Minister of Fisheries has been as silent in this matter as he has been. Perhaps he is a very busy man and I really have no quarrel with the Minister of Fisheries. We should have had our lessons in connection with charters. We allowed railroads to be built all over the country and then when they went bankrupt we had to take them over in the interests of the people of Canada. The people of Canada are still paying for the bungling policies that enabled promoters to fleece the people.
I think the time has arrived when we should use Canada's natural resources to build up the wealth of the country. Canada is being denuded of its minerals, lumber and all other natural resources in order to build up the wealth of the United States. It is time we began to use the natural wealth of Canada for our own benefit. What can be done under the provisions of this bill goes far beyond the building of a pipe line. I do not know whether hon. members have read it, but I should like to refer them to section 6 of the bill, which reads:
The company, subject to the provisions of any general legislation which is enacted by parliament, relating to pipe lines for the transmission and transportation of gas and oil or any liquid product or by-product thereof, may (a) within the provinces of Alberta and British Columbia or outside Canada-
How can we issue a charter to build pipe lines, or to do any of the other things that are mentioned in this bill, outside Canada? I do not think that parliament has the right to pass a statute for the building of pipe lines outside Canada. Let me read some of the other things that may be constructed:
-may (a) within the provinces of Alberta and British Columbia or outside Canada construct, purchase, lease, or otherwise acquire, and hold, develop, operate, maintain, control, lease, mortgage, create liens upon, sell, convey or otherwise dispose of and turn to account any and all interprovincial and/or international pipe lines, for the transmission

ana transportation of gas and oil including pumping stations, terminals, storage tanks or reservoirs and all works relative thereto for use in connection with the said pipe lines; and buy, or otherwise acquire, sell, distribute or otherwise dispose of gas; and as an adjunct or correlate to pipe lines for gas to have similar powers and facilities for pipe lines for the transmission and transportation of oil and the acquisition and disposal of oil-
And so on. It is presumed apparently that all these things can be done outside Canada as well as within its boundaries if we issue a charter. I know there are sharp legal minds on the opposite side of the house- and there is no sinister connotation associated in my mind with the word "sharp"-and they should tell the house what authority a charter issued by this parliament has once these people go outside Canada. Has this house any authority whatsoever to do what is suggested? With my very slight knowledge of law, and perhaps a little more knowledge of logic, I am wondering whether we are within our rights at all in dealing with this bill. As has been said so often during the debate, and particularly by members of the house from the province of British Columbia, if it is stipulated in the bill that the needs of Canada will be served before any gas goes out of the country-


George Alexander Cruickshank: I am sure the hon. member will allow me to correct him as to one statement. He said that if all members from the province of British Columbia had the assurance of an all-Canadian route it would be satisfactory. I think he will agree with me I am the only member from this side of the house who has agreed with him.


Angus MacInnis: We have had so little cooperation from that side of the house that I overlooked the hon. member for Fraser Valley (Mr. Cruickshank), but I am glad to know where he stands. I knew it before but I overlooked it. If we have the assurance that the needs of Canada will be supplied before any of the gas is exported outside the country, we will immediately withdraw our opposition to the bill. To that end, Mr. Speaker,
I wish to move the following amendment, seconded by the hon. member for Yale (Mr. Jones):
That Bill No. 119 be not now read a second time but that it be resolved that in the opinion ol this house further consideration of this bill should be deferred until the house has been assured that the route of any pipe line built by the proposed company will be laid out so as to serve Canadian requirements before any such pipe line leaves Canadian soil.


Mr. Church:: I wish to speak on the amendment moved by the hon. member for Vancouver East (Mr. Maclnnis).


Mr. Speaker:: Order.
Prairie Transmission Lines


Mr. James Sinclair (Coast-Capilano):: Mr. Speaker, I have taken no part in this debate although I am a British Columbia member, but I wish to take part now as a result of the challenge hurled by the hon. member for Vancouver East (Mr. Maclnnis) a few moments ago.


Howard Charles Green: You did not have the floor.


George Alexander Drew: Mr. Speaker, I thought some point of order was being raised by the hon. member for Coast-Capilano (Mr. Sinclair). I submit that the hon. member for Broadview (Mr. Church) who was speaking had the floor and should be permitted to continue to speak.


Mr. Speaker:: I saw the hon. member for Coast-Capilano before the hon. member for Broadview started to speak. I did call on the hon. member for Coast-Capilano.


James Sinclair: As I was saying, unlike the C.C.F. members of the house, we do not consider it necessary to speak for forty minutes on every issue before the house. Our votes show the way we feel about these matters, and we are prepared to justify them before our constituents. On the matter of the pipe line bills I, like every other British Columbia member no matter what his party may be, feel that these pipe lines should be constructed through British Columbia if possible, for reasons which have been very ably given by members on this side of the house, members of the official opposition and members of the C.C.F. group. We feel that if these pipe lines are built through British Columbia it will give us a Canadian route, and it will be of great advantage to the province of British Columbia and certainly to the city of Vancouver to have the small interior towns of British Columbia have abundant and cheap industrial fuel. We feel that at this time it is most important in British Columbia to have the labour and employment which will arise as a result of the construction and maintenance of these lines in our province.
We are informed, however, and the information comes only from reading the report of proceedings in the Senate Hansard and in the Senate committee, that the cost of a line through British Columbia, with the market it would supply on that route, is so high that such construction is uneconomical. I say that neither the arguments of the members who are opposing these pipe lines nor of those who are supporting them are sufficient to convince any reasoning man as to the merits of the case. The only place where that can be decided is before the standing committee on railways, canals and telegraph lines where expert witnesses, engineers both for and against the pipe lines, can be called and give

Prairie Transmission Lines members of parliament actual and not ipse dixit information. For that reason I, as a British Columbia member who yields to none in devotion to my province, say that I will vote for the bills on second reading if only to get them where they can be properly studied in committee. Unless very sound reasons are given in the committee why construction through B.C. is uneconomic I will vote against the bills on their return to the house.
I say I resent the challenges and slurs flung out by the C.C.F. that just because we do not speak on every issue we are not interested in every issue. Somehow or other the business of the house has to be conducted, and I submit that members' votes in themselves are sufficient indication to most people of where they stand. There is one other point. Last spring in the standing committee on railways, canals and telegraph lines I was the one who actually conducted the crossexamination of the representatives of the Westcoast Transmission Company which was then proposing to build an all-Canadian route through British Columbia and got their charter because of this route. I have heard with some dismay that this company, which has been referred to as an all-Canadian company, has now, according to two hon. members of the house, filed an application to build a route through the United States exactly similar to the routes which are now under discussion.


Arthur Leroy Smith: Utter nonsense.


James Sinclair: All I can say is that the statement was made by the hon. member for Burnaby-Richmond (Mr. Goode), and it has not been contradicted.


Arthur Leroy Smith: I contradict it now. It is absolute nonsense.


James Sinclair: I am glad to hear that, but it does not alter my submission. I want to tell you another thing, Mr. Speaker. My opposition to filibustering does not date only from this session. I remember another session, when members of the opposition were filibustering a public bill I was sponsoring, the one on margarine, and at that time there did not seem to be the same indignation against obstruction. I do not want to be held up as obstructing these bills, so I am going to conclude my remarks; but I say they should get second reading and go to the standing committee on railways, canals and telegraph lines, if only to give the members of this house and the people of Canada knowledge of the facts rather than the opinions of members of parliament, many of whom obviously have very little knowledge of the engineering problems involved.


Mr. T. L. .Church (Broadview): I rise to support the amendment which has been proposed by the hon. member for Vancouver East (Mr. Maclnnis) and seconded by the hon. member for Yale (Mr. Jones). The amendment asks that this bill be not now read a second time but that further consideration be deferred until the house has been assured that the route of any pipe line built by the proposed company will be so laid out as to serve Canadian requirements before any such pipe line leaves Canadian soil. In my opinion that is a very good resolution.
The other day in this house we were referring to similar proposals, and the only two hon. members from British Columbia who spoke in favour of those were the hon. member for Cariboo (Mr. Murray) and the member for one of the Vancouver island seats. That member is a graduate of the university of British Columbia, a very likable young gentleman whom I have known for many years. On the other hand the hon. member for Fraser Valley (Mr. Cruickshank) has expressed strong objection to giving away the natural resources of this country.
We have seen some of the effects of giving away the vast natural heritage in which the people of Canada have taken such pride in years past. It seems that most of those who have spoken in support of this bill have come from Manitoba and Ontario. Ever since I have been a member of this house this principle has been under discussion. I came here in the early twenties, when we were suffering from severe unemployment following the first war. At that time we experienced some of the results of giving away our natural resources; we saw how it affected trade and commerce and industry. We have become largely an industrial nation; but with the unemployment that followed the first war it became more and more necessary for us to conserve and develop our natural resources for our own benefit. This house has declared itself on several occasions on the question of giving away our great resources, such as our forests, in return for mere trifles. That is one reason why within a short time this country may be suffering from a depression. We are sure to run into one very shortly; that is the opinion expressed in a great many financial textbooks, and many leading economists have also sounded that warning. That is the fate which awaits this country unless it wakes up and develops its natural resources for the benefit of all the people.
After all is said and done, who own these natural resources? They were given by Providence for the development of this country. We have great admiration and respect for our neighbour to the south, which has

been very friendly and has done a great deal for us in many ways. Still they are our competitors in trade and commerce, in industry and all along the line. Ours is a greatly coveted land, standing right in the gateway between what is called the east and the west. Today we are the centre of the empire and in fact of the entire world. This country is greatly envied by the dictators. They know the natural wealth we have. It is only necessary to read Parkman's history to realize something of the value of those resources. In both an economic way and in an industrial way Parkman has been very kind to the people of this country. He is not only a great historian of the development of Canada; he is an economist first, last and all the time.
When I first came here as a private member of the house we enjoyed certain rights, functions and privileges. Are we to lose all those now? I do not wish to reflect upon the Prime Minister (Mr. St. Laurent); far from it, because I have been a great admirer of his for many years past. I imagine I have known him as long as any member of the House of Commons, and he is very much respected in our city. Only last year or the year before I suggested to the exhibition directors that they invite him to see something of what is being done there, and I think it was the year before last he was asked to open the winter fair. As it happens I designed that building and opposed the proposal once made that this great fair be moved to Hamilton. As a matter of fact the directors of the exhibition took the position that they did not want the winter fair to compete with the summer fair, and it was decided to move the winter fair to Hamilton.
I am glad that did not happen for the reason I gave, because it is a great asset to the city. Those hon. members who went to that exhibition this week saw something surprising. That is to be continued by the present Minister of Trade and Commerce (Mr. Howe)-he may have turned it over now to the Minister of Reconstruction (Mr. Winters)

in what is known as the great world's national trade fair to be held there next May. That announcement has been made accordingly with regard to the development of that great trade fair which is going to revolutionize the whole world. Exhibits are going to be shown at that trade exhibition next year in 1950. I have the book about it and the notice which is in all the magazines. It is at the back of one of the books which come in to us monthly from the Department of Trade and Commerce, and which has a map on the back of it. It shows the name of that great trade exhibition, with exhibits from all over the world, including
Prairie Transmission Lines the natural resources of Canada. I wish I had the book with me tonight. I just left the last copy in my office a moment ago. But it refers to that great trade exhibition which the Minister of Trade and Commerce has mentioned to the house on several occasions. He has referred to it at some length in the book which he has had published recently.
I now wish to say a few words with regard to this particular Bill No. 119 which is being considered tonight. It deals with many phases of this proposal. It will be noticed that the amendment which has been moved asks that the pipe line to be built by the proposed company be laid out to serve Canadian requirements before any such pipe line leaves Canadian, soil. That policy has been a well established one for many years past, and it is a blessing we have had it in this country. It has meant a great deal to our people. At the present time we are a greatly coveted land, so much so that many people want to come out here, even many who know something about what the Indians and Eskimos did away up in the northern part of our country. Explorers went up there among the Indians and Eskimos. They were the pioneers in discovering the great mineral wealth which lies away back in the northern part of Canada, frozen up as it were, and they have shown us how to develop that country. There were Frobisher, Hudson, Fulton, Mackenzie and Fraser. These men made discoveries in this great northland. In the travels they made and the suffering they endured in the depth of winter, in temperatures of 60 degrees and 70 degrees below zero away up in that northland when they were the pioneers, they proved to the people of Canada and to the world the value of this land, and did much to develop that part of the country. I say therefore that we should be careful in giving away the heritage which these men discovered. The matter has been referred to extensively on all sides of the house and by some of the clergy, especially by the clergy of one great church. I have reference to one of the Church of England pastors up there who went as a humble missionary to the Indians and Eskimos, the present Right Rev. Bishop Renison. Every Wednesday on the editorial page of the Globe and Mail have appeared glorious articles which he has written about the northland up there, and he has been assisted largely by some of the clergy of another great church, one of the fine Christian churches up there; I refer to the Roman Catholic church. By what they have done through their bishops and their clergy, they have developed that north country as well. Two years ago they appeared
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Prairie Transmission Lines before our committee in the House of Commons which was considering the north country and the lands up there. We had several of them before us at that time, including Cardinal McGuigan, Archbishop Vachon and some others, who showed what could be done in that northland to develop the natural resources of that great country. Many of the great discoverers never realized the blessing they were conferring and what they were doing for the humble generations of workers and for trade and industry in this country when they made their great discoveries, nor did they realize the great development that would take place of the mineral wealth which the country had up there.
A country does not belong to those who inhabit it today. It is an inheritance from the past. It is just a possession for the present. It is a trust for the future. That is what I say about these natural resources. They are trusts for the future. This generation has no right to give them away in the haphazard manner in which we are doing it at the present time. I believe that is a correct doctrine. We know the blessing of employment at the present time; but we know that our own trades and industries will require this work in the future if we should run into a depression. So I say that we should be assured first that the pipe line, before it leaves Canadian soil, is going to be required to be built by this pipe line company in the manner indicated. It will be noted that, to the motion for second reading of the bill, an amendment has been moved. It was dealt with recently in connection with forest development. I was referring in another debate to the export of power, where a former president of the United States, who died after the first war, referred to this matter. President Theodore Roosevelt said:
The people of our country are threatened by a monopoly more powerful than has ever been seen, as It affects very closely their domestic and industrial life. Our next generation will witness a shortage of those natural resources, petroleum and gas. The price of coal will be such that hydraulic power-
He dealt with that, but I cannot refer to it here. He is referring to the erection of a steam plant and all that kind of thing. He then went on to say:
The major portion of these powers is not developed and remains the national property. It would be madness to part, without conditions, with one of our greatest resources. If we become guilty of this crime, our children will be bound to pay an annual royalty on a capitalization fixed at the highest price that the trade will stand for. They will see themselves struggling with powerful sweaters entrenched behind the doctrine of discharged rights strengthened by all means of protection that money can buy and the cunning of corporations defended by legal men. These ogres


of finance will have succeeded long before then to monopolize those resources so as to be able to dictate to the people the management of their affairs and their ways of existence. Public opinion will be their least worry.
That is the reference he made to it. The late Theodore Roosevelt was a great statesman of that time.
I remember when he came to our city and addressed a meeting in the armouries before the first war closed in 1918. He came and addressed a magnificent meeting there. Colonel Denison, the police magistrate, who had been the defender of the natural resources of the country, introduced him. The late Colonel Denison won the Czar of Russia's prize in 1878 for Canada. He was a great statesman as well. He believed that we should conserve the natural resources of the people of this country for the people of the country. We have no right to part with them or to give them away in the manner indicated.
I do not wish to be unfair. There are other hon. members who would like to speak on this bill. I cannot refer to the text of the bill on second reading, and I do not intend to. I just wish to say this about the pipe line companies. They were placed under the control of the board of transport commissioners. They were given wide powers under the general Pipe Lines Act. I noticed that this bill was taken out of the general act. They will no doubt have to get a permit from the province of Alberta, an export permit I believe it is called. I think that is the phrase used in the statute. I have the statute here but I shall not read it.
The Alberta act requires the permit to be taken out by the company before the gas can leave Alberta. When it does go through Alberta it heads for the Pacific coast. The amendment will provide for that. But before it leaves Canadian soil the pipe line must meet certain requirements laid down in the proposed amendment to the bill. So far as I can see that is a very wise proviso.
We used to be called a nation of property owners. Years ago we were a nation of property owners. Everybody owned some property. It may have been a small mill, a little grocery store, or a small wagon. It may have been a little factory, but we were all property owners. We have been slow to see how we have become a nation not of property owners but of people who do not own a foot of property. In the city from which I come we were looked upon as a nation of property owners. Nearly 75 per cent of the people in that city owned their own homes. Now, everything has been given away. We do not own anything. I doubt whether anybody wants to own anything, because sooner or

later taxes of all kinds will take it away. High rents, high railway fares now, nothing for Christmas, everything is going sky high. Departments are multiplying. With the parliamentary assistants, we have pretty nearly a hundred now. I propose that we call a halt to it.
I doubt whether people can buy property. I doubt whether there is any money in the country left to buy property. What I object to in this particular bill is that it is taken out of the general Pipe Lines Act. Without the authority of the committee, or without the authority of anybody, it is taken out of the general Pipe Lines Act which this house placed under the control of the board of transport commissioners. They were given the right to decide it. Now, who is going to decide it? Without consulting the board of transport commissioners they wiped it out with one stroke accordingly. 1 object to the way in which we are dealing with this matter. I object to the way in which we are giving away the natural resources of the country.
The bill is also faulty in many other ways. This matter was dealt with the other day by two of my colleagues from Calgary. They had something to say about the development of this work. They raised certain objections to it. I have referred to our forests, our lumber interests and many other great interests and have said what it would mean to trade. I referred to the power development and I said that tens of millions of kilowatt hours of power were exported to help industry in the United States. I have no objection. We are competitors for trade, and no doubt it was done by agreement. But I do object when it interferes with trade and industry in this country. It would provide a great deal of employment for our people. We may run into dislocation of business in a few years, and power developments such as these, where millions and millions of kilowatt hours are given away, would be a great help. We are all competitors for trade on the continent of America. There is no doubt about that at all. Therefore I say I am for a policy of Canada for Canadians. I am for a policy to build up our own trade, to build up our own country, to develop this country first, last and all the time before we develop another man's country, especially when we are competitors for the trade of the world. We are living on export trade. That is where we are making our living. Ships are now tied up because they cannot get cargoes. It reminds me of the close of the first great war. In Great Britain for taxes you could buy a man-of-war. I held up pages of the old
Prairie Transmission Lines Post of London, England, which contained a map. One night in the House of Commons when I was sitting over in the seat in which my colleague from Calgary city now sits, I held up pictures of ships which had been sold for taxes. Shipping is now tied up. How are we going to develop the trade and natural resources of this country if we have not shipping? It is the same on the Pacific. Ships are remaining idle because there is no trade for them.
It is the same with the export of power. I have no objection if it is exported on contract or by agreement; far from it. Hundreds of millions of kilowatt hours are given away to develop our competitors' industry across the border. I do object to that. I want to see us have a policy of Canada for Canadians first, last and all the time, not the policy that has been proposed in this house for many years past. Parliament used to deal with public matters; it used to deal with private bills. I say that the rights of private members are being challenged, because this bill should go to the private bills committee. This is not a bill which should go to the committee on banking and commerce, at all.
We used to have a committee on industrial relations. I was a member of it years ago, when the former member for Winnipeg North Centre, Mr. Woodsworth, sat in the house. I came to the house the same day he did- and may I say he was a very fine gentleman. I think his wife lives in my constituency at the present time. They were a fine family, all the way through. I knew the late gentleman very well. I attended Parkdale collegiate, and I think he used to attend. They were from Dixie, Ontario, the place where Tommy Kennedy comes from. That is the Hon. Thomas Kennedy, formerly premier of Ontario. He attended Parkdale collegiate, too. He was a colleague of my hon. friend the present leader of the official opposition (Mr. Drew).
I believe in a policy of developing our own industries ourselves for the people of Canada. We ought not to depart from that policy or give it away to our competitors in the manner indicated here. It is my view that this bill should have been considered by the committee on private bills, and that is one of my chief reasons for opposing it. I do say that in these dying days of the session I object to any challenge to the rights and functions and privileges which as private members we used to have, when we first entered the House of Commons.
Do not forget this, that the private member is the connecting link and the only connecting
2108	HOUSE OF
Prairie Transmission Lines link, between the government and the electors. When he ceases, the functions of parliamentary government are at an end. That is what happens-it is the end. When we are asked to vote away our resources in this way, we are voting to hamstring parliament.
The other day I met an old friend from Fort William (Mr. Mclvor) on the elevator in this building and was complimenting him upon his effort in the house, when he had objected to someone suggesting that he was only a rubber stamp. I said he showed spirit which would have served him well in a boxing bout, and I nominated the hon. member for Calgary West (Mr. Smith), who is known as a sport, to act as judge. I thought he would look after our beloved clergyman over there, in that corner, with our men over here in this corner, and the hon. member for Calgary West would be the judge. Perhaps I should not say much more about the hon. member for Fort William, because he is not in his seat tonight. I do say about him however that he is a fine sportsman, and I have known him a long time.
Let me say in conclusion that this bill should have been considered by the committee on private bills. We used to have some rights and privileges in parliament, when I first came here. I doubt very much that anyone now seeks the privilege of becoming a member. What is the use, I ask? We are just wasting our time. We have no power; our functions, rights and privileges have been taken away from us. We are losing our rights; we are losing employment; we are losing industry; we are losing trade and commerce; we are attempting to develop somebody else's property at the expense of the Canadian people.
For those reasons I object to this proposal to hand over our rights, functions and privileges to somebody else. And I will say this to the private members, that many of them come from municipalities. I am glad to see them here. Those men who contest municipal elections are closer to the people than are members of the federal government.
A rule was placed on the Ontario statute books whereby no franchise could be given away in any municipality of Ontario without first having a vote of the people. That was a good and sensible proviso. I doubt if we would ever have owned our own street car systems, or our power and hydro electric developments if that had not been the law of the land in Ontario. Had it not been we would not own the Toronto transportation commission, and would not have any street cars to travel to that magnificent winter fair. In Ontario we do not hand out franchises in a haphazard way.


There is no control over these pipe line routes. I call it a pipe dream act, and that is what it is-just a pipe dream act. It hands out other people's property-and to whom? It hands it out to every Tom, Dick and Harry who wants to have it. Definitely that it not the law in Ontario, where a franchise must first be voted on by the ratepayers in their municipalities. None of the members coming from Ontario could take part in giving away a franchise without first having the vote of the people at municipal elections.
It is the people who own the property and give it away; that is the law in Canada. What law have we? What power have we in the House of Commons to hand over property which I say should belong to the people? After all is said and done, the country does not belong to the House of Commons. It is an inheritance of the past and a possession for the present. It is a trust for the future, and we have no right to hand it away. As President Roosevelt said, we have no right to hand out property to those who come along and ask for it or grab it-and then make a lot of wealth out of it in the way it is proposed to do in these pipe line bills.
We should be very careful before giving away our natural resources in any haphazard manner. Hon. members would not give their own property away in that manner. If they would not do that, then why as members of the House of Commons, with business capacity -and many hon. members, if not all of them, have such capacity-should they give away natural resources?
I remember on one occasion when the hon. member for Temiscouata (Mr. Pouliot) was standing in the company of the hon. member for Lethbridge (Mr. Blackmore) and myself in front of the Sir John A. Macdonald monument. Mr. Boucher, who used to represent the constituency of Carleton, was also there. The hon. member for Temiscouata asked if we saw anything wrong with the monument. I did not-because I am shortsighted, anyway. Then he said, "Look at his glasses; he has a pair of glasses in his right hand". I asked why and the member for Temiscouata said some people said Sir John was shortsighted and I said no, what Sir John was probably looking for was an honest man in the parliament buildings. I said that so far as I knew, they were all honest men in there. He said he was very much amused. After listening to the hon. member for Temiscouata (Mr. Pouliot) I began to think that he would have made his fortune as a comedian. There is a great element of truth in what was said by Sir Wilfrid Laurier that we have no right to give away the natural heritages of this country. Sir Wilfrid Laurier had an east

and west and overseas policy in connection with our natural resources, to develop our own country, first, last and always.


James Sinclair: Mr. Speaker, I rise on a question of privilege. When I spoke a few moments ago the hon. member for Calgary West (Mr. Smith) challenged the statement I made that the Westcoast Transmission Company Limited which was incorporated last year intended to follow the same route proposed to be followed by the company now seeking incorporation. I have in my hand a copy of the application made by the West-coast Transmission Company Limited to the Board of Transport Commissioners of Canada on May 11, 1949, setting out a new route identical with the one requested by the present bill, that is, through the United States.


Arthur Leroy Smith: The hon. member for Coast-Capilano (Mr. Sinclair) was good enough to see me in the interval and I assured him that if I was wrong in my statement I would take the first public opportunity to apologize to him and to the house. I suggest to him that I still think that he was wrong and I would like an opportunity of looking into it.


Hon. R. W. Mayhew (Minister of Fisheries):: Mr. Speaker, I have not taken part in this debate although I have felt like doing so many times. Every evening when this matter came up I thought that we would have a vote, but on each occasion someone would talk out the bill and prevent it from being sent to the committee where it would get the study it deserves. I have noticed there are very few hon. members who have spoken who seem to know very much about this.


Howard Charles Green: It was studied in the Senate.


James Sinclair: We are not guided by the Senate; this is the House of Commons. The hon. member would like to go over there.


Arthur Leroy Smith: I shall apologize only once to the hon. member so I ask him to be careful.


Robert Wellington Mayhew: In talking out this bill hon. members are doing-


An hon. Member:: What are you doing?


Robert Wellington Mayhew: What am I doing? One hon. member spoke for over forty minutes and no one called him to order. I am not going to talk it out. I simply want an opportunity to say what I have to say. In talking out these bills hon. members are bringing about one of two results. We are either going to have one company operating a pipe line in Canada under a monopoly or we are going to have no pipe line at all. You can take your choice between the two. In my opinion
Prairie Transmission Lines hon. members who have been following the tactics that have been started are simply obstructing the development of oil in Alberta.


George Alexander Drew: This is gas.


Robert Wellington Mayhew: And the getting of that gas to British Columbia. I have great respect for the hon. member for Calgary West (Mr. Smith) but the other evening he said that we should remember that there is going to be only one pipe line. Then he went on to say that this pipe line should be built on Canadian soil. I think he should be asked to give us his authority for making such a definite statement to the house.


Arthur Leroy Smith: There is only market enough for what can be carried by one pipe line. If the minister will read my speech he will find that statement in it.


Robert Wellington Mayhew: There is a great difference of opinion as to where the market is, and that is the reason why I wanted to speak tonight. Several other statements were made by the hon. member for Calgary West and I think he should read his own speech over again. As I say, he said that there was room only for one pipe line from Alberta to British Columbia. A statement such as that shows an entire lack of the size and importance of British Columbia.
That province can be developed if we get the necessary gas, but it will take more than one pipe line to carry that necessary gas. The hon. member said that it would require from 1,500 to 2,000 gas wells to supply the gas. On what size well does he base that statement? Two wells came in recently in British Columbia, one producing about 20,000 cubic feet and another 500,000 cubic feet. Which well would he take as his measurement?


Arthur Leroy Smith: How much do you take out of a well? You cannot take all of it out. I have consulted more engineers about this than the minister ever knew.


Robert Wellington Mayhew: I maintain that it will take more than one pipe line to take care of the needs of British Columbia. Nature has provided routes for two pipe lines from Alberta to British Columbia, one through the Yellow-head pass and the other through the Crows-nest pass. Gas is to be found at the gateways to both of those passes. A great volume of gas is available in the Leduc field and the northern area of Alberta, with some in British Columbia. This could be carried by a pipe line into British Columbia following the route taken by the Canadian National Railways and the Great Northern railway.

Prairie Transmission Lines
Then at the mouth of the Crowsnest pass is the Pincher Creek field which could provide a tremendous supply of gas. The pipe line from there should in my opinion go through the Crowsnest pass to Frank, through Coleman, Fernie, then into Cranbrook and Kimberley, and then down the west side of the interior in order to develop that whole area. Anyone who knows anything about British Columbia knows that it is a province of mountains and valleys. It would be utterly impossible to put a pipe line through in just one direction. In my opinion the proper way is to go south and then north into the Kootenay and Okanagan valleys, the line to go from the south to the north. Then on the other side the proper route to follow would be from the north to the south, having the two meet.
We need all the gas that we can get. However, it should be remembered that the gas belongs to Alberta, although we might question that as the gas was there before the boundary line between British Columbia and Alberta was decided upon. But they are handling it well and are doing a good job of looking after it.
I am sure that when there is a supply sufficient to take care of our needs we shall get it, but we should get it through more than one line. What you are doing tonight is saying that we are going to have a monopoly or we are going to have no gas. I say to you: Let the bill be voted on and go to the standing committee on railways, canals and telegraph lines where we can secure the evidence of experts as to what should be done.
Let me tell you this fact about the export of gas and oil. Do not let us forget that today there is a pipe line running from the United States into Montreal and supplying Canada with oil.


Douglas Scott Harkness: That is oil.


Robert Wellington Mayhew: That is oil. You were talking about oil also in this debate.


Douglas Scott Harkness: I was talking about gas.


Mr. Stuart (Charlotte):: They are talking
about pipe lines.


Robert Wellington Mayhew: They are talking about pipe lines. Gas comes into the Windsor district to take the place of the supply they used to get from the wells in the Chatham area.


George Alexander Drew: Where they ran out of it.


Robert Wellington Mayhew: As Canadians we should be supplied first with the gas we need and then, just the same as with anything else, we should export our surplus. If we have a surplus of gas and oil then I say we have every right to export it unless we want to build a fence around ourselves and become isolated from

everybody else. That is not the kind of world in which we are living today. I do not think anybody in the house can accuse me of wanting to sell our heritage for a mess of pottage. There are very few in this chamber who have spent more of their time and energy on trying to develop this country than I have. I should like to tell the hon. member for Calgary West (Mr. Smith) that, when the first oil field was drilled in the province of Alberta, when people thought it was a wild gamble and there was no oil in the Turner valley, some of my money was invested in that project taking a long chance.
Mr. Smith (Calgary West: Tell them that for twenty-six years I lived in the house you built, if you want to get close to me.


Robert Wellington Mayhew: I have had a pretty long association with this matter. I have never made any money out of it, but I have had the satisfaction at least of helping in its development. I do not want to take any more time because I see it is a quarter to eleven, but I hope that we can have a vote tonight so that the bill may go to the committee.


Clarence Gillis: Mr. Speaker, everybody is quite prepared to have a vote tonight as soon as he himself is finished talking. I have not occupied any of the time of the house on this bill, and I would not be occupying it now if it were not for the fact that the hon. member for Coast-Capilano (Mr. Sinclair) provoked me into rising at this time. He accused members of the C.C.F. group of talking for forty minutes on every matter that comes up in the house. As I have just pointed out, I have not had anything to say about these measures so far.


James Sinclair: You are now.


Clarence Gillis: The hon. member for Coast-Capilano is responsible for provoking me into entering this debate. I had something to do with the five bills that were passed by the house during the last session, and I think it is immaterial what you say about the rest of these bills in the light of what we did in April of this year. On the 27th of the month the other place handled these five measures and sent them over here. We discussed and gave second reading to them on the evening of the 29th of April without having any information as to who was sponsoring the bills or where the pipe lines were going.
The hon. member for Coast-Capilano stated a few minutes ago that these bills went before a standing committee before they received third reading, and that there was a thorough investigation of them. I want to recall to hon. members who were here just before the house was dissolved at that time

that we gave second reading to them on the evening of the 29th and they received third reading on the morning of the 30th, the day the house was dissolved. There was not very much discussion on those measures during that brief interval.
The Minister of Fisheries (Mr. Mayhew) has just advanced an excellent argument in favour of the amendment. He said that these pipe lines should follow a Canadian route, that Canadian needs should be supplied first, and then we should export our surplus. That is exactly what the amendment says. If those sponsoring these bills can tell the house that they are prepared to carry out the views expressed by the Minister of Fisheries then any objection we may have will be withdrawn.
I rose to point out one thing because nobody else has done so. I do not like to repeat arguments that someone else has made. On April 27, 1949, the other place passed on this problem to us. What I do not like about the business in the first place is that it is back door legislation. It is initiated in the wrong place. If you will recall at that time these bills were introduced, and Bill B8 of the other place, which was Bill 238 of this house, was the master bill. It provided for a capitalization of some $200 million, and for the sale of four million shares at $50 per share. That was the key bill; that was the financial bill. That is the company that is going to own and control whatever auxiliaries are set up afterwards. The other four bills that were passed with this joker did not provide for any capital at all. They were merely stock promotion bills.	For
example, Bill 240, letter D of the other place, provided for no capital but they are going to sell five million shares, and no par value is stated and no nominal sum per share. The company with the capital will get the smaller companies to front for them, and in the final analysis it will buy the shares of the subsidiary companies. The directors mentioned in the bill providing for $200 million capital will own and control these subsidiary companies by buying up their shares.
That is not new. I presume the hon. member for Coast-Capilano has read Myers' "History of Canadian Wealth''. Anyone who has read that book knows that this is the usual front for practically every stock promotion scheme that the country has seen.
I do not like to see us not being smarter than that in 1949. Surely we should develop new and better mechanics of fooling the people. So far as I am concerned, I am quite prepared to form as many of these companies as possible because, as the Minister of
Prairie Transmission Lines Fisheries pointed out, in the final analysis Alberta has the right to license any company that may be exporting gas or oil from that province. The more legitimate companies the province of Alberta has coming to it for licences, companies with the necessary capital and facilities to export gas or oil, the better it is for the province. Alberta will be able to differentiate between a company following a United States route and a company following an all-Canadian route. The final say is in the hands of the government of Alberta as to what companies will get that product for export.
Mind you, this bill is exactly the same as the other four I mentioned, which were put through in April of this year. There is no capital; the stock has no par value. They are going to sell a million dollars' worth of shares, but they do not say how much a share will cost. There is nothing like that in the bill. Bill No. 238 of last session was the master bill that takes over these other companies when they are formed, lock, stock and barrel.
I wanted to point that out, because all over this country the history has been the same. Railways were mentioned by the hon. member for Vancouver East (Mr. Maclnnis). Since this session opened we have seen the government of Canada taking steps to buy up the Temiscouata railway, and to extend another railway in western Canada. This parliament granted franchises to companies that did not have the capital necessary to develop and expand these railways, and after years of inefficiency, after dragging along on a shoe string, performing practically no service, the government has to spend a lot of money to take them over and develop them.
If we are going to do anything along this line the only franchise that should have been granted was the first one, to the company with the capital necessary to go ahead with the project and service the Canadian people. The sentiments expressed by the Minister of Fisheries (Mr. Mayhew) would have been more to the point if this company had intended to follow an all-Canadian route. I believe we should export our surpluses, and should not have to depend upon the United States to give us back what they do not need. If this line follows the suggested route there is no doubt the main valve will be in the United States, and we will just get what they do not want. I do not want to talk out these bills, but just to refresh the memory of the Minister of Fisheries, who made an excellent speech for an all-Canadian route, I should like to read the amendment again, because I want to see him vote for it:
That Bill No. 119 be not now read a second time but that it be resolved that in the opinion of this

Prairie Transmission Lines house further consideration of this bill should be deferred until the house has been assured that the route of any pipe line built by the proposed company will be laid out so as to serve Canadian requirements before any such pipe line leaves Canadian soil.
That is all I intend to say, in order that we may have a vote on. this immediately.


Arthur Leroy Smith: Mr. Speaker, we are not going to have a vote on this immediately. That is the first time I have been able to speak in this house with authority as to what the house is going to do. I intend to discuss first something which I hope may clarify the legal position though some people may say that my remarks will further confuse it. We have all been proceeding on the assumption that the province of Alberta has authority to forbid this gas going from that province. We have taken our cue in that regard from a statement made by the Prime Minister (Mr. St. Laurent); that, in short, was exactly what he said. I am a humble member of my profession, Mr. Speaker, and I have a great deal of timidity in submitting an opinion which may be in any way contrary to that expressed by this eminent lawyer who is our Prime Minister; but in my view that is an incorrect statement of the legal position. I put it on this broad ground; so that everyone may understand, I ask this simple question. Since when did any province of Canada have authority over interprovincial trade? The answer is never. So while the province of Alberta, no doubt with their tongue in their cheek, passed an act dealing with this very matter, I think they know very well that they passed legislation which is quite beyond their jurisdiction.
I give this simple illustration, which is familiar to all. During and after the war there was much discussion in this house

about the shipment of cattle from Canada to the United States. Those of us who were here in the last parliament will remember those discussions. Such shipments were then embargoed; but they were not embargoed by the provinces in which the cattle were raised. The embargo was put on by the dominion government under emergency powers this government possessed by virtue of the War Measures Act. But the point remains, and I am sure I am correct in my statement, that the province of Alberta has not the right to say whether or not gas shall be exported from this country. In my judgment that is a matter solely for the Minister of Trade and Commerce (Mr. Howe), who has taken authority-and when I say that I mean he has been given authority by this parliament-to say whether or not these things may be exported from this country. It is my humble opinion that he and only he, not the province of Alberta, may deal with exports from that province or from the dominion.
It being eleven o'clock, Mr. Speaker, I move the adjournment of the debate.
Motion agreed to and debate adjourned.



BUSINESS OF THE HOUSE

Alphonse Fournier: Tomorrow, which is a short day, we shall continue with the debate on the second reading of Bill No. 144, to amend the Combines Investigation Act. Being an optimist I think I can announce that after that we shall take up Nos. 64 and 65, which are two Department of Justice bills. If we have time we will take up Bill No. 63, respecting the inspection of fish and marine plants.


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