1949-11-03

Mr. G. A. Cruickshank (Fraser Valley):: Mr. Speaker, on a question of privilege, in this morning's Citizen certain derogatory remarks are made about me which I think are unfair, and I shall quote them. They are as follows:
. . . and, for the first time some members of parliament could recall, George Cruickshank (Lib.-Fraser Valley) didn't jump up to say that British Columbia could have produced something better.
The reference is to apples. I did not see this report. One of my colleagues, the hon. member for Vancouver South (Mr. Laing) saw it. We do not boast, and we have never boasted, particularly the member for Fraser Valley, about anything from British Columbia, but my hon. friend arranged to have flown from British Columbia these typical examples of what we produce and they are now on the members' desks. With your permission, Mr. Speaker, I should like to have it recorded that they are but a small example of what we can produce.


Mr. Fulford:: Too bad they are not like Ontario apples, and do not taste as good as they look.


Mr. Mclvor:: We are learning, Mr. Speaker, that there is something quite red which comes from British Columbia, and it is very good, and we say thanks.


Mr. McCusker:: I wish to thank the hon. member for telling us what these are. Many hon. members were under the impression that they were Newfoundland cranberries.


Mr. Jones:: In order to correct the record, may I say that these apples were not grown in the Fraser valley; they were grown in the Okanagan valley.


Mr. Cavers:: Coming from a fruit-growing area in the county of Lincoln, I should like to express my thanks, and the thanks of other hon. members, to the hon. members from the province of British Columbia, and also to the fruit growers of that province, for the fine specimens of apples we have received today. I certainly intend to sample them and compare their taste with that of the fine taste of the apples grown in Ontario.



MARITIME PROVINCES


[Stage Direction]
On the orders of the day:
Mr. G. D. Weaver (Churchill):: Mr. Speaker, on a question of privilege may I say that in today's Ottawa Citizen it is reported that the Minister of Fisheries (Mr. Mayhew) tendered a dinner, and I quote:
. . . given for the express purpose of getting members from Canada's "seagoing" provinces better acquainted.
There were Liberals from British Columbia, the Yukon, Nova Scotia, New Brunswick, Newfoundland and Prince Edward Island.
My point of privilege, sir, is that Manitoba should have been included as a "seagoing" province. Since she has a coastline almost equal to that of the province of British Columbia, she should have been included as a Canadian maritime province. I have visited many of the world's seagoing ports, as far as the east coast of Africa, and I assure hon. members that the facilities of the port of Churchill, and the port of Churchill itself, compare favourably with anything else I have seen. The disadvantages have been well advertised, but not the advantages. Through you, Mr. Speaker, I should like to say to the Minister of Fisheries, and to hon. members from the maritime provinces of Canada, that before this parliament terminates the members of the maritime province of Manitoba, including my good friend the hon. member for Dauphin (Mr. Ward), will tender to them an invitation to a seafood dinner, of which the piece de resistance will be white whale steak, caught in Hudson bay and processed in the great salt-water port of Churchill.


Mr. Speaker:: Order. I have allowed considerable latitude today in connection with questions of privilege, but I hope hon. members will not expect me to continue to do so.



NEW MEMBER

Mr. Speaker:: I have the honour to inform the house that the Clerk of the House has received from the chief electoral officer a certificate of the election and return of the following member, viz:
Of J. Eugene Lefrangois, Esquire, for the electoral district of Laurier.

Questions



MISCELLANEOUS PRIVATE BILLS


[Stage Direction]
Mr. H. W. Winkler (Lisgar) presented the first and second reports of the standing committee on miscellaneous private bills, and moved that the first report be concurred in. Motion agreed to.

[Stage Direction]
(Questions answered orally are indicated by an asterisk.)
OLD AGE PENSIONS Mr. Diefenbaker:
How many old age pensioners, by provinces, are now in receipt of the maximum old age pension?
Mr. Marlin:: Province	Old Age	Blind	TotalAlberta	12,189	378	12,567British Columbia.	20,458	506	20,964Manitoba 	12,918	473	13,391New Brunswick. . Newfoundland	7,438	925	8,363(maximum $30)	4,215	23	4,238Nova Scotia	6,590	785	7,375Ontario	
Prince Edward	65,304	1,832	67,136Island 	1,085	75	1,160Quebec 	52,876	3,361	56,237Saskatchewan . . . Northwest	11,384	410	11,794Territories ....	19	1	20Yukon Territory.	75	-	75194,551	8,769	203,320
The above information, except that relating to the Northwest Territories, was furnished by the provincial old age pensions authorities.
Note: Figures for all provinces, except Quebec, are as of September 30, 1949. Figures for Quebec are as of October 31, 1949. As of dates shown, all cases had not been reviewed by provincial old age pensions administrations in the light of the 1949 amendment to the Old Age Pensions Act.



MINES AND RESOURCES


Mr. Viau:: 1.	Did the Department of Mines and Resources, during the years 1948 and 1949, request through the civil service commission applications for immigration settlement officers?
2.	If so, on what dates and when were applications tiled?
3.	How many are being employed in various centres throughout Canada (a) temporary; (b) permanent?
4.	How many for each province?
5.	What are their duties?

6.	How many in each province are required to have a knowledge of both the English and the French language?
7.	Were applicants for Manitoba and Saskatchewan required to have a knowledge of both the English and the French language? If not, why not?
8.	What are the names of the immigration settlement officers selected for the provinces of Manitoba and Saskatchewan?
9.	What are their qualifications and ages?


Mr. Gibson (Hamilton West):: 1.	Yes.
2.	(a) May 21, 1948; (b) October 30, 1948.
3.	(a) 4; (b) 4.
4.	Quebec, 2; Ontario, 2; Manitoba, 1; Saskatchewan, 1; Alberta, 1; British Columbia, 1.
5.	Under direction, to report upon opportunities for the establishment of immigrants in farming or small business enterprises; to advise and, if required, to assist immigrants in becoming suitably established; to prepare reports on specified areas; to conduct correspondence and perform other related duties as directed.
6.	Quebec, 2; Ontario, nil; Manitoba, nil; Saskatchewan, nil; Alberta, nil; British Columbia, nil.
7.	No. It was not deemed necessary in order to give satisfactory service to require applicants to possess a knowledge of both English and French languages.
8.	The following persons were appointed by the civil service commission: Manitoba: William Cox McCullouch; Saskatchewan: William Robert Sinton. Both these men are veterans of the first great war.
9.	W. C. McCullouch: Immediately prior to his appointment to the Department of Mines and Resources, Mr. McCullouch was settlement supervisor at Winnipeg under the Veterans Land Act. He is fifty-one.
W. R. Sinton: Prior to his appointment in the Department of Mines and Resources, Mr. Sinton had extensive experience in agriculture, and from 1946 until 1949 was employer representative on the court of referees, unemployment insurance commission. He is fifty-one.



NEWFOUNDLAND


Mr. Browne (Si. John's Wesi):: 1 What staff is now employed by the engineering branch of the Department of Public Works in Newfoundland?
2.	What are the names of those employed?
3.	What salary is paid to each?


Mr. Fournier (Hull):: 1, 2 and 3.
Name-Position-Salary per annum
Gerald Millar, engineer, grade 6, acting as district engineer, $5,040.

A. E. Cameron, grade 1, $2,880.
G. Bannister, maintenance supervisor, grade 2, $2,340.
J. Dicks, maintenance supervisor, grade 2, $2,340.
Miss M. M. Downey, stenographer, grade 2A, $1,500.
Note: G. Millar on loan from Ottawa headquarters. A. E. Cameron on loan from Ottawa headquarters, but he will shortly be transferred to Newfoundland staff as an engineer, grade 2.




Mr. Browne (St. John's West):: 1.	Has there been an examination or investigation with a view to the construction of a bridge over Placentia gut at Placentia, Newfoundland?
2.	If so, what report has been made on this matter?


Mr. Fournier (Hull):: 1.	Yes.
2.	Survey of the site and preliminary report only have been made.



CENSORSHIP OF BOOKS

Mr. Diefenbaker:: 1.	Who is the examiner of publications or censor in the Department of National Revenue, customs and excise section?
2.	How many (a) books; (b) journals; (c) comics, have been denied or refused admission by the said examiner or censor during each of the years 1948 and 1949 to date?


Mr. McCann:: 1.	There has been no position of examiner of publications since the retirement of the previous incumbent on July 17, 1942. Censorship in the broadest sense is not exercised by the customs division, but the department is responsible for the administration of item 1201 of the Customs Tariff, which prohibits the entry of publications of a treasonable, seditious, immoral or indecent character.
2.	The following publications have been classified under tariff item 1201 during the years 1948 and 1949:
1948	1949
(a) Books	 45	81
(b) Magazines and newspapers 23	22
(c)	Under the provisions of the Emergency Exchange Conservation Act, periodical publications unbound or paper bound, commonly known as comics, but not including bona fide supplements used with newspapers, are prohibited entry.



TRADE AGREEMENTS


Mr. Diefenbaker:: 1.	Have any trade agreements been negotiated or completed within the last year between the republic of Spain and Canada?
2.	If so, what are the particulars thereof?
Questions


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



UNEMPLOYMENT INSURANCE


Mr. Knowles:: 1.	Has the unemployment insurance advisory committee or the unemployment insurance commission received from an actuarial expert, at any time since January 1, 1948, any recommendation with respect to the request that the Unemployment Insurance Act be amended so as to make it possible for a recipient of unemployment insurance benefits to continue to receive such benefits even though he becomes ill after being awarded the same?
2.	If so, what are the terms of such recommendations?


Mr. Cote (Verdun-La Salle):: 1.	No. The unemployment insurance commission has received a preliminary report in regard to sickness insurance from Mr. A. D. Watson, actuarial adviser, Department of Insurance, but this report contains no recommendations.
2.	Answered by No. 1.



QUESTIONS PASSED AS ORDERS FOR RETURNS


NATIONAL HARBOURS


Mr. Isnor:: 1.	What was the ratio of operating expenses to operating revenues for all harbours under control of the national harbours board, for each of the years from 1936 to 1948?
2.	What was the ratio of operating expenses to operating revenues for each of the harbours under control of the national harbours board, for each of the years from 1936 to 1948?
3.	Have tariff schedules been increased at any of the harbours since 1938?
4.	If so, what was (a) the year or years increases were made; (b) the amount of increases; (c) the name or names of ports affected?


Mr. Chevrier:: Return tabled.



SPONGES


Mr. Knowles:: 1.	Since April 1, 1948, how many contracts have been made by the Canadian Commercial Corporation, or any other government agency, to cover procurement for the armed forces, or any other government requirements, of (a) sea sponges; (b) synthetic cellulose sponges?
2.	With reference to each such contract, what is the name of the supplier, what are the types, sizes and quantities of sponges supplied, and what is the contract price for each such type, size and quantity?



PRESS REPORTS OF REMARKS OF MR. DONALD GORDON IN NEW YORK ON NOVEMBER 1

[Stage Direction]
On the orders of the day:
Right Hon. L. S. St. Laurent (Prime Minister):: Mr. Speaker, the hon. member for Broadview (Mr. Church) has sent me a note
1396	HOUSE OF
Inquiries of the Ministry asking if I would make a statement in answer to a question he asked yesterday on the orders of the day, and which unfortunately I was not able to hear.
The question has to do with a report of a speech attributed to Mr. Donald Gordon in New York. As it appears at page 1,370 of Hansard, the question is as follows:
Is this government policy, or is it not? As head of the national railways was Mr. Gordon authorized to make this statement?
The report, as I read it, is a statement which Mr. Gordon is supposed to have made before the convention of the national foreign trade council in New York. The first part of the question is: Did he go over there for the government? He did not go there for the government. I assume he went there on invitation as deputy governor of the Bank of Canada.
The other part of the question is: Is this government policy, or is it not? It does not purport to be a statement of policy, as I read it. I suppose it is the fruits of Mr. Donald Gordon's experience as deputy governor of the Bank of Canada. However I think it is a statement with which many of those who believe in the value of world trade would be inclined to agree. It seems to me it does not differ very much from the statement attributed to Mr. Acheson, secretary of state for the United States, along the same lines, the report of which many of us welcomed this morning.


Mr. Church:: I thank the Prime Minister for his courteous reply.



CONSULTATION BETWEEN CANADIAN AND UNITED KINGDOM OFFICIALS

[Stage Direction]
On the orders of the day:
Mr. G. K. Fraser (Peterborough West):: Mr. Speaker, I should like to ask a question of the Minister of Trade and Commerce or the Minister of Agriculture. The United Kingdom press and the Canadian press state that United Kingdom buying in Canada is to be cut. Will the minister make a statement to clarify this situation?


Right Hon. C. D. Howe (Minister of Trade and Commerce):: I have nothing to add to the reply I gave to this same question a few days ago. Representations have been made through officials of our government to officials of the government of the United Kingdom, and ministerial decision is expected in due course. After a decision is made it will be communicated to the house.



COMBINES INVESTIGATION ACT


[Stage Direction]
On the orders of the day:
Hon. Stuart S. Garson (Minister of Justice):: Mr. Speaker, yesterday I was asked by the hon. member for Rosetown-Biggar (Mr. Cold-well) the following question:
Has a report been made by the commissioner under the Combines Investigation Act on alleged violations of the act in the flour milling industry?
The answer is yes. Then the question continued: "If so, will the minister table it?" The answer is yes.
Then the hon. member for Vancouver East (Mr. Maclnnis) asked this question:
Will the minister tell the house whether Mr. F. A. McGregor, commissioner under the Combines Investigation Act, has resigned?
The answer is yes. The question continued: "and if so, whether his resignation has been accepted." The answer as of today is yes.


Mr. Maclnnis:: Will the minister answer a supplementary question? Has one of the deputy commissioners under the Combines Investigation Act also resigned?


Stuart Sinclair Garson: The answer is yes.


An hon. Member:: Why?


Mr. Diefenbaker:: Further to the answer given by the Minister of Justice, will he table the correspondence between Mr. McGregor, the deputy commissioner, and himself, and the replies, if any, before tomorrow afternoon, when apparently the proposed amendment to the Combines Investigation Act will be discussed?


Stuart Sinclair Garson: The council meeting at which the resignation was considered was concluded at two o'clock this afternoon, and my letter has not yet been written to the commissioner. I shall be able to table his letter and my reply tomorrow.


Mr. Knowles:: Will the report to which the minister referred be published within fifteen days of its receipt by the minister, as required by the act?


Stuart Sinclair Garson: The report in question will be tabled on Monday next.


Stanley Howard Knowles: When did the minister receive it?


Stuart Sinclair Garson: Some time ago.


Stanley Howard Knowles: In other words, the minister does not keep the law.

(Translation):



FRUITS AND VEGETABLES


[Stage Direction]
On the orders of the day:
Mr. Leopold Demers (Laval):: I would like to ask the Minister of Finance a question which I consider urgent and highly important.
Since the removal of import restrictions on certain foods, particularly on vegetables, the Canadian market, especially in Montreal, has been flooded with American products selling at less than production cost in Canada. Here is my question.
Is the government considering steps to protect gardeners in the Montreal district from this ruinous state of affairs?


Hon. Douglas Abbott (Minister of Finance):: Mr. Speaker, in reply to the hon. member from Laval, I must say that the government does not contemplate any special steps in this regard. I would call the hon. member's attention to the seasonal tariff protecting this category of food products.
(Text):



ARMISTICE DAY


[Stage Direction]
On the orders of the day:
Mr. G. S. White (Haslings-Peierborough):: Will the Prime Minister indicate whether the house will be sitting on Armistice day, and whether Armistice day is a legal holiday?


Louis Stephen St-Laurent: I will answer the second part of the question first. Armistice day is a legal holiday. To answer the first part of the question, may I say that, in conformity with the practice which has prevailed for several years when parliament is in session at this time, the house will sit on November 11.



CRIMINAL CODE


[Stage Direction]
On the orders of the day:
Mr. C. W. Hodgson (Victoria, Ont.):: On a
question of privilege, I should like to refer to an article which appeared in The Ensign of November 1. This article which appears on the first page is headed: "So far, so good". It refers to the bill introduced by the hon. member for Kamloops (Mr. Fulton), and it
The Budget-Mr. Jones congratulates both the government and the hon. member upon this legislation. It goes on to say:
Congratulations are in order in connection with the proposed changes in the criminal code to ban crime comics and to tighten the prohibition of obscene publications.
I should like to send to the Minister of Justice (Mr. Garson) a couple of books that have been sent to me by some of my constituents-


Mr. Speaker:: Order. I stated earlier that I had been allowing considerable latitude when questions of privilege were raised, but I asked that I should not be requested to do so in the future. I do not think this is a question of privilege that should be raised at the present time.



THE BUDGET


[Stage Direction]
The house resumed, from Wednesday, November 2, consideration of the motion of Hon. Douglas Abbott (Minister of Finance) that Mr. Speaker do now leave the chair for the house to go into committee of ways and means, and the amendment thereto of Mr. Rowe, and the amendment to the amendment of Mr. Thatcher.
Owen Lewis Jones: Mr. Speaker, when the house adjourned yesterday I had quoted a Canadian Press dispatch which had appeared in the Ottawa Citizen. I was drawing attention to the trend in Great Britain and other countries in the sterling bloc to seek commodities from other than dollar countries-in other words, to seek them in the areas where supplies were available. I mentioned such things as newsprint, bacon, eggs, timber, and so on. In the same edition of the Citizen was an editorial which I should like to place on Hansard. It reads:
A forward step in British colonial administration is the establishment of university colleges in the West Indies, Nigeria, and the Gold Coast. These have completed their first teaching sessions. Emphasis is on practical studies like rural science, so that graduates may accelerate the economic development of the colonies.
Those two articles show quite clearly the desire of Great Britain to break away from the dollar areas in purchasing her requirements, and to find these elsewhere. This curtailment may affect us considerably in the near future. In pursuance of this policy, Great Britain has developed large areas in Africa for the growing of groundnuts, which play a great part in the economy of the country. By developing these lands and seeking new markets in sterling areas, the British

The Budget-Mr. Jones are following a logical course from their point of view. These facts are too selfevident to need further emphasis.
Our position is just as clear and simple. We must put up a fight to retain the British market, and we must do so before it is too late. I was pleased to see that the Minister of Agriculture (Mr. Gardiner) is taking a progressive step to retain the last segment of this market by arranging a contract for $3 million worth of apples. While this is going to cost the Canadian people some money in the current year, I think in the long run we shall gain through retaining a market that is one of the best markets British Columbia ever had. The fruit growers in my district are pleased with the action taken by the government, and would welcome any further action that would make this market a permanent one. I believe the amendment to the amendment would have that effect and I appeal to hon. members on both sides of the house to support it. As I see it, the situation calls for urgent action.
Another subject I should like to deal with is one that was raised a short while ago by the hon. member for Vancouver-Quadra (Mr. Green), who referred to the tremendous growth in population in British Columbia during the past few years. This has brought a considerable problem in its wake, one being the increased cost of education to the municipalities. Many of the British Columbia municipalities find themselves unable to keep a reasonable balance between the cost of education and other services needed in a community, such as roads, sidewalks, light, power, sewers, and so on.
The first charge on a municipality is that of providing educational facilities; then if there is anything left it is used to provide the other services. As I say, this unusual growth of population in British Columbia has placed an unfair burden on some of the municipalities. In some cases the municipalities are left with insufficient funds to carry out immediately necessary projects such as waterworks. Many of them have borrowed to the legal limit of around twenty per cent, and of necessity have had to leave undone many essential works that may be needed, such as sewers, waterworks, roads and so on.
I have in mind one very progressive municipality in my riding, the town of Enderby. The officials wrote to me a short time ago and pointed out that that municipality had been faced with the usual growth of population throughout the province. They stated that their education costs were worrying them, because they had had to increase their school accommodation, as well as the teachers' salaries. The general cost of education has gone up in the district. On top of all this


they have to build a new hospital. This could not be avoided, because the old one was simply a firetrap and completely obsolete. They are now compelled to renew their waterworks. Enderby is not a very large town, and during the war, or even before the war, they were in difficulties. They were in difficulties in the thirties, and the government helped them out. Therefore their credit would not be considered the best. Today they must have a new waterworks plant which will cost $178,000. It is a must. They have written me asking whether I know of any means by which they can get money from the dominion government. I made inquiries, and found that no such funds are available. I also discovered that there is an act under which something might be done to assist them. It is the Municipal Improvements Assistance Act, under which municipalities were allowed to borrow money at two per cent for self-liquidating projects. Under it $30 million were made available for municipalities. Up to date $7 million have been used; the remaining $23 million were frozen by action of the government in 1940, when further access to the fund was denied. In the first place I believe it was a mistake to deny access to it. I understand that the fund was reopened for the benefit of the province of Quebec, which borrowed money for three or four years afterwards. It was a good act. I am going to ask the government to reconsider making it operative again, and thus give a break to the municipalities.
The position of the municipalities today in a province such as British Columbia is almost as serious as it was during the depression. They must grow, and they must have the facilities to take care of that growth. They must look after the health of their people, and they must have access to money bearing reasonable interest. Self-liquidating loans of this type are a sound financial investment; but more than that, they would bring untold returns by way of improvement in the health and general economy of the community. This is particularly so in the case of towns such as Enderby, which need more than the legal amount they are allowed under the municipal act, or possibly more than they could get on the open market.
I would not advocate the making of loans to the same extent as was done twenty or thirty years ago. I have in mind one town in the province of British Columbia which was compelled to borrow money over a fifty year period. After eighteen years the project for which the money was borrowed had no asset value whatsoever. It happened to be wood stave pipe. For thirty years following the loss of use of the project they had to continue to pay interest at the rate of six

per cent. I am not referring to projects of that kind; I have in mind self-liquidating projects which will return the money to the government within a reasonable number of years.
These municipalities do not expect charity. They are not willing to accept assistance of that kind, but they do seek a fair break in getting access to this money. I would go further and suggest that sound self-liquidating projects of this nature should be able to borrow money anywhere at two per cent, directly from the Bank of Canada, if you wish. After all, the wealth of Canada is not in bank credits but in the numerous progressive communities of our land. It is in our wheat fields, our mines and our timber. To my mind, the function of the Bank of Canada is to make funds available at a low interest rate in order to promote the development of these areas, thereby adding more tangible wealth to our economy. I think that the rules governing the operation of the Bank of Canada should be altered if there is to be substantial immigration to Canada in the near future. With access to that money we could have the 500,000 houses we need, and also the municipal improvements that we seek.
During the last war, British Columbia municipalities prepared plans for rehabilitation and reconstruction of their communities. The plans called for the expenditure of millions and millions of dollars, and the assumption was that the government would make funds available at a low rate of interest. So far as I know, most of them are still in abeyance. To my knowledge the bulk of the plans were sound; they were prepared by qualified engineers, right down to the blueprint stage so that they were ready to proceed. I am satisfied that unless the government change their present policy and make this money available, these plans will remain in abeyance for all time to come, because they call for a greater expenditure than any participating municipality could borrow legally on the open market.
I should like to point out that the government is doing its utmost to speed up the housing plans of the dominion. Criticism has been levelled against the government for not acting rapidly enough. I believe it is folly for the government to accelerate the construction of houses unless the municipalities in which the houses are to be built are assisted in securing the facilities necessary to service them. That is why places such as Enderby must have access to funds to which I have referred.
In Hansard of June 11, 1947, both the hon. member for Eglinton (Mr. Fleming) and the hon. member for Coast-Capilano (Mr. Sinclair)
The Budget-Mr. Jones made valuable contributions in discussing the merits of the Municipal Improvements Assistance Act. I do not intend to quote from their speeches, but anyone who has any doubt about the merits of the legislation, and the benefits to be derived therefrom, can read the record. It is true that the act was designed to meet emergent conditions created by the depression, and that the conditions today are somewhat different. Speaking generally, this may be true, but fast growing municipalities are faced with the same problems of finance now as those which confronted them during the depression. The municipalities to which I refer are those which were incorporated and laid out for a population of from three to four thousand, and which now suddenly find themselves compelled to take care of a population of eight to ten thousand people without a single acre of new land being added to their taxable areas. One drawback is that the area of land within the municipality does not grow according to the increase in population. Assessment values, therefore, do not increase sufficiently to compensate for the population increase.
Having regard to the limited area incorporated, the argument may be advanced that the dominion government has no direct responsibility to assist these municipalities. May I point out that the average municipality carries between twenty and twenty-five per cent of its property tax free. Of course that includes churches and dominion and provincial public buildings. The cost of providing services to these tax-free assessible properties is carried by the other seventy-five or eighty per cent of the population who pay taxes. Many of these buildings are the property of the dominion government. I was pleased to hear the suggestion made-although not a promise-that money may be available to compensate municipalities for the services they provide to public buildings. These buildings receive, and expect to receive, police protection, road protection, fire protection, sewer and water services, and they would be the first to kick if they did not get them.
The other reason why the dominion government should assist municipalities is a simple one. In my riding we have a dominion experimental farm. Naturally there are children living there, and there is no dominion government school for them to attend. They attend the school at Summerland. The school board quite rightly feel that the dominion government should assist by taking care of some of the cost of educating children whose parents do not pay taxes because they live on dominion government experimental farm land. The same could be said of caretakers and others living on dominion government premises whose children attend school. The

The Budget-Mr. Jones principle is not new, because already this government takes care of the cost of educating the Indian children who attend the very same schools.
When all these things are considered, it will be seen that the dominion has a direct interest in the welfare of the municipalities; therefore I feel justified in asking the government to bring into operation the Municipal Improvements Assistance Act. Under this legislation a municipality could borrow a portion of the $30 million on a pro rata basis, in relation to the population of the dominion. In other words a town of 3,000 could borrow approximately $9,000, and so on. But the legislation also contained a clause under which a municipality which might not qualify otherwise could borrow up to $200,000, an amount far greater than would be available on a per capita basis. It may be necessary to broaden the act to provide a far larger amount for distribution than $30 million, but I do feel that in this act the government have an instrument that should not be withheld at the present time. Either make use of it and distribute the remaining $23 million, or broaden the act and carry it even further. I understand that one province would not take advantage of this legislation when it was available; but if no other province wants it,
I think I can say on behalf of the British Columbia members that we should be glad to take the whole $23 million for municipal improvements in our province, though I understand the maritimes would like some of the money also.
Before concluding my remarks on this subject I would point out that no municipality which borrowed money under that act is in default with respect to either principal or interest, though most of the municipalities which took advantage of it were regarded by the orthodox finance houses as being on the borderline of sound finance.
I want to deal with one other subject, and in doing so to make a suggestion to the Minister of National Revenue (Mr. McCann).
I have been receiving quite a number of letters from people in my riding who have a member of the family taking medicinal drugs, originally under the supervision of a doctor but later, presumably after a period of training, being permitted to take them without going either to the doctor or to the hospital. Sometimes the cost of these drugs is very heavy. In one instance I had brought to my attention it costs $60 a month, or $700 a year, for the drug in question; but when they claim exemption in respect of income tax they are refused. On the other hand if the person concerned had the same amount added to his doctor's or hospital bill, it would be allowed as an exemption. I merely ask the


minister to consider changing the act so that anyone who is so unfortunate as to be obliged to take these drugs and to meet these heavy expenditures, while not directly under the supervision of a doctor or hospital, may claim the same exemption that would be granted if these amounts were added to the bill of the doctor or the hospital.


Mr. George A. Drew (Leader of the Opposition):: Mr. Speaker, in rising to take part in the debate on the budget I wish to deal with only a limited number of points that arise in this connection, since in fact this budget was under discussion earlier this year as well as during the present session. The figures before us are virtually the same as those which were under consideration earlier in the year. We must recognize that in most cases a large part of the expenditure already has been made and that the government is committed to those expenditures; no practical result, therefore, can follow from suggesting substantial changes in any of these items.
There are, however, certain aspects of this budget which should be of particular concern to members of this house at this time. As we look through the estimates which give the detailed amounts covered by the budget as a whole we find that the Department of National Defence spends more than any other single operating department of government. For that reason alone, if there were no other, it would be the duty of every hon. member, before passing upon the budget as a whole, to examine carefully how that very large amount is being spent.
Expenditures for national defence take on a new importance in view of the fact that Canada has assumed responsibilities in connection with the preservation of peace. It has been said in this house on a number of occasions that the hope for peace depends upon the combined strength of the free nations joined in the Atlantic security pact, and therefore the estimates before us have a special meaning at this time. But apart from the importance which may be attached to these estimates for that reason, there is the fact that the taxpayers of Canada are being called upon to spend nearly $400 million on national defence during the current financial year. It is the duty of hon. members of this house to take whatever steps may be regarded as necessary to ensure that this enormous sum will be properly expended and put to the best possible use for the purposes for which it is asked.
The actual estimates for the Department of National Defence amount to $375 million, but with the supplementary estimates and civilian expenditures associated with national defence activities we can take the round figure of $400 million as the amount to be expended this year by the taxpayers of

Canada on the defence of their country and as one of the member nations of the North Atlantic security pact. For this reason the members of this house who are considering the expenditure of these large sums should at the earliest moment give full consideration to the meaning of the Mainguy report- especially when one examines the purpose of these expenditures and the effectiveness of them. Requests have been made on a number of occasions for a standing committee on national defence. Such a committee has not yet been set up, and on different occasions the Minister of National Defence (Mr. Claxton) has indicated an unwillingness to set it up. If there ever was a doubt in the minds of the members of this house that there should be a committee of this house on national defence, it would be removed by a careful reading of the Mainguy report.
It is necessary to remember that this report does not cover the function of the navy as part of our national defence organization. It deals with a limited part of the activities of the navy, as is indicated in the opening part of the report. On the first page, in their submission to the Minister of National Defence, the commissioners state that their conclusions are unanimous. Then they go on to say:
In an attempt to assist you, the government of Canada and the officers administering the Royal Canadian Navy, we were requested to find out and record what happened on the occasion of each of the incidents of alleged mass insubordination which occurred in the three ships concerned. We were further instructed to make appropriate recommendations, if we reached the conclusion that there were things which could and should be done to improve conditions of service, the relations between officers and men, the machinery for the ventilation of grievances and other collateral matters. We were also asked to consider whether there should be changes in regulations, conditions of service, and the training of naval personnel.
That indicates the positive limitations of this inquiry. The Mainguy report is so far-reaching, and so important in what it presents to the members of this house, as well as to the people of Canada, that we could well bear in mind that as to the organization of the navy for the particular duties assigned to it, the suitability of the ships, and the general composition of our naval forces, we receive no information. The report deals with the limited problem that was placed before the commission. I think it is proper to say that the commissioners have, by their report, demonstrated the value of inquiries of this kind. It shows what can be done in a constructive way to advance the defence services of this country by exposing to public examination those things which the people of Canada should know, and particularly, and above all, which the members of this parliament, the supreme
The Budget-Mr. Drew authority for expenditures of this type and for the organization of our defence forces, should know.
The report deals with a number of subjects. I should like to refer to some of the findings, because they have a direct bearing on the discussions that have taken place from time to time on the general problem of national defence.
On page 10 referring to consideration of the situation on board H.M.C.S. Magnificent, the report has this to say:
The complaints concerned unsanitary conditions and the presence of bedbugs, defective showers, overcrowding and inadequate arrangements for latecomers at meals. There was some ground for all these complaints. It was apparent that some of the matters complained of were adjusted. Overcrowding could not be dealt with at all during the cruise. Some fumigating was done to make the living quarters more sanitary. We are of the opinion that a good deal more of explanation could have been given of the reasons why some things could not be done. Reference has been made to the alleged lack of the proper planning of aircraft operations. It is true that a number of flights were cancelled for reasons which were not apparent to the men concerned. Apparently the aircraft handlers took some pride in their work and were quite willing to do extra tasks if they knew they contributed to the objects of the cruise. They felt that some of the changes were capricious, whereas many of them could have been easily explained but were not. The medical evidence suggested that some of the unhappiness and restlessness on board a ship which everyone called "unhappy" could be attributable to the tropical heat to which many of the men were not accustomed. This appears reasonable.
I should like to point out, in regard to this particular quotation, that all the matters to which reference is made are matters of administration, which means that, if the organization of our navy is in any way effective, they must have been brought before the Department of National Defence over and over again. If they were not, then there was a complete breakdown in the administrative organization of that department. These are conditions which any ordinary process of inspection, or any attempt to find out what was being done with extremely important equipment, would disclose very quickly.
I turn to page 41 of the report. In the intervening pages there is a tremendous amount of useful information and extremely useful recommendations. On page 41 there is a reference which may be regarded as a summary of the important recommendations contained in the report. On that page I read the words: "The Nelson tradition is overdone". No one in this country, Mr. Speaker, is more anxious than I am to see our defence organization and every aspect of our defence preparation truly Canadian, but I should think that the navy of the United States, or the navy of any other country in the world, would be proud of the Nelson tradition, which was

The Budget-Mr. Drew one of outstanding success in that great branch of the service. It is not a question of continuing to follow an ancient pattern. Nelson fought in ships under sail, and undoubtedly Nelson had an able force, recruited under very different methods from those described in this report. I am not now referring to the invention of the radio. In those days people had different views as to methods of encouraging enlistment in the armed forces of the time, but so far as the tradition was concerned, it was one which seemed to be good. I have found that our friends in the United States-and I mention the United States because we must recognize that that country provides the great central strength of our combined system of defence of the free world-at all times have been only too willing and too anxious to embrace the traditions which they inherited in earlier days from another land. I find that they study with enthusiasm the events which led to success in that branch of the service in an earlier day. But there is one Nelson tradition which in this house has been preserved. Every time an hon. member has raised some question in regard to national defence, has sought further information about it and advocated an inquiry by a committee of the house set up for the purpose, the Minister of National Defence (Mr. Claxton) has followed one well-known Nelson tradition; he has put the telescope to his blind eye; he has refused to see the subject that was being discussed. This particular Nelson tradition is not one that has borne very useful results in this particular case, and I think every hon. member will agree that it might well be abandoned; that we should put the telescope to the good eye and begin to appreciate these extremely important responsibilities.
I should like to refer to a statement which appears on page 42. There is the positive statement of these men that, according to the reports they received, the present actual complement of officers and men-and this was stated by several witness-was inadequate for the existing commitments and tasks of the navy if it is to concentrate on training, as it must do.
The report goes on to make certain suggestions which the commissioners believe would be helpful in meeting the situation. In the next paragraph on page 42 the report says that there are too few ships available for adequate training. My information is that certain steps have been taken to improve that situation, and that one of the ships which had been used for other purposes is now being used for training purposes.
On the next page, under the heading "Recruiting", there is a statement which has

a direct bearing on the expenditures of public money. This is what the three commissioners found:
In our opinion, and in the opinion of almost every witness, the recruiting methods were bad. Many officers complained that the organization of advertised recruiting had been left almost entirely to professional advertisers and specialists in commercial radio, who have known nothing of the navy, however skilled they may be in the sale of consumers' goods to a coy and jaded public. We propose to deal with this matter at some length, as we join with the men and officers whom we have examined in the belief that "soft soap operas" do not contain the virility, dignity and patriotic appeal which should be used to persuade young Canadians to serve their country.
That is something that every hon. member has observed. Looking at the advertisements for the navy, many people might imagine, until they read them more carefully, that they were advertisements for a world cruise in which the greatest possible comfort would be available for all who took this special opportunity. As the report points out, our young people are ready to assume their full responsibilities. They are a virile, courageous and energetic group of young people who are prepared to perform the tasks that are involved. What this report points out is to suggest that this is just some pleasant episode in which the crew are taking part creates an entirely wrong approach in seeking enlistments in the navy. The report suggests that it is desirable that an appeal be made to the real spirit of our people to take their share in the duties of nationhood. That general recommendation is one which certainly should have a bearing on the question of the continuance of some of these radio broadcasts, which give the impression that the appeal is being made for something in no way related to naval training or naval service.
On page 53 there is another reference in regard to recruiting, which follows a number of intervening pages that deal with this matter in some detail. It is as follows:
In recruiting, what is sometimes called the "bed of roses" approach, and what is sometimes called the "beer and skittles" approach should be eliminated. Naval officers themselves should be invited to take far more interest and a much greater part in recruiting campaigns. Neither the design nor the content of publicity should be left to commercial advertisers. Every naval officer examined criticized what has been done. While their criticism may be fair, their abstention from this activity in the past placed an unjust burden upon those whose duty it was to shape the programs. A consultation between naval authorities and officers of the Royal Canadian Mounted Police would probably produce some good ideas. In any event, we have sufficient faith in the youth of Canada to believe that they will not shrink from rigours if they know they are essential to national service.
Nor do we think either, that they need to be molly-coddled before they will offer themselves in their country's needs. In the picturesque phrase of one journalist who wrote about the navy, they

will not run away from the sea it they realize that "the navy is a challenge and not a chesterfield." If they are told that the navy, while treating its men and their dependents fairly, and paying them good wages and giving them wholesome food, is nevertheless a career for a "man," hard to enter but honourable, patriotic and adventurous, we do not believe that young Canadians will fail to respond to the appeal of their country.
That is the end of the quotation, but it is a quotation which should be in the minds of all hon. members in examining the very large sums being spent on advertisements of this kind, and on the soap operas to which this report refers.
Then, at page 60 there is another item of importance in discussing this whole subject, and it comes under the heading of "Laundries". This may seem unimportant in itself, but it is very important to people who require facilities of that kind. I quote the following from page 60:
We received most vigorous evidence concerning the absence of proper laundry facilities at Esquimalt. The situation, in our opinion, demands immediate attention. In spite of frequent representation by responsible officers, over a period of years, no laundry yet exists in Esquimalt.
There is a naval laundry at Halifax. Esquimalt should be given the same facilities immediately.
The point I should like to make is that this refers to repeated representations by responsible officers. There again, if that is something that needs to be done, and has needed to be done for some years, then there is definitely some breakdown in the organization, and a breakdown in the chain of responsibility in the over-all administration of this service, if that has not been acted upon. While in this particular instance it deals with the absence of a laundry, it is quite possible a much more serious subject might receive equal treatment under the same system of administrative responsibility.
Then at page 67 we find the very strongest emphasis placed upon training that should be given in the matter of the relationship between officers and men, and the requirements of full instructions in the humanities. There, again, is something that stems from the top, and for which those in the highest position of responsibility must assume responsibility in respect of everything that has happened.
At page 70 the report deals with recreational facilities ashore, and makes this finding:
Shore facilities for the recreation, entertainment and, education of Canadian sailors are very inadequate, especially on the west coast. They are somewhat better at the east coast. Many of the men are aware of what the United States authorities do for the officers and men of their navy. We had the privilege of visiting the Seattle Naval Air Station Recreational Building at Seattle. When we compared the magnificent facilities for the playing of games, for the carrying on of hobbies, for sea bathing and for reading at Seattle with the dinghy
The Budget-Mr. Drew surroundings, the poor quarters and the lack of equipment at Esquimalt, we could not be anything but envious for our country's sake.
I feel sure that the word "dinky" is the word that was originally intended, when they refer to "dinghy surroundings". I should think "dinky" would be the only appropriate word.


Douglas Charles Abbott: No, "dingy".


George Alexander Drew: Oh, I thought it was probably
"dinky".


Douglas Charles Abbott: I would think it was "dingy", which is a good English word.


George Alexander Drew: There is another reference at page 71 under the heading "Films at Sea" and this again makes the finding that a great deal more could be done to provide films at sea, that this whole matter should be dealt with, and that the national film board should be brought into this general picture. They say much greater use could be made of the film board, although the ordinary educational films are not popular with men at sea. I quote this statement from page 72:
Many of them told us, however, that they would be interested in travel films and particularly in films depicting life in countries to be visited on their various cruises.
Then at pages 72 and 73 we find the conclusions which, at this time, I do not propose to read in detail. However, they are conclusions which relate to the whole question of the proper expenditure of our money, and what we are getting for this enormous sum that we spend. One finding which I believe will be welcomed by every hon. member is that in paragraph (1) at page 73, which states:
We do not believe that there are any so-called "subversive" forces at work in the navy or that any such elements were responsible for the incidents. Like many other similar happenings, they passed through the usual phases of discontent, exaggeration of grievance, folly and thoughtless action.
The whole report, Mr. Speaker, is simply a finding within a limited field to the effect that there has not been effective administrative supervision of our naval services. There is no one in the house who has had contact with the members of the Royal Canadian Navy who does not realize that the personnel of that navy commands the admiration and respect of the people of Canada. It should be a matter of concern to every member in the house, wherever he sits, to make sure that appropriate steps are taken to deal with the findings in this report.
The point however which I should like to emphasize in this budget debate is this: This report opens only one window to the
1404	HOUSE OF
The Budget-Mr. Drew whole national defence department. What we see here indicates the urgent need for similar inquiry into every other aspect of our defence organization and administration in Canada. Across this country young men and women in the permanent and nonpermanent units of the navy, the army and the air force are doing a splendid job within the limitations of the opportunities afforded to them. In any one of the naval, military or air stations across Canada we can see young men and women carrying themselves in a manner that justifies the pride of every Canadian in those who wear the uniform of Canada. The least that we can do as members of parliament is to accept the responsibility of making sure that the $400 million of the taxpayers' money that is being spent for national defence is spent in the best possible way.
Nothing will contribute more effectively to the efficiency and high morale of those young men and women than to be sure that what money is being appropriated for this purpose is being put to the best possible use. I have no intention of reviewing in detail the many incidents that have occurred or going back over the discussions which have taken place in the past, but it will be recalled that in response to repeated requests for a standing committee on national defence the hon. members of this house have been given over and over again reassuring statements as to the complete efficiency of every operation in every branch of the department.
Those members of the press who had the opportunity to accompany the very small military and air forces which took part in Operation Eagle gave to the Canadian people a report which could be described only as disturbing, to use the mildest possible word. Following on the very emphatic assurances which had been given as to the quality of equipment and the readiness of certain of our forces to play their part, a report was given to the people of Canada by highly experienced veterans of the war who are now in the press service of Canada describing what could only be termed a fiasco.
This was no reflection on the men who had taken part in that operation. On the contrary, the press reports emphasized the excellent drill, the excellent spirit and the high morale of those who had taken part. But the reports emphasized also the inadequacy of the equipment and the fact that the units concerned were certainly not ready to go into action with the equipment they had. That was another small window opened to the situation in the army.
In the case of the air force, in spite of reassurances about the availability of equip-
	i, 1 SflMI

ment, the same press reporters informed the people of Canada about the inadequacy of the aircraft available for that particular operation. There again a very small window was opened through which the people of Canada could get just a peek into the actual situation in that great force.
Let no one suggest that anything that was said by these reporters was in the way of reflection upon those who are in these services today. Nowhere in the world are there men and women in uniform more capable of undertaking the tasks placed before them, but they can only do the job for which they are trained and for which they are given the essential equipment and supplies.
Without going into further details of this uniform and unanimous report of those who attended Operation Eagle, it does point to the necessity of an inquiry which will make it possible for the hon. members of this house to pass upon the estimates of the Department of National Defence with an actual knowledge of what the facts really are. Our whole free system rests upon knowledge of the facts. We do not prove that we have a working democracy merely because members representing all the constituencies in Canada are permitted to come and sit in this chamber, with the right to speak under the rules of this house. What determines whether this is really an efficient democracy is whether the members of this house are able to make their decisions with full knowledge of every essential fact in the possession of the government itself.
Perhaps because of the secrecy of the war years, which is something that no one can criticize to the extent that it became necessary, there has been a continuing tendency to regard essential information as the particular knowledge of the government unless by accident members of the opposition happen to find out about it or happen to make inquiries which bring it into the open for discussion in this chamber.
The whole history of our system demonstrates that it rests for its effectiveness upon knowledge of every essential fact, and that in peacetime the opposition-may I say hon. members supporting the government as well -are entitled to all essential information in the possession of the government. No one will question the necessity under circumstances of grave international uncertainty for some measure of secrecy-I will go further and say a high degree of secrecy-in regard to the military aspects of the development of atomic energy. But that relates to preparation of highly secret defence requirements which every hon. member of the house accepts. So far as the organization of our defence forces and their suitability for the

tasks that they may be called upon to undertake are concerned there is no reason for secrecy as to a single detail. There is no reason why every hon. member of the house should not have available to him for the purpose of reaching conclusions all information that is in the possession of the government.
This is not a new subject. Over and over again in the past the same arguments have been made, and the advances that have taken place throughout the years have been as a result of the appointment of committees of some kind which could inquire into the real requirements of our defence forces, and their efficient organization for the tasks they might be called upon the undertake. The modern army system in Great Britain, which we in Canada have followed to a considerable extent, came about as a result of the findings of the famous Esher committee of 1904. Demands have been made since the time of the South African war for an inquiry into the organization of the forces, the suitability of training, and their ability to undertake any tasks they might be called upon to perform in the future. It was not until that committee was appointed that the errors that had been so apparent in the South African war were overcome, and an effective reorganization took place under the modern general staff system. Other famous and important inquiries followed at different times. After the first world war General Otter made his famous findings known as the Otter report. In it was laid down the appropriate organization of the land defence forces of Canada, and the way in which they should be trained for the tasks they might be called upon to undertake.
It was not for some years that effective steps were taken to bring about the necessary reorganization, and in the meantime much had happened. In 1933 and 1934 extensive inquiries were conducted by the conference of defence associations, a body which embraced both permanent and non-permanent officers of the defence services of Canada. It was as a result of their recommendations that the reorganization took place which made it possible for Canada to mobilize its forces effectively at the outbreak of the last war.
Another war has passed. Four years have elapsed since it ended. The evidence is now clear on all sides that it is essential that there be an examination of the over-all plan of national defence, the suitability of the organization of our forces for that plan, the effectiveness of the training that is undertaken, and the proper expenditure of the money devoted to this purpose. There is no occasion to go into the past. We are confronted today
The Budget-Mr. Drew with the necessity of spending enormous sums of money, approximately $400 million. Only a few days ago it was indicated to us that a bill would be presented for the unification of the defence forces of Canada. Unification undoubtedly is highly desirable, but unification will not be very effective unless the forces which are unified have themselves been placed in proper relationship to other forces, having regard to what is conceived to be Canada's particular place in the general overall picture today.
It is only by the assessment of our requirements that we can know whether our money is being properly spent. It is an enormous sum of money by any standard, and every hon. member of the house has a duty to make sure that we know that it is being properly spent. If unification is to be effective, then there must first be an understanding of what the tasks are of the various forces which are to be unified under a plan of that kind. In the past few weeks we have seen a demonstration of the problems of unification. It may be worth while for us to remember that these problems were brought to the light of day by a committee where evidence was given about the organization of the defence forces, and the related requirements of the various defence services.
Many people may feel that in the Washington inquiry into certain problems of defence in the United States there was too full a discussion of various matters connected with national defence. I believe that nothing but good can come from a full discussion of that kind because the officers of the different departments were free to express their opinions, and to place before congress and the people of the United States what they regarded as the correct relationship of the army, navy and air force in their combined responsibilities. It is not a sufficient answer to say that the system in the United States is based upon committees, and that those committees initiate legislation, and initiate findings which are acted upon by the executive. I am not speaking about procedure but about the result. I am speaking about the fact that in the sister democracy of the United States members of the house of representatives and of the senate are able to make their decisions with a knowledge of the facts as placed before a committee by the highest experts of the different services of that country. After all, they did not hesitate to discuss the advantages or disadvantages of the B-36. They did not hesitate to discuss the capabilities of their most modern jet fighters. They did not hesitate to discuss the limitations of their aircraft carriers, their battleships and their cruisers. They did not hesitate to discuss the relationship of the army to the

The Budget-Mr. Drew navy and air force in the defence of freedom. Out of that discussion will come a decision based upon actual knowledge, and undoubtedly future errors which might seriously threaten their defence will be overcome by that very exchange of information and public discussion.
I know a motion could be placed upon the order paper that in the opinion of this house it is desirable that a standing committee on national defence be appointed for the purpose of considering our problems in connection with national defence. I also know that placing such a motion upon the order paper would not assure me the same opportunity to discuss this subject that is assured me at this moment. I also know that such a motion can produce no greater results if at this time the government is not prepared to accept the lesson of the Mainguy report and recognize that the time has come to appoint such a standing committee.
We had reasons given why this could not be done. I submit, Mr. Speaker, that any reason for not setting up a standing committee on national defence was swept into the discard the moment this government set up a committee on atomic energy. If it is appropriate to set up a standing committee of this house to examine the question of atomic energy, which has the very highest military potential as well as great peacetime possibilities for the welfare of society, surely it is equally appropriate that there should be a standing committee on national defence to examine the whole subject. That committee could examine our military forces to see how they should be constituted in order that we might make the very best use of our money. It could examine how the forces can be most efficiently integrated, how the minister may be best advised by his military officers, how the chain of military responsibility up to the chief of staff of each of the main services can best be carried out to avoid what was found in this recent inquiry. These are things a committee of this house can do. These are things it is the duty of members of this house to consider; and I submit that hon. members have no right to give the government a blank cheque for $400 million unless they have an opportunity to learn what really are the facts.
When I mention the figure of $400 million I recognize that at this point we cannot expect to have the appropriate information for the consideration of the estimates this year. Most of the money has been spent already. However, I do urge the government, and I do urge the minister in the interests of the efficient operation of his own department as well as in the general interests of the people of Canada, that an undertaking be

given that a standing committee on national defence will be set up this session so that it may start its work and hon. members may have some assurance of adequate information when they are called upon to consider these estimates in the session to be called in the new year. That is the only way we can have an assurance now that we will be able to fulfil our responsibilities at that time.
I do hope the minister will regard this report as something that will be helpful to him. I hope he will not be satisfied to simply tell us of the things he has done already and what he intends to do to implement the recommendations of this report. Because of what this report has disclosed I hope he will assure us that we shall have the opportunity to obtain this information, and that in addition to the officers of the department experts will be obtained who can advise that committee on the most effective way in which the money provided in the estimates may be spent upon the defence forces of this country. We want to know that this large amount is being properly spent and that the waste disclosed in the Mainguy report is not being continued over a much wider field, throughout the whole of the defence services.
Now, Mr. Speaker, I wish to refer briefly to the subject matter of the amendment introduced on behalf of the opposition, to remind hon. members that we have urged that at the earliest possible date a conference of the nations of the British commonwealth be called for the purpose of doing everything possible to solve the trade problems that exist between those nations. It has been pointed out already that if we succeed in solving those problems within the commonwealth we shall have found a solution to the wider problems which confront the dollar-sterling areas today. This is a subject with which every hon. member of every party must be greatly concerned at this time. In presenting his budget the Minister of Finance (Mr. Abbott) gave assurances that the government is dealing with the matter. We have placed before the house a proposal which offers one practical and effective way of dealing with this problem as it should be dealt with, at the earliest possible date. Let us find ways of tackling this question which can gain the support of all hon. members. It is not sufficient for us to have bland reassurances from the minister that this will be solved. We have a right to know how it will be solved. We have a duty to suggest how it can be solved; and we know there is a problem to solve.
I am not going to go back and read the assurances that were given just a few months ago, when members of this government told the people of Canada there was no trade

problem. I need not recall to hon. members the repeated statement by the Minister of Finance that there would be no change in the value of the Canadian dollar in relation to the United States dollar. I need not recall the fact that even the word "ridiculous" was applied to suggestions that soon we would be called upon to face this problem. There is no need to refer to those now. The ministers of this government are quite properly telling the people of Canada today that there is a crisis ahead.


Douglas Charles Abbott: No minister said there was a crisis ahead of us.


George Alexander Drew: If the ministers have not used that expression, then they simply failed to use an expression which properly describes what they have said. If they do not believe there is a crisis, then the proper ministers should speak to Mr. Donald Gordon, who described the crisis fully in New York a few days ago. There have been those who have suggested that this government places great reliance on the statements of Mr. Donald Gordon, and the confidence of the government in his statements has been indicated by his recent appointment. Mr. Donald Gordon gave a speech which should be reread-I do not want to suggest to the minister that he re-read it.


Douglas Charles Abbott: I saw it before it was delivered.


George Alexander Drew: Mr. Speaker, we now know that these statements by senior civil servants are, in fact, statements of government policy. In future we will bear that in mind. I believe it is important to know that the Minister of Finance saw Mr. Gordon's statement. We shall all re-read that speech in the light of that knowledge. Since the minister saw it before it was delivered, it can be taken for granted that Mr. Gordon at least wanted to know that there would not be any disapproval of what he said. If that is the case, we can examine Mr. Gordon's speech knowing that, to put it in its mildest form, the government did not disapprove of what he said.


Douglas Charles Abbott: The Minister of Finance certainly did not disapprove of what he said.


George Alexander Drew: The Minister of Finance certainly did not disapprove, and this is his budget. The Minister of Finance did not disapprove of a speech which gave a clear picture of recurring crises in the history of the world, brought us up to the present crisis, and pointed out that the only way to meet the crisis was for North America to buy more from Europe in the years ahead. It is that crisis to which I refer. If the Minister of Finance has not used the word crisis, he has certainly approved of the description of
The Budget-Mr. Drew the crisis by a senior civil servant who discussed his speech with the minister in advance.


Douglas Charles Abbott: Mr. Gordon is not a civil servant.


George Alexander Drew: I am not going to go into the definition of the appropriate description of employees of the Bank of Canada. The word "civil servant" is a word of which anybody can be proud who occupies a position in the public service. Since the Bank of Canada is an agency of the government or is presumed to be performing a public service, I would have thought the term was reasonably appropriate in this case. We need not quibble as to whether he is a civil servant. In this case, he would appear to be a government spokesman.


Douglas Charles Abbott: That is not the case, Mr. Speaker.


George Alexander Drew: Although Mr. Donald Gordon before going to New York consulted with the Minister of Finance and submitted his speech to him-


Douglas Charles Abbott: On a point of order, Mr. Speaker, Mr. Gordon, as he has done in the past, was good enough to send me a copy of his speech. I think he sent it to a great many people. I read it with interest, as I always read his speeches. It represents his own views. I happen to concur in them, but it does not represent a statement of government policy and was not put forward as such.


George Alexander Drew: Mr Speaker, there is a clear principle involved in the statement that has just been made. Our system of government is one which accepts the proposition that the government is one, and that the statement of the appropriate minister is a statement on behalf of the whole government in regard to a matter that is the responsibility of that department. The Minister of Finance has stated that he approved Mr. Gordon's speech, so that whether he was the government's spokesman or whether he was merely putting forward his own opinion, we may read that speech with the knowledge that the Ministe; of Finance, the minister responsible for the budget statement of Canada which we are now considering, approves of that speech. We may examine it in that light.


Douglas Charles Abbott: I sometimes approve of the speeches of the leader of the opposition, but not often.


George Alexander Drew: I know that there have been occasions on which the Minister of Finance approved, because I was interested in hearing him repeat some of the arguments I had used about letting the Canadian dollar go to another

The Budget-Mr. Drew level when that decision was actually made. I also recognize that, in the very nature of things, we shall not always agree. I am hoping that in this particular case the Minister of Finance will agree with the proposal that has been put forward, that a positive step be taken to meet what was described in a speech that was approved by the Minister of Finance as a crisis.
If there is to be an effective solution of that problem it is essential that those who have two different parts of this problem to deal with should get together as soon as possible. There was one feature of Mr. Gordon's speech which, perhaps, does call for some attention. Mr. Gordon was speaking in New York. Undoubtedly he was really making an argument that the United States should buy more from Europe, but in using the appropriately courteous terms he used the expression "North America". Now, that expression indicates a general tendency to bracket Canada and the United States as two countries with the same dollar problem. One frequently sees clear evidence that the discussion of this subject is based, in many cases, on the idea that although we may be a nation with about one-eleventh of the population of the United States, nevertheless, standing side by side with the United States, our problem is the same.
Our problem is not the same. Our problem is a different problem and it is of vital importance to the future of Canada that we begin to deal with this problem as a different dollar problem from the United States dollar problem. Today Canada is actually at the crossroads in the relationship between the United States and Great Britain in the economic field. If we proceed to regard our problem as the same problem which confronts the United States, we may find that the United States has solved its part of the problem while we are left with no satisfactory solution. The reason our position is so different from that of the United States is that we have one striking similarity to the United Kingdom. We have a very unbalanced economy.
When I use the term "unbalanced" I do not mean adversely unbalanced, I mean the contrary. We have been expanding and developing for years, exporting far more than we import. We have been a great supplier of foodstuffs, of raw materials and of partially fabricated materials from those raw materials. In more recent years we have become a great industrial nation, and with the dramatic discoveries of oil and iron in this country in the past few years we shall become an increasingly important industrial nation. The prospects of this country were never brighter than they are today, so long

as we do not forget that we have built up our whole level of production on the basis of export. We export more than one-third of all we produce; whereas the United States exports only a very small proportion. The United States has an almost completely self-contained economy. True, they buy from us such things as paper, pulp, wood products, minerals and certain of our industrial products as well as agricultural products, but to a great extent they are self-reliant or potentially self-reliant. On the other hand, we in the northern part of this continent must buy from outside Canada huge quantities of the goods we require. No matter what our population may become we shall always be a great importing nation, and for that importation we shall depend upon enormous exports.
In discussing this subject there is one feature of our export position which we must never forget and which places us in a different position from that of the United States. Before the war our great markets were overseas. In the last few years before the war, when the impact of war preparation did not have its effect upon exports and imports, in the year 1937, out of every thousand dollars worth of exports from Canada $370 worth went to the United States, and $630 worth overseas. Of that $630 out of every thousand, $372 was paid by the United Kingdom and $104 was paid by the rest of the nations of the British commonwealth. Thus we find that out of every thousand dollars of exports to the whole world $476 was paid by the nations of the British commonwealth. That was our great export market; also, these exports were going to nations which produced many of the things that we required as well. That proportion of export business had a very important bearing on the whole internal structure of this country.
Because we have relied on overseas exports from the earliest days our rail lines, our internal shipping lines, the services associated with them and the seaports have been built up to carry our trade to the outside world, and particularly to the United Kingdom. Any substantial loss of that overseas trade cannot simply be compensated for by a corresponding amount of exports to the United States. We want the highest possible export to the United States of goods that we produce; but it would be disastrous for this country if we became entirely dependent upon the United States as the one place outside Canada where we could sell the goods we produce. That has no relationship to our friendly association with the United States. It has to do with the situation that would result from the loss of that export business. Think of what it would mean to our railways; think of what it would

mean to all these shipping services; think of what it would mean to the internal ships that carry these goods to the seaports; think of what it would mean to the people at the seaports; and think of what it would mean to the men and women working on the ships themselves which carry these goods to the different markets of the world. It would have the most serious consequences on the whole economy of Canada. Therefore one of our most urgent requirements is to find a way of meeting that problem.
Only yesterday a Canadian Press dispatch carried the story that the two Canadian representatives who visited Britain in the past couple of weeks were shocked at the severity of the cuts proposed by the British government in the purchase of Canadian foodstuffs. Today we read in the press it is expected that there will be a cut of $100 million in certain lines of foodstuffs; but what is even more serious, as we look at this picture, is that nearly all of the purchases which are now being made in the sterling area are being made with Marshall funds. Unless we take effective steps, and take them soon, to meet this problem, then we shall have found no effective way to sell to the sterling area when Marshall funds come to an end. The time, therefore, to take the steps is now, and the time to meet the United Kingdom, Australia, New Zealand, South Africa, India, Pakistan, Ceylon and the other partners of the commonwealth, is right now while we still have time to work out an effective solution before we are confronted with the actual withdrawal of the buying power which exists today. That is the reason for our proposal. It is the only effective way it can be done.
We have before us a subamendment calling for an over-all reduction in tariffs. I submit, Mr. Speaker, that hon. members have not before them sufficient information to vote on the subamendment with any knowledge of what the effects of it would be. Already we have had reports from different ridings of what the effect is of the differential between the revaluation of the pound and the revaluation of the dollar. The fact is that for all practical purposes the United Kingdom has reduced our tariffs by a net 20 per cent within these past few weeks. We certainly should know what the impact would be on Canada generally and on employment in Canada before we support any general resolution of this kind, no matter how sincerely desirous every one of us may be to assist the United Kingdom and the other nations of the commonwealth at this time.
We shall not have greatly contributed to the solution of this problem if we follow any course which weakens Canada at this time. It has been pointed out that in the textile
The Budget-Mr. Drew industry alone 500,000 Canadians are dependent for their livelihood on a business which is feeling the new competition. The answer to that may be given in different ways. The answer will doubtless be found by the appropriate examination of the subject bj those directly concerned in this business. But today the indication is that the manufacturers in Britain are finding it possible to sell their products here under the new circumstances. A dollar-sterling board has been set up in Canada and a dollar-sterling board has been set up in Britain for the purpose of stimulating this business.
I submit there is not sufficient evidence before the house at the present time for us to deal with a recommendation of this nature, because already we see evidence that the opportunity to sell here in Canada has been greatly changed in these past few weeks to the advantage of those in the sterling areas. All of us will certainly welcome their opportunity to sell in our markets.
I should like simply to refer to the amendment before the house, which reads:
This house regrets that the government has failed to take effective measures to prevent the present decline in our trade with the sterling area and is of the opinion that the government should consider the advisability of inviting the nations of the commonwealth to a conference in the immediate future for the purpose of working out arrangements to preserve and enlarge those traditional markets on which jobs and opportunities for Canadians very largely depend.
I submit that when the purpose of this amendment is examined it will be found it is one which can be supported by every member in the house; and that, in so far as any expression of regret is concerned, no member of the opposition will suggest that that is a want of confidence motion in the ordinary sense, but merely an expression of our regret that this has not yet taken place. We do urge members of the House of Commons to support this recommendation, that Canada take the initiative, with its special dollar problem, in bringing together the nations of the commonwealth to find a solution of the trading arrangements upon which the common prosperity of this great partnership will depend in the years ahead.


Hon. Brooke Claxton (Minister of National Defence):: Mr. Speaker, I am sure hon. members will not expect me to agree with everything the leader of the opposition (Mr. Drew) has said in his interesting speech; but with the general objective in his concluding remarks I am sure each of us would agree.
With regard to his references to the subject of national defence, and particularly to the Mainguy report, I am glad to hear him say that the report demonstrated the value of inquiries of this kind. And I might ask this

The Budget-Mr. Claxton question: Who asked that the inquiry be held? The suggestion did not come from any source except myself. Who made public the report of the inquiry when it was made?


George Alexander Drew: " 'I', said the sparrow".


Brooke Claxton: I find we are on all fours with respect to some of the conclusions, but I am rather surprised that the fact that the inquiry should have been instituted, carried out effectively and promptly and resulted in such a useful report, and that this report should instantly have been made public, should not have been the subject of some word of appreciation.
May I say a word or two with respect to the report itself. At page 1 I find these words:
Without in any way controlling our activities, directing our inquiries, or attempting to shape our conclusions, you were kind enough to add to your instructions a number of most valuable suggestions. We wish to thank you for the honour of our appointment and for the helpful observations with which it was accompanied.
That is the end of this quotation from the opening passages of the report, addressed to myself.
So that hon. members may have before them some of the suggestions to which reference was made, I should like to read from a memorandum I gave to the members of the committee when it was set up. This memorandum of suggestions will show why the inquiry went into the subjects it did, and made some findings which have been surprising to hon. members. Some of their findings and their report were made in response to specific inquiries, but no effort was made to limit the scope of the report in any way whatsoever.
In this memorandum I said:
While no suggestion is made as to the form or tenor of the report, it is considered that it would be useful if its contents could cover the following questions which are included among those raised in the minds of many members of the public.
(a)	Is there any indication that any one of the incidents was the result of the action of subversive elements?
(b)	Is there any indication that any one of the incidents was planned some time in advance?
(c)	Is there any indication that the three incidents were the result of concerted action of men on two or more of the vessels? (For example, even if there was no direct evidence of this, it might appear that one or two men taking a leading part in spark-plugging the action had been together in a group at some time at Esquimalt. If there was anything in this, it might be desirable to make a detailed comparison of the service careers of at least some of the men.)
(dO In each case had any of the grievances or complaints subsequently voiced by the men been made either formally or informally to their officers? If so, had any action been taken to remove the cause of such complaints or to explain why it was undesirable or unnecessary that any action should be taken?
(e)	Is the procedure laid down for making complaints adequate, understood and used?

(f)	Is the relationship between officers and men such that the men really do go to their officers and speak frankly to them?
(g)	In each case did any of the ship's junior officers, chief petty officers, petty officers, leading seamen or other senior ratings know of the complaints or grievances before the incident? If so, what action did they take? Did they bring the matter to the attention of the appropriate authority and explain the action they were taking to the men?
(h)	Did any of the officers or senior ratings know in advance that the men were going to take the action they did?
(i)	If they did not know, how was it explained that this should be the case in view of the close and continuous association between officers, senior ratings and ratings aboard ship?
(j)	When did the men first begin to discuss the action they subsequently took? Was the action taken the result of an accumulation of grievances, whether real or imagined, or did it result from some particular incident, or was it due to a combination of a number of grievances which culminated in the action taken?
(k)	Did the men thoroughly understand the machinery for voicing grievances?
(l)	Did the men thoroughly understand the impropriety of the action they took?
(m)	What reason do the men give for not following the regular procedure?
(n)	If it is considered useful, some general reference might be made to the general character, bearing, background, training morale, sense of duty and education of the officers and men.
(o)	Reference might also be made to any relevant facts or views about the conditions of service ashore and afloat, including accommodation, food, recreation, leave, pay and allowances.
It must be quite obvious from the scope of the questions in this memorandum that the answers which might be given to some of them at least were anticipated by the officers at naval service headquarters and myself. In view of these incidents it was exceedingly important in the interest of our national defence and of our naval services to establish beyond question what the facts were, why the incidents occurred and how the conditions which gave rise to them could be met. It was not only important to find that out, but also to get from the three members of the committee which made the inquiry, a group which enjoyed the most complete respect and confidence, views on these questions which would be useful in presenting the matter to the public and which would reinforce our own efforts to see that conditions in the navy were made as good as they could be.
It is important to recall that the members of the inquiry made some general findings. On page 3 they said this:
Although this report in the very nature of things is bound to be critical, it must not be assumed that there are not many reasons for great national pride in the achievements of the Canadian navy past and present, and in the men who inherit and guard its traditions. It is certain also that wisdom, experience, and the passage of time will, by their own momentum, work many great and lasting improvements. We were asked to find out what was wrong

with the navy. If, therefore, we have stressed what is wrong, it should not be forgotten that a great deal is overwhelmingly right.
The members of the inquiry saw some 238 witnesses and in accordance with the directions that had been given they -had officers and men in and obtained their views in the frankest and freest possible way on everything relating to the incidents and the state of training and discipline and the conditions of life aboard the ships. This was done with the purpose of endeavouring to rectify a condition which clearly was wrong, and it was done with the thought that a full disclosure and a full and frank report would enable the people to judge exactly what was the situation,
I must say that the members of the inquiry did a magnificent job and in tabling the report the day before yesterday I thanked them in the name of the government for having done a great bit of work. This is more than a report dealing with certain incidents; it may well constitute an historic document dealing generally with the questions of naval traditions and discipline and the allimportant relationship of officers and men.
The report contains some thirty enumerated recommendations, but in addition there are a number of others. As I said yesterday, when the estimates of the department are under consideration I shall be glad to take up any of the points mentioned in the report and discuss them in detail with hon. members. The leader of the opposition (Mr. Drew) referred to some seven or eight different pages in the report, but before dealing with what he said I should like to call the attention of hon. members to one significant fact that must be taken into consideration when evaluating and considering the problem of organizing the navy after the end of the war. At page 5 of the report there is a table showing the number of officers and men and the number of ships in the Canadian navy in 1939, the total personnel being 1,585 and the number of ships, 16. During the war the personnel was built up to a peak of 93,034 and the number of ships increased to 956. At the time of the report the personnel totalled 8,813 and the number of ships 54.
These figures will show hon. members something of the problem of reorganizing the Royal Canadian Navy on a post-war basis. I might say from my own knowledge that the navy has suffered one handicap in comparison with the army and the Royal Canadian Air Force in that the proportion of officers and men who were in the service before the war is smaller than is the case in the other two services. This means that the navy has fewer
The Budget-Mr. Claxton officers and men who have long experience, particularly experience of service in peacetime.
One striking fact I might mention is that the navy has increased in size some 25 per cent in the last two years, which represents a large job of training, of manning ships and settling down to the routine of working the ships. The navy has been operational to a larger degree than the other two services and unquestionably this has imposed a strain upon it, which is referred to in the report. I am not saying this by way of an answer or by way of an excuse; I say it because it is necessary in order to understand the problems that the navy has been faced with and to be fair to the officers and men who did a great job during the difficult period.
I think it would be more convenient to deal with these specific points mentioned by the leader of the opposition when the estimates are under consideration, but perhaps I should refer to some of them. He referred to the fact that on page 10 reference is made to some of the conditions on board H.M.C.S. Magnificent and expressed some surprise that the conditions there described should not have been brought to the attention of naval service headquarters or of the minister himself. Some of us have been on great ocean liners and I venture to say that we probably would not be surprised that cockroaches are occasionally found on some of the great luxury vessels. The fact that that condition existed for a time in the Magnificent was not brought to my attention.
Had that been done, no doubt I would have caused the appropriate officer of the navy to give instructions to destroy the cockroaches, but I think it is somebody else's job to look after cockroaches. I certainly would have expected that the officers of the Magnificent, if that condition existed, would have been competent to deal with it without its having to be reported to me. Quite a few of the other complaints and grievances are of a rather similar character. Put together they present a certain picture, but from my own service experience in the army, if our unit had been interviewed at length in the sympathetic fashion that the officers and men of the Canadian navy were interviewed, you would have had a picture of a most disastrous and appalling situation, whereas I venture to say our unit was one of the best in the Canadian army. Therefore I think it is necessary in considering the report to take into account the fact that the members of the committee making the inquiry were asked to do just this kind of job so that all of us would see the whole picture.
As to recruiting, which is dealt with at page 43, the leader of the opposition (Mr. 1412	HOUSE OF
The Budget-Mr. Claxton Drew) followed the members of the committee of inquiry in referring to "soft soap operas". Here again I must say I am not going to enter the lists on the side either of the committee or of the leader of the opposition on the question of the appreciation of the value of advertising of any type. It is a matter on which everybody has an opinion, and one opinion is frequently as good as another. I can speak, however, about recruiting advertising from one point of view, and that is that it produced results. The fact that the navy is the first of the three services to be up to its present establishment in men is striking evidence that the navy got the men it needed, and is continuing to get them. At the present time we have a waiting list for enlistment in certain classes of the navy. We are going to continue to recruit men even if the present establishment is maintained, because there is a wastage of about sixty-six men per month.
Not only did we get the men, but before and during the inquiry we also conducted investigations to see how the men were liking the life. I have talked with a good many of them myself and these investigations, made by people in the services and outside, have shown that by and large the recruits we have been getting for the armed forces have said, after they have been in service for a matter of some weeks or months, that generally speaking they have found conditions of life much better than they expected, indicating that we are not painting too bright a picture of world cruises and the like.
In the light of the report, I have looked again at all the navy advertisements in the last week, and have gone over them in detail.
I can assure hon. members that there is very little in the way of advertising of "world cruises'" indicating that it is going to be a "pleasant episode". The advertising has been aimed at young Canadian boys and men from the age of seventeen up who want a career of usefulness and service to their country where there will be opportunities for them. That is the note that has been emphasized. That is the appeal that has been made, and the fact that the response has been good indicates that we have not been shooting wide of the mark.
I have also compared our advertisements with those of other services, those of other countries, and those of the R.C.M.P., to which reference was made. I must say that from my examination of our advertisements I feel they are suitable for the job, well framed and fair, that they have painted an honest picture, and have obtained results.


Mr. Pearkes:: Would the minister indicate how much money that recruiting has cost?


Brooke Claxton: I would have to get the figure for the hon. member. Reference was made at page 60 of the report to the fact that we did not provide laundry facilities at Esquimalt. That is an important thing, but I would not have thought it would warrant particular attention at this time in a budget debate. I have looked into that matter, and I find that, whereas laundry facilities are provided for officers and men of the armed forces at most places, at Esquimalt provision was made in the service's program for last year or the year before, and before it reached me it was taken out by officers of the service on the ground that there were other things which had a greater priority. That is one of the recommendations which depends on treasury action, and which I think should be carried out. I am sure if it had been brought to my attention earlier I would have seen that it was carried out.
With regard to recreational facilities, to which the leader of the opposition referred, quoting from page 70 of the report, I have not seen the building that the members of the committee of inquiry visited at Seattle, but I have seen the recreational building in
H.	M.C.S. Stadacona at Halifax. I know of no better recreational building in any service in any part of Canada. I think it is the equal of anything I have seen in any university with the possible exception of Hart House. I have never seen anything to better it in a Y.M.C.A. or community hall. That is the situation at Halifax. If the building at Seattle is better, then it must be a very fine place, and rather like a good club with all kinds of specialized equipment. The building at Halifax has a swimming pool, a track, a large drill hall floor for badminton and other games and for dances, bowling alleys, billiard tables, ping pong tables, and two rooms containing a large library and a very large record library of serious and jazz music. Altogether it provides a good place for men to seek their quite proper entertainment and recreation.
At Esquimalt we hope to construct a similar building, but there again it is a question of priority. During the last two and a half years I have put the emphasis, so far as our construction program is concerned, on the building of married quarters. I felt that came first, that the one essential thing we needed to do was to enable the officers and men of the armed forces to be united with the members of their families in their own homes in good communities. To that end we started a building program, and have increased the number of married quarters from what it was at the beginning of 1947,
I,	100, to a total of 7,400 or 7,500 when the present year's program is completed. Each

of those quarters relieves the situation with respect to civilian housing, because it enables a service family to make room for a civilian family. We put that first and this program of constructing married quarters has been much bigger, in proportion to the size of our armed forces, than anything I know of being done in any other country. We felt that was needed, because we wanted to create conditions for a good life for our men, particularly our married men, particularly veterans, and more particularly those who had been separated from their families for some time.
The next priority we considered was the building of barrack accommodation to replace some of the barracks that were in bad condition. Two of the worst in the armed forces were those at Halifax and Esquimalt. We have done work on the building at Halifax, and I hope the appropriation for next year will permit us to do what must be done at Esquimalt. This kind of consideration is a question of priority. This year, in the services and through Central Mortgage and Housing Corporation, we have some $90 million available for the construction, maintenance and repair of buildings. That represents an enormous construction program. When we shall have met the need for married quarters and for more barrack accommodation, undoubtedly we can move forward with regard to recreation; and that will enter into the long-term program.
Then the hon. member mentioned films. The arrangement in all three services is that films are provided to service units through the canteen or other funds raised by the men themselves. It has not been the practice at our ordinary service centres to provide films out of public funds. I think hon. members will agree that this seems reasonable in view of the fact that the men themselves have to pay if they want to see films. But in all three services arrangements are made for the circulation of good films obtained from the agencies on a hire basis. The film society in the navy, which is a voluntary organization, apparently has not been as active as it might have been, and at the time of the incidents I understand Magnificent was not taking films from the film society. At the present time it is, however; so is Ontario, and so are most of the other principal units in the navy. That is largely a matter of internal management, and we will see that greater facilities are provided for securing co-operation in this respect and also for making available more films of the film board and other serious films. However, that is not a very great matter.
The Budget-Mr. Claxton
Then the hon. member referred to Operation Eagle, which I think perhaps I should deal with again when the estimates of the department are under consideration. However, I venture to say that no word of criticism has been or could be uttered about that operation from the point of view of the performance, the ability and the state of training of the officers and men of the P.P.C.L.I. In the second place I do not think a word of criticism has been offered or could be offered about the skill and state of training of the officers and men of the air force, either regular or auxiliary. In the third place I do not think anything has been said or could be said in criticism of the work done by the staffs who planned and carried out the exercise. I make these statements believing, from my discussion with people who were there, either press or otherwise, that they are in accordance with the facts. It was those three things the exercise was designed to test, and the reports by my officers indicate that in these respects the exercise was very successful indeed.
As for equipment, of course the reports did not indicate to us anything we did not know. We have no packet aircraft, and I do not think any country in the world has them except the United States. They are still being modified, and they cost well over half a million dollars each. In this exercise we did use some seventy-two aircraft of a type suitable for the purpose. We did not use any Vampires because it was not an exercise in which we were using Vampires; and to criticize the exercise for not using Vampires or not having one type of equipment or another seems to me about as relevant as criticizing a rifle shoot out at the Connaught rifle ranges because we were not using 5-5 guns. This exercise was planned as a battalion exercise, to test co-operation between the men of the battalion who were doing a parachute jump, and air force units. It produced some very interesting results, which will be profitable in future training.
The exercise was criticized on the ground that the parachutes were patched. There are no patches in the parachutes. In the Canadian forces, as in the United States, if on examination-and parachutes are examined after each use-a parachute is found to have any sign of wear or scuffing of any kind, an entire panel is replaced by a new panel. It happens that the new panels in this case were white and therefore showed up, since the other panels were camouflaged. Apparently this caused someone to say that the parachutes were in bad repair, or were patched.

The Budget-Mr. Claxton


George Alexander Drew: Was that the cause of the report that some patches had been made with parts of women's clothing?


Brooke Claxton: If such a report was made it was completely unjustified and untrue; and I am sure the leader of the opposition (Mr. Drew) does not believe it.


George Alexander Drew: I think the minister knows the report I mean.


Brooke Claxton: I am sure the leader of the opposition does not believe any such report; and if it was made it was not true. Then I saw one suggestion somewhere that machine guns were being used which were obsolete, and in fact that they were of the first world war type. The reference was to Vickers guns, which I am advised by my officers are still the best and most effective type of gun for a particular purpose. They had the appropriate number of Vickers guns and all other types of weapons for an exercise of that kind.


Mr. Harkness:: The complaint was that they were lacking in sights, I think.


Brooke Claxton: I never heard that complaint and never saw it in the newspapers. That report was never brought to my attention; therefore I am not in a position to say whether or not it was justified. It is a new point, which I shall look into. I did see some suggestion that we were to blame because the guns lacked ammunition. I should point out that the guns were firing blanks, and the only effect of any lack in the blanks available at any point would be that the noise would not be as loud as otherwise. However, there is no shortage of blank ammunition in Canada, nor was there any shortage at the scene of the exercise. Some of the reports indicated that the guns had jammed, and that is quite true. The Vickers gun is equipped with a special lock for firing blanks. This lock is not as well machined as the gun itself and sometimes it jams. When it does the soldier clears it. If he does not, he stops firing blanks. We have considered it is not worth while making up a new set of attachments for firing blanks just to meet this particular difficulty with which we are familiar.


Mr. Stewart (Yorkton):: Were there any Ross rifles there?


Brooke Claxton: There were no Ross rifles. I do not want to spend more time on this subject now. The hon. leader of the opposition closed his speech with a reference to the reports of a number of other committees, stating that all those reports had been useful. He mentioned them in support of his plea that there should be a committee of this house on defence. He referred to the Esher


committee of 1904. I might point out that was not a parliamentary committee. The leader of the opposition referred also to the Otter report; that was not a parliamentary committee. He referred to the excellent work done by the council of defence associations, which is not a parliamentary committee. The fact is there has not been a parliamentary committee on defence which made a report, either in the parliament at Westminster or in this parliament. It has not been considered, by any government at any time, that that was a desirable way of doing it.
Now, that is not my decision. It is the view of the government. It has been the view of all governments up until now. I indicated the reasons for it during the discussion of a motion by the member for Eglin-ton (Mr. Fleming) for the appointment of a committee on social security. The reasons are the same, and they are general. So far as I am concerned, I would welcome a committee on defence or anything else, but I do not believe that is the proper method of conducting business in parliament or of running the defence forces of this country. I believe experience in other places supports that view.
The leader of the opposition on this and other occasions gave the impression that the members of the opposition had consistently been refused information about the defence forces and defence matters. That statement would paint a picture of requests coming from members of the opposition almost daily. 1 should tell this house that, so far as I know, I have never received a private request from any member of any of the opposition groups that I have not answered. With regard to questions put in the house-I have not had an opportunity of checking my own records or those of the department because I have been in the house ever since the leader of the opposition raised the point-I believe I am right in saying that only one request for information has been refused in the last year and a half, and that was made by the hon. member for Calgary East (Mr. Harkness). It was refused on the advice of my advisers, after the most serious consideration, for reasons which were made clear at the time. It is not the practice and has not been the practice, in this or any other country which has the parliamentary system of government and particularly at Westminster, to give specific information about the strength or the trained strength of the units of the active forces.
The reason for that has been made plain on a number of occasions. 1 believe that reason has appealed to the good sense of the majority of hon. members as well as to the people throughout the country. So far as I am aware that is the only bit of information, certainly

it is the only type of information, that has been the subject of an inquiry that has met with such a reply.
The leader of the opposition said they would be failing in their duty if they did not have an opportunity of making an examination of the over-all plan, the suitability of the forces, effectiveness of training, and the proper expenditure of money. It seems to me those are all proper matters for discussion at any length, and in any detail, in the consideration of the estimates of this department. That is the type of matter which has been discussed when the defence estimates have come before this house on previous occasions. I shall welcome a discussion of them to the fullest possible extent when the estimates of the department come before this house, which I hope will be at an early date. I hope we can have then a debate on defence matters. I shall be glad indeed to give every possible bit of information about anything relative to the work, aims or objects of the defence forces that we do not believe is contrary to the national interest. So far as I am aware, that has been limited in the past only in the way I have indicated.
It seems to me that the best time to take all this up is on the defence estimates rather than on the budget. Certainly I did not come here today expecting to make this speech. In conclusion, I should like to say that I have been in this portfolio for two and a half years. In that time, I have met most of the officers and many of the men in the armed forces in Canada; I have visited the units, active and reserve, and I have been proud to be associated with them in this work. It has been a work full of interest and full of difficulties, as is indicated by the subject matter of this report as well as by events in other countries. It is a work in which we can show results, and there are signs which give encouragement.
With regard to organization, I believe I can say without fear of successful contradiction that in the work of unification, co-ordination and the streamlining of our forces, navy, army and air forces, the Department of National Defence of Canada has made more progress than any other country in the world. I believe that in the all-important question of the training of officers we have, in the various plans in effect in Canada, subject to such adjustment as we will make particularly in regard to executive officers in the navy, more candidates for commissioned ranks in the three services training to our standards than any country in the world. With regard to the general work and training activities of the armed forces, we are making steady progress. Recruiting for the active forces is proceeding at the rate we want, so that the target for the 45781-90
The Budget-Mr. Rooney army will be met in September and for the air force in December of 1950. With the continued support of the members of this honourable house and the constructive, useful criticism of the loyal and all other opposition, I believe we shall build up our armed forces in a way which will redound to the credit and security of Canada.
At six o'clock the house took recess.


[Stage Direction]
AFTER RECESS

The house resumed at eight o'clock.
Mr. J. H. Rooney (Si. Paul's):: Mr. Speaker, for the record may I add my congratulations to those which have been extended to you by hon. members. I have always felt that in your appointment it was a friend appointed. It must be apparent to all that you are carrying out the duties of your high office with dignity and all fairness.
I also desire to congratulate the mover (Mr. Boisvert) and the seconder (Mr. Laing) of the address in reply to the speech from the throne As a newcomer to the house I was told by one of my friends to read a certain book written by George W. Ross entitled "In and Out of Parliament" in which he said that you should get up as soon as you can, because if you are going to get thrown out of the house you may as well get thrown out early.
Today, Mr. Speaker, I had a wonderful apple presented to me. Some time ago we had peaches and other fruit presented to us. I sent to St. Paul's in Toronto to see if we had apples or any other fruit. After they had made their report the consensus was that we had only one apple tree and they could find only a couple of apples on it. But in St. Paul's, when you visit there, what we can give you is hospitality and good will. When you visit Toronto, whether you come by rail or water, you will land in St. Paul's riding, the very centre of the capital of the banner province of all Canada, which I have the great honour to represent.
It was with a feeling of pride in our government that I listened to the terms of the budget which was presented to the house by the Minister of Finance (Mr. Abbott). Throughout the years of the war and in the years prior to and since the war the Liberal government has built up a consistent record of wise and honest administration, which I maintain is again reflected in the present budget. Under the long and brilliant leadership of the Right Hon. W. L. Mackenzie King, Canada has grown and prospered and has become one of the major nations of the world today. I suggest, sir, that under the leadership of

The Budget-Mr. Rooney the present Prime Minister (Mr. St. Laurent) the torch will be carried high and his name will go down in history along with King, Laurier and Macdonald as one of the greatest leaders since confederation.
In the time at my disposal tonight I propose to direct my remarks to that portion of the budget relating to housing, in this sense, that the federal government, as well as rendering financial aid in one form or another, should also give serious consideration to the location and type of future housing projects which more and more are becoming allimportant factors in our national housing problem. Relief for our people in the matter of housing has been, and still is, one of the most pressing needs. It is one to which the federal government, through its crown company, the Central Mortgage and Housing Corporation, under the capable direction of Mr. D. B. Mansur, has extended all possible ud in money and materials in an effort to speed up construction of homes for the people. In spite of this, the scarcity of dwellings, or living accommodation of any kind, within the means of the average person, still continues. One needs only to read local newspapers to realize the situation.
I am sure we all agree with the Minister of Reconstruction and Supply (Mr. Winters) that the housing shortage, which started during wartime and continued into the post-war years, gives every promise of becoming a longterm peacetime problem. Therefore, any approach to the problem should be made with that end in view, and will require the joint efforts of the three levels of government, municipal, provincial and federal, together with private endeavours.
Methods used to solve an extreme housing shortage during periods of emergency cannot be applied with the same success when the need remains continuous for a lengthy time, and will only bring further additional problems.	,
Up to the present, for the most part, we have largely attempted to meet the situation by the building of small dwellings on the outskirts of our towns and cities where land was readily available for the purpose. If we continue to solve our problem in this manner when we are faced with a long-term housing shortage, will it not have the effect of creating additional problems, such as transportation, schools, roadways, sewers, and water for communities already overburdened with taxation, and will it solve the dwelling needs of the majority of citizens? I personally do not think so as the large percentage of those citizens belong to that vast group of workers who must go forth daily to their work, individuals and married couples where both husband and wife must work. Housing units for


this class of citizen should, therefore, be located within easy distance of their work. In any city or large town, I believe it will be found that the greatest number of persons are employed in the downtown section of the community. This is why in our cities and towns we find people living in deplorable conditions in overcrowded rooming houses or in run-down small houses in our so-called slum areas of our downtown sections. The only remedy offered these people in the matter of improved conditions is a single family unit miles away from their work on the outskirts of the city, which in most cases would be out of the question financially, even with assistance, and in addition most of them do not require or want a house.
As a resident of the city of Toronto, I have recently made a partial survey of conditions in that area as they relate to housing, particularly in St. Paul's riding, which I have the honour to represent. To illustrate my point I would like to briefly outline some of my findings.
Toronto is the second largest city in Canada, covering an area slightly over forty square miles, with a population of 670,000. The assessed value of its taxable property is $1,172,000,000. St. Paul's riding, covering an area of almost five square miles, cuts through the centre of the city from the Toronto harbour on the south almost to Eglinton avenue on the north, a distance of four and a half miles. It has a population of 72,347 and the assessed value of its taxable property is $356,694,000-30-43 per cent of all the assessed property value in the entire city. This may be a reason why St. Paul's is called the richest riding in Canada.
Within the southerly area of St. Paul's is located the heart of Toronto's financial district, with its skyscrapers and many large office buildings, its docks and warehouses, and a large percentage of the city's hotels, theatres, hospitals, government buildings, and business establishments, some of which are: the union station, the dominion public building, the postal terminal, the harbour commission building, the Royal York hotel, the King Edward hotel; the head office in Ontario of the Bank of Montreal, which has just moved into its $8 million buildings, and the Royal Bank of Canada; the head offices of the Canadian Bank of Commerce, the tallest building in the British empire, the Bank of Nova Scotia's new building under construction, the Imperial Bank of Canada, the Bank of Toronto and the Dominion Bank; the head offices of the Canada Permanent Trust Company, the Toronto General Trusts Corporation, the National Trust Company, the Chartered Trust and Executor Company; the head offices of

the Canada Life Assurance Company, the Confederation Life Association, the British American Life Assurance Company; the Canadian Pacific Railway Company and the Bell Telephone Company of Canada; the three daily newspaper offices and plants-the Toronto Daily Star, the Globe and Mail and the Telegram-the Metropolitan building, the National building, the university of Toronto buildings, the Royal Ontario museum; the two great department stores, the T. Eaton Company and the Robert Simpson Company; Maple Leaf Gardens, St. Michael's hospital, the Toronto General hospital, the Women's hospital, the Wellesley hospital, the Mount Sinai hospital, the Hospital for Sick Children now under construction.
From the foregoing list of large companies and institutions one can readily see the vast number of persons who would be required to staff them. For example the two largest departmental stores employ a combined total of 21,850 people. At Christmastime there is an additional 8,000, making roughly 30,000 people working in these two stores. In addition there are countless other large and small businesses and factories too numerous to mention. In passing I might say that the university of Toronto has 3,000 employees, with 13,700 students.
In all there are literally tens of thousands of workers employed in the downtown section of St. Paul's riding. This fact is borne out by the following figures received from the Toronto transportation commission. The commission carries in the city of Toronto approximately 960,000 people in the normal week day, of which number a total of 240,000 people are carried daily into the downtown section of St. Paul's riding.
In other words, one-quarter of what they carry in the city of Toronto is carried daily into St. Paul's riding, which I have the honour to represent. Unfortunately the residential areas surrounding this downtown business district have never undergone any change in the way of remodelling or rebuilding in order to meet the ever-growing demand caused by the ever-increasing number of persons employed in that section. The many city blocks of residences, large and small, in the central, east and west sections of my riding were all built years and years ago. They are long since obsolete even for the purpose for which they were built, let alone for the purposes for which they are now being used, which are rooming houses for the large ones, and families too large for the small ones. In addition, there are row after row of old stores, with one or two storeys over them which are used for dwelling accommodation, and which are in many cases actually unfit for living in or for any other use.
45781-90i
The Budget-Mr. Rooney extreme, and with them all the undesirable features of conditions associated with so-called slum areas. Yet, all available living accommodation in this central and downtown area is fully occupied, whether good or bad, and high rentals are being obtained. For example, a recent newspaper article stated that three dwellings on Jarvis street had been condemned as a firetrap. Yet one hundred persons are still housed there.
Consequently, the majority of those thousands employed today in the downtown business district, in order to find accommodation, are compelled to live north, east, and west, many miles from their work, travelling anywhere from one to one and a half hours each morning and night.
Evidence of this exit of population to the outside areas may be found by glancing at the population figures of Toronto proper, and the population figures of its adjoining municipalities, in a ten-year period, and particularly in the past three years, as follows:
Population of
Vear	Toronto
1939	 649,123
1946	 696,550
1-948	 670,035
One is amazed to find that in a city which appears to have prospered and expanded in business to such a large extent, the population has increased by 21,000 in ten years, and it is startling to note that in the past two years, from 1946 to 1948, it has decreased 26,000. The records of adjoining municipalities, sometimes referred to as greater Toronto, for the same period, are as follows:
Population of Suburban Toronto
1946
219,234
275,273
317,133
Here we have an increase of nearly 100,000 in population, over a ten-year period, and in the past two years alone, from 1946 to 1948, an increase of 42,000.
In my opinion, Mr. Speaker, the amazing increase in population in the suburbs, as compared with a decrease in population in the city proper this past two years, is due-almost entirely to the housing policy which has been in vogue during the period under review. The record of building permits issued for new houses throughout the entire city of Toronto in the past three years has been practically nil in comparison with those-issued for the suburban areas, as follows:
City of Toronto: Year
1946		
1947		
1948		
1949	(9 months)
Number of Permits Issued

	225

	174

	144
.... 161


Mr. F. D. Shaw (Red Deer):: Mr. Speaker, my purpose in rising this evening is to deal exclusively with three or four matters which
The Budget-Mr. Shaw have been alluded to during the course of this budget debate. Were it not for the fact that certain rather fallacious arguments have been advanced, arguments bolstered by deceptive evidence resulting in wholly erroneous conclusions, I probably would not find it necessary to participate in the discussion at this time.
The first matter to which I should like to refer has to do with oil. Perhaps this could be designated more properly as the farmer in relation to oil, or still more properly as mineral rights in relation to the farmers of my province of Alberta. At least two assertions have been made during the course of this debate which may well leave the impression that farmers living in the province of Alberta are, as a consequence of the policies of the government of that province, being deprived of all but, as one hon. member said, a smile and not a very pleasant one. I should like to quote from page 1122 of Hansard of October 25, 1949. Speaking at that time the hon. member for Athabaska (Mr. Dechene) made this assertion:
The other day a few hundred acres of land in Alberta were sold to one of the oil companies for over $3 million cold cash for just the right to search. No oil had yet been found there. What did the farmer who owned the land get? A smile, and not a very pleasant one.
In the first place no land was sold to any oil company. The company only purchased drilling rights. Secondly, I emphasize what he said, namely, that no oil had yet been found. This is the speech in which the hon. member for Athabaska made an earnest plea for the completion of a certain line of railroad in northern Alberta. In that connection the hon. member for Athabaska has our whole-hearted support. This is the speech in which the hon. member assailed the Conservative government under the late R. B. Bennett for having discontinued operations on that line during the first five years of the depression. After assailing the government of that period he said that then the war came. This is the speech in which he forgot to mention that there were four years and some months of depression between the defeat of the Conservative government and the outbreak of the war with a Liberal government in office, and nothing was done to hasten the completion of that railroad. I mention that simply because he forgot to- or did he?
I should also like to quote from Hansard of November 1, 1949, page 1329. In this instance the hon. member for Vegreville (Mr. Decore) was speaking, and he said:
The farmers upon whose land oil is discovered receive little direct benefit from the discovery because few of them have mineral rights. All that

The Budget-Mr. Shaw
these farmers receive is the rancid smell of oil twenty-four hours a day, seven days a week, plus a little compensation for the use of their land.
I suggest to the hon. member lor Athabaska and the hon. member for Vegreville that they ought to hold a caucus and endeavour to come to some agreement with respect to what the farmer in Alberta does or does not get because in one instance the hon. member for Athabaska said he got nothing but a smile, and not a very pleasant one at that, and in the other instance the hon. member for Vegreville said he got some slight compensation, including the rancid smell of oil. I will show that they are both wrong.
What are the facts, Mr. Speaker? After all, facts mean far more than the imaginary wanderings of some minds. When the resources were returned to the province of Alberta in the early thirties, 51 per cent of such resources had already been alienated by the government of Canada. Therefore the province of Alberta only had 49 per cent to deal with. The government of the province of Alberta owns the mineral rights on considerable land in the province. That is a fact. It is also a fact that certain farmers own mineral rights on their lands in the province. On lands where the province owns the mineral rights, drilling rights are sold to oil companies. Tenders are called for and bids considered. It is a fact that millions of dollars have gone into the public treasury of the province as a consequence of the sale of these rights. The company drills, and if it strikes oil 12| per cent of all production goes into the treasury of the province of Alberta. To be used for what purpose? To be used for the welfare of all the people of the province of Alberta to build roads, to provide better and more extensive health services, to provide educational services, for debt reduction, tax reduction, and also for other purposes.
Where does the farmer stand who does not own the mineral rights? Is it true that he gets nothing but a smile, and not a pleasant one, or very limited compensation? I wish to refer to some of the facts as they are found in an official publication of the government of the province, entitled "Surface Rights". The part to which I wish to refer reads:
Under the common law which was in force for many years in Alberta, as well as other provinces of the dominion, the title to mines and minerals always included the right of entry and reasonable use of the surface for the purpose of working the minerals, including oil and gas. The owner of minerals had a vested right to use as much of the surface as might be required for his operations without any compensation to the surface owner or without liability except for negligence. In carrying out a program of oil development, which is so necessary in any country, provision must be made in the public interest whereby those engaged in the

development might enter upon the land where development work is to be undertaken. However, the government-
Referring to the government of the province of Alberta.
-is convinced that the owner of the surface is entitled to full compensation as he would be in case a canal, a railway, a highway, a power line, a coal mine or any other thing required in the public interest would cause him any damage or inconvenience.
In 1947, Mr. Speaker, an act known as the Right of Entry Arbitration Act was passed which provided for the setting up of a board of arbitration in the province of Alberta with wide powers to deal with the matter of compensation to surface owners. What factors are taken into consideration by that board? They are, first, the value of the land; second, the amount of land which may be permanently damaged by the operator's operations; third, the adverse effect of the right of entry on the remaining land; fourth, compensation for severance; fifth, compensation for the nuisance, inconvenience and noise which may be caused by or arise from or in connection with the operations; and finally such other factors as the board may from time to time deem proper, relevant or applicable.
This legislation shows one thing. It demonstrates the intention and desire of the government of Alberta to give the board of arbitration all necessary leeway to deal with applications from the standpoint of equity and justice. Let me cite five cases that were dealt with by the board of arbitration in order that we may see whether the farmer gets just a smile, and not a very pleasant one, or something comparable. This is the first case: payment for one well, $1,188, plus annual compensation of $420 for the life of the well. Case No. 2: $1,288 as the first payment, and $428.50 every year thereafter for the life of the well. Case No. 3: $1,551 as the first payment, and $461 every year thereafter, in each case for one well. Case No. 4: $1,400, with $500 payable every year thereafter for the life of the well. Case No. 5: $2,000 the first year, with $700 per year thereafter for the entire life of the well. From the information I have given it will be readily seen that from a quarter section of land on which four wells are drilled-and that is not at all uncommon- the farmer would receive an average of approximately $6,000 the first year and $2,000 for every year the wells operate, which might be twenty years. The farmer also enjoys the right to continue to farm his land during that time. After all, once a well is brought in, very little of the farm is taken out of production. As the hon. member for Peace River (Mr. Low) says, it amounts to only a few

square feet. And I must emphasize that these are cases in which the farmer does not hold the mineral rights.
Further in his speech the hon. member for Athabaska (Mr. Dechene) advocated that all farmers on whose land oil is found should be paid royalties. I think the Calgary Albertan, which supported the Liberal party with all its vigour during the last campaign, dealt more effectively than I could with that suggestion. I refer to an editorial under date of October 28 of this year, under the heading, "Don't Pension a Few Northern Farmers." The editorial states:
It is unfortunate that a man of the stature of Mr. J. M. Dechene. Liberal M.P. for Athabaska in northern Alberta, should be so far off the beam on this matter of oil royalties. In parliament, the other day, he said the oil belonged "to the people, not to the provincial government,'' and the provincial government should give a big slice of its royalty income (he suggested 5 of the 121 per cent) to the farmer under whose land the oil was found. He wanted something done "to see that the farmer out of whose land this wealth is taken receives a royalty."
Except on C.P.R., Hudson's Bay and certain other freehold land, the great bulk of the oil is owned by the provincial government, which is all the people of Alberta. The farmer who owns the surface has no more right to the oil under his land than the farmer who lives three hundred miles away. It is not his. It belongs to the government and thus to all the people. If the government gives him a slice of its 121 per cent royalty it is depriving all the other rightful owners of their just income. It is robbing 99-9 per cent of the farmers to give a modest and entirely undeserved fortune to -1 per cent of the farmers.
The only way that the real owners, meaning all the citizens of Alberta, can benefit from their ownership is through the provincial government. It is taking many millions of dollars a year out of the oil industry, and rightly so. That money can be used to permit the reduction of taxes, which we strongly oppose. Or it can be used first to pay off the provincial debt and then to build roads, schools, hospitals and other capital assets which all the people of Alberta could enjoy. That use of the oil money we strongly support. But never, never should the province use its royalty to pension off a few farmers in Mr. Dechene's constituency, who have no more right to it than anybody else in the province.
I think that editorial is rather significant. I must add that the Liberals in Alberta are finding it desperately difficult to make election issues. Why, they even grabbed this, which the C.C.F. leader could not drop soon enough after he had picked it up the first time. The Liberals are using this and endeavouring to make capital out of it. The other day that same newspaper, the Albertan, dealt with the Liberal leader in Alberta and his criticism of oil policy. First it deflated him editorially; after deflating him it dissected his arguments, and then exposed them to the ridicule of the public of that province. That was how it dealt with Mr. Harper Prowse, leader of the Liberals in the province of Alberta.
The Budget-Mr. Shaw
The government of my province believes that in dealing with this most important question sense, reason, good judgment and good business practices are the things that count. Obviously to the Liberals of that province these things, at any rate in relation to oil, have all gone with the wind. Before leaving this matter I want to refer to another editorial, which also appeared in the Albertan. I am always pleased to be able to quote that newspaper to Liberals, because I cannot forget how strongly it supported them during the last campaign. An editorial under date of October 25, referring to Liberalism and oil, had this to say in part:
It was during the Borden administration, when the Alberta government was Liberal and so was the Senate. The Alberta government, it seems, wanted to give the Shell Oil Company exclusive oil rights for the whole province in return for a payment of $5,000. But it didn't have the power to do so, so it asked the federal government to give it that power. The enabling legislation went through the commons but the Senate turned it down.
So, Mr. Speaker, when it comes to condemning whatever may be done in the province of Alberta in connection with oil, such condemnation should not be voiced by the Liberals.
Now I come to matter No. 2. The day before yesterday, November 1, a certain textbook was brought into this house. I did not see the book, but I know all about it. It is called "The World of Today", by Paterson and McDougall, and has been used in the province of Alberta. Incidentally, this matter is not new in the House of Commons. It was brought into this house over eight and a half years ago by the hon. member for Athabaska, who used almost the same arguments that were used the day before yesterday and drew the same fallacious conclusions. Eight and a half years ago, Mr. Speaker, my colleague from Lethbridge took these arguments and buried them about six feet deep under logic and truth. Now, eight and a half years later the hon. member for Vegre-ville (Mr. Decore), in a ipolitically ghoulish fashion, exhumes the bones of that argument and makes an effort to cloak them with the same arguments that killed the thing eight and a half years ago, leaving the same type of impression-at least, first he tried to breathe life into the thing and failed miserably.


Some hon. Members:: Oh, no.


Frederick Davis Shaw: All right, I will deal with it. I am going to deal with it not from the standpoint of what he said, but from the standpoint of what he did not say, which is often more important. He did not tell this house that Mr. Paterson was the editor of the Ryer-son Press in Toronto, or that Mr. McDougall

The Budget-Mr. Shaw was principal of the normal practice school in Edmonton. No, he wanted to leave the impression that the writers were probably members of the Alberta government. He did not inform this house, and I ask my friends to listen, that Saskatchewan, under a Liberal government and with a Liberal minister of education, used the same textbooks for years. He did not indicate that, Mr. Speaker. Undoubtedly, he did not know-or did he?
This is significant. At page 1329 of Hansard, after referring to this book, he quoted the following from it:
Some people feel-
Notice that.
Some people feel that the capitalist (competitive) system is out of date in this modern world, and should be modified or replaced entirely by a system better fitted to deal with the problems of today. Three of these plans are especially interesting: The Communist (as in Russia), the C.C.F., and Social Credit.
He referred to this book after saying he did not mind having his children learn about these different things, but that it was vicious propaganda. I would ask my hon. friend if it is not a fact that some people do feel, as it says here, that there are alternatives to the capitalist or competitive system. You have heard that said in this house. I cannot see anything vicious in that. Like my hon. friend, I taught school for many years. I tried to give my pupils both sides of the question. I told them there are some people who believe there are alternatives to the capitalist system. I gave them the truth, the whole truth, and let them form their own opinions. What he did not seem to know, Mr. Speaker, or it would have wrecked his whole argument, is that Social Crediters have not advocated the implementation of a system to take the place of the capitalist or competitive system, if you want to call it that. Let him remember that. I repeat that he does not seem to realize that there are two sides to every question, not only here but in all events of our everyday life. I am not so sure that I would want him to teach my children if he were going to deal with only that one side of each question.
Reference was also made, Mr. Speaker, to education. No group in this House of Commons has taken a firmer stand than we have in support of federal grants in aid to assist the provinces in establishing equality of opportunity in the field of education. Let me make that quite clear. The hon. member for Vegre-ville said at page 1329 of Hansard:
In our province of Alberta there is no earthly excuse for the government not making more substantial grants to education which would be in keeping with the requirements and the expanding needs in that province.
Obviously, in making that statement, the member for Vegreville was not aware of one
[Mr. Shaw.}

or two things. First, from the fiscal year 1934-35 to 1948-49, educational grants in the province of Alberta increased from $2,269,286.41 to $9,829,000. In other words, our assistance to education has increased much more rapidly than has the income of the province of Alberta. In order to assist in the equalization of educational opportunity in my province, the government, in many districts, is paying as high as eighty-five per cent of the cost of education. Those are the more remote, less prosperous areas. That is one effective method of bringing about equalization of educational opportunity.
We realize, Mr. Speaker, and admit that the revenues of our province have increased quite rapidly during these past few years. But we believe in facing the situation realistically. We are not unmindful of the fact that the present government of Alberta took over the affairs of the province in 1935. At that time we had $158 million of debt; $95 million of it given by the Liberal government between 1905 and 1921. It is that period which the Bank of Canada characterized in its 1937 report as the period of waste, extravagance and loose administration. The farmer government of that province gave us another $63 million in debt. Of course, $51 million of our total debt accumulated as a consequence of the depression-a depression which we feel justified in attributing, at least in part, to some of the asinine financial policies of the dominion government.
The government of the province of Alberta realizes what a good many Liberals do not seem to realize, namely, that the gas and oil resources are a wasting asset. I think that should be underlined. It is quite conceivable that within forty years the oil and gas fields in my province may be completely depleted. All one has to do is look at what has happened in Turner valley to visualize what could occur in my province, if the government were to heed those who have neither vision nor good business judgment and load the budget with a burden of fixed charges right up to the level of revenues. I ask some of our critics to consider that. If that were done and, after forty or fifty years, the revenues were down or falling materially, it would leave the province with that burden of fixed charges and nothing with which to pay them. The government of Alberta wisely takes the stand that a portion of the present income from gas and oil must be used to create other assets which will be well enough developed at the end of forty years to enable the services of the province to be carried on uninterrupted. With the depletion of these oil and gas fields the revenues would go, Mr. Speaker. That, I contend, in the field

of provincial or any other administration, is nothing but vision and good business practice.
We have heard in this house, in the province of Alberta, and from the Liberal leader and his followers, that we should pile up a burden of fixed charges by utilizing the resources which we have now in their entirety for current activities within that province. Well, I say to you that we contend vision has been displayed in dealing with the matter. We have increased the grants to education in the province by almost five times. We still say, however,-and this is in keeping with part of my hon. friend's remarks-that we must have federal grants in aid in order to assist in the equalization of educational opportunity across this country.
There is another matter to which I should like to refer, Mr. Speaker. In a speech on Tuesday, the hon. member for Vegreville (Mr. Decore) made reference to something which I had said previously in the House of Commons, as reported at page 1330 of Hansard. I would not refer to it at all of course if it were not almost laughable. I quote:
However, I have heard of expressions coming from some of my Social Credit friends-and when I say some of them, I mean just some of them-
Of course he should have named me.
-to the effect that my election to this house was made possible by the communist vote of the Vegreville constituency, and I intend to deal with this matter. The insinuations are quite clear. Mr. Speaker.
I interject here to say that he is wrong. There were no insinuations. I made cold, blunt, hard statements that were true. There were no insinuations. I continue with the quotation:
Such statements cast a reflection not only on the nine thousand people who voted for me in the election of June 27 but also on all the people in that constituency, numbering some 60,000.
Now, Mr. Speaker, you notice what he has endeavoured to do. He has endeavoured to take my assertions and portray them as a reflection upon the 60,000 people in his riding. Out west we call that buncombe. He did not take the figures which I gave in this house in my last speech and endeavour to break them down or destroy them at all. I know that Vegreville constituency. I know that it embraces a fine part of the province of Alberta. I know its people. Thousands of these people are good citizens, energetic, sincere, honest, one hundred per cent Canadians. The hon. member's statement to the press on October 6 to the contrary notwithstanding, I know these things from personal experience.
Notwithstanding the fact that the great majority of these people are as I have described them, there are, and he cannot deny it, between three thousand and four thousand
The Budget-Mr. Shaw communists within his riding. And whether these communists are of Anglo-Saxon, French or Ukrainian origin, they are still communists. They are traitors to democracy and traitors to the democratic concept of human organization. The hon. member did not in any way, shape or form refute the concrete evidence which I put on the record, Mr. Speaker.
I hold in my hand a circular which was circulated by the thousands in the Vegreville constituency during the last election. This circular is headed:
Voters of Vegreville Constituency!
On election day, June 27, you will need to make a choice. On that day you will be marking your ballot for the man you want to represent you in the House of Commons for the next four years. You will be judged throughout the country by the man you choose.
After a vicious attack upon the former member for Vegreville, Mr. Hlynka, they went on to say:
The Labour-Progressive party calls on the people of Vegreville to defeat Anthony Hlynka on June 27. Vote against him! Put him out of office! Send this war-mongering, pro-fascist back where he belongs!
Then they go on to show that they have no love whatsoever for the Liberal party. They say:
The Labour-Progressive party is campaigning in every constituency for peace, democracy and security. In Vegreville constituency we decided not to nominate a candidate in this election. We decided this because we do not want to split democratic opinion in the constituency as then Hlynka might get back in. We say to all voters in Vegreville: Stand united! Vote united! Defeat your main enemy-Hlynka.
We greet the decision of the C.C.F. to also not contest this constituency. We urge all C.C.F. supporters to actively campaign against Hlynka and to help defeat him.
Go to the polls on Monday, June 27, and vote against Hlynka!
There were and there are between three and four thousand communist supporters-


Mr. Cole (Malapedia-Malane):: Hear, hear.


Mr. Low:: The hon. member should live in Vegreville.


Frederick Davis Shaw: -in Vegreville. Since I spoke in the house in reference to this matter I have had scores and scores of letters from that constituency confirming what I had said before.
I asked specifically if there were any evidence to indicate that the Liberal candidate condemned this or whether he said publicly that he did not want their support, and to date I have not been able to get any evidence of that. He may be able to present it, but it is most significant that up to the present time he has not produced any such evidence.

The Budget-Mr. Noseworthy
In his speech the hon. member made certain references to such things as, for example: in 1938 in Alberta our candidate at that time who was elected, Mr. Orvis Kennedy, thanked Jan Lakeman, the communist chief, in the province of Alberta, for his support. When the hon. member for Peace River (Mr. Low) undertook to pin him down on that and produce his evidence he found it utterly impossible to do so. In fact, the hon. member for Peace River even went so far as to question his honesty in connection with it and still he could not produce one iota of evidence to back up his assertion.
In the early days of our movement, that is in its infancy, it is conceivable that a few communists may have wormed their way in, but it did not take any more than a good political delousing to get rid of them. What the Liberal party needs in certain parts of its organization today is a complete political delousing to get rid of the communists. They can make their insinuations on the floor of the House of Commons, but I ask any Liberal in this house if he can produce evidence of propaganda published by the Social Credit party containing the pictures of communist leaders. I have in front of me propaganda published and distributed within the last six years under the authority of the Liberal association containing the pictures of some of Canada's outstanding communists. That occurred within recent times. Is it any wonder, Mr. Speaker, we say that at least in certain quarters of the Liberal party a good political delousing would do them a lot of good in order to get rid of the communists, who are still within certain sections of that organization.


Mr. Deputy Speaker:: I am sorry to interrupt the hon. member but his time has expired.


Some hon. Members:: Go ahead.


Mr. Deputy Speaker:: Has the hon. member the unanimous consent of the house to continue?


Some hon. Members:: No.


Frederick Davis Shaw: Mr. Speaker, I know I have not the unanimous consent of the house. Actually I did not expect it from some hon. members; therefore I shall not impose upon the house.


Mr. J. W. Noseworthy (York South):: Mr. Speaker, in his remarks on Friday, October 26, as recorded at page 1223 of Hansard, the Prime Minister (Mr. St. Laurent) indicated that hon. members interested in the subject of education could discuss it in this debate. I am going to follow his suggestion, and shall take a rather unusual line for one who is not a member of the government party. I suspect that much of what I shall say tonight will be


used against me at some future time in York South. Nevertheless I am interested in education in Canada, and in order to lay that ghost of suspicion which is abroad, that the federal government dare not touch education without stepping on provincial corns, I propose tonight briefly to review the extent to which the federal government is involved in educational work at the present time.
First of all, I am sorry the Minister of Labour (Mr. Mitchell) is not in the house. It is not often I can compliment him; but I wish to pay tribute to him and to his assistants for the good educational work carried on by the Department of Labour under the Vocational Training Co-ordination Act of 1942. The minister and his assistants deserve high commendation for their administration of that act, and particularly I suggest for the great measure of co-operation with the provincial departments of education they have been able to develop and maintain.
The vocational training branch of the Department of Labour from 1937 to March 10, 1948, has had an enrolment of approximately 918,000 students, young and old, and during that period has spent approximately $65 million of federal money on vocational education in Canada at the secondary school and university level. That money has been spent to assist students at the universities, to assist unemployed youth training in the country, to provide courses in forestry, to provide vocational training for the armed forces during the war, training for war industry during the war, pre-matriculation and vocational courses for veterans, apprenticeship training and training or re-training of older unemployed.
All this educational work, even that for which the federal government itself was directly responsible, has been carried on in the very closest co-operation with the provincial departments of education. I note in the Canadian vocational training report that an agreement known as the vocational schools assistance agreement was made with the provinces in 1945, and that it provides, first, an outright annual grant of $10,000 to each province; second, an annual grant of $1,910,000 for a ten-year period to be allotted among the provinces; and, third, a dominion contribution of $10 million to be allotted among the provinces for capital expenditures on building and equipment for vocational training purposes.
All projects which were to be assisted under that agreement were to be approved by the minister before April 1, 1948. I wish now to quote a paragraph from the vocational training report for the past year, which states: At the meeting of the vocational training advisory council which was held on October 4, 1948, various members drew attention to the fact that increased

costs for new buildings and higher operational costs of vocational schools, have reduced the value of the grants which were provided under the vocational schools assistance agreement.
The availability of dominion funds has given a notable impetus to vocational education in Canada, and has been responsible for an active program of development in practically all provinces. Many projects have not been completed, and some have not even been commenced.
The council felt it was in the interests of Canada that facilities for vocational education should be strengthened and developed as speedily as possible. It is recommended that a further grant of S5 million be made by the dominion for capital expenditures, to be distributed on the same basis as the earlier capital grant, and that the annual grants be increased from $2 million to $4 million.
Then the report goes on to say:
As of March 31 these recommendations were still under consideration.
I submit that that recommendation of the advisory council is worth special consideration at this time, and I would urge the Minister of Labour to proceed immediately with the implementation of his council's recommendation. Let me give one example, one with which I am most familiar because it pertains to my own riding of York South.
In York South, with a population of well over 100,000 people, we have three collegiate institutes, but no technical school. Today there are well over a thousand pupils in that riding wanting technical education, but none is available. The school board had planned to build a vocational school which would accommodate a thousand pupils, provided a federal grant is available. Unfortunately they were unable to complete their plans so as to get under the wire by April 1, 1948. In any case I understand the $10 million had all been allotted for approved projects before that. So, without federal assistance, York township will be forced to build a school to accommodate 600 pupils instead of 1,000, a school with one gymnasium instead of two, a school of that size without any auditorium.
This is just one example of many such cases throughout Canada. Unless the government will act and act quickly thousands of young people will be deprived of the opportunity for vocational education. This is not a matter in which we can afford any delay. Young people want education now; they do not want to have to wait three or four years while the government is getting around to the consideration of one of its own council's recommendations.
I pass now from the Department of Labour to the Department of Veterans Affairs in order to show just how deeply the federal government is already involved in education. Up to September 30,	1949, the Department of
Veterans Affairs had assisted 55,260 veterans in under-graduate courses at universities, 6,000 in post-graduate courses, and another 85,900 45781-91A
The Budget-Mr. Noseworthy veterans in vocational training at the secondary school level, making a total of 147,160 veterans who have received allowances and tuition from that department.
That is no slight contribution to education on the part of a government which normally is supposed to be keeping out of education entirely. The Department of Veterans Affairs paid $116,685,595 in allowances, over $30 million in tuition fees and nearly $15 million in supplementary grants to universities to compensate the universities for the difference between the payment of fees and the cost of educating these veterans.
I should like to digress for a few moments to say that since coming to this house I have had occasion to refer to the Minister of Veterans Affairs (Mr. Gregg) and his superintendent of educational training, Mr. Jamieson, a considerable number of individual cases. In my opinion both the minister and the superintendent are handicapped by narrow, rigid regulations that I certainly would have opposed to the best of my ability on the floor of this house had I been here when they first came into effect. Nevertheless, I want to add that, subject to those overriding regulations, every single educational case that I have referred to the minister and his superintendent has received the most sympathetic consideration possible. I am pleased to say that in several cases, notwithstanding the limitations of ironclad regulations, ways and means of assisting students have been discovered.
I turn now briefly to the Department of National Defence. I have been unable to put a price tag on the educational work done by that department, but reference to their report for the current fiscal year shows that during last year there were 4,119 army, navy and air force personnel taking undergraduate and post-graduate courses in thirty colleges and universities in Canada and in twelve colleges and universities outside Canada.
I should like to take a few moments of my time to refer to the educational work that was carried on by the Canadian Legion educational services during the war, and is still being carried on by that organization. I have been unable to get any figures to show the extent of their work overseas during the war, but in Canada and Newfoundland during the war years the C.L.E.S. had an enrolment of 215,818 in their correspondence courses and spent $3,130,941. In addition to those correspondence courses, there were nearly half a million members of the armed forces registered in the oral classes that were conducted by the C.L.E.S.
This same organization purchased in Canada for distribution among the forces in Canada

The Budget-Mr. Noseworthy and Newfoundland over 3 million library books and carried on 92 courses of study at the matriculation and university levels. One remarkable feature of the work of that organization is the fact that they were able to get the co-operation of the departments of education of all the ten provinces. More than that, every department of education in Canada accepted their certificates of achievement and every university in Canada accepted their senior matriculation certificates for university entrance. I am told that up to the present time there are approximately 11,000 veterans in veterans' institutions, in the federal civil service, and elsewhere who are still taking courses of the Canadian Legion educational services.
Another department involved in educational work is the Department of National Health and Welfare. In 1946 that department appropriated $100,000 for the provision of scholarships and the extension of educational facilities in the seven schools of social work in Canada. For some mysterious reason, I presume known only to that still more mysterious body known as the treasury board, that amount was reduced in 1947-48 to $50,000, and it still stands at that figure. The result is that practically the entire grant has been used for the extension of school facilities and practically none is available for scholarships. I am sure that everyone interested in education in Canada, except possibly the treasury board, is anxious to see that $50,000 raised to the original $100,000 in the next estimates.
The national research council has also given direct aid to education. When that council was set up in 1916 one of the first things it did was to set aside $5,500 of its appropriation for research into medicine and pure science. Over the years that amount has been gradually increased until in 1948 there were 178 scholarships provided by the national research council of a value of $160,150. In addition to that there were grants in aid paid to 17 universities and educational institutions to the value of well over $200,000.
The Department of Trade and Commerce, through the bureau of statistics and especially through the education division of that bureau, has been making its contribution to education. It is true that in the educational field the dominion bureau of statistics unfortunately is limited by its charter to the compilation of educational statistics, but even that in itself is of immense interest to education across Canada. Only in the publications of that branch can we find educational statistics from all the provinces brought together and properly correlated.
I want to repeat the plea that I made in this house over five years ago. It is high time that we had in Canada a federal education

office that would do for Canadian education what the federal office in Washington does for education in that country. I believe that the charter of the education branch of the dominion bureau of statistics should be broadened and that sufficient help should be provided in order that that division may be able to do some of the things that need to be done, things that are either not being done at all or are being done in a haphazard fashion by volunteer organizations.
For instance, there is the whole field of research in education for the benefit of the country at large. It is true that the provinces are carrying on a great deal of educational research, but there is no federal agency in that field. I understand that the Canadian Life Insurance Officers' Association have been spending about $10,000 a year for the past few years in research on school health projects. My information is that that will be discontinued this year. Here is a field of research that will pay national dividends in the future and such a project should not have to rely on private and public campaigns for funds to carry on.
There is another research project being carried on through the -co-operation and support of the Canadian Manufacturers Association, the Canadian Chamber of Commerce and the labour congresses. This is a project the purpose of which is to discover to what extent our schools are giving the training best suited to the needs of our communities. If we had a federal bureau of research in education, projects such as these could be carried out for the benefit of the nation, and the research work that is done by the provinces could be correlated and made available for the use of educationists all across the country. We need a federal institution for educational guidance. Most of the schools in the larger centres have educational guidance officers, but educational guidance officers should have a knowledge of, and be able to benefit by, the experience and the data collected by the employment offices all over Canada. Educational guidance today cannot be successfully carried on within the limits of any one province.
We no longer educate boys and girls tc remain citizens of any one province. At least one out of every three students educated in our provinces earns a living in a different province from that in which he or she was born and educated. We need some agency that will compile and keep up to date the vast number of government publications which could be of inestimable value to the schools of the nation if only teachers knew what these publications were, and how and where to get them. These publications, valuable as many of them are, are left to gather dust in some back office or storeroom

just because we have no agency to provide us with a list of the material of that nature that could be made available for use in our schools. There is no list available today of all the educational institutions in Canada. Guidance officers have been asking for such a list. Nowhere today can you get a complete list of all the educational institutions. I suggest that is a job for an office such as the educational branch of the dominion bureau of statistics. It is impossible today to find a list of what scholarships are available. Pupils have a knowledge of the scholarships established by their own schools or their own communities. It is impossible for a student in any one school to know even what scholarships are available within his province. There is no way in which a student can find out what scholarships are available throughout Canada for which he could compete. I suggest that is another job that could be done by the educational branch of the dominion bureau of statistics.
I want to turn for a few moments to the Canadian Broadcasting Corporation. I have not time to deal at any length with what I consider to be some of the excellent features of its programs. If I had an hour instead of forty minutes in which to make my speech I could really inform Liberal members of the house of just what a good job the C.B.C. is doing on a very small budget. I want to mention-and again I regret I have not time to develop the subject at any length-the educational work that is being done by the national film board. I want to refer to one paragraph from my prepared speech that has a particular connection with schools. The board maintains a complete visual aid service for schools, including films, film strips, glass slides, flat pictures and posters, and I am told that these aids are used in most Canadian schools. There are more than one thousand schools in Ontario alone making use of them. Some idea of the extent of their work may be gathered from the fact that in ten years the film board has produced approximately 2,500 films, and has established a film library of more than 400 films in French and English. They have assisted in setting up 250 film councils and film libraries. There is a regular monthly showing of Canadian documentary films in some 500 theatres. The motion picture association of Canada estimates that in 1948 the national film board Canadian newsreel audience totalled 60 million people, and about 320 million in the United States.
I have not time to touch on the educational work that is being done by such organizations as the national museum where I understand about two-thirds of the exhibits have to be kept in the basement because of lack of space. Nor have I time to deal with
The Budget-Mr. Noseworthy the national art gallery where again over half the pictures in their possession have to be stored in back rooms and basements because of lack of space to display them.
In the few minutes remaining at my disposal I want to turn to the broader issue of federal aid for education at every level. I submit there is now no question whatever about the feasibility of federal aid for education without interference with provincial rights. Two departments of the federal government have spent well over a quarter of a billion dollars in the past ten years on vocational education at the secondary school and university level. There has been no friction with the provincial governments on this score. The federal government has spent nearly $162 million in educating veterans. This work is now nearing completion, and the government will not be required any longer to spend these millions of dollars on their education. I submit that millions should now be available for aid to education within the provincially controlled schools of the nation.
For 1946 the total cost of provincially controlled schools in Canada was $186 million. An annual federal grant of $50 million to be allotted among the provinces would give education in Canada possibly the greatest fillip it has ever received with the exception of the educational work that was done in the forces during the war. That certainly would bring us closer to a realization of equal educational opportunity for all Canadian children; and that opportunity, I submit, should be limited only by the ability of the student to profit by it and the ability of the nation to provide it.
So I do urge the Prime Minister (Mr. St. Laurent) to include on the agenda for the dominion-provincial conference to be held in January the question of co-operation between the federal and provincial governments in the matter of federal aid to education, thereby providing wider educational opportunities for more Canadian boys and girls. As I have said, no longer can there be any question of the willingness of provincial governments to accept federal aid for education, nor is there any question of their readiness to co-operate with the federal government in the administration and use of such aid for the benefit of those who are to be educated.
There can be no question as to the lack of equal educational opportunity in Canadian schools. Municipal and provincial governments, with the ever-increasing financial burdens which our constitution lays upon their doorstep, can no longer meet the educational requirements of our youth. Educational facilities vary as between province and province and even as between municipality and municipality within the same province. The

The Budget-Mr. Johnston educational opportunities available to a Canadian boy or girl today depend to a large extent upon the chance of being born and educated in one of our wealthier municipalities or provinces. That principle, I submit, is wrong, but it can be remedied only by aid for education given from the federal treasury to the provinces.
The inequalities of educational opportunity in Canada are ably set forth in a brief prepared by the Canadian teachers' federation, from which I should like to quote briefly in conclusion. In that brief, which was presented to the members of the cabinet last spring, they ask:
Is the government aware of the following facts?
(1)	That one out of every ten persons engaged In teaching Canadian children holds only a permit or temporary certificate, i.e. without the minimum professional qualifications normally demanded.
(2)	That the children of Canadians living in rural areas depend for their education upon the teachers whose services are purchased at an average salary of $1,207, whereas city children are taught by those with an average salary of $2,120. (Quebec not included in these averages because the figures are not available.)
(3)	That rural teachers are a transient group, the majority moving from one school to another (or out of teaching altogether) every two years or less, whereas the average tenure for teachers in urban schools is ten years.
(4)	That the latest available table (1947) showing median salaries reflects to a considerable degree the qualifications of teachers and gives some indication of the geographical differential in the matter of educational opportunity.
Median salaries-1947
Prince Edward Island	 $ 816
Nova Scotia	 1,241
New Brunswick	 977
Ontario	 1,514
Manitoba	 1,304
Saskatchewan	 1,265
Alberta	 1,546
British Columbia	 2,042
(5)	That despite the return of male teachers from the armed services, at the end of 1947 there were 1,700 fewer than in 1939.
(6)	That as of April, 1948, approximately 22,000 pupils in two provinces were receiving their education through correspondence courses because of the lack of teachers.
(7)	That 31 per cent of the teachers of one province and only 2 per cent of another are university graduates.
These statements are much more eloquent than I could possibly be with respect to the need for consideration at the next dominion-provincial conference of the question of federal aid to education.


Mr.  C. E. Johnsion@Bow River: Mr. Speaker, in taking part in this debate I intend to deal with only one or two subjects, since it is not necessary for me to review at any length those important matters already dealt with by other members of the Social Credit party. The hon. member for Battle River (Mr. Fair) dealt most effectively with the
[Mr. Noseworthy.)
agricultural problems of this country, and it is not necessary for me to repeat his arguments because he expressed the views of this party. The hon. member for Acadia (Mr. Quelch) ably dealt with the problems of foreign trade, pointing out the difficulties and suggesting remedies, and I need not discuss that matter.
I want to deal with a domestic matter which is becoming increasingly important. The hon. member for Acadia dealt with the condition of our trade relations with foreign countries, but that is not the only trade condition which is bad, or which is affecting this country. Some of our industrial concerns are facing trying times, entirely because of the policies of this government. Only the other day I saw a clipping from a United States publication, American Business, in which it was prophesied that by the end of 1951 over sixty per cent of the small businesses which had been started since the war, principally by returned men, would face failure. That is unfortunate because these men have invested their entire savings in these businesses, hoping to be able to make something of their lives after having fought in the war. It is interesting to note that I am not the only one concerned over the failure of businesses in this country. The other evening the hon. member for Hastings-Peterborough (Mr. White) described the situation which exists in his constituency and the adjoining riding. The hon. member for Lanark (Mr. Blair) also dealt with the situation in his constituency. Both hon. members referred to textile and woollen industries, which they said were laying off workers as a result of the devaluation policy of this government. But the matter of devaluation should be considered very carefully by the Conservative party, I think. Even before the Liberal party decided to devalue the dollar, the Conservative party had advocated the lowering of it. In the house tonight, the leader of the Progressive Conservative party reiterated his stand on that matter. I do not mention that in any spirit of criticism of the old line parties; I mention it to point out that this condition which exists in some of our industries and in the two constituencies to which I just referred is a condition which is brought about by the policies of this government as well as by the policies or suggestions of the Conservative party.
When the question of devaluation was brought up in the house, the Social Credit party opposed it. You will recall that back in 1945, when the Bretton Woods agreement was considered by this house, it was followed by the Geneva and Havana trade agreements. The results of these trade agreements are the

very conditions about which we are complaining today. The Conservative party, which is complaining about the deterioration in business and the closing up of factories, advocated those policies which have resulted in these conditions. The Conservatives supported the Liberal party on the Bretton Woods, Geneva and Havana trade agreements and those are the things that are causing the difficulties today. I think it would be well worth while if everyone in this house seriously considered the policies we are pursuing today, lest they have greater repercussions than those we have mentioned.
There is another industry, too, which needs a little attention. It is not only the industries in the constituencies to which reference has already been made that need attention, but in western Canada there is a business that is threatened with closing as a result of the policies of this government. It is the potteries at Medicine Hat in which two hundred and eighty people were employed, two hundred and thirty of whom have been laid off. I have just been handed the Medicine Hat News, which speaks about this very plant under the heading "Alberta Cabinet Hears Problem of Medalta Workers." This article is contained in the Medicine Hat News of Monday, October 31, 1949. It says:
The layoff developed a week ago as a result of devaluation of the pound sterling which resulted in eastern markets being offered British hotel and restaurant ware at twenty per cent under Canadian prices. Medalta is the largest Canadian manufacturer of this particular line, eighty per cent of its production being hotel ware.
It was forced to close production on all but a few special decorated lines. 230 of the total work force of 280 being laid off. On Friday some forty persons were called back to work with receipt of a large C.N.R. order. This staff is still on the job with no prospect of any greater increase in employment.
That is just another case in another part of Canada in which we find a failure in business due to the policies of this government.
Still further west, there is another industry which is facing grave difficulties. It was not more than two weeks ago, Mr. Speaker, that I had in my office a man engaged in the shipbuilding industry on the west coast. He pointed out some of the difficulties facing the shipbuilding industry in Canada. He said that this industry in Canada, so far as the west coast was concerned, was almost a thing of the past. His particular company was endeavouring to get into another line of production, so they would not be forced to close up entirely. Those are conditions that one views with alarm. They are conditions that have danger signs attached to them, and we should heed those signs.
I should like to read an extract concerning the shipbuilding industry which I believe
The Budget-Mr. Johnston was taken from the Ottawa Citizen. The heading is, "Government Studying Ways to Help Sagging Shipping Industry."
The government is considering ways of helping Canada's sagging shipping industry, but the policy is not expected to take shape for at least several months.
May I interject to say, Mr. Speaker, that almost anything can happen in those several months. Unless the government has a policy at hand, disaster may be the result. The articles continues:
Transport Minister Chevrier told the Commons last night that a number of plans are being considered on how to bolster the vital shipping industry.
"I wish I could say what those plans are, but I do not think it is in the public interest to do so," he said.
Farther down, the same article reads as follows:
Mr. Chevrier said he fully recognizes the seriousness of the shipping situation. But it was not a problem faced only by Canada. The same was true of every country in the world.
Increased cost of operation was one of the difficulties. Another was lack of freight and deterioration in freight rates. A third was devaluation.
Again we find in this shipbuilding industry the results of the policy pursued by this government. It seems to me that if this continues our country is in for a very bad time. For the ministers to say they are considering plans is not good enough. The government should have a definite plan to remedy this situation.
I should like to speak of another industry, one which is important not only to western Canada, but to Canada as a whole. It is facing grave difficulties and it is going to take more than just giving the matter consideration to remedy the problems facing the coal industry of western Canada. The member for Cape Breton South (Mr. Gillis) spoke about the condition in which that industry found itself in eastern Canada. I can assure him that the coal mining industry of western Canada is facing just as serious conditions as those faced by that industry in other parts of the country.
When we live in a country possessing about fourteen per cent of the world's known supply of coal, it seems to me we should be in a position to take advantage of that great industrial asset. No nation, at least up until today, has had great success industrially without using coal. There is talk about oil, but I believe the backbone of industrial power on the North American continent must be coal. We should, therefore, give every consideration to the maintenance and prosperity of that industry.
One of the conditions facing us in the west, and the same condition is facing the east, is that there is not the market locally for all the coal we can mine or all the coal we are mining. Even today, a great many

The Budget-Mr. Johnston coal miners are only working three or four days a week. In the interval, they have been living on their unemployment insurance. These benefits are nearly exhausted, so they will have to turn to relief. The prospects now are not very bright for anything else. The Canadian coal mining industry is in a deplorable state. It almost faces extinction unless something is done immediately to relieve that condition. There is a good market in Canada and why we do not take advantage of it is more than I can tell. In the central part of Canada, in the great provinces of Ontario and Quebec, we have an excellent market. Some hon. members may say to me, there may be some reason for your statement; they may say to me, the mines are so far off that it is not economically feasible to have the coal shipped down here and compete with coal coming from the United States. A condition has arisen in the United States through the coal strike which is being felt by all the industries in Canada. Should we allow our coal mines to be closed down and become dependent on a foreign nation for power to run our industries in central Canada? It seems to me to be the height of folly. Even though it might cost Canada a few million dollars to increase the subsidy on coal coming down here, I believe it would be a good investment in order to ensure the continuance of the production of the industries in central Canada. Even though a strike is on in the United States and even though devaluation of the dollar has taken place, yet it does not compensate the western coal dealers in sending coal down here to compete with United States coal. This is a time when we should be considering that problem seriously.
There is another important factor which should lead us to the preservation of our coal mining industry in Canada, namely, what would happen to us in time of war. We had an unfortunate experience of that during the last war when we were so short of coal because the United States refused to ship us any more inasmuch as they needed it themselves. If we allow our coal industry to close down, what will happen to us in a time of great national need? Just what happened during the last war. In this instance I do not think we should rely on a foreign nation for our coal supply.
There is another problem which will face us if we allow our coal industry to close down. Seven hundred thousand people are employed in the coal industry. If we allow the mines to close, even though oil production is increasing in the west, when we have a market here in eastern Canada, then we shall be faced with a tremendous unemployment problem, a problem that the federal govern-


ment will have to face sooner or later, because unemployment is becoming quite serious. It was estimated that there were over a hundred thousand employable unemployed on July 4. It is quite safe to say that there are at least 250,000 unemployed in Canada today. We cannot afford to have that number of unemployed climb much higher without serious repercussion in the country.
The cost of transportation is one of the difficult problems that we face in western Canada in order to obtain a market in central Canada. There are several factors which contribute to that high cost. The present freight rate alone on coal coming from the west is $8.33 a ton. On top of that we have the increased freight rates. The house will recall that the last increase the railways were asking for was 20 per cent. They received 8 per cent, but on coal they were allowed a straight 8 cents a ton flat increased rate. Just at a time when we really need a lower cost of transportation we have an increase in freight rates which could have been prevented by this government, making it still more difficult for us in western Canada to get our coal down to eastern Canada. It is true that the federal government pays a subsidy of $2.50 a ton on this coal; but even with that subsidy it is not possible to lay that coal down here and compete with Pennsylvania coal. If we allow that condition to prevail there is only one thing that is certain, namely, that our mines will close down.
It costs us between $16 and $18 a ton to lay down bituminous coal in Ontario. I should like to read a little clipping from the Financial Times of Friday, October 28, in regard to that question. It reads as follows:
Pressure Mounts for Coal Policy as Imports Stop Consumers Discover for Themselves High Transport Cost-Subvention Fails to Make Canadian Coal Fully Competitive
The article goes on to say:
Inquiries have therefore been made in Calgary and Edmonton, about the possibility of shipping coal from the foothills to Ontario. It was thought that increased costs of United States coal might finally have succeeded in making Alberta coal competitive in the east.
This does not seem to be the case, however. Although the would-be buyers of Alberta coal were favourably impressed with the prices that were quoted, and with the quality of the coal that was described to them both as to cleanliness and heating value, the cost of transportation threw all considerations out of gear. It costs $8.33 per ton, in carload lots, to get coal from Alberta to Ontario; and this after the subsidy paid by the government of $2.50 per ton.
Approximately one of every three tons of coal consumed in Canada is produced in this country. Particularly in the maritimes and, of course, throughout the western provinces, Canadian coal is burned to a very great extent in Quebec and to a greater extent in Ontario, the coal is almost exclusively

American. Most of the anthracite burned in Canada is American but, in the case of bituminous coal, the business is competitive, or would be competitive if the freight costs enabled Canadian mines to compete. At $8.33 per ton this is, of course, not likely, considering that United States coal comes to Canada largely in lake boats at much lower rates.
There are others who are concerned with the probable failure-I should not say "probable", I should say almost certain failure-of the coal mining industry, particularly in western Canada. It would not be an entire loss if the federal government were to raise the subvention on coal. They pay $2.50 a ton, but I am sure they could at least double that amount and still make it worth while from an all-Canadian standpoint. When you remember that we ship in $41 million worth of anthracite and $97 [DOT] 9 million worth of bituminous, making a total of $138-9 million from the United States each year, you can see that it would be a tremendous saving of United States dollars, and once again we would have the provinces both east and west coming to Canada's aid in the United States dollar shortage. I say even if we had to pay a much higher subsidy it would be to the federal government's financial advantage in the long run to increase the subsidy on western coal so that we would be able to put the coal down here in eastern markets and compete with the coal coming from the United States. The time has come, Mr. Speaker, for the federal government to consider a national coal policy, having in mind the things which I have suggested.
We are not overlooking the fact that oil is a keen competitor in the field of producing industrial power. We must recognize that probably oil development is going to be a very serious problem which must be dealt with in competition with coal. But from the standpoint of safety alone of the Dominion of Canada in time of war, and in other emergencies, it would be well worth our while to see that the coal mines of western Canada and Nova Scotia are kept in operation. In order to do that, it may be necessary to extend the research in the processing of coal, in an endeavour to extract oil or other by-products from it.
In a time of great emergency, in a time of war-particularly another war

it is very possible that this North American continent may become so isolated that it, including the United States, would not be able to get oil from any other outside source. It may stand us in good stead if we have developed the process in this country whereby we can get oil from coal, or use the coal in its natural form. In my opinion we dare not allow our coal mines to go.
I wish to read a brief article in connection with this subject entitled "Coal Industry
The Budget-Mr. Johnston Must Pay Attention to Oil". I read this to show that those who are interested in coalmining, including trade unions and others, are vitally concerned and recognize fully the competition that will come from oil. This dispatch from Sydney, Nova Scotia, states:
The coal industry must become a coal-into-oil industry or it is due for a serious and permanent decline, the United Mine Workers (C.C.L.) district 26 told the dominion coal board today.
In a brief, the union said the coal industry is headed for a decline because of the tremendous growth in the use of oil by industry, railways and residential consumers. The board is holding maritime sittings to hear various views on the industry.
It presented figures to show that in 1947 the mari-times consumed oil equivalent to 1,000,000 tons of coal, and that since 1943 oil consumption in the maritimes had increased by the equivalent of 350,000 tons of coal. During the same period coal consumptions declined by 600,000 tons.
The brief said the first step in development of an oil-from-coal industry in Cape Breton should be construction, at government cost, of a demonstration or pilot plant for experimentation. Fuel oil from coal now costs not more than three cents per gallon more than natural oil, the brief said. Operation of a commercial hydrogenation plant for experimentation would soon reduce this gap.
There is a good deal of truth in that. But whether the statement is based upon fact or not, surely our research branch in the dominion government could make very material progress in connection with the hydrogenation of coal in order to take the by-product of oil from it. This was done in Germany-in fact Germany almost conquered the world because of her highly mechanized armed forces which operated on oil produced from coal. So that what Germany could do, surely we could do, too.
There is one other subject with which I wish to deal briefly, namely that of old age pensions. I do not think I could go to sleep tonight and rest comfortably if I did not say a word for our senior citizens in Canada. I say this, not because I am partial to the subject at all-although I confess I am-but because it is within our physical potentialities to produce so much in this country that everyone should have the highest possible standard of living. That being so, I am not advocating anything the country cannot economically or financially do.
Our old age pensioners receive a maximum of $40. If every old age pensioner in Canada were to receive that maximum pension, they could not have anything but a very substandard living. When one considers the high cost of rent, coupled with the exceptionally high food costs-and they are still going higher and higher-there does not need to be any argument to convince every member in the house that it is an utter impossibility for human beings to exist decently on $40 a month.

The Budget-Mr. Johnston
But the old age pensioners of Canada do not all get that much. The Social Credit party- others too, but at least the Social Credit party-has advocated a minimum pension of at least $50 a month. We would be a sorry nation indeed if we could not produce enough in this country to give our old age pensioners at least that amount. These are the people who so faithfully worked all their years to build the Canada of which we are so proud; yet we turn them aside, with little thought, and with $40 a month, expecting them to exist on that pittance. It must indeed be an irritation and humiliation for these people to eke out their living on such a small amount.
We also advocate that the age for old age pensions should be lowered to 65 years for men and 60 years for women, and that when a husband qualifies for old age pension the wife too should automatically qualify. The reason is obvious. Usually the husband is the breadwinner, and when he has reached the age of three score and ten he is not capable of producing a living then for himself and his wife. As so often happens, however, the husband gets $40 a month-if he is lucky enough to get the maximum-and then the two of them must live on that $40. This makes it absurd.
Surely it should not require argument in the House of Commons to convince members that two people cannot live on $40. One could not have a decent living on it, so we should not expect two to do it. We say therefore that when the husband qualifies for the old age pension the wife should qualify automatically.
I believe old age pensions should be noncontributory. The only ones in Canada who are going to require assistance in their old age are going to be those who cannot possibly earn sufficient so that they may save enough to take care of themselves in their declining years. How in the world could we expect those people to contribute toward an old age pension?-and they are the only ones who will need it. It seems absurd to ask them to contribute out of their meagre savings so that they may obtain a pension upon reaching the age of seventy years.
Each one who at the present time is receiving an old age pension is contributing every day of his life very materially, because each time he buys an article from his old age pension allotment he is making a substantial contribution to the income of Canada, and to the consolidated revenue fund. Therefore let it not be said that the old age pensioners, or those who will come under pension provisions in years to come, are not making their contributions, even at this time. We say therefore that the old age pension should be
[Mr. Johnston.l
non-contributory. I do not want to keep the house any longer, but I did want to say those few words.



HOUSING


[Stage Direction]
Hon. Douglas Abbot! (Minister of Finance):
Mr. Speaker, if I could have the unanimous consent of the house to revert to motions, I should like to make a statement respecting rent control.
Mr. Speaker:: Has the minister the unanimous consent of the house?


Some hon. Members:: Agreed.


Douglas Charles Abbott: For some time now the government has been considering what action should be taken with respect to rent control when the present legislation expires. As hon. members are aware, the Continuation of Transitional Measures Act, 1947, will expire on March 31, 1950, or sixty days after parliament first meets during the year 1950, whichever date be the earlier.
Just about a year ago-to be exact, on October 23, 1948-I wrote to the premiers of each of the provincial governments, advising them that the federal government was prepared to vacate the field to any province which might decide to undertake rent control. I offered, on behalf of the government, to make available to any province the records, information, experience and staff of the rentals administration and also, subject to parliament's approval, to pay the cost of any provincial rental administration for one year. At the same time I reminded the provincial premiers that the constitutionality
Rent Control
of federal rent control had been questioned and was before the courts, and referred to the situation that would arise should federal rent control be held to be invalid.
None of the then existing provinces was prepared to undertake rent control. On the other hand, when Newfoundland joined Canada it retained its own system of rent control.
In offering to vacate the field to the provinces a year ago the federal government was not seeking to relieve itself of responsibility for rent control. It was motivated solely by concern for the situation that would arise should rent control be held to be beyond the constitutional powers of the federal authorities. It believed at that time that the sudden end of rent control would result in unnecessary disruption and hardship, and it offered to put the matter beyond doubt by giving the provinces an opportunity to introduce legislation that could not be successfully challenged in the courts.
May I say at this point that the advice which the government receives from its law officers is that the existing federal regulations with respect to rent control are valid. But in a matter which concerns the welfare of so many Canadians the government would not be discharging its responsibilities to the people of Canada as it should if it did not take every precaution. It is possible that the courts would decide that our regulations are unconstitutional. We cannot disregard that possibility.
If there was uncertainty about the position a year ago, there is at least the same degree of uncertainty today. The government has therefore decided to refer the question of the validity of the rental regulations to the supreme court, in the hope and expectation that a decision will be given before the present legislation expires. As I have said, the law officers of the crown are of opinion that the rentals regulations are valid. They are also of opinion that both the law and the facts support the view that it lies within the authority of parliament to extend these regulations for a further period. Counsel will be instructed by the Attorney General of Canada to press this view before the court. The order in council making the reference is being prepared and when approved will be tabled in this house.
If no unfavourable decision is given, the government at the next session will ask parliament to grant a further extension of the rentals regulations. The government intends to continue with its program of orderly decontrol as rapidly as conditions warrant but we do not believe that this program can be completed before March 31, 1950. Let me make it quite clear that the purpose of clarifying the

Rent Control
legal position is not to perpetuate federal rent control. On the contrary, the purpose is to confirm our authority to proceed in an orderly way towards the eventual withdrawal of all controls. This has been our firm policy towards wartime controls in general and rent control is no exception.
Should the supreme court find that the rentals regulations are now beyond the powers of parliament, then of course a different situation arises. I am accordingly writing at once to the premiers of the provinces acquainting them with our intention and offering to assist in the preparation of what might be termed "stand-by" legislation if they wish to present such legislation to their respective legislatures.
After the most careful consideration of all the alternatives, the government believes that this course of action is the best. We believe that gradual and orderly decontrol is the right policy. At any time, however, that policy could be frustrated by an adverse decision of the courts. Such a decision might come at a most inconvenient time when the provinces might not be in a position to act as they see fit in the interests of their residents. By referring the question to the supreme court before the present legislation expires and by giving ample notice of our intention to do so, such a situation can, we hope, be avoided.
I should add that the federal government, of course, continues to stand ready at any time to vacate the field of rent control to any province which makes a formal request to that effect. We do not wish to stand in the way of any province which desires to operate in the field of rent control.
I also wish to take this opportunity of announcing some further measures of decontrol.
We have made some progress in the direction of decontrol since the end of the war, but a very high proportion of tenanted dwellings is still subject to the rentals regulations and maximum rentals are undoubtedly still well below the levels that would be established in a free market. Before the rentals regulations are completely withdrawn I hope that there will be some further improvement in the housing situation, and I think it fair to say that no other country is overcoming its housing shortage more quickly. Nevertheless, it seems probable that rentals might well settle eventually at a level substantially above the present maximum levels provided in our regulations. Sooner or later the adjustment must be made, and, as I have said, it is our policy to permit this adjustment to be made gradually rather than abruptly.

The rentals regulations are accordingly being amended as follows:
(1)	Rentals for rooms, parts of houses and the like, in which a tenant is required to share toilet facilities or some other similar equipment, may be increased by not more than 20 per cent. I should point out that there have been no previous general increases in maximum rentals for this kind of accommodation since the introduction of rent control. Landlords of such accommodation are also being given the right to terminate any lease on six months' notice. These changes do not apply to per person rates, that is, to rates which include services such as the provision of furniture, linen and so forth. There is already a sufficient degree of flexibility in the present regulations applying to per person rates.
(2)	Landlords will be permitted to offer a term certain lease for not less than one year in consideration of a rental increase of not more than 20 per cent in the case of unheated self-contained dwellings and of not more than 25 per cent in the case of heated self-contained dwellings. This lease must contain a clause permitting the tenant to terminate it at one month's notice. If the tenant refuses the offer the landlord may require him to vacate under the laws of the province and the accommodation then becomes free of federal rent control.
(3)	Landlords and tenants may enter into term certain leases of not less than two years' duration at any rental upon which they may agree. The rentals administrator has already given approval to about 2,500 joint applications by landlord and tenant to enter into such two-year leases. Hereafter these two-year leases will not require the specific approval of the administrator.
(4)	Landlords who owned accommodation prior to November 1, 1949, will be enabled to gain possession for their own use as a residence on giving six months' notice declaring their need. Until now landlords have had this right only in respect of accommodation which they owned prior to November 1, 1947. The rule that such notices may not expire during the winter months is also being withdrawn. It is not retroactive, of course, so that none of the notices already given will expire during the coming six months' period.
These are the major changes being made at the present time. They will become effective by orders of the wartime prices and trade board, as from December 15, 1949. A number of other sundry changes are also being made and they will be announced in the usual way when the orders themselves are completed and published.

May I add one final word to which I hope the press will give some prominence. In order to carry out the changes which have been announced it will be necessary to print and distribute many thousands of forms. They will be made available as quickly as possible. Even under the most favourable circumstances, however, some time will elapse before every rentals office in the country has an adequate supply on hand. This necessary delay will not in any way affect the rights of landlords or tenants because, as I have said, the orders do not become effective until the middle of next month. My advice to the general public therefore is to wait for a further announcement by the rentals administration before applying to local offices for the forms and other details.



THE BUDGET


[Stage Direction]
The house resumed consideration of the motion of Hon. Douglas Abbott (Minister of Finance) that Mr. Speaker do now leave the chair for the house to go into committee of ways and means, and the amendment thereto of Mr. Rowe.
Mr. Speaker:: The house will now resume consideration of the motion of Mr. Abbott that I do now leave the chair for the house to go into committee of ways and means, and the amendment thereto of Mr. Rowe.


Mr. Blackmore:: May I move the adjournment of the debate?
Business of the House
On motion of Mr. Blackmore the debate was adjourned.



BUSINESS OF THE HOUSE

Alphonse Fournier: the adjournment of the house.
He said: There are six government resolutions on the order paper and we intend to proceed with those six resolutions tomorrow. I shall give merely a tentative order because I could not get in touch with all the ministers concerned. The first would be No. 13, under the name of the Minister of Transport, concerning the Temiscouata Railway; second, No. 14, a measure to authorize the governor in council to grant to the province of British Columbia a subsidy for the construction of a railway; the third item would be a resolution under the name of the Minister of Agriculture, presenting a bill to amend the Animal Contagious Diseases Act; No. 4 would be a resolution under the name of the Minister of Finance to authorize the Canadian National Railways to issue securities not exceeding a certain amount; and the last would be a resolution in the name of the minister of reconstruction concerning the trans-Canada highway. If perchance we concluded all that business, we would go into supply and take up Transport. I am sorry; there is one resolution I omitted and that is No. 12, in the name of the Minister of Mines and Resources.
Motion agreed to and the house adjourned at 10.55 p.m.

Friday, November 4, 1949