1950-06-23

FLOOD CONDITIONS


Mr. W. G. Weir (Portage-Neepawa):: Mr. Speaker, I request the privilege of announcing that the money received on behalf of the Manitoba flood relief fund from parliament hill, which includes contributions from members of the Senate, members of the House of Commons, members of the press gallery, and staffs of both houses, as well as some outside contributions and the collection taken at the ball game, now totals $6,706.35.
Members of the committee named to accept these contributions are most grateful for this splendid response, and desire to take this opportunity to thank those who have so generously contributed to this very needy cause-particularly so when it is known that many had already made contributions through other sources.



PRIME MINISTER'S RESIDENCE


Right Hon. C. D. Howe (Minister of Trade and Commerce):: Mr. Speaker,-1 wish to make a statement with reference to the Prime Minister's residence.
In the supplementary estimates to be tabled by the Minister of Finance (Mr. Abbott) the government is asking parliament to vote $300,000 for the completion of the Prime Minister's residence. This amount is in addition to $80,000 already included in the main estimates, and $30,000 expended in the fiscal year which ended on March 31 of this year, or a total of $410,000.
I admit at once that this figure, which includes $305,000 for the cost of the building and $105,000 for the furnishing of the house, is higher than the rough estimates of cost which were given to the government at the time the decision to provide an official residence for the Prime Minister was made in September of last year.
We were warned by the architects at that time that no satisfactory estimate could be made of the cost of reconstructing an old house until the work was far enough advanced 55946-256.1
to enable the architects to make a firm estimate of the soundness of the structure, and the extent to which it would have to be torn down and replaced by new construction.
As a result of their preliminary examination, the architects estimated that the cost of removing the old building and replacing it with a new modern building of similar proportions and dignity would be about $360,000. The architects considered that the existing structure could be rebuilt for a smaller amount, which is proving to be the fact, assuming that the preliminary estimate of cost of a new house is correct.
Rightly or wrongly, the government decided to rebuild the existing structure and, as I said on June 8, the government secured the services of an architectural firm which seemed to have the widest experience in this type of work, and of a local contractor with a first-class reputation.
Since the decision to rebuild was made, two factors have combined to increase considerably the estimated cost. In the first place, as the demolition of the interior of the house proceeded, it was found that the structure had deteriorated to an extent that the house practically had to be rebuilt, except for the outside walls and one or two main partitions. In the second place, building costs have risen substantially since last September.
It can be argued that the government should have decided to build a new residence, perhaps on a smaller scale than the existing house. However, the decision was made to rebuild the old residence. I gave the reasons for that decision in an earlier discussion on this subject.
As the hon. member for Rosetown-Biggar (Mr. Coldwell) pointed out at that time, once we had made substantial progress on the reconstruction of the present building, it was too late to change the decision, assuming that a change should have been made, which I do not admit. The problem then was to make the old building into a suitable modern residence. That is what is being done, and we are not spending a dollar which is not required to create an official residence for our Prime Minister which will be worthy of Canada.
When the house is completed it will not be a palace-I might just remind the hon. members by way of comparison that it is estimated the reconstruction of the White

Trans-Canada Highway House will cost $5,400,000-but it will be a dignified and well-equipped official residence where the Prime Minister can receive appropriately the representatives of any country, and in its beautiful setting, the residence will be an addition to the national capital of which the people of Canada can be proud.


Mr. Coldwell:: Mr. Speaker, on a question of privilege, I appreciate the quotation the minister has given from what I said the other day, but I think the minister has quoted me at the wrong time and the wrong place. I would prefer to have been quoted to the effect that I thought that this building should have been tom down and a new and smaller and more modest residence erected.


Clarence Decatur Howe: I shall quote you accordingly next time.


Mr. Fraser:: May I ask the minister if the figure quoted includes the original $140,000 that was paid for the property?


Clarence Decatur Howe: No, sir.


Mr. Fleming:: May I ask the minister if this additional appropriation will be the end of this extravagant splurge?


Mr. Knowles:: Is the answer yes or no?



AIR TRANSPORT BOARD


Hon. Lionel Chevrier (Minister of Transport):: On May 25, 1950, during the debate on the bill to amend the Aeronautics Act, I stated I would table directives and circulars issued by the air transport board. I now beg leave to table copies, in English and in French, of the directives and circulars issued by the board since publication of the board's last annual report.



TRANS-CANADA HIGHWAY ANNOUNCEMENT OF AGREEMENT WITH NEWFOUNDLAND

['The possibilities of dumping have been explored, and it has been found that there is no dumping in connection with this cargo. At least that is the decision of the Department of National Revenue. The ordinary safeguards of the tariff law are applied to this and other imports into Canada.']
Hon. Robert H. Winters (Minister of Resources and Development):: Mr. Speaker, hon. members may be interested to know that the federal government has today completed an agreement with the government of the province of Newfoundland for the construction, under the terms of the Trans-Canada Highway Act, passed by parliament at the last session, of the route of the trans-Canada highway through Newfoundland. The agreement was signed on behalf of the province of Newfoundland by the Hon. E. S. Spencer, minister of public works. '


Mr. Higgins:: Have there been any changes in the specifications for the road?


Robert Henry Winters: The same agreement and the same specifications as apply to all other provinces will apply in the case of Newfoundland.


Mr. Browne (St. John's West):: Will the minister table a copy of the agreement?


Robert Henry Winters: I shall be glad to do that.


Mr. Black (Cumberland):: Has the minister's department or the government completed an agreement with the province of Nova Scotia for the construction of the trans-Canada highway through that province?


Robert Henry Winters: No such agreement has yet been completed.


Percy Chapman Black: Will the minister table the correspondence with the province of Nova Scotia?


Robert Henry Winters: Subject to permission being obtained from the province.



[Stage Direction]
On the orders of the day:
Mr. J. M. Macdonnell (Greenwood):: Mr. Speaker, I should like to ask a question of the Secretary of State for External Affairs, of which I have not had a chance to give him notice. Has the minister's attention been drawn to the Ottawa Journal of yesterday, which contains a report of a speech by General McNaughton in Vancouver to the Junior Chamber of Commerce, in which, speaking of the Russians, he is reported to have said;
They will turn to war as a means of achieving their ends.
At a time when everyone is advocating more moderate statements, does the minister think that someone who bears such a close relationship to public affairs and the government of this country should make a statement of that kind?


Hon. L. B. Pearson (Secretary of State for External Affairs):: I prefer not to comment on this alleged statement until I have seen a text of what General McNaughton said.


James MacKerras Macdonnell: When the minister considers it further, will he use his influence to see that future statements of the same kind are not made?

Canadian Citizenship Act CANADIAN CITIZENSHIP ACT


[Stage Direction]
On the orders of the day:
Mr. J. G. Diefenbaker (Lake Centre):: should like to direct a question to the Minister of Trade and Commerce in connection with a Broomhall's summary to the effect that several million bushels of oats are to be imported into Canada and the United States from Argentina. Is the minister in position to say whether that report is correct, and whether the price is to be 75| cents per bushel?


Clarence Decatur Howe: I do not know the details of the transaction, but I do know that one cargo of oats has been brought into Canada. I read in the morning paper that certain oats are being brought into the United States. I see nothing strange about the situation, as Canada markets oats in the United States. The transaction is protected by the Canadian tariff law. There is no prohibition against imports into this country.


John George Diefenbaker: Would the minister say what he means by his last statement?- because that is what I had in mind. What are the ordinary tariff laws that would apply to the bringing in of oats from countries that bonus exportations, as Argentina does under her exchange provisions?


Clarence Decatur Howe: The possibilities of dumping have been explored, and it has been found that there is no dumping in connection with this cargo. At least that is the decision of the Department of National Revenue. The ordinary safeguards of the tariff law are applied to this and other imports into Canada.



CHIGNECTO CANAL


[Stage Direction]
On the orders of the day:
Mr.  W. Chester S. McLure@Queens: should like to ask the Acting Prime Minister whether the brief presented in connection with the Chignecto canal will be tabled, as well as the reply of the Prime Minister?


Clarence Decatur Howe: Neither is an official document of the type it is customary to table. I think the Chignecto canal committee could be persuaded to supply my hon. friend with a copy of their brief.


[Stage Direction]
The house resumed, from Thursday, June 22, consideration in committee of Bill No. 315, to amend the Canadian Citizenship Act- Mr. Harris (Grey-Bruce)-Mr. Beaudoin in the chair.
On section 8-Part III.
Mr. Harris (Grey-Bruce):: It was requested that this section stand last night, because of two questions that were raised. One was by the hon. member for Rosetown-Biggar, who suggested that there should be inserted some reference to the person who takes preliminary steps toward obtaining citizenship in another country. During the limited time available we have given consideration to this, and have decided that we would prefer to continue to consider it rather than to make an amendment now. It would run counter to the principle we have introduced of giving quick citizenship to those who are completely naturalized and who return to this country and desire to regain their Canadian citizenship.


Major James William Coldwell: I had in mind the person who has renounced allegiance to this country.


Walter Edward Harris: I realize that and we will give consideration to it. The other question had to do with natural-born Canadians who served in the armed forces of a country that fought against us in the last war. At that time there was no citizenship act in force which would apply to them, and there was no loss of citizenship because of the action they took. We have given consideration to this, and feel that the decision made at the time the citizenship act was introduced four years ago not to make the section retroactive is probably the best decision to make in the circumstances. I can assure my hon. friend, however, that we have no record of these people coming to this country, nor have we any record of applications being made for their re-entry into Canada.


Mr. Green:: If I remember correctly, when the citizenship bill was under discussion in 1947 the minister in charge said that its provisions would be wide enough to prevent the return to Canada of Japanese who had fought in the Japanese forces. I may be wrong, but that is my recollection. If the new section is not wide enough to prevent them from coming back, then I suggest that the minister
404G

Canadian Citizenship Act take steps in his capacity as minister of immigration to see that they are not allowed to return to Canada.
Earlier in the present session this question was raised in the other place by Senator Reid. I have a press dispatch of April 8, 1950, the heading of which is as follows:
No persons of Japanese origin who served with enemy armed forces admitted to Canada.
The article reads in part:
The department of immigration issued a statement this week that no persons of Japanese origin who served with the Japanese military forces in the second world war have been permitted to enter Canada.
I do not know the basis on which that prohibition has been enforced, but I would urge the minister to have his officials look into the situation further, and if by any chance legislation or regulations are necessary to prevent the return of such people, steps should be taken to that end.


Walter Edward Harris: I shall do so.


Mr.   Baler@: Under the new legislation will a married woman born in Canada, who married a man who is not a Canadian citizen, lose her Canadian citizenship?


Walter Edward Harris: No. It depends on the citizenship of her husband whether she ever lost it in the first place, but if she did lose it she may regain it under this act.


Mr. Adamson:: How may she regain it? There have come to my attention several cases in which Canadian women who married during the war lost their Canadian citizenship, and ai;e now deprived of it and wish very much to regain it. As a matter of fact one of the employees of the house during the last session married a citizen of Holland during the war and lost her citizenship. She wishes to regain it. What steps can she take to regain her Canadian citizenship?


Walter Edward Harris: We went through that last night, but if my hon. friend will permit me to say so, all the provisions are designed for the particular case the hon. member has in mind. As I said last night, it covers many girls from his constituency who married Norwegian soldiers during the war. If he will get in touch with me I shall go into the details with him.


Mr. Hodgson:: When do immigrants become full-fledged citizens, so that when Canada faces emergencies such as existed in the periods from 1914 to 1918 and from 1939 to 1945 persons who have lived in this country for fifteen or twenty years will be subject to military call-up? In the last two wars young men who came to this country when they were five or six years of age were not
(Mr. Green.]

subject to call-up in the same way as Canadian citizens were. Is there anything in the legislation affecting that situation?


Walter Edward Harris: No. Persons who become subject to service in time of emergency are made subject to service under the Militia Act or special orders in council which may be passed for the purpose of the emergency. They are not affected by this act.


Clayton Wesley Hodgson: In the last two wars there were quite a few young immigrants of the required age who could not be called up because they were not naturalized citizens. I believe a change should be made in the act, and that people should be compelled to become naturalized citizens after they have been here for a certain length of time. I should like the minister to look into that situation.


Walter Edward Harris: I shall.


John George Diefenbaker: I do not think the
question I have in mind arises under this section, but I did not have an opportunity to bring it to the attention of the minister last night because of a committee meeting I had to attend. It concerns persons of Chinese origin in this country, and the sons and daughters of Canadian citizens of Chinese origin. I have several cases in mind of Chinese who are Canadian citizens and who were unable to secure Canadian citizenship, as the minister knows, until just recently. Some members of their families are still in China. They are endeavouring to bring their sons and daughters to Canada and are unable to do so if those sons and daughters are over eighteen years of age.


Walter Edward Harris: I think that is a
matter of immigration, not citizenship. We shall have supplementary estimates on immigration.


John George Diefenbaker: I will not disagree with
that view, but these sons and daughters should now be able to come to Canada, in view of the fact that their fathers have become naturalized Canadian citizens. They should not be denied admission to this country on an arbitrary basis of fixation of the age of qualification for entry into Canada at eighteen. After all, if we are to meet the challenge of communism in the world today, nothing must be done that will make it appear that Canada denies admission to this country of the sons and daughters of Canadian citizens. To the fathers, Canadian citizenship means something. When the minister discusses the supplementary estimates I suggest that he let these people know whether or not some consideration will be: given. Altogether there are only 2,000 affected, but the opinions of

Canadian citizens of Chinese origin are anything but favourable to the present regulations.


Major James William Coldwell: I know that discussion of
this matter is out of order, but representations in this regard were made by the hon. member for Winnipeg North Centre when the estimates of the Department of Citizenship and Immigration were under consideration. I merely want to say I hope the minister is studying this matter and will give some consideration to the plight of foster children of Canadian citizens of Chinese origin.


Walter Edward Harris: I would have
made that answer to the hon. member for Lake Centre. The question was raised on my estimates last week by the hon. member for Winnipeg North Centre. We had a discussion on it in which I gave some information, but we may pursue the matter further on the supplementary estimates.
I should like to take a minute to discuss the bill under consideration. I misunderstood a question that the leader of the C.C.F. party asked me last night with respect to the right of the minister to grant certificates should an applicant not qualify as to language, or something of that nature. The correct answer is completely different from the one I gave. I did not understand the hon. member. The minister has no power to override the recommendation of the judge, and I indicated he had, which was my error.


Mr. McLure:: What is the difference between an English immigrant and an English settler? I ask this question because some time ago I made application to the department for assistance on behalf of an English settler who had come to Canada, and the government replied that they could not do anything for a settler, that it was only the immigrants they were out to assist. So I would like to know what is the difference between an English settler and an English immigrant coming to Canada.


Walter Edward Harris: I shall be glad to answer that question on the supplementary estimates of my department.


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


Hon. Alphonse Fournier (for the Minister of Finance) moved: the second reading of Bill No. 314, to amend the Canada-United States of America Tax Convention Act, 1943, and the Canada-United States of America Tax Convention Act, 1944.
Tax Agreements


[Stage Direction]
Motion agreed to, bill read the second time and the house went into committee thereon, Mr. Beaudoin in the chair.
On section 1-Convention approved.
Mr. James Sinclair (Parliamentary Assistant to the Minister of Finance):: Perhaps I should make a short statement. I think the purpose of this act is best described in the words of the original protocol between Canada and the United States-for the avoidance of double taxation and the prevention of fiscal evasion in the case of income tax. In a country such as Canada, which has close business interests with both the United Kingdom and the United States, it is very important that we avoid double taxation on the same income in order not to impede business between ourselves and the United States or between ourselves and Great Britain. It is also very important that our taxing authorities co-operate to see that there is no opportunity for evasion by taxpayers because of different taxation laws in the two countries.
It is not easy to negotiate such a tax convention, for several reasons. The most obvious one, of course, is the fact that the taxing laws of Canada and the United States are by no means identical. A second factor is the difference in legal terminology. A third factor, and a very important one, is that in such conventions the revenue loss through a concession must be roughly equal to the revenue we are going to gain through a similar concession from the other party. Because of the similarity between our tax laws and those of Britain, we have been able in the past to have our tax conventions with the United Kingdom more advanced than the ones we have with the United States. During recent years, however, continuous negotiation at Washington has resulted in this present Canada-United States taxing agreement coming much closer to the Canada-United Kingdom agreement. That, of course, is a good thing in the interests of business between all three countries.
The present amendments can be discussed in detail as we go through them, but the principal one in the first part, the income tax part, is to widen the present exemptions for workers of one country on temporary duty in the other country.


James MacKerras Macdonnell: Would the
parliamentary assistant please give us the reference as he goes along?


James Sinclair: Perhaps it would be better if I just dealt with the sections as we come to them, instead of indicating the principal amendments now. The second thing is to get way from double withholding tax on these temporary workers, where both their

Tax Agreements
parent country and the country in which they are on temporary duty have withholding taxes. Third is the mutual exemption of royalties for literary and artistic works in either country.
The second provision refers to succession duties. Under the old act the situs of stock left in estates was spelled out; the rest was left to the courts under the common law. Now we have a mutual arrangement spelling out in the act the situs of pretty well every class of property which might be left in an estate.


James MacKerras Macdonnell: In the
preparation of these tax conventions has there been consultation with people in the business world who have particularly to do with taxation measures, or has it been left entirely to government officials? I ask this because I know in times past there has been consultation.


James Sinclair: Most of these changes have come about because business both in Canada and the United States has come forward with these problems of double taxation and asked both governments whether they could not get together to see that double taxation was avoided. On the other phase, of course, to see that there is no opportunity for evasion, naturally that is not left to business advice; the taxing authorities themselves decide on that. For the most part these changes are consequent upon representations made by either United States or Canadian business, showing that because of our present convention there is an element of double taxation.


James MacKerras Macdonnell: Can it be
broadly said, then, that, in so far as it is possible to consult them, the Canadian Tax Foundation, for instance, and other similar bodies have been consulted?


James Sinclair: Quite right.


Gordon Knapman Fraser: There has been no change in the withholding tax of fifteen per cent on American funds of a Canadian going into the United States?


James Sinclair: There is the one exception I mentioned, with respect to royalties. Last year we amended our law to exempt them, and now the Americans have agreed to do the same, so that is in this schedule.


Gordon Knapman Fraser: It will come in with this bill?


James Sinclair: Yes.


[Stage Direction]
Section agreed to.
Sections 2 and 3 agreed to.
Schedules A and B agreed to.

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


[Stage Direction]
The house resumed, from Thursday, June 22, consideration in committee of Bill No. 303, to amend the Canada Shipping Act, 1934- Mr. Chevrier-Mr. Beaudoin in the chair.
Sections 10 to 35 inclusive agreed to.
On section 36-Radio installation.
Howard Charles Green: Section 36 of this bill substitutes a new section 406, subsection 1, in the Canada Shipping Act, including a new paragraph (a) to which I wish to refer. The side-note reads "radio installation". This particular paragraph applies, of course, only to Canadian ships on international voyages. It does not apply to ships engaged in the coastal trade or on the great lakes. In accordance with the international convention for safety of life at sea, it makes certain provisions concerning radio installations which I believe are excellent. Members of the committee will observe that it provides that all Canadian ships carrying more than twelve passengers, and other Canadian ships of 1,600 gross tonnage-which of course refers only to cargo vessels-plying on an international voyage, must, unless they are exempted by the minister, be fitted with a radio installation which complies with the safety conventions. They must carry radio operators with such qualifications as are specified, who must keep such watches as the minister may prescribe, and in addition we find this provision: that while keeping watches the operator shall not engage in other duties which in any way interfere with the keeping of watches. That, of course, is taken from the international safety convention which applies to all ships of all maritime nations except Russia, which is not a party to the convention. It sets up a standard which I think is one which should be followed, not only for international voyages but also for certain of the ships on our coasts.
Under the Canada Shipping Act, subsection 2 of this section 406 deals with the domestic trade; in other words it contains the law applicable to the coastal trade. I should like the minister to correct me if I am wrong in any of these statements. Under subsection 2, paragraph (a), all passenger ships-this paragraph does not include cargo vessels-must have radiotelegraph installations provided that they are on voyages of a certain length. For example, if a ship is

licensed to carry from 50 to 250 passengers she must have radiotelegraph installation if she is going for more than 200 miles from one place to another place. Those are the words used in the act. If she is licensed to carry from 250 to 500 passengers, then she must have radiotelegraph installation if she is going for more than 90 miles from one place to another place. If she is a larger vessel licensed to carry over 500 passengers, then she must have this radiotelegraph installation with a radio operator if she is going for more than 20 miles from one place to another.
There is not the same provision in this subsection 2, which applies to the domestic trade, covering the watches that are to be kept. I should like to see it amended to contain the same provisions as are now to be applicable to all passenger ships on international voyages. In addition there is one great weakness in subsection 2 of section 406 of the act as it reads today, and that is the reference to the mileage which is described as being measured from one place to another place. The ordinary layman reading that section would think it meant that if a ship was going from Vancouver to Prince Rupert, which is a great deal more than 200 miles, it would have to have radiotelegraph installation and an operator. That is not the interpretation that has been placed on the section by some of the shipping companies. They say that "from one place to another place" means that if the ship stops every 200 miles in the case of a small ship, or every 90 miles in the case of a middle-sized ship, or every 20 miles in the case of a larger ship, then the provision does not apply and it is unnecessary to have radiotelegraph installation. That interpretation simply means that if these vessels call at a logging camp, a fish cannery, or any sort of whistle stop on the voyage up the west coast of Canada, they are not subject to this provision, and need not have radiotelegraph installation or an operator.
'My submission is that in effect they are evading the intent of the act. Because of the discovery of radiotelephony there is a distinct trend towards doing away with these radiotelegraph installations, or at least easing up on the provisions. Our dislike of this trend was clearly expressed in an editorial in one of the Vancouver papers two or three months ago, and I shall quote from the Vancouver Sun of March 13, 1950. The heading on the editorial is "Safety at Sea." Throughout my remarks I would stress that the whole issue here is safety at sea. We do not want to have a catastrophe on our coast by reason of one of the vessels plying up and down the coast not having the proper radiotelegraph
Canada Shipping Act
installation and an operator whose sole job is to look after it. I do not know whether I should quote this editorial, because it is praising a speech made by the hon. member for Skeena. However, it says:
Mr. Applewhaite urged that every ship of 50 or more tons and every ship chartered to carry passengers be required to carry at least one fulltime radio operator who shall have no other duties but the maintenance of radio equipment and keeping of radio watches. This demand may be extreme. The stress should be on the number of passengers carried and the distance of the voyage from point of origin to the most distant point.
You will notice that there they indicate that the words "from one place to another place" should not be used but "from the point of origin to the most distant point". The editorial continues:
The government should consider that ships carrying at least 50 persons including crew should be so protected. And it should also be remembered that the carrying of a full-time radio operator is not merely for the safety of the ship in question but to enable her to co-operate in rescuing other ships.
Maintenance of a full-time watch is also important. The operator should have no other duties that will interfere with his watch.
This question of interfering with the watch of the radio operator has arisen because some of the companies are trying to make the radio operators act also in other capacities- for example, as freight clerks or pursers or to have one of the officers do the job. They are trying to put other work on these men. That practice of course means that they are not available at all times to look after radiotelegraph on the ship. The editorial concludes:
There should be no distinction between international coastal voyages and domestic coastal voyages. A voyage from Vancouver to the Queen Charlottes can be just as dangerous as to Ketchikan.
A voyage from Vancouver to Seattle, or from Vancouver to Ketchikan, Alaska, or to Skagway, Alaska, is of course considered to be an international voyage. It therefore comes under subsection 1, which is being amended by the bill now before the committee. By the terms of this new subsection 1 there must be a radiotelegraph installation unless the minister exempts the ship, and there must be an operator keeping watches as set by the minister, and devoting his full time to the one business of looking after the radiotelegraph. A passenger on a trip from Vancouver to Seattle or from Vancouver to Alaska is thus protected. But a passenger on a voyage from Vancouver to Victoria or from Vancouver to Prince Rupert does not have that protection, although the voyage is just as dangerous. The ships have to go through the same difficult channels. They are exposed to the same open sea in certain places.


An hon. Member:: Ripple Rock.

Canada Shipping Act


Howard Charles Green: Yes, they are exposed to Ripple Rock, which the hon. member for Comox-Alberni and some of the rest of us have not yet been able to get removed. They are also exposed to the dangers of fog. I hesitate to say that we ever have any fog on the Pacific coast-


An hon. Member:: Or rain.


Howard Charles Green: -or rain, but it must be admitted that once in a while we have an extremely heavy fog, and that these coastal voyages are dangerous ones. There have been some serious accidents. For example back in 1918 or 1919 the Princess Sophia was lost north of Prince Rupert and several hundred people were drowned. This whole question is one of safety of life at sea, as the Sun editorial points out.
We are deeply concerned about this matter. We believe that passengers on a coastal trip within Canada should have the same kind of protection that they get on a trip from a Canadian port to an American port. Certainly that one defect in the Canada Shipping Act should be removed-that is, the use of the phrase "from one place to another place." I ask that it be removed, because it is being misinterpreted by the shipping companies. Instead, I think those words should be "from the point of commencement to the farthest outward point", so that a ship carrying 50 to 250 passengers could go only 200 miles from the point of commencement to the farthest outward point without having a radiotelegrapher; a ship carrying from 250 to 500 passengers could go only 90 miles from the point of commencement to the farthest outward point, and a larger ship carrying 500 or more passengers could go only 20 miles from the point of commencement to the farthest outward point without carrying a radiotelegrapher.
It is quite possible that there might be some cases in which, by reason of the nature of the voyage, it is unnecessary to have a radiotelegrapher. In such a case the minister has power to grant an exemption. But the words I have suggested are the very words that the Department of Transport itself used in the fire regulations which were enacted on April 12 of this year. These fire regulations were put into effect as a result of the Noronic disaster and of the inquiry held by Mr. Justice Kellock. In paragraph 3 of the regulations hon. members will find this definition, under the head "Application": These regulations apply to all passenger steamships

I repeat that I am dealing only with passenger ships in requesting that a change be made in the act.
-registered in Canada employed in home-trade, inland or minor water voyages-
(a) which are certified to carry more than 25 berthed passengers or more than 50 berthed and unberthed passengers: or-
And this is the definition to which I refer particularly.
- (b) which do not carry berthed passengers but are certified to carry more than 100 unberthed passengers and the length of the voyage from the point of commencement to the farthest outward point exceeds fifteen miles or the distance from shore at any time exceeds five miles.
I am asking that subsection 2 of section 406 of the Canada Shipping Act be amended by substituting those words "from the point of commencement to the farthest outward point" for the words now found in that subsection, namely "from one place to another place". I should like to move:
That paragraph (a) of subsection 2 of section four hundred and six of the said act be amended by substituting for the words:
"from one plaae to another place" where they appear in clauses (i) (ii) and (iii) of the said paragraph, the following:
"from the point of commencement to the farthest outward point."
Frankly, Mr. Chairman, I probably should go further and ask for additional amendments to provide that the radiotelegraph operator must not be given other duties; but for the present I am moving this amendment in order to prevent the evasion of subsection 2 as it reads at the present time. I hope that the Minister of Transport will see fit to accept the amendment.


Lionel Chevrier: Mr. Chairman, may I take a few
moments to deal with the amendment moved by the hon. member for Vancouver-Quadra? I am sure he does not for one mpment take the position that the officers of the department are not seriously concerned about this section of the act dealing with the safety of life at sea along the coasts of Canada. I believe that was clearly established when section 406 and other sections were discussed in the committee on railways, canals and telegraph lines.
Dealing with the amendment, however, I think there are general considerations to be examined. The first is the present position so far as section 406 is concerned. That position, as dealt with by section 406, covers the domestic trade-and by that I mean inland shipping, great lakes shipping and coastal shipping. Then there is the other aspect dealing with international shipping and international voyages as covered by the convention.
It has been the feeling of departmental officers all along that there should be a distinction between the requirements necessary

for international voyages and those in respect of inland or coastal voyages. That position has always been taken, and is recognized generally in the Canada Shipping Act. It was taken with reference to the steamship inspection regulations to which my hon. friend referred a moment ago.
While I am on that point may I say that while the hon. member in his amendment uses the language of the steamship inspection regulations, there are many members on his side of the house who thought those regulations were much too stringent. Indeed, what we attempted to do when we enacted the steamship regulations was to take a middle course between international and inland requirements in order to protect ships of that kind.
Leaving that position for the moment, let me say that the coasts of Canada-and I am referring particularly to the west coast-are pretty well protected by radio aids. It was clearly explained in committee that there is a difference between the range and effect of radiotelegraphy and radiotelephony. An expert from the department in radio matters indicated that radiotelegraphy should be considered on long voyages, international voyages, and that in so far as they were concerned it was more effective than radiotelephony. He did think however that a distinction should be made in respect to great lakes shipping, inland shipping and coastal shipping. He was of the opinion that the radiotelephone was effective, provided that there was a sufficient range, for coastal operations; and he thought that that condition obtained in connection with the west coast.
Then there is the general view among technical men-and of course I am not familiar with it, but only state what they say- that great developments are expected in the field of radiotelephony.


Howard Charles Green: That would be a good time to make the change-after the developments have been completed.


Lionel Chevrier: But today developments in science move so quickly that before any change could be effected under the act we would be face to face with changes in the scientific field. That is why it was felt, after giving the matter careful attention, that there should be no change.
Let me assure the hon. member and the committee that the matter to which the hon. member for Vancouver-Quadra addresses himself in submitting this amendment was given the most careful consideration by the officers of the department. They heard both sides of the case, having received representatives of the industry and of the union.
Canada Shipping Act


Howard Charles Green: They did not hear the union people.


Lionel Chevrier: I have said that. After having given the matter consideration they came to the conclusion that there should be no change other than that contained in section 406(1) to meet the international convention.
While I do not want to repeat what was said in committee about coverage in the matter of protection of the west coast, I do wish to add this, if it will be of assistance to hon. members who have any fears so far as the amendment is concerned. I believe I indicated in committee that there was in the Department of Transport a continuing committee that dealt with amendments likely to be made from time to time to the Canada Shipping Act. In view of what happened in the standing committee, as well as what is happening in this committee of the whole, I have asked the officers to give this matter further careful .thought. They are prepared to do this and to hear additional representations. If they come to the conclusion that a permanent radiotelegraph operator should be employed on the ships in the coastal service, they will so indicate to me during the course of the next year. If that is their view- because it is a technical matter-then I think I can be relied upon to bring in amendments to the Canada Shipping Act accordingly. As the matter now stands however, I regret I cannot accept the amendment.


Howard Charles Green: Can the minister tell me the difference, from the point of view of safety, between a so-called international voyage between Vancouver and Ketchikan and a coastal voyage from Vancouver to Prince Rupert?


Lionel Chevrier: The definition is set out in-


Howard Charles Green: But can the minister tell me whether there is any difference so far as the safety of the people on the ship is concerned?


Lionel Chevrier: If it is put on that general basis, then I suppose there is no difference between a voyage of that kind and one on the St. Lawrence, so far as safety is concerned. One never knows what is going to happen. Viewed in that broad sense, perhaps there is no difference.


Howard Charles Green: Is there any less need for protection in a voyage from Vancouver to Prince Rupert than in one from Vancouver to Ketchikan? According to the act, the ship going to Ketchikan must have an operator doing nothing but watching the radiotelegraph. Is there any difference between two voyages of that kind, so far as the fellow who is apt to be drowned is concerned?


James MacKerras Macdonnell: It is the same kind of water.

Canada Shipping Act


Mr. Applewhaiie:: I have no intention of repeating speeches I have made before, or of endeavouring, to rehash the story told at considerable length by the hon. member for Vancouver-Quadra this morning. However, because I believe his amendment is justified, I am going to support it.


Mr. Beyerslein:: Mr. Chairman, I find
myself in agreement with the hon. member for Vancouver-Quadra. It is my view that the welfare of those who travel on a passenger vessel should be looked after to the greatest possible degree. The minister has said the department has to make some difference between international and coastal shipping. I would remind him that just as many people could be drowned on a voyage between Vancouver and Prince Rupert as on one between Vancouver and Ketchikan. The minister also made reference to the shore installations and the fact that the coasts were adequately covered with such installations. I would remind the minister that the shore installations would be no good whatsoever if a radiotelephone set on a ship broke down, unless a qualified operator was aboard who could repair it. At the whistle stops serviced by these coastal vessels there are no means of repairing these sets; as a general rule the only place where they can be repaired is at either end of the trip.
I see little difference between an international voyage and a coastal voyage in that respect. If there were facilities for repairing either a radiotelephone or a radiotelegraph at these stops there might be less necessity to carry a qualified operator, but a broken set is of utterly no value if anything should happen to a ship. In view of that I shall have to support the amendment.


Mr. Herridge:: I was a member of the committee and we discussed this matter quite fully. Like the hon. member for Skeena, I am not going to take up the time of this committee by rehashing the arguments that were presented, because they have been covered fully by the hon. member for Vancouver-Quadra. Without question the hon. member is expressing the views of the people who live on the coast of British Columbia and who use these ships, and that is doubly evidenced by the fact that the hon. member for Skeena is supporting his contention. Possibly better than anyone in this house the hon. member for Skeena knows what the people who live on this coast and who use these ships want, and by supporting the amendment he is indicating that those people want a change because they are not satisfied with present conditions.


James MacKerras Macdonnell: I am ignorant of the conditions that exist, but I do want to make one comment. I cannot see why a voyage from Vancouver to Prince Rupert would be less dangerous than the other voyage, and it seems to me that that question put to the minister by the hon. member for Vancouver-Quadra has not been answered.


Gordon Francis Higgins: At the other end of the dominion the same problem exists as has been outlined by the hon. member for Vancouver-Quadra. It is highly necessary that an operator be on duty on these ships at all times and not be burdened with the necessity of carrying on the duties of a purser or some other work. Safety at sea is an important matter, and the question of additional costs should not be considered.
Amendment (Mr. Green) negatived: Yeas, 24; nays, 39.


[Stage Direction]
Section agreed to.
Sections 37 to 63 agreed to.
Schedule agreed to.
On the title.
Howard Charles Green: Is the government bringing in a resolution to provide for the acceptance of this convention?


Lionel Chevrier: I am advised that that is not necessary. The same procedure is being followed here as was followed when the Canada Shipping Act was amended in 1948, and when four international conventions were implemented by that amendment. The Department of Justice advises that this is sufficient.


[Stage Direction]
Title agreed to.
Bill reported.
Lionel Chevrier: the third reading of the bill.


Howard Charles Green: An amendment was suggested by an official of the Dominion Marine Association to which the minister and the committee agreed, but the minister has not moved that amendment.


Lionel Chevrier: I moved it in the committee to which the bill was referred and it was included in the bill.


Howard Charles Green: Should it not have been moved in the committee of the whole?


Lionel Chevrier: Not if the bill comes back amended. It was reprinted, and the section was called and passed as amended in the committee.
Motion agreed to and bill read the third time and passed.


The house in committee of supply, Mr. Beaudoin in the chair.
DEPARTMENT OF RESOURCES AND DEVELOPMENT National film board-
401. Administration, production and distribution of films, and other visual materials, including authority to finance temporary work performed for other public authorities or other agencies as the public interest requires, $2,092,413.


Robert Henry Winters: Mr. Chairman, in view of the events which have taken place over the last six months affecting the administration of the national film board, it might be helpful to hon. members if I made a brief statement in introducing the estimates for the current year.
It will be remembered that on December 7 last I informed the house that the business administration of the film board was being examined by Messrs. J. D. Woods and Gordon Limited, a firm of business consultants. The committee will also remember that following a meeting of the board on December 15 a new film commissioner, Mr. W. A. Irwin, was appointed, effective February 1, 1950. These two moves, the survey undertaken by J. D. Woods and Gordon Limited, and the appointment of the new commissioner, have afforded an opportunity of assessing the value of the board's work, of taking steps to correct weaknesses which have appeared, and to some extent of charting the path of the board's future development.
It is fortunate also that the government, in considering the future of the board, should have the advantage of the advice of the royal commission on national development in the arts, letters and sciences, under the distinguished chairmanship of Right Hon. Vincent Massey, which has in recent months heard briefs presented by groups and organizations of all kinds in public hearings conducted in the principal cities across Canada.
On March 29 I tabled a copy of the report submitted by J. D. Woods and Gordon Limited. Hon. members have since had an opportunity to study the report and the recommendations it contains. It is not my intention to discuss in detail all the recommendations contained in the report, but I should like to make these observations.
The recommendations put forward in the J. D. Woods and Gordon Limited report fall into two main classifications:
1.	Recommendations requiring legislative authority before they can be implemented.
2.	Recommendations which could be implemented without legislative action.
Supply-Resources and Development
None of the recommendations in the first category has been implemented to date, although a bill is now ready for consideration by the house. I am able to report, however, that progress has been made in implementing some of the recommendations in the second category. An announcement has already been made by the film commissioner concerning the appointment of three senior personnel of the board-director of production, director of technical operations, and director of distribution.
The board has taken over its own internal accounting. The number of individual accounts has been reduced from more than
5,000	to about 1,000, and a system of accounting on an accrual rather than a cash basis has been established. I would point out, however, that the treasury branch of the Department of Finance will continue to operate a cash account for the board to pay out and receive moneys on a cash basis.
One of the recommendations of the report was that the film commissioner should review every activity in which the board is engaged to see whether any of them should be curtailed or transferred to other government departments or agencies. In the course of the past four months the commissioner has had an opportunity of surveying the various divisions of the board. It is too early yet, in view of other reorganization suggestions put forward by the report, to say which, if any, activities can be transferred or curtailed. However, this question is being pursued, and in due course I believe some action can be taken with respect to this recommendation.
After reviewing the report submitted by J. D. Woods and Gordon Limited, I am sure that hon. members will agree that many of its recommendations are sound and reasonable. The report does not recommend status as a crown corporation for the board, but it does indicate that it should be possible to establish the board within the regular governmental organization plan, at the same time providing the flexibility which is felt essential for its efficient operation.
In general I can therefore inform the committee that many of the recommendations contained in the Woods-Gordon report which do not require legislative action are already being implemented with a view-to improving the efficiency of the board's operations. At the same time careful consideration has been given to those recommendations requiring legislative action, and hon. members will shortly have an opportunity of considering a bill which is a complete revision of the National Film Act of 1939.

Supply-Resources and Development
Shortly after taking up his new duties, the film commissioner asked for and received from the board permission to have a survey of the board's technical services and equipment undertaken by a qualified expert. As a result the services of a highly qualified technician, formerly connected with the J. Arthur Rank Organization, were engaged for this purpose. His observations have been most helpful and will guide the board in its future technical development.
1 should like to say a word about security. On March 29 last I reported to the house that the screening of all employees of the board had been completed. At that time I said that three employees out of some 580 had been relieved of their duties for reasons connected with the screening. I have nothing further to report in this connection. The board is now a secure agency and is in a position to undertake work of a secret nature on behalf of all government departments.
During 1949-50 the efficiency of the board improved, with the result that greater production was achieved in all departments without increasing staff. Films were produced on a wide variety of subjects, including Newfoundland's entry into confederation, national parks, tourists, health, welfare and nutrition, resources and national development. One of the more outstanding productions of the year was an extraordinary film, "Challenge: Science against Cancer", which was made with the co-operation of the Department of National Health and Welfare and the National Cancer Institute of the United States Public Health Service.
Hon. members will be pleased to recall that the national film board again won an impressive number of awards for its films in competitions conducted in Canada and in other countries. The board received six awards in the Canadian film awards which are given with the participation of the Canadian Association for Adult Education. Awards were received from three film festivals in Italy, and others held in Brussels, Belgium, and Cleveland, Ohio. Two of the board's productions were included in a selection of the ten best 16 millimetre films of 1949 conducted by the American Scholastic Teachers' Magazine, New York city. The national committee on films for safety in the United States selected as the outstanding non-theatrical film in the occupational safety field the film "Safe Clothing", produced by the board for the Department of Labour.
The Woods-Gordon report comments favourably on the value of having a central body like the national film board to handle government photographic assignments. The

report points out that the board, by getting government departments to pool their still picture requirements, has produced for those departments many useful photographs at reasonable cost. Demand for the board's films for use on television is growing in the United States and the United Kingdom. Of particular interest to television stations in the United States are the board's films on travel which are produced for the Canadian government travel bureau.
In presenting the estimates of the national film board for 1950-51, it will be noted that this year the total figure submitted is $2,211,017, which represents an increase of $153,607 from 1949-50. It will also be noted that this year only two votes are submitted as against four votes last year. This is in conformity with the Woods-Gordon report, which recommended one vote for operations and another for purchase of equipment. Members will find on page 260 of the estimates the details of services under various headings of administration, production of films, distribution, and so on. The increase to which I have referred is occasioned largely by a rise in administration costs due to increased salaries. An additional $50,000 has been provided for production of films. An increase of $33,319 has been provided for distribution of films to permit the supply of more prints to rural and urban areas, and replacement of existing prints both in Canada and abroad.
In conclusion I should like to say that in my opinion the national film board has made a successful passage through a very difficult period. It is a tribute to the high morale of the staff that the board has maintained and even increased both production and distribution during the year. The work of the new commissioner has already been reflected in the work of the board. The deputy chairman, together with the six others who sit with him on the board, have given freely of their time and effort and have made a really worthwhile contribution. Last December I expressed the hope that the film board would come to be regarded everywhere without prejudice as an important instrument in the expanding life of Canada. I feel that since that time the board has taken firm steps in. that direction.


Gordon Knapman Fraser: There are a few questions I should like to ask the minister. First of all, an agent or representative of the film board was sent to the United Kingdom a short time ago. The Woods-Gordon report suggests that the external affairs department should handle this distribution in all countries but the United States, and I should like the minister to explain why this man was sent to Britain.

I should like to know also how the film board arrives at an overhead of five per cent this year as compared with ten per cent previously, when on page 27 of the report it is definitely indicated that the quarters and equipment, services, light, heat and water are provided by the Department of Public Works; telephone services are provided by the Department of Finance, accounting service is provided by the comptroller of the treasury, and so on. No accurate figure could be fixed in regard to overhead, and I am wondering why it has been reduced to five per cent and if the minister has any idea as to what would be the real overhead of the film board in producing their pictures.
At page 26 of the Woods-Gordon report it is indicated that accounts receivable amount to some $43,000, and that some of them are a year or more old. I wonder if any of those have been collected; and if not, why not? Also I have learned from fairly reliable sources, as I mentioned the other day, that a series of films were made for the Department of Agriculture out on the prairies but that they have never seen the light of day. I understand they were simply put in a vault in the Department of Agriculture or the film board, and have never been shown. If that is so, I should like to know the reason for it. I should like to know also the cost of the "Canada Carries On" series per year, and what is paid for that series by Columbia Pictures, who I believe are your distributing agents. Also I should like to know if any revenue is received from that series in any country other than Canada.
I should like to know for what departments of the government films were made in 1949, and what films are contemplated for 1950, as well as how many stills were made in 1949 and up to June 1, 1950; how many were sold in 1949 and how many in 1950.
I would ask if any co-operation is given the Department of National Defence in regard to the production of their films. I understand they make their own because as was stated in the house some time ago that department could not trust its films to the film board. The minister has said that this condition has been cleared up so far as the board is concerned, and I wondered if any different arrangement had been made. Then some departments have their own film liaison officers, and I should like to know how the film board works in with those departments in that respect.


Robert Henry Winters: I do not know whether 1 have all those questions, or whether we have all the details before us. The first question had to do with the distribution of films abroad by. the Department of External Affairs. That was recommended in the Woods-Gordon re-
Supply-Resources ' and Development port, and in some countries such as Mexico the distribution of film board pictures is at present directly under the Department of External Affairs.


Gordon Knapman Fraser: There has been a change, then?


Robert Henry Winters: That has been going on for a few years now, but at one time it was done by the film board. The arrangement in England was that the film board had an employee acting in its behalf there. He was taken ill, and is being replaced by another employee of the board, who has not yet taken up his duties in London. That arrangement has the approval of the Department of External Affairs. I feel that perhaps we can move further in the direction recommended in the Woods-Gordon report, and that is one of the matters under consideration.
The hon. member asked about overhead. It was reduced last year and is being increased again this year to make it more realistic in comparison with what is being charged by private companies operating in the field. We still have considerable work to do along that line before we can reflect an operation that is comparable to the private operators in the field, but that is one of the points under active consideration.
The hon. member asked about accounts receivable, whether any had been collected since the figure was reported in the Woods-Gordon report. The answer is that some collections have been made since that time. I believe the next matter the hon. member referred to was the allegation that certain films produced for the Department of Agriculture had never seen the light of day. I can find no support for that statement. There is a close liaison with the Department of Agriculture at the present time; four films are under production for that department, and to my knowledge none of those films, and none that has been produced in the past will fail or have failed to see the light of day.
The hon. member asked about the cost of the "Canada Carries On" series. It costs the film board approximately $120,000 a year. The films are distributed through Columbia Pictures, and the board realizes a revenue from the distribution. A further question was asked as to whether they are distributed outside Canada. The answer is that they are not so distributed as a series, but that occasionally they do find an outlet.


Gordon Knapman Fraser: What is the revenue in Canada from the series?


Robert Henry Winters: While that is being looked up I might refer to the number of still pictures produced. In 1949 the sales of photographic

Supply-Resources and Development prints were: to government departments, provincial departments of education and nonprofit or educational organizations, 61,701, of a total value of $31,157.35; to publications, newspapers, advertising agencies and so on, at prevailing commercial rates, 1,288, of a total value of $2,981.10. I think that answers all the questions, with the exception of the revenue from the "Canada Carries On" series.


Mr. Stewart (Winnipeg North):: While the minister is getting that answer perhaps I might comment upon some of the things said in the report, and also upon what has been said at other times by the hon. member for Peterborough West. In the past the severest critic of the film board has been the hon. member for Peterborough West, but he seems to be mellowing with advancing years. I appreciate the change. The pity is that all the arguments which had to be advanced in favour of the film board had to come from this section of the opposition rather than from the ministers who through the years have been responsible for the board. Only last December I had occasion to criticize severely an article which appeared in the Financial Post and which I described in somewhat colloquial though accurate terms as being a certain type of gossip. The allegations contained in the article in the Financial Post have been thoroughly disproved, if we can place any reliance whatever in this report on the national film board which has been submitted by J. D. Woods and Gordon Limited.
Looking over the recommendations, it is interesting to note that many of the proposals contained in the report came from the employees. I cannot believe that the employees came to these conclusions suddenly when they advanced them to this organization. They must have had these opinions for some years, and undoubtedly they must have passed them on to their superior officers. It appears, therefore, as though the government is the laggard in not acknowledging them sooner. Criticism has been made frequently of the alleged inefficiency of the film board, and there has been an element of merit in that criticism. When we are told again, as we are in this report, that the board has had to work in at least ten different buildings it can easily be understood why inefficiencies did exist. If the film board was compelled to do that, I do not think the fault can be attributed to it, but rather the fault again comes back to the government which is responsible for the care of its creature. What is more, the buildings for production in which the staff of the film board worked were not adequate, and had to be adapted to the purposes which the

film board had in mind; that in itself would add to some extent to the inefficiency.
As to the costs of production, which have been so frequently criticized, I think it is only right that this section on page 5 of the report should be read:
The board has had to do its film shooting on locations everywhere across Canada. This has been costly, due to the travelling and living expenses involved. Furthermore, the Canadian climate has made it necessary to do the bulk of the shooting during four months in the summer. Film production, therefore, has been not only costly, but also difficult to plan and control because of its seasonal nature. Another problem peculiar to Canada has been the necessity of producing films in both English and French.
Those facts were known to many people, and one would have thought their criticism might have been tempered by that knowledge. Unfortunately, such has not been the case.
There has been criticism of the film board because of its accounting procedure. Again this criticism, when directed against the film board as such, is quite unfair, because we are reminded in this report that the accounting of the board is handled primarily by the comptroller of the treasury. That statement is found on page 25 of the report. Lower down on the same page we find this statement:
Since the comptroller of the treasury took over the accounting of the national film board some four years ago, there has been a considerable improvement in the accounts.
Nevertheless it is the treasury which has been responsible for the accounting, and not the film board.
Another matter upon which all members have expressed dissatisfaction I am sure has been the terms under which the members of the staff of the film board have had to work. They have been existing on three months' contracts, a very unsatisfactory way of working. I am glad to see that is now being stopped, and they are to be put on the same employment basis as other employees of the government. When the report mentions that the morale of the film board is high, and one considers the conditions and sometimes the criticism under which its personnel had to work, one is surprised at that comment.
There has been a campaign, perhaps a deliberately instigated campaign, against the film board, but that instigation has no place whatever amongst our citizens. The people of Canada, as we can see from the submission made to the Massey commission, are thoroughly behind the film board and what it has done. It has been supported before the commission by dozens of briefs from home and school associations, the Canadian Association for Adult Education, the Federation of Agriculture, the Canadian Citizenship

Council and film associations across the country. The rank and file of the people of Canada support the film board. It is only a few, as I say, who have attacked it, and there has been reason for it.
Canada has shown that we take second place to no other nation in the world when it comes to the production of documentary films such as the film board has given us. These films are in competition with private industry, especially the Hollywood industry. One of the reasons for the concerted attack on the film board has been that commercial interests in Canada, and in Hollywood, instigated them. Today the best way to attack is to smear. If you want to attack an organization or an individual, you conduct a smear campaign. The one way you smear is, of course, by labelling the organization or individual as communist. It is very easy, and it has been done far too often. I repeat what I said earlier, that the film board has not received the defence it should have had from the ministers in the past.
This question of communist allegations brings up the whole matter of security. I made my position and the position of my party quite clear yesterday. We believe that security precautions are necessary, but we must never forget that while security of the state is important, freedom of the individual is no less important. The minister has told us that after the screening had been completed, about three individuals had been relieved of their duties. He spoke in the past tense, so I intend to ask him if any are under notice just now, because of the screening which has just been completed. I want to remind the committee again that while security is important, the liberty of the individual is important too. I hope that ways and means will be found whereby security of the individual will be protected.
The question which I have specifically in mind is this: Are there any employees of the film board who are now under notice to terminate their employment because of the screening which has already been completed?


Robert Henry Winters: The answer, Mr. Chairman,
is no.


Gordon Knapman Fraser: May I just say a word about
the remarks made by the member for Winnipeg North? He mentioned my name, or at least my riding, and said that commercial companies were behind the attacks on the film board. I want to assure the hon. member and the house that no commercial company ever approached me in regard to the film board. I also want to say that I have no connection with any commercial film company. My sole purpose in criticizing the film board was an attempt to see that the
Supply-Resources and Development film board becomes a film board producing pictures that are worthy of the people of Canada, and carrying out the duties it was intended to carry out. I had no other purpose. I do not think it was proper for the member for Winnipeg North to impute motives to any member, and I object to it strongly.


Alistair McLeod Stewart: Let me
answer that, Mr. Chairman. May I say that if I imputed motives to the member for Peterborough West I certainly had no intention of doing so. I accept his statement categorically, and without reservation. I impute no motives to him or any other member in this house, but I do repeat that commercial interests in the United States and Canada have been responsible for much of the campaign against the film board.


Mr. Gauthier (Sudbury):: Mr. Chairman, I should like to say a few words on this item, and not words of criticism. I want to commend the minister and the officials of his department responsible for a film made by the board last year concerning poliomyelitis in Sudbury. At the request of many medical men and service clubs in our district, as well as the Red Cross Society, I was asked to ascertain whether the national film board would consider spending a few dollars in making a film to show what can be done locally in connection with a matter of that kind. I am sure that this film is now being shown in all the communities- across Canada. In cases of emergency, having to do with such dreadful diseases as poliomyelitis, and many others, I think the film board should be commended for the work they are doing to help the many communities.


Mr. Murray (Cariboo):: First, Mr. Chairman, I would agree with the hon. member for Sudbury that the film is a tremendous educational factor and its use should be extended. I should like to ask the minister if he could not get a crew of camera people to go up into the Peace river district and there make a film showing the resources of the country, the land that is available for settlement, and the development that is going on, particularly the oil development. Just the other day at Whitelaw a well was brought in which is running six hundred barrels of oil per day. I doubt if on that country the film board has a film of the character which I outlined.
The Alaska highway is also a subject which should be filmed. Those films should be sent broadcast throughout America because the highway opens up a great tourist area there as well as an industrial area. The scenic features of the Rocky mountains, which are cut in three places by the Alaska highway, are superior to those in Switzerland;

Supply-Resources and Development yet little has been done to publicize that fact. The possibilities of the Yukon as a place for tourists and also for industrial development could be shown only by film. Some time ago I saw a film on the Peace river country made by the national film board. It was dated 1941. In the last ten years so many things have happened north of Edmonton that there has been a transformation of the entire country, and a film dated 1941 is not particularly useful in presenting the story as it is in 1950. I would ask the minister to direct his department to these parts of Canada which should be illustrated by the film board.


Mr. Fulford:: I should like to quote a few figures in order to show what an important part the film board is playing in the life of the rural section of my riding. It was just a year ago that the film council of the county of Leeds was organized. Last winter no less than 87 public and continuation schools were given visual education through the use of national film board pictures. Those 87 schools represented ninety per cent of the rural schools in the county which are serviced with hydroelectric power. Besides, there are fifty adult audiences which are shown national film board pictures each five weeks. That means that there are over 1,000 students and adults who view the films each week. In my opinion that is a considerable audience. Not only do these films bring education to the school children of the county; they also bring education and enjoyment to a great many of the adult residents of the rural sections. Actually there are two sets of equipment in continuous use five days of the week, morning, afternoon and evening; and occasionally it is necessary to bring a third projector into service. Certainly the rural people of the county of Leeds are most enthusiastic about the services given by the national film board. Many of them have come to me requesting that every effort be made not to curtail but to increase greatly the activities of the film board in making more films available both for schools and for adult education.


Mr. Croll:: May I say how highly pleased I am to hear the tenor of the remarks made today in the committee with respect to the film board. I want to follow in the mood of the hon. member for Sudbury and the hon. member for Cariboo. I want to make a plea to the film board to direct their attention to films that deal particularly with citizenship. The last one I saw that was made by the film board was slightly out of date; nevertheless it was an excellent picture. Large numbers of the people who are coming into this country may not be able to read for a

while, and they may not be able to write; but they attend the films and they can see, and an impression is made upon them. There is a tremendous opportunity for us to spread the gospel to these people to push home a lesson to them, to let them know the meaning of freedom, what we mean by Canadianism, and what we expect of them in this country.
We are naturally gratified to hear the words of praise directed today to the film board. They deserve it, and I am sure that they will deserve it even more in the future. But through you, Mr. Chairman, I ask the minister to consider the suggestion I have made because I think the field I have referred to has been neglected.


Alistair McLeod Stewart: Can the
minister tell me if there are any employees of the film board who today are under notice of dismissal?


David Arnold Croll: He said no.


Robert Henry Winters: I answered that question before, Mr. Chairman. The answer is no.


Alistair McLeod Stewart: I know I asked if there were any under notice of dismissal for security reasons but are there any under notice of dismissal not for screening purposes, but for any purpose whatsoever?


Robert Henry Winters: I understand there are certain resignations pending, not for reasons related to screening. There is quite a turnover in the employees of the board, and the resignations that are pending have no relationship to screening at all.


Alistair McLeod Stewart: I am quite prepared to accept the minister's statement that they have no relationship to screening; nevertheless I think it is most unfortunate that these resignations should take place at such a time when screening has been so recently conducted, because it must leave a certain stigma upon those who are resigning. I do not think this is the time for people to choose to resign, let us say.


Robert Henry Winters: We have had that consideration in mind, of course. That is the reason why I was anxious to announce at the earliest possible date that screening had been completed, so that anybody who wished to retire after that, for reasons of his own, would not retire under the cloud of security.
While I am on my feet perhaps I should answer the final question the hon. member for Peterborough West asked. It was about the board's relationship to the Department of National Defence at the present time. I can assure the house that after the screening was completed and the board was declared a

secure agency, the normal relationships with the Department of National Defence were resumed. The most cordial relationships prevail, and we are as a matter of fact making one picture now for the Department of National Defence. With other departments of government the film board works very closely through the film liaison officers or any other officers who might be appointed to deal with the film board in respect to pictures made for the department.
In reply to the hon. member for Cariboo, may I say that a considerable amount of film has been produced on the north, which is a fertile field for filming, and I am hopeful that we shall be able to do something more in that district.
Item stands.
Progress reported.
At one o'clock the house took recess.
The house resumed at three o'clock.



SUPPLEMENTARY ESTIMATES, 1950-51

[Stage Direction]
A message from His Excellency the Governor General, transmitting supplementary estimates for the fiscal year ending March 31, 1951, was presented by Hon. Douglas Abbott (Minister of Finance), read by Mr. Speaker to the house, and referred to the committee of supply.
[Stage Direction]
The house in committee of supply, Mr. Dion in the chair.
DEPARTMENT OF FINANCE General administration-
85. Departmental administration, $1,392,488.
Mr. Drew:: Mr. Chairman, it seems appropriate that on the general administration item for the Department of Finance certain remarks should be made in connection with a subject which has been under discussion here on different occasions during the present session.
The public accounts committee has had a number of meetings, and is still sitting, but an interim report was tabled which dealt with certain recommendations made by that committee and certain evidence received by it. First of all I wish to make it clear that the interim report is not unanimous, and that while there are a number of recommendations in it which are useful and will be helpful to members of the House of Commons, and I would hope particularly useful to the Minister of Finance in the preparation of estimates for next year, the fact remains that there were certain im-
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portant points put forward in the report which do not represent the views of some members of the committee.
The sittings of the committee have been useful in that, in addition to the discussion of the details of the public accounts, we had the advantage of recommendations by the Auditor General in regard to a great number of procedural matters which do suggest that important improvements can be made. One of the things emerging most clearly from the recommendations of the Auditor General was the emphasis on the fact that public accounts should be before members of the house, and estimates as well, in a form that would make it possible for hon. members to exercise supervision over public expenditures.
The recommendations were based quite clearly upon a recognition of the fact that the estimates and the public accounts as they come before the House of Commons and the examination and discussion of them in the house do not give to hon. members effective control over public expenditures unless they are so presented that hon. members are able to understand how the details are made up and to obtain the kind of information they should have.
One of the recommendations of the Auditor General was that the system of presenting the estimates and the public accounts should be simplified and information given in such a way that related subjects could be discussed with a knowledge of the facts behind the figures. One statement was prepared and placed in evidence before the committee which indicated the difficulty there is in dealing with the estimates in the way we now do.
An official of the Department of Finance prepared an analysis of the estimates now before us and of those for two other years, one of which was the last full year before the war. The information was broken down on what was described as a functional basis. It brought together related activities, and then accumulated the totals from each department.
What was apparent when those figures were brought together was the very large increase in a number of items out of all proportion to the increase in population of the country, or what would appear to be the normal business of government. Without attempting to review the whole of the statement, I should like to take a single item to show the extent to which expenditures have increased. Similar increases are found in many respects on almost the same proportionate basis as the one I shall now mention.

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Under the heading of telephones, telegrams and postage, the total in 1938-39 was $960,248, whereas in the present estimates the total is $8,595,943. I shall not go into details of the other items, because similar increases, some on a larger and some on a smaller proportionate basis, occur right through this statement. I take that particular item to show how impossible it is from the practical point of view to examine the estimates here with any suggestion that we are actually performing an effective audit of the items and are in position to make specific recommendations in regard to reductions under one heading or another.
The total in regard to telephones, telegrams and postage is the combined total of the items in the estimates of different departments. We see a figure in front of us which requires explanation, but when dealing with each of these items separately it is impossible to say exactly what can be donq in the way of reduction consistent with efficiency. It was for that very reason that we proposed an examination of the whole system of accounting and the organization of government by an independent body. That proposal has been disposed of by a majority vote of this house for the present session, but it will be renewed again in the hope that in the meantime the government will have seen the advantage of such a method.
But even if that course were not adopted, there is another course which I submit should be adopted. This is the time to put this forward because when the estimates are being prepared next year they will be prepared before we have an opportunity to express our views on the subject. If the estimates were submitted to a committee on estimates we would have the nearest approach that we could have within our parliamentary structure to that type of independent examination formally put forward by motion in this house. A committee on estimates could deal with the estimates of each department by bringing the officials of the department before it. They could bring the items together, examine them and see exactly how they are made up and find out if there were any substantial economies which could be effected to the advantage of the public service and to the very great advantage of the taxpayers of Canada. If we did that we would only be doing what every large business is doing year by year, seeking to find out ways in which business can be carried on more efficiently and at reduced costs through the elimination of duplication of services and through a careful examination of how expenditures are actually incurred and how they are made up.

Without any suggestion as to the improper-use of these services under such headings as telephones, telegrams and postage, it is easy for everyone in this committee to understand how these things can get out of hand unless there is some effective measure of control. I do not believe that the Minister of Finance or his officials are better able to examine details of this kind in the very largest business in the country, the business of government, than are the experts in other types of business. They seek the examination by people who can examine from an objective point of view outside the actual organization itself.
We could examine details like this. We could examine details like travelling and transportation expenses which have grown from $4,742,206 in the last year before the war to $22,744,344 for the coming year. The Minister of Finance has said, "Point to single items where reductions could be made." That sounds like a practical suggestion, but except for the purposes of making a statement in this house every hon. member knows that it is not a practical suggestion. Every hon. member knows that the only way that members can obtain information which will make it possible to deal with this upon the basis of single items is to have a committee on estimates and also concurrently in the wider field an investigation such as we proposed in the resolution to which I have referred.
There has been a tendency during the present session when proposals were made for the appointment of committees of this kind to suggest that we are seeking to establish the system of government that is in operation in the United States and to depart from the practices described as British parliamentary institutions. Here is a case where that argument can have no validity because there is a committee on estimates at Westminster which has authority to call, and does call before it, senior officials and others who are in position to explain details and show exactly how the items are made up. On that basis that committee on estimates is able to make recommendations in detailed form.
What we are proposing is the adoption of a system which has worked satisfactorily for many years in a parliament which is described, outside the commonwealth as well as inside, as the mother of parliaments. Far from proposing any. departure from traditional parliamentary practices, we are merely proposing that we adopt parliamentary practices which have been carried on successfully in that parliament from which we drew our general practices and traditions.
To sum up the items under the various headings, we arrive at a total showing that

the estimates for the last year before the war required a total of $549,219,048, while this year the estimates call for $2,367,480,478. When we suggest that economies can be effected the answer is given, as it was given just a few days ago, that a substantial part of the estimates of most of the departments is made up of items for services of a statutory nature which cannot be reduced. When that explanation is given it invariably overlooks the fact that wrapped in those total costs is the cost of handling services and that an independent examination might well disclose large numbers of items where reductions could be made in the handling of the services, to the advantage of the government and to the advantage of the taxpayers of Canada.
The proposals made by the Auditor General were not accepted in the report presented by the public accounts committee. I am not suggesting for a moment that the recommendations of the Auditor General should be accepted without question. I can see real arguments against reducing the number of items, as was suggested. I can see no arguments against simplification of the presentation of the accounts and the giving of greater detail in that part of the statement of estimates explaining the items found in the front part of the book.
Moreover, I have heard no sound argument put forward suggesting any reason why a committee on estimates would not be the best procedure for t^ie year by year examination of the estimates. I do not think any argument was put forward before the committee suggesting any reason for not making the recommendation that there should be a committee on estimates to deal with estimates presented to the house in future. I also think the recommendation which was made with respect to explanation of details and steps being taken to give parliament effective, practical and real control over expenditures is one which should be emphasized and carried into effect.
I am making these comments now because the Minister of Finance is the minister primarily charged with the responsibility for the preparation of the estimates and the form in which we shall receive them. There is a lack of uniformity in the way in which they are presented. While the reduction of the number of items in some departments may be questioned, there certainly can be no such question in the case of the Department of National Defence where the bulk of the expenditure on national defence is included in a single item. Furthermore, the supporting details given at the back of the book do not explain these enormous expenditures, today approaching the total of the budgets of the government before the war, in a way
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that makes it possible for members to make any real examination of these estimates. If there is a single department which demonstrates the necessity for following a number of the recommendations of the Auditor General it is the Department of National Defence.
As I pointed out in discussion of its estimates earlier, it does not follow the same procedure as other departments in regard to the construction of buildings and other things of that kind, which cannot by any possible stretch of the imagination be regarded as secret. I urge the Minister of Finance to give careful consideration to the recommendations of the Auditor General. I hope that after consideration thereof he will arrange for the presentation of the estimates next year in a form which will be more understandable to members and which will follow some uniform pattern in each department so far as that is practicable. I hope he will also inform the house that he is going to agree to the setting up of a committee on estimates shortly after the opening of the next session.
All hon. members know that during the time we have sat here this argument has been before the other place and has also been discussed in public. Hon. members are also aware that not only in Canada but also in other nations of the commonwealth and in the United States there is constant emphasis on the fact that the greatest need today in the field of government activity is to find a way of exercising effective control over expenditure so that, with the enormous expenditures made by many agencies not subject to the ordinary supervision of parliament or even of government, the highest measure of accounting efficiency may be established and the most economical practices adopted. Many of those who have put forward these contentions have emphasized the fact that our whole democratic structure may break down unless we are able to exercise control of the amount of expenditure by so many agencies of the government as well as by the government itself.
For the very reasons that have been given it is not possible to deal with single items here. The public accounts committee deals with past accounts; a committee on estimates could deal with the present estimates before us and other estimates in the years ahead. The most that we can do now is to say that the system that has been adopted is one which denies that measure of detail which would make it possible to recommend reductions, except in a few simple cases. We must therefore urge a procedure which has worked well elsewhere, and would work equally well

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here, so that in the future we may be able to consider the estimates with actual knowledge of the facts.
The question before the Minister of Finance and other members of the house is whether the machinery set up by parliament is to be machinery which will really carry on the business of parliament and the government in the most efficient way, or whether it is to be machinery which will be used for the purpose of hiding information. Those who have sat as members of some of the committees this year know very well that there are numerous instances of steps being taken to use the machinery now available for the purpose of hiding information instead of exposing it to the examination of members of the house. What we do should be for the purpose of reducing costs wherever costs can be reduced, for the purpose of increasing in every way the efficiency of the biggest business in Canada, for which members of the house are primarily responsible, and urging the taking of steps for next year which will make it possible for us to deal effectively with the estimates that come before us at that time.


James MacKerras Macdonnell: I want to
raise one question with the minister which is really a matter of finance. When we were discussing the public works estimates the other night the question of commitments arose. I hope the minister is aware that it was then suggested, and I hope agreed, that the whole question of commitments might be dealt with in more detail on the estimates of the Department of Finance. I should like to know whether it would be more convenient to discuss the matter now or later.


Mr. Abbott:: It might be as convenient to
take it up now as any other time. The position with respect to commitments is this. As my hon. friend and the committee are aware, under British constitutional practice there is no limit to the commitments a government may make under contracts which will carry on in future years. The making of those commitments or the giving of those undertakings does, of course, imply that parliament will have to vote the necessary funds in succeeding years, and that in making such commitments the government of the day must feel that it is going to be in a position to implement them.
The practice with respect to commitments in the past has been varied, but my understanding is that where a specific amount has been voted, say in the estimates of the Department of Public Works, encumbrances would not be issued beyond the total of the amount voted. There was nothing to prevent commitments being entered into which would fall due in future years. The practice we

have followed the last year or two of inserting specific commitment authority in a particular vote is for the purpose of limiting the extent of the commitments that may be made by that particular department for the particular purposes indicated. In the absence of such specific statutory limitation on commitments, the department of course would be perfectly free to make any commitment it saw fit. As I have indicated, the purpose of inserting a specific amount as commitment authority was to limit the department in the commitments it might incur. Does that cover the point my hon. friend had in mind?


James MacKerras Macdonnell: Yes and no.
When we were considering the estimates of the Department of Public Works the other evening it became clear that there was a whole list of substantial commitments. We asked the minister to let us know to what extent those had been availed of, and my recollection is that the extent was comparatively trivial. So the question arose as to whether there was any need for these substantial amounts, running into many hundreds of thousands of dollars earmarked against various items, or whether it might not be more sensible to have a common fund.
I digress for a moment. I am a little surprised-perhaps I took it up wrongly- to hear the minister say there is nothing to prevent a department making commitments of any size; that is, I suppose nothing except common sense. Does the minister mean that literally?


Douglas Charles Abbott: That is quite right. There is no constitutional limitation on the minister of a department, with the approval of the government, entering into contracts for any amount he sees fit.


James MacKerras Macdonnell: I suppose I understand the sense in which the minister makes that statement. It would not mean a thing except the hope that later on parliament would grant those amounts. I find it a little difficult to understand the minister's explanation that this really is not an enabling provision but a limiting provision.


Douglas Charles Abbott: That is exactly what it is, and what it is intended to be.


James MacKerras Macdonnell: Then I would ask the minister what in point of fact was the practice before this commitment provision came in? Frankly I do not think the Minister of Public Works quite regarded it in that sense. It seemed to me he regarded it as merely some additional leeway given to his department if it should find itself pinched here and there. Let me put a specific question. What is the objection to having a common fund for these purposes? Let us

turn, for example, to page 43 of the estimates, under public works, where we have a whole series of commitments totalling some $610,000. What is the objection; or in the minister's view would there be no advantage in having one common fund which would be available, bearing in mind the fact that, as I say, apparently these commitments under public works were very little availed of?


Douglas Charles Abbott: I am not sure that I am quite clear just what my hon. friend has in mind by a common fund. As I indicated a moment ago, the practice with respect to the use of commitments varied a good deal in the past, and varied as between different departments. In considering how these matters should be dealt with, and taking into account the fact that extensive construction projects, for instance, in some cases may go on over a number of years, it is quite clear that a department such as public works should be in a position to in fact give undertakings or make commitments for future years. As my hon. friend has indicated, this implies that parliament will be willing to vote the funds in the years they are required for payment. It is true that the commitment authority in public works has not been too extensively availed of; I have a list here of the votes in the main estimates, indicating the extent to which that commitment authority has been utilized. If my hon. friend would like me to place it on Hansard for purposes of illustration I shall be glad to do so. It is for 1949-50, the year to which I think my hon. friend referred. The list is as follows:
Department of Public Works Commitment Authority 1949-50
Vote No.	Name of Vote	Amount
328	Maintenance of public buildings.. $500,000
Encumbered	(repairs) 107,000
329	Public bldgs., outside Ottawa _ 500,000
Ottawa bldgs	 67,000
333	Maritime provinces	 100.000
Encumbered	 nil
334	Quebec	 100,000
Encumbered	 53,000
335	Ontario	 100,000
Encumbered	 nil
336	Manitoba	 50,000
Encumbered	 nil
337	Saskatchewan	 50,000
Encumbered	 nil
338	Alberta	 50,000
Encumbered	 7,000
339	British Columbia	 50,000
Encumbered	 nil
347	Public bldgs, generally	 200,000
Repairs, alterations, etc.
Encumbered	 nil
Harbours, Rivers, Maintenance Wharves
367	Prince Edward Island	 35,000
Encumbered	 7,000
369	New Brunswick	 65,000
Encumbered	 15,000
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370	Quebec		 125,000
Encumbered	 nil
371	Ontario	 75,000
Encumbered	 nil
374	British	Columbia	 75,000
Encumbered	 nil
The practice now in connection with public works expenditures, as the committee is aware, is to indicate in the details the estimated cost of the various public projects by provinces. A lump sum is voted, which represents the best estimate the department can give as to the amount of money that actually will be expended on all those projects in the particular fiscal period. If that proved insufficient it would be necessary, of course, to get a supplementary vote. In their experience it has been found that if they were to list one hundred different projects such as wharves, breakwaters, public buildings and so on, some can proceed more rapidly than others, and if they are restricted to each individual vote there is a substantial overestimate of what will be the probable expenditure. In addition to that, in the public works estimates there is specific authority to incur commitments for future years; but, as I have said before, that is intended as a limitation so the department will not place contracts now extending into future years beyond the amount indicated in the particular item.


James MacKerras Macdonnell: Then one
further question in this connection. Will the minister look at item 357 of the public works estimates, which indicates a somewhat different practice, though possibly it does not cover the same situation. The minister will see that the amount is $150,000, and the item reads:
To provide for balances required to complete any propects undertaken in previous fiscal years and for which no specific provision is made in the fiscal year 1950-51.
That looks like a kind of mopping-up operation.


Douglas Charles Abbott: Of course the Minister of
Public Works would have more information on this than I have, but I am told that is to cover a number of smaller projects where amounts were being carried forward which would need revotes if reference were made to the specific items in previous years. These would be amounts of $500, $1,000, $750, and so on; so it is a sort of mopping-up operation, as the hon. member said.


William Joseph Browne: In the course of his budget speech the minister made this reference at page 1214 of Hansard:
But I think it is fair to remind the house that during the past year and over the next few years the accession of Newfoundland to Canada has imposed and will continue to impose a considerable net burden on the federal treasury.

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Since this has given rise to some editorial comment in the Newfoundland papers I should like to make brief reference to it. This is not intended as criticism, because I do not think we have sufficient facts to be able to comment upon it in that way.


Douglas Charles Abbott: My hon. friend knows what I said immediately after that statement.


William Joseph Browne: Yes; I have read all the remarks the minister made, including the reference to the saving of several million dollars on the sterling debt you took over.


Douglas Charles Abbott: No saving there.


William Joseph Browne: From $62 million to $52 million. It cost you $52 million and you took over $62 million. There was also a benefit in United States exchange of about $40 million, and there was the increased trade in the internal market through the diversion of about $25 million worth of imports from the United States to the other provinces of Canada. What I want to do principally is to ask the minister if he can prepare a statement showing the actual expenditures corresponding to the items in the supplementary estimates from No. 666 to No. 745. Those are the estimates for expenditures in Newfoundland. I do that particularly for this reason. As the minister must be well aware there is a provision in the terms of union for the setting up of a royal commission within eight years. It is going to be less than eight before it will be necessary to have that royal commission, and I would suggest to him that a careful record be kept of the actual expenditures and the moneys received as a result of the union.


Douglas Charles Abbott: As I think my hon. friend will see on reflection, it is not possible to accurately pinpoint the items to which he refers in the supplementary estimates, because the cost of those services is absorbed in the regular departmental vote. It would be quite impractical to maintain separate accounts for Newfoundland or individual provinces. One can make estimates, of course, as to the revenues from a particular part of the country, but it is impossible to give definite figures.
The sales tax, for instance, with respect to sales in Newfoundland is collected at the manufacturers' level or the wholesalers' level, and in some cases would be collected in Quebec, Ontario or some other province. One cannot state with complete accuracy what revenues are derived from any particular part of Canada, other than the moneys that are paid into a particular customs house.


William Joseph Browne: What about the income tax?


Douglas Charles Abbott: Income tax collections, of course; and those statistics are published each year with respect to the different provinces, except for corporations. Any information that can be obtained, of course, I shall be glad to get.


William Joseph Browne: I should like to give one illustration of what I mean. Under the votes 704 to 709 there was $3,620,000 voted last year of which only
5900,000	was expended. Therefore, I think it is important for the minister to do the best he can to keep a record-I do not expect him to be accurate.


Douglas Charles Abbott: Was that last year?


William Joseph Browne: Yes, So far as sales tax is concerned, there was an estimate of $4 million. Comment in the Newfoundland press says that amount was underestimated, as were other amounts, and that the correct amount is probably in the neighbourhood of $8 million. I was going to ask the minister if someone in his department could prepare a statement showing how that $4 million was estimated.


Douglas Charles Abbott: I shall be glad to see if I can get the information as to how the estimate was made. Nothing is better than proven results, however. We are now over the first fiscal period in which Newfoundland has been a province of Canada. From here on we shall not have to rely on estimates, so far as income tax receipts are concerned.


William Joseph Browne: But the sales tax?


Douglas Charles Abbott: It will be more difficult with the sales tax, because we shall have returns of sales tax collected from wholesalers in Newfoundland, but it would be difficult to segregate the parts which would have been paid by residents of Newfoundland but which would have been collected in other parts of Canada.


Mr. Quelch:: Will the minister make a statement on the apparent shortage of venture capital in Canada? The other day I referred to a statement made by the deputy governor of the Bank of Canada, in which he stated that thrifty Canadians had increased their savings by $3 billion in the past four years, and were increasing their savings at the rate of $400 million a year. These savings were adequate to meet the investment needs of Canada, but apparently Canadians were not prepared to take the risk. Consequently the United States investor is stepping in to put money into the resources of this country.

The situation has now developed where 50 per cent of the dividends of all corporations in Canada are being paid to non-residents. Is the minister considering taking any steps to encourage people to invest their money in the resources of Canada?
I suggested that it might help the situation if the government were to refund part of the maturing dominion bonds through the Bank of Canada. This would increase the amount of investment capital and would als'o help in reducing the national debt, and consequently the rates of tax; that in itself would help encourage investing. It seems as though the financial institutions of this country are far more interested in investing money in bonds than in investing money in the resources of the country. We hear members deplore the fact that we have adopted a form of paternalism towards the people of this country, but it does seem to me that we have done that to a far greater extent towards our financial institutions. They apparently require a government guarantee against loss before they are prepared to make an investment in such things as farm improvement loans, housing, or business loans for veterans. Surely our own financial institutions should be prepared to show a more venturesome spirit. If it were not quite so easy for them to invest their capital in bonds, then they might be prepared to enter the legitimate field of developing the resources of this country. If the United States investors are prepared to do it, there is no reason why the Canadians should not be prepared to do it.
I suggested also that it might be. worth giving consideration to setting up the securities commission, or an investment advisory board, on a voluntary basis. Then companies desiring to obtain capital could apply to this board, pay a licence fee, and a statement of their circumstances would be published. It would help to give the people who are desirous of investing money a better understanding of the proposition being placed before them. Has the minister given any consideration to that?


Douglas Charles Abbott: Yes, I listened with a great deal of interest the other day to the useful speech that was made by my hon. friend from Acadia. I am just as interested as he is in encouraging venture capital. I think that capital should be perhaps more venturesome than it is. So far as the government is concerned, we have taken some measures to encourage it to be so; the ten per cent tax credit on dividends, the reduction of the income tax on small business corporations and the liberalization of investment powers of 55946-257
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insurance companies and trust and loan companies, which passed this house a few days ago, and so on.
As every member of this house knows, we have been in the midst of a capital investment boom in this country over the last three or four years. Actually the proportion of our national income that is going into capital expenditures today is higher than ever before in the history of Canada, and I am told higher in proportion than any other country in the world. I think that is a satisfactory situation, and I am glad to see it happen. I think most of it is going into enterprises which will make for greater prosperity. I do not think it is entirely fair to say that either Canadian individuals or Canadian financial institutions are lacking in a venturesome sprit or a desire to invest in Canadian enterprise.


Winfield Chester Scott McLure: I should like to draw to the attention of the minister a statement he made not very long ago, that if the committee wanted information it was their duty and the duty of the opposition to ask as many questions as possible to secure that information. That was a proper thing for the Minister of Finance to say, and I hope this committee will take advantage of it today.
There is one item in particular which I brought up at every session. I want to compliment the minister for giving us that information in a more comprehensive way. I refer to the amounts we are asked to vote, namely, $8,774,178, or almost one-third of the total amount of money voted, and for which we have no details, except that we can find out how many temporary employees there are. We were never given that information before, and I want to congratulate the minister on giving us those details. What I should like to know-that is, for another year; we cannot get it now-is this. According to the record that I have here in the detail, there are 4,318 temporary employees, and these receive the average salary of a little over $2,000 per year. I think it would be quite in order for the department to put in a list, the same as they do with the regular civil servants, showing how many of these were economists, how many were supervisors and so on all through the various categories, showing what they are working at and what are their salaries.
We have not any account of that whatsoever. When a little over 30 per cent of the total vote is there as a blank cheque, I think that we should get some information about this matter. I raise the matter again because, as I said, in the last four or five years we have gained this much. We now know how many temporary employees there are. We

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never knew that before. If we can now get information as to what salaries they are receiving, from that we can possibly find out whether more of them should be made permanent or not. I always wonder how it is that so many of them are carried on year by year-some of them for ten, fifteen and twenty-five years-as temporaries and have never been made permanent. That, however, may be a special arrangement of the Department of Finance.
As I said a moment ago, there are 5,733 employees, and of those 4,318 are listed as temporaries. While it may not be a great factor in the department to give these details, I think it should be of great interest to this committee to have the details concerning an item which accounts for one-third of the total vote.


Douglas Charles Abbott: As to the information that my hon. friend is interested in, I am sure it is available. I shall be glad to give consideration to his suggestion. There is of course a mass of information available with respect to each individual vote. If all of it were to be printed, the book of estimates would run to a fairly extensive size. One has to select which information is of particular interest to hon. members and try to make that available. If any particular information is not printed and if it is asked for, it will be obtained as soon as possible. I think the change this year was as a result of the suggestion made by my hon. friend last year; I refer to classifying the number of permanents and temporaries.


Winfield Chester Scott McLure: The department could say that there are ten clerks at an average of $3,000, for instance.


Douglas Charles Abbott: That is quite right.


Winfield Chester Scott McLure: They could also say that there are five economists-


Douglas Charles Abbott: That is quite right.


Winfield Chester Scott McLure: -and ten superintendents. That is all we want. We do not want the details of names and so on.


Douglas Charles Abbott: That is quite possible.


[Stage Direction]
Item agreed to.
Administration, of various acts and costs of special functions-
87.	Superannuation and retirement acts, administration, $188,700.
Herbert Wilfred Herridge: I just want to speak for a
few minutes on this item, although I had intended to speak for forty minutes. The parliamentary assistant has been over here and he has sort of worn me down.


James MacKerras Macdonnell: He is not
going away too, is he?


Herbert Wilfred Herridge: I want to refer to a small
group of people in this country who suffer a certain hardship and injustice by the present superannuation act and the regulations. I have run into an occasional case here and there, and I am just bringing this matter to the attention of the minister to see whether something can be done to amend the regulations or order in council or anything of that sort, just in order to take in a small number of people, as far as I can see, who are affected in various departments of government.
I am just going to mention one case in order to illustrate the situation. In the city of Nelson we have a young man who has been twenty years in the employ of the post office. He was eight years in the employ of the postmaster before the post office was made a revenue post office. Then it was made a revenue post office and he became a civil servant; and he has been twelve years a civil servant. When he became a civil servant he was allowed to come under the superannuation act, I understand, as were the postmasters. But at that time neither postmasters nor clerks were permitted to pay up back superannuation for the years they had previously been employed. But since that time, owing to the order in council that was passed on December 24, 1948, I understand the postmaster has been permitted to pay up his superannuation for all the years he has served the government, even including the time prior to his actually being a civil servant. There are in that post office a few men who paid superannuation since but who are not permitted to pay their back superannuation as the postmaster did. One of these young men has contracted an incurable disease. He has been in hospital for six months and cannot possibly live but a short time longer. He is actually dying at the present time and because of the provisions of the superannuation act, his wife is left with that limited amount of security.
I want to ask the minister if he thinks it is possible for this matter to be given consideration, not only for the sake of this unfortunate civil servant but for that of a small number of others also who are willing to pay up their superannuation in order to provide their wives with a satisfactory security. The sad part of this case also is that this young man's sick leave allowance has now also been discontinued by the post office, so that he and his wife are absolutely flat after his having worked for this country as a civil servant for twenty years. I should like the minister to make a study of the situation.


Douglas Charles Abbott: I shall be glad to do that. My hon. friend and I have had a little bit

of correspondence, I think, about the case to which he has referred.


Herbert Wilfred Herridge: Yes.


Douglas Charles Abbott: With the pressure of other matters, I do not know that I have answered his last letter, but I have been looking at it. As he, of course, realizes, the difficulty is this. Employees of revenue postmasters were at no time government employees. I know the situation because my grandfather and my uncle after him were revenue postmasters for a great many years. The system there is that the postmaster gets commission on his stamp sales, his money orders, box rentals and so on, and he hires and pays his own staff. That is the traditional position of the revenue postmaster. His employees are not, during the term of employment, government employees and never were. He of course at all times has been a government employee. That is the distinction between the postmaster and the people whom he hires. But I shall be glad to study the situation to which my hon. friend refers and to see whether anything can be done.


Herbert Wilfred Herridge: Thank you.


Stanley Howard Knowles: I hope the minister, despite the heat and the time of the session, is ready to discuss in some detail the question as to providing a cost of living bonus or some other supplementation for superannuated civil servants, especially for those whose pensions are in the lower brackets. It certainly is not necessary for me to speak at length on this matter, because I have spoken on it a good many times. I am sure the minister must be prepared. He must have known that when this item was called I would have something to say about it. Fortunately I came into the chamber just in time for this item. We have just concluded another meeting of our committee on old age security, and I came directly here, although I did not know that we were going to reach this item quite so soon.
As the minister knows from figures that have been placed on Hansard, there are quite a number of retired employees of this government whose pensions are a disgrace. I am looking at the answers to questions of mine as recorded at page 834 of Hansard of March 16, 1950. I find that, as at February 28, 1950, there were 253 retired civil servants on pensions of less than $20 per month.


Douglas Charles Abbott: Some probably with extremely short service.


Stanley Howard Knowles: And they will live a very short time on that sort of pension, too. There were 498 whose pensions were $20 or over but less than $30 a month. There
55946-257J
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were 677 whose pensions were $30 of over but less than $40 a month, and so on. All told there are 4,584 retired civil servants whose pensions are less than $80 a month. The table at page 834 gives more details on that, but I have picked the $80 figure because it is the old age pension figure for a man and wife, both on pension, at the present time.
As I have said there are 4,584 retired civil servants of the federal government whose pensions are less than that amount. In addition there are 871 widows of retired civil servants whose pensions are less than $20 a month, and there is a total of 2,516 widows of retired civil servants whose pensions are less than $40 a month. I take that $40 figure for widows because that is the old age pension for a widow, by herself.
The minister knows this whole problem has been brought to his attention a good many times. Indeed, it was first brought to the attention of the Department of Finance when Mr. Ilsley held the finance portfolio, which means that it has been on the desk of the present Minister of Finance ever since he took over the department. He gave it a fair amount of consideration early in the game, but that seemed to end with the issuing of a statement which indicated that the government felt it should not do something which was not being done generally by others who paid pensions to retired employees. I have pointed out on other occasions that at least three governments I know of are paying supplementary amounts to their retired civil servants. The three I have mentioned are the governments in the United Kingdom, the province of Newfoundland and the province of Saskatchewan. There may be others of which I am not aware; but at least these three do something for their superannuated civil servants, especially those in the lower brackets.
The plan of supplementing civil servants'' pensions so far as the United Kingdom is concerned began back during the war years when the coalition government was in power, and has been continued and in fact amended upwards since the Labour government took office. So there are at least three governments that recognize that, despite the contractual nature of civil service pensions, they have a responsibility toward their former employees.
I might point out that, small though it is, the Canadian Pacific Railway makes a small addition to the pensions of their employees who are in very low brackets. That supplementation applies only between the time an employee goes on pension and the time he qualifies for old age pension. It is not all it could be, but at least it is a gesture on

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the part of that railway company. My colleague from Kootenay West tells me that Consolidated Mining and Smelting Company does the same thing.
Even if there were not any examples of other employers doing this sort of thing, it seems to me there is a moral responsibility resting upon the government to give a lead to other employers. However, there are these examples and I think that, rather than lag behind provincial governments such as Newfoundland and Saskatchewan, where their resources are limited, this federal government should be taking the lead in an important matter of this kind.
As the minister knows, and as I am sure hon. members in all parts of the house know, this is something of such concern to the people affected that they have organized themselves into associations in various parts of the country. There is a very active branch of their association in Quebec city, as well as in Montreal, Toronto, Winnipeg, Vancouver, Victoria, and a group of them here in Ottawa. These associations and their various branches have made their representations from time to time 'to the government. They have also been in touch with their various members of parliament, particularly those members from the areas where these associations are organized.
In other words members of parliament generally, from the correspondence they have received and the representations made to them, must know just how serious is the plight of these people and how strongly they feel that they have a moral claim upon the government, their former employer, to do something about the situation. They have been assured many times by various members of the house that consideration would be given to their plight. I remember on one occasion making the statement that particularly during the last election compaign, many Liberal candidates in British Columbia assured their constituents that they would go to bat on this question. At that particular point the hon. member for Coast-Capilano interjected something to the effect that he had not made any such promises. As he knows, he has since received a letter from one of the associations at the coast reminding him of the promise he made to them in a letter concerning this matter. I know he has received such a letter because the same association wrote to me a letter with which they enclosed a copy of the letter sent to him. I have not that letter with me because, as I have said, I have just come from the committee on old age security and have not had time to go to my office to get my file. However, I just wish to make the point that hon. members

generally, and particularly at election times, in those centres where these people are concentrated, have felt that their plight has been sufficient for those hon. members to give varying grades of assurance that they would go to bat for those people in parliament, or by making representations to the government. I feel that the case has been brought forcefully to the attention of the government, and that it has been done repeatedly. In the past delegations have appeared before the minister, and it does seem to me that on moral grounds in this year of 1950 there simply is no excuse for an employer as well off as the federal government to be paying to any of its former employees pensions as low as $20 or $30 a month, and these various other figures I have mentioned.
I am familiar with the argument about the contractual basis of these pensions, but I suggest that that argument disappears when one realizes what has happened. The value of the dollar and the whole question of our economic situation is at least to some extent under the control of the federal government. These people feel that they are getting back now-from the fund into which they put their contributions-dollars which are by no means worth what the dollars were worth that they put into that fund, and they contend that the argument by the government about the contractual aspect of the matter does not hold at all.
I need not extend the argument. The case has been well put forward by these people in their letters to the government and to members of parliament. The case has been well put forward by representatives of these branches who have come to Ottawa and have waited upon members of parliament. I am sure many hon. members who are listening to me now will recall that those representations have been made to them both by letter and in person. I trust that other hon. members in all sections of the house will support me in this plea to the minister to give favourable consideration to the request that something be done to supplement the pensions of these retired civil servants, particularly in the case of those persons whose pensions are in the lower brackets.


William Joseph Browne: If the minister is not going to reply I would draw his attention to one phase of the situation in Newfoundland. When people have been pensioned by the provincial government they receive a cost of living bonus because the cost of living is 80 per cent above what it was in 1939.
As one who had something to do with getting that, as president of the civil service association for 15 years, I know how people

feel when they do not get it. I had a case drawn to my attention of a postmistress who was pensioned and who had to wait six months before she got her pension. When she got it she found that she was not getting the cost of living bonus. Is the minister in a position to tell us anything about that matter? It has been brought to his attention before.


Douglas Charles Abbott: My hon. friend will recall that service in Newfoundland is added to service of the civil servant for Canada, and the appropriate pension is paid. The provincial government of Newfoundland in effect pays the portion of the pension attributable to the Newfoundland service and the federal government pays the difference. I do not think that special rates could be made with respect to pensions payable in Newfoundland. The terms on which the pensions are payable were fixed by the terms of union and confirmed by the statute. I would not think it would be feasible to have one level of pensions in one province of Canada and another level in the other provinces.


Stanley Howard Knowles: But it would be feasible to make arrangements, by an item in the estimates, or better still by legislation, to provide a scale of supplementation across the country *which would make possible a greater percentage of increase for those in the lower brackets. I hope the minister will not try to get this item through without discussing it.


Douglas Charles Abbott: I do not want to get it through without discussing it and I shall be glad to discuss it. I think I can discuss it very shortly by saying that the government's position has not changed from that indicated in the statement I made last year. I know my hon. friend is intensely interested in this question. Among his other attractive qualities he has the capacity of repeating at intervals practically the same speech-I do not blame him-perhaps in the hope that the government will change its mind. But there would be no purpose in repeating my speech of last year on this matter because in substance it would be exactly the same. As I say, there has been no change in government policy on this matter and so far as I am aware no change is contemplated. I cannot go any further than that.


James MacKerras Macdonnell: The only
recommendation I can make of my speech is that it will not be the same because 1 have never spoken on this subject before. I sympathize greatly with the minister's problem and I am sorry that I do not remember the details of his speech last year. Assuming that the minister is aware, as I think he probably is, that there is a great
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deal of distress among the people referred to by the hon. member for Winnipeg North Centre, should he not make some statement? I know the minister cannot be Santa Claus to the whole world and if he tried to be I would be the first to criticize him. But if he could say something on this matter it would perhaps relieve the feelings of the people concerned.


Douglas Charles Abbott: I am sure that my hon. friend is as fully aware of the situation as I am. The civil service superannuation system of Canada is one of the most generous and favourable, if not the most favourable of any in the country. As has been indicated by my hon. friend, it is a contractual obligation. There are thousands and thousands of Canadians who have to provide their own social security and old age retirement fund by buying insurance, annuities and so on out of their own earnings and on a basis, if I may say so, somewhat less favourable than that enjoyed by civil servants. I have never felt that it was fair to the taxpayers of Canada as a whole that the civil servant who is entitled to benefits under this excellent and generous and fair superannuation plan should be on a preferred basis as compared with taxpayers generally.


James MacKerras Macdonnell: I think the minister is perfectly right and I am going to congratulate myself upon having induced him to make such a speech.


Stanley Howard Knowles: At the risk of getting another compliment from the minister of the kind that he paid me a few moments ago, and although he may think I have made the same speech over and over again a little too often, I would remind him that it is quite a while since he made a speech on this subject.


Douglas Charles Abbott: I speak only when I have something new to say.


Stanley Howard Knowles: This matter came up in December toward the end of the session last fall and the minister's comment at that time was nil. There were only three speeches-my opening remarks, then a speech by the hon. member for Vancouver-Quadra and one by the hon. member for Peace River, and then the item carried. When we got back here for this session I raised the matter on March 21. On looking over my speech in Hansard I find that the minister is correct, that what I said today is similar to what I said then, only that the figures have been brought up to date. At that time we were dealing with supplementary estimates or interim supply, and the minister complained about my raising the question at that time.

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I quote from the minister's remarks as reported on page 975 of Hansard of March 21, 1950:
I would be very glad to discuss this or any other question at length when my own estimates are called, which I think would be the more usual time to do it. We have done it in the past and I shall be happy to do it again,-


Douglas Charles Abbott: My hon. friend has discussed it at length; that is what I referred to.


Stanley Howard Knowles: I continue with the minister's remarks:
-but I think that is really the time, not when we are asking for approval of an item of $63,000 to provide for a too-conservative estimate of the government's contribution to the superannuation fund.
As I say, that was either on supplementary estimates or interim supply back in March and on that occasion the minister persuaded the house to put off the debate.


Douglas Charles Abbott: When my hon. friend made his speech a minute ago I listened with my usual attention. I did not try to curtail the debate but I do not know why I should stand up here and keep on repeating the same thing.


Stanley Howard Knowles: I am trying to get the minister to make a speech so that we may have his comments on the question. If there are any arguments that he can advance, then we can endeavour to answer them. The minister has referred just now to the generosity of the civil service superannuation scheme. I admit that that would apply to the scheme now in effect; I admit readily that civil servants who are now contributing to the various funds have a prospect of looking forward to fairly good pensions; but surely the minister does not contend that it is generous in the case of people who are now retired and who are receiving a pension of less than $20 per month.


Douglas Charles Abbott: Supposing they had other resources which they presumably might have built up before they came into the government service? Those should be taken into account. A number of the people my hon. friend has referred to have had very limited service, perhaps of only a few years. They may have been engaged in other occupations before they came into the service and may have made provision for their own future from their earnings.


Stanley Howard Knowles: If these people were in that position they would not be worrying their hearts out and going to the meetings of the associations which they have organized in order to try to get somewhere with their plea for consideration of their plight. The minister knows that I am not putting up a plea for those who have other resources or

for those who are well fixed, but I do think that there is a moral claim that these people have, particularly those who are in the lower brackets. If the only comment the minister has to make is to compliment me for the kind of speech I make, then I shall have to continue making that speech twice a year in the hope that in time it will wear him down.


[Stage Direction]
Item agreed to.
Administration of various acts and costs of special functions-
88.	The Bank Act-salaries and expenses of the inspector general of banks' office, $28,400.
James MacKerras Macdonnell: I presume
the bank inspection involved here has to do only with the chartered banks. Who inspects the Bank of Canada? Does the minister inspect it?


Douglas Charles Abbott: The Bank of Canada is audited by its auditors. The auditors who inspect the Bank of Canada are appointed by the governor in council under the statute.


James MacKerras Macdonnell: Who are
they?


Douglas Charles Abbott: They rotate from year to year. I will get the information in a moment.


[Stage Direction]
Item agreed to.
Administration of various acts and costs of special functions-
89.	Administration of the Farmers' Creditors Arrangement Act, 1943, and the Municipal Improvements Assistance Act, 1938, $34,202.
James MacKerras Macdonnell: I should like an explanation from the minister about the Farmers' Creditors Arrangement Act. What is the size of the operation at the moment? My impression is that it must have greatly dwindled, and I should like to know where it stands. I should also like to learn something about the Municipal Improvements Assistance Act.


Douglas Charles Abbott: The extent of the operation under the Farmers' Creditors Arrangement Act is pretty small. Of course it only operates in Manitoba, Saskatchewan and Alberta. The number of unfinished cases on the first of April, 1949, in Manitoba was nil; Saskatchewan, 42; Alberta, 38. The number of proposals filed by farmers during 1949-50 was one in Manitoba, twenty-two in Saskatchewan and three in Alberta. The Municipal Improvements Assistance Act was enacted in 1938 to assist municipalities in making self-liquidating improvements and to relieve unemployment. The act was suspended early during world war II and has not been reopened since. Therefore no new applications have been considered and no new loans have been approved during the current year.


James MacKerras Macdonnell: Will the
minister tell me what staff there is for the operation of the Farmers' Creditors Arrangement Act? According to the figures he has given it is practically a dead letter, as one would expect, because farm prices have happily been very much better than they were, if not all that we would have liked. What staff is there?


Douglas Charles Abbott: A total of eleven.


James MacKerras Macdonnell: Without
wanting to dwell too long on it, I suggest to the minister that if there are eleven people to do all that the act now does they must be busy keeping each other busy. Without labouring the matter further, I suggest that it might be looked into because to all intents and purposes it seems to me that the staff is too large.


Douglas Charles Abbott: It is on a steadily reducing basis. I am satisfied that the staff is not too great. After all, the act is there and these cases have to be processed. We are reducing the staff, and as a matter of fact it is being reduced this year.


James MacKerras Macdonnell: I am not
going to regard that as one of the shining examples of the effectiveness of the minister's staff. After all, I know a little about this kind of thing. Here you have eighty cases in all. Incidentally, I see there is a nil return for Manitoba. Nothing must have happened there at all. I would have thought that eleven people are about five times too many to deal with this matter.


Douglas Charles Abbott: There were forty-nine cases disposed of during 1949-50. There is one permanent salary of $2,280, and there are ten persons under the head of temporary assistance. It is an extremely small staff and the total expenditure is estimated at $30,000 odd.


Mr.   Baler@: I should like to advise the hon. member for Greenwood that, while it is true that farm prices have been considerably higher in recent years, there is still an area in Saskatchewan, which has often been mentioned by the hon. member for Maple Creek, that will still derive benefit from the act.


Douglas Charles Abbott: There is one other point I should have mentioned. Of course this staff also administers the Municipal Improvements Assistance Act on which payments are still being made. There are loans outstanding and they also have to be processed.


James MacKerras Macdonnell: I want to
make it quite clear that I am not criticizing the act. I am only suggesting that such a large staff is not needed.


Douglas Charles Abbott: The auditors of the Bank of Canada for the year just ended are Mr. Supply-Finance
Gates of P. S. Ross and Sons and Mr. Samson of Chartre, Samson, Beauvais, Gauthier and Company.


John George Diefenbaker: Who are the various representatives in the province of Saskatchewan for the Farmers' Creditors Arrangement Act and how much did each receive last year?


Douglas Charles Abbott: I am afraid I have not that here. I did not anticipate it would be asked, but it is readily available. I will get it and give it to my hon. friend.


John George Diefenbaker: I am glad to hear that the act is being continued because it fills a need. It has done a great deal for the benefit of farmers in various areas of the western provinces who, by reason of conditions beyond their control, would otherwise not have been able to carry on. It is an act that the Bennett administration introduced in 1935, and it has been most beneficial. As everyone who comes from the province of Saskatchewan knows, there are areas where the act is still applicable, and may be more applicable having regard to conditions prevalent this year in parts of Saskatchewan, which are a continuation of last year's conditions. I am not going to go into detail at this time, but I feel some consideration should be given to the act at the next session to make provision for an extension of the time within which farmers may be permitted to make a second application.
When the act was first brought into being in 1935 the administration was rather too strict and confined as to the degree to which indebtedness was written down. It may have gone the other way later on, but certainly farmers who had their debts written down in 1935 and 1936 did not have them written down to the extent that later applicants did. If I were to speak personally about the act, I might say that in the case of two or three claims I felt the reduction was rather steep, but I know what the act did. It was beneficial. I hope that consideration will be given to extending an opportunity to those in parts of Saskatchewan within the Pal'liser triangle who had their indebtedness written down earlier in the administration of the act and later on found that the amount they received was so much less than what was extended under the later administration of the act as to be of very little, if any, benefit to them.


Mr. Jones:: Is the minister giving consideration to capital loans under the Municipal Improvements Assistance Act being granted again to municipalities, or is the act frozen?


Douglas Charles Abbott: That question has been raised by a number of members, and so far no consideration has been given to it. As I said a

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moment ago, it was introduced during a period of relatively low unemployment. I think I can certainly say with safety that it will not be reconsidered until after our discussions with the provinces this fall.


[Stage Direction]
Item agreed to.
Administration of various acts and costs of special functions-
90.	Administration of the Farm Improvement Loans Act, 1944, and the Veterans Business and Professional Loans Act, 1946, $55,520.
James MacKerras Macdonnell: I should like to make one comment. I observe with interest that the Farm Improvement Loans Act has, I should think, proved to be of great assistance because I note that in 1949 loans for the purchase of agricultural implements amounted to some $41 million, considerably more than in 1948. It seems to me it is serving a useful purpose.


Herbert Wilfred Herridge: I want to ask a question concerning the Veterans Business and Professional Loans Act. Are the loans expanding? Are the veterans taking greater advantage of this opportunity from year to year? Then, what percentage of loss has been incurred, if any?


Douglas Charles Abbott: At December 31, 1949, there were 4,633 loans outstanding for a total of $8,390,236, and the losses totalled $72,855.78, plus costs of $802.93.


[Stage Direction]
Item agreed to.
Administration of various acts and costs of special functions-
91.	Foreign Exchange Control Act, 1946-administrative costs (other than those provided by the Bank of Canada), $205,500.
Agar Rodney Adamson: I have something to say on this item which will take a few minutes. No doubt the minister will say he has heard some of it before. Sometimes in this house I find one has to adopt the principle of water dropping on a stone and wearing it away in order to get any hearing at all. The matter I want to discuss is the foreign exchange control board, of course, and the whole business of controlled currency and exchange. The situation today is rather like that of a doctor called in to see a patient who is flushed and has a very high colour. The doctor says to the patient and his family, "Why, look at that fine, glowing complexion. He is in fine shape. Keep him on his diet of beefsteak and champagne". That is the diagnosis, though the patient may be suffering from a thrombosis or high blood pressure.
Today the dominion bureau of statistics published figures on our trade which were treated by the press as being extraordinarily favourable. I want to examine those figures in perhaps a more critical light. First I want

to look at the principal trend in our trade, which of course is brought about by the deliberate policy of the government to have a controlled dollar based upon United States currency. It is true that we have increased our exports to the United States for the month of May by $54 million over last year, and that is very good. But let us look at what has helped bring that about. In the first place there has been a tremendous increase in the population of the United States in the last year or so, which has had something to do with this increased trade. Another and very important point is that during the past year the United States has been in a deficit position with respect to certain base metals and wood products, which form our two major items of export to that country. Then the policy of the United States government of putting floor supports under many items of food and thus keeping up the price of food in the United States, particularly beef and other meats, which has brought about great increases in our exports of cattle and other animals to that country, not only by volume but also in price. That, I maintain, has been a direct result of the farm support policy followed across the line.
There are, however, certain warnings of which we should take note. One is the fact that very shortly this whole matter of tariffs is going to be raised again, particularly the tariff on copper; and in this item alone there might be a very serious decline in our trade with the United States. While I am on the subject I think I should say that with the growing depletion in the United States in the metals it must have for its economy, it is natural to expect that our trade north and south will increase. That is due to geological factors which are beyond the control of either government.
Looking at the picture today, I find these figures. According to the bureau of statistics our exports to the whole world in the month of May amounted to $289-6 million, as compared with imports for May of $290-1 million. In other words our deficit amounted to $500,000. Our exports to the whole world in May 1949 amounted to $275-7 million, while our imports from the world amounted to $250-5 million, showing a surplus on trading account of $25-2 million. In other words our basic position for those same months of the two years shows an impairment of $24-7 million. Our adverse balance with the United States in May of 1950 was $19-2 million, while the adverse net trading position with the United States in May of 1949 was $49 million, showing an improvement of $29-8 million in comparing the two months. As I have said, that is to be expected largely because of the shift in trade caused by

the deficiency picture south of the line, which incidentally is likely to get worse.
Now let us come to our exports to the United Kingdom. In May, 1950, they amounted to $48-8 million and in May, 1949, to $72-9 million, or an impairment on balance of $24-1 million. That is a shift in the pattern of our trade, north and south versus east and west, and it is something which is done by government action largely through the operation of exchange controls. It is a deliberate policy, and it is having the effect of cutting down our world trade. As has been shown, we had a deficit in the month of May, 1950, versus a surplus in the month of May, 1949. Our trade with the rest of the world has greatly decreased, and we are putting ourselves into the position where we are becoming more and more dependent on the United States for our international trade.
I feel there is some danger in this deliberate policy, a part of which is the foreign exchange control board, because through that policy we are likely to price ourselves out of the world market. It is not entirely our fault because the rest of the world has resorted to these vicious devices of exchange controls, cartels, bilateralism, and has erected a barrier which we find it difficult to pierce. Nevertheless, the adoption of the same methods by ourselves will not solve the problem.
Let us turn to the question of the management of currency. Just so long as the government controls currency, credit expansion can go on slowly but continuously, without causing any alarm amongst the general population. The inflationary pressure to which the present government, or any government of Canada, is subjected is something which I feel must be taken into account. While we are still financing on a budget surplus, and have not adopted the pernicious system of deficit financing followed by Washington, yet I feel that steps should be taken now to prevent that. I feel that it is a distinct possibility. I give to the committee the sort of thing which I feel is likely to happen at any forthcoming general election under the sort of pressure which this government will be, and the sort of pressure under which any responsible political party will be. First, we shall have a tremendous pressure for an increase in old age security. Naturally, I approve of old age security based on the country's ability to pay, but I can see the slogan going out across the country something like this: Vote for us, fifty at fifty. That would mean, vote for us and get $50 at fifty years of age.


Douglas Charles Abbott: I would be in on that policy.
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Agar Rodney Adamson: I would soon be coming in on it, too. It would be very attractive. Then, there will be the health program and the housing program. If there is any increase in the cost of running the national railway, there will be an increase in the railway deficit. In addition to those things there will be a great demand for expenditure for national defence. Now, Mr. Chairman, all of those things will be direct inflationary pressures on any government of Canada at any election. Unfortunately, that is the pattern of democracy both here, in the United Kingdom and in the United States. It is the promise of something for nothing. There is a bit of English doggerel about a father who, on his daughter's wedding day, says:
Ah, 'tis my daughter's wedding day;
Ten thousand pounds I'll give away.
On second thought I think it best
To put it in the old iron chest.
Mr. Chairman, everything from there on is unprintable, but that is the sort of reaction which will take place if the government makes these promises. What does that mean? It means that there will be an inflationary multiplier in our economy which it will be extremely difficult to resist under a system of managed currency. Last year the minister said the minimum revenue requirement would be about 2-4 billion dollars. I do not think any of us in this house will ever see it get down even to that. I feel that, if it keeps on going up, only one thing can happen, and that is a decrease in the purchasing power of the dollar. So long as the government can manage the currency it can embark on a slow but permanent program of inflation, This is not seen as dangerous by the people, and the government is urged or pushed into further excesses. The purchasing power of the currency is forced down slowly perhaps but nevertheless steadily. Let us not fool ourselves that this is not going on now, and not too slowly either.
For the members of this house, Mr. Chairman, I should like to quote the figures for the cost of living, wholesale prices, the annual labour figure and the raw money supply. I should like to have the permission of the house to put this small table in Hansard, because I think the members would be interested in those four figures, taking 1939 as 100 in the first three cases. The cost of living in 1949 showed an increase of 58-4 per cent; or if you want it expressed as a ratio as the dominion bureau of statistics expressed it the figure is 158-4, taking 1939 as 100. These figures are new, Mr. Chairman, and they have just been worked out by the dominion bureau of statistics. From the end of 1949

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to April, 1950, the increase in the cost of living was from 158-4 to 161-6 per cent, going up at an accelerated speed.
Let us take wholesale prices, again taking 1939 as 100. Wholesale prices at the end of 1949 had increased by 108-2 per cent and to April, 1950, by 112-3 per cent. That again is a rapidly increasing inflationary spiral, making the ratio, at the end of 1949, 208-2 per cent and to April, 1950, 212-3 per cent. The annual figure of wages for labour, on the basis of 1939 as 100, was an increase of 105-1 per cent or a ratio of 205-1 per cent. That is a new figure that has just been released from the Department of Labour.
Now let us take the raw money supply. In 1939 the raw money supply was $1,370 million. At the end of 1949 it was $4,422 million; and in April, 1950, it was $4,483 million, or an increase on the percentage basis during the war decade of 223-5 per cent, and up to April of this year, of 227-2 per cent; or on a ratio basis, 323-5 and 327-2. An even greater acceleration.
It will thus be seen that the money supply has increased at a rate double that of the cost of living, 100 per cent more than wholesale prices and a little over 100 per cent more than the annual wage rate for labour.


Alphonse Fournier: And everyone is satisfied.


Agar Rodney Adamson: That is the horrible danger. With permission, Mr. Chairman, I should like to place on Hansard that short table, because I think it shows what is happening to our economy under the present system of managed currency.


The Deputy Chairman:: Has the hon. member leave to put this table on Hansard?


Some hon. Members:: Agreed.


Agar Rodney Adamson: The table is as follows:
Statement showing increases in cost ot living etc 

1939-1949; April. 1950
Cost of living	1939	April, 1949 1950
	100	per cent per cent 58-4 61-6
Ratio 			158-4 161-6
Wholesale prices			per cent per cent 108-2 112-3
Ratio 			208-2 212-3
Labour (annual) 			per cent per cent 105-1
Ratio 			205-1
	Millions	Millions Millions
Raw money supply ...	... 1,370	4,422 4,483
Ratio 			per cent per cent 223-5 227-2 323-5 327-2
These figures are for the 10-year period from the beginning of the war till 1949. (The war decade.) 
I am mentioning this, Mr. Chairman, and the whole question of exchange and monetary control because I believe that it is going to cause to the very people who are now pushing for it more grief than anything else we can think of. I believe there is nothing more sinister to the hourly worker or the wage earner than a continuous inflation of the currency which is known as the debauching of the currency.
The safeguard against the destruction of the purchasing power of the dollar is of course a return to the gold standard. I am not going into the question of a free market first at the present time; but until control of purchasing power is placed back in the hands of the people, the urge for continuous inflation is going to be difficult or impossible to overcome. This is true of every freely-elected democracy. The gold standard makes the determination of money's purchasing power independent of the changing ambitions and doctrines of political parties and pressure groups. This is the security of the gold standard and its main excellence. The hatred of the gold standard is inspired by governments who imagine that they can create wealth out of little scraps of paper.
What the expansionists call the defects of the gold standard are in fact its pre-eminent usefulness. It checks large-scale inflationary ventures on the part of governments. The gold standard did not fail. Governments were eager to destroy it because they were committed to credit expansion as a means of lowering the rate of interest and of improving the balance of trade.
No government-even the American or the Russian government-is powerful enough to abolish the gold standard. Gold is still the vehicle of international trade. As long as the country is not economically selfsufficient, it must meet that deficiency in gold. We cannot isolate ourselves against it.
In this connection I should like to read a quotation. At this juncture may I say that with all the criticism I feel is due to the government for the financial situation, Canada has as yet not resorted to the expansionist and inflationary measures employed by the United States. That is just another reason, and possibly one of the main ones, why the abolition of exchange control would react in our favour. Public men from one end of the United States to the other have criticized the growing inflation in that country. I just want to quote one Mr. Lawrence, who says this of the United States government:
The failure to return to a gold standard, the persistence of budgetary deficits, the flagrant disposition of government to corrupt large voting groups with

handouts, all indicate beyond any reasonable doubt that the dollar of tomorrow may well be a dime in purchasing power. The government has served multiple notice that it has no intention of protecting the integrity of the currency.
Against the possibility of cyclical business and price retreat the average citizen balances the probability of war and the certainty that the government, deliberately avoiding the salutary discipline of gold, will undermine the currency.
He would be a chump if he failed to adjust his personal plans. He therefore seizes the forelock of the future by purchasing today the heavy items now available which he otherwise would not have bought except at some future date. Again we borrow from that future and crowd the current days with business which gives those days the character of a boom in high tide.
Stock markets today are moving up. The country is experiencing a boom. The pressure partially exerted by inflation in the United States is driving up, up, up the price of our staples. We welcome it-we welcome it because it balances our trade with the United States. But, Mr. Chairman, it is a very dangerous thing, and if we are completely tied to that inflationary economy the results for us will be profoundly serious.
In that connection I should like to quote a Canadian authority in a Canadian Press dispatch of June 23, as quoted in today's Globe and Mail. It carries a dateline at Sarnia and states:
A continuing dominion government policy of full employment and managed currency, instituted with the founding of the Bank of Canada in 1933, could bring economic havoc, the accounting forum of Sarnia and Port Huron, Michigan, was told here.
Speaker was Earl A. Steiss, investment head of a London, Ontario, trust company (Canada Trust) and a lecturer in business administration at the university of Western Ontario.
He said that the "full employment system,"-
And I shall later explain the expression "full employment system".
-which succeeded the gold standard as a basis for national economy, could eventually bring food surpluses such as existed in the United States, disastrous loss of export markets, and a declining standard of living.
It had already meant a serious drop in the real value of salaries for Canadians dependent on fixed incomes, he claimed. Because salaries, unlike wages and farm incomes, have failed to keep pace with the rise in the cost of living.
In 1933, a man with a $3,000 a year salary had more than $2,900 left after tax deductions. In 1949 the same salary after tax deductions was worth less than $1,500 in terms of 1933 dollars. A $5,000 income in 1949 was worth less in buying power after tax deductions than a $3,000 salary in 1933.
Mr. Steiss said that the three direct effects of the system of managed currency under government control was to increase government spending, increase prices and decrease interest rates.
The most serious effect of increasing prices was the threatening loss of export markets on which Canada depends for 30 per cent of her income.
These are the inevitable results. We are trading today at an increasing rate with, I will not say "our partner", but our co-partner in an inflationary debauch.
55946-258i
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Let me say a word about the expression "full employment". The policy of full employment means a constant expansion in the money supply so that when an industry prices itself out of the natural market new money will be created so that it can sell its products at an increased price. It does not mean that everyone will have a job. The unemployment, seasonal and otherwise, during the past year when the policy of "full employment" was in force is testimony of this.
What does this boil down to? It boils down to this: We have a growing inflationary pressure placed against the present administration, and against the whole Canadian economy. We make this possible to continue, and seem even pleasant, because we manage the currency and constantly increase the raw money supply. This procedure has been embarked upon by many other countries in the past, but no one ever embarked upon it without desperate consequences,
I suggest that now is the time for the government, before it is forced into deficit financing, before the purchasing power of the dollar has dropped further and before the next demand for increased wages and increased prices is made, to stabilize the situation at this level. Let us see if we can set a lead, even to the United States, and stop the inflationary pressure that is taking place. If we do not do that our economy is in the gravest danger it has ever experienced.
Up to now things have gone reasonably well. The purchasing power of the dollar as reflected in the cost of living basis is down to about 40 cents as compared with the pre-war dollar. But from now on that depreciation in purchasing power is likely to accelerate. Every hoist in the cost of living and those other items that enter into our economy makes the next hoist, the next inflationary move, that much more certain and that much more inevitable.
The experience with the assignats in France could be repeated here. It is only our buoyant productivity that has saved us thus far. Our new resources and new developments-oil, base metals, wood products, fissionable materials, farm produce

all these have been the source of our salvation. They will continue to be; but let us not ride our luck too far.
Therefore in order to give substance to my protest I move:
That item 91 shall be reduced to one dollar.


James MacKerras Macdonnell: I should like to add a word to this. I am sure the mover of the amendment will agree that this is a

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protest on principle and is an indication that we feel there should be a move made toward freedom and in the direction indicated by the previous speaker. We are not overlooking our obligations under Bretton Woods or any other agreement, but we do protest against the inflexible principle of managed currency which unfortunately seems to be a permanent policy. It is on that basis that I am prepared to vote for the amendment.
I do not want to repeat what I said the other day, but I think we should remind ourselves that there is a growing movement toward what might be called the dictatorship of currency. By that I mean that a few men are allowed to fix the value of our currency, and that demands either infallibility or absolute freedom from political pressure. I shy nothing about infallibility, but I should like to comment upon the freedom from political pressure. We need only to see what goes on in the United States and England to realize how impossible it is to have freedom from political pressure under the conditions that exist now.


Mr. Bater:: What does the hon. member for York West mean by raw money?


Agar Rodney Adamson: Raw money is a technical term used by the Bank of Canada to indicate the total currency and the active bank deposits. Active deposits are shown for April, 1950, as $4,483 million, inactive deposits as $3,875 million, and government of Canada securities as $9,707 million, making a total of $18,107 million at the end of April, 1950. The raw money supply really means the active money supply on hand.
Amendment negatived on division.


James MacKerras Macdonnell: I should like to ask one or two questions on this item. This item deals with administrative costs other than those provided by the Bank of Canada. May we have the additional operating costs and will the minister tell us what he considers to be the total cost of carrying on this board?


Douglas Charles Abbott: As my hon. friend will recall, having read the report of the foreign exchange control board, the expenditures made by the Bank of Canada for staff, premises, office space, equipment, travelling expenses, on behalf of the board amounted to $1,175,194. In addition to that there are items, corresponding to the one we are voting here and which are outlined in the report, of $212,885 and which I take it I do not need to read.


James MacKerras Macdonnell: It would seem to me, without wanting to press the

point, that the natural way to deal with it would be to show the total cost here.


Douglas Charles Abbott: If my hon. friend looks at the Foreign Exchange Control Act he will see there is a statutory provision for the Bank of Canada performing these foreign exchange control services. This item is put in here in order that there may be a debate each year on the operations of the board.


James MacKerras Macdonnell: Perhaps the minister has it in mind to do it, but I am anxious to have him make some statement as to the attitude of his department toward the whole question of exchange control. I would draw to his attention that there are indications in France that they are seriously considering doing away with foreign exchange control. I ask the minister if he regards that as significant and whether he cannot make some general statement?


Douglas Charles Abbott: My hon. friend has raised a very important question of government policy and I do not propose, nor do I feel it would be proper, to give any indication as to what future government policy may be, except to say what I have said on a number of occasions, including the time when the Foreign Exchange Control Act was before the house, that no one will be happier than I when it is possible to eliminate foreign exchange control. But as to when that may be or under what circumstances it will occur I am not prepared to indicate by engaging in any hypothetical discussion today. I do not feel that it would be proper for me to do so.


James MacKerras Macdonnell: I am sure the minister will not be surprised at my saying that that is thoroughly unsatisfactory. After all there are people who are in just as important positions as the Minister of Finance who are making statements and I think it is highly undesirable that we in this country should be left without any indication. I hope the minister will not regard it as being discourteous, because it is not intended that way, when I say that this appears to be another of those cases, perhaps with more excuse than in others, where we are being treated like a lot of children.


Douglas Charles Abbott: I am sorry I cannot accommodate my hon. friend. I have never considered that I was gifted as a prophet.


James MacKerras Macdonnell: I am not
asking the minister to be a prophet, I am simply asking him to indicate if there are any general principles on which they are moving. The minister says that he will be glad when this is over, but it is not going to come to an end unless people like the minister move

toward bringing it to an endi. I am not suggesting that it can be done the day after tomorrow, but apparently we are being met with an attitude of splendid negation which is not going to get us anywhere.


Douglas Charles Abbott: I have no intention of influencing the sale of futures by the foreign exchange control board by making a prophecy in this house.


Mr. Harkness:: When measures were brought in in 1947 to conserve the amount of gold and American exchange two lists were issued, one of prohibited articles which could not be imported from the United States and the other of articles which could be imported only under quota. Those lists have been successively cut down since that time. As I remember, most of the articles were taken off the prohibited list and many were taken off the quota list in April of this year.


Douglas Charles Abbott: Some to be effective on July 1, but announced in April.


Douglas Scott Harkness: The announcement was made in April that most of the remaining articles were to be taken off the prohibited and quota lists. Could the minister tell us what articles still remain on those lists?.


Douglas Charles Abbott: I am sorry I have not that information here. As my hon. friend will recall, those quotas and prohibitions are not under the Foreign Exchange Control Act, they are under the Emergency Exchange Conservation Act. I must confess that I did not come prepared with that data because the foreign exchange control board does not administer that act. I can get the information very quickly for my hon. friend and send it to him, possibly tomorrow morning. The information has been published in the Canada Gazette.


Douglas Scott Harkness: The minister will correct
me if I am wrong in saying that the number of articles left on the prohibited list is very small.


Douglas Charles Abbott: Speaking from memory, I
think there are no longer any articles on the purely prohibited list, unless it is crime comics and that sort of thing. I have no details here of the articles on what we call schedule II or the quota list, but I will get it for my hon. friend.


Douglas Scott Harkness: I should like to draw to the attention of the minister a matter about which I have written several times. Parking meters were on the prohibited list and I was under the impression they were the only article still left on that list. It may be that they are on the quota list now. Electric
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phonographs, or juke boxes as they are commonly called, have been taken off the list as of July 1. It does not seem reasonable when you are dealing with coin-operated machines that you should keep on the prohibited or quota list parking meters which are required by a large number of municipalities and cities. A number of these municipalities want particular types of machines which are not manufactured in Canada. I understand there-are two kinds of machines manufactured in Canada but they do not have the automatic coin counting devices possessed by certain machines manufactured in the United States which certain municipalities want to get. As I understand, these machines will still continue jinder quota whereas juke boxes are being removed from the quota list in spite of the fact that a juke box costs anywhere from $500 to $2,000 and a parking meter only costs from $25 to $60. Can the minister give any explanation why this situation exists, and say whether it is going to continue? Perhaps parking meters are going to be taken off the list.


Douglas Charles Abbott: I am not prepared to give very much information about the specific details today. As I have said, we have been following a progressive policy of relaxing import restrictions and quotas as rapidly as we felt was justified by the improvement in our exchange reserve. We have usually made rearrangements once a year. As was pointed out, we announced quite substantial relaxations early this year, some of them to be effective as of the first of July. I will take note of the special case of parking meters. I have listened to my hon. friend, and I will inform myself about it. I cannot give him the answer this afternoon but I will write to. him about it.


Winfield Chester Scott McLure: I received word today that a municipality wants to buy a certain type of road machinery not manufactured in Canada.. I understand they have to secure a permit from the department to import such a machine from the United States.


Douglas Charles Abbott: That comes under the Department of Trade and Commerce.


Winfield Chester Scott McLure: I understand the only objection raised is because of the exchange situation. I thought that might come under the minister.


Douglas Charles Abbott: No. These items of capital
machinery and equipment come under schedule III of the Emergency Exchange Conservation Act which is administered by my colleague, the Minister of Trade and Commerce. I am sure he will be able to answer my hon. friend's question, but I am afraid I cannot.

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John George Diefenbaker: Under this item I want to bring to the attention of the minister again some of the forfeitures that have taken place. I know of several people in my own province who unwittingly committed breaches of the Foreign Exchange Control Act when crossing into the United States. I do not want to make personal references but I feel that any one of us might very well make a mistake, fail to carry out the provisions, and if we were searched might find ourselves in difficulties. I feel there will be general agreement with that suggestion. I do not want that to be considered as personal testimony, Mr. Chairman. I am speaking about others. I am sure you understand that.
Having said that, I feel that some consideration should be given to the return of small amounts of moneys that have been forfeited under the provisions of the act. I mentioned one or two examples last year and the minister, with that friendliness with which he pilots his estimates through the house, smiled benignly and said that the matter would receive consideration. He was sure it would be seriously considered. I return once more to the matter, and all I can say is that nothing has been done.


Douglas Charles Abbott: Does that relate to particular cases?


John George Diefenbaker: To particular cases. I feel that people who have had small amounts of money taken away from them, where there was obviously no intentional wrongdoing, should certainly receive consideration. I mentioned one case last year and I shall mention another one now A constituent of mine received a call to hurry to the United States to attend the funeral of his mother. He gathered together a few dollars in the small town where he lived, crossed the line into the United States, and was picked up with some $20 or $25 on him, which was confiscated. The news was received on Saturday afternoon after banking hours and some of his friends helped him out. By reason of the money being taken away from him he was denied the opportunity of attending the funeral.
I feel that such regulations are not just and fair. Travelling in various parts of this country as I do, I believe it is a fact that in large measure moneys have been returned to border residents. I am going to ask the minister to give the committee particulars as to the number of cases in which forfeiture has taken place in each of the provinces during the last year, and the number of cases in which there has been a return of the moneys taken. I know that the law has to be enforced, but I also know that it is difficult for some people to understand why the little man crossing the

boundary should find himself in this position when, having regard to the stringency of the regulations, some people possessed of great resources seem to be able to secure the necessary moneys to maintain themselves in parts of the United States for considerable periods of time.
I feel that the law should be enforced equally, and that in the case of an individual who did not deliberately attempt to break the law there should at least be some resiliency in administration. I am asking the minister to give the committee particulars. I can do no more than protest. There is nothing else I can do, but protest I will and protest I do against the action of the foreign exchange control board in cases that have been brought to my attention where confiscation and forfeiture have taken place and where the circumstances indicated no intentional breach of the law. I ask the minister to let the committee have the particulars, and at least an expression of hope that some regard will be had to returning small amounts of money where there was no obvious degree of guilt, and where what took place, while wrong and therefore an offence under the law, nevertheless was not worthy of the punishment imposed.


Douglas Charles Abbott: Mr. Chairman, I shall have to get the statistics as to forfeitures by provinces asked for by my hon. friend, but I shall be glad to do that. It will take a little time.


John George Diefenbaker: Will you place them on Hansard?


Douglas Charles Abbott: If it is possible to do so. I will get the information as soon as it can be obtained. All I can say now is that I have had a good deal of experience in looking into cases of forfeitures because I get requests not only from my hon. friend but from a good many other members of the house whose constituents have had moneys taken from them at the border. My experience has been that the board is extremely lenient in these matters and has given the benefit of the doubt to the citizen. I look into all these cases that are brought to my attention, and in most of them I find that the forfeitures have been as the result of deliberate misstatements by the tourists to the customs officers at the border as to the amount of money in their possession. When that happens in those circumstances, as the committee knows the money is taken by the customs officer and reported to the foreign exchange control board; and the person from whom it has been taken has the right to appeal against the forfeiture. I suppose if I have looked into one of these cases I have looked into a couple of hundred, and in the great

majority I have come to the conclusion that the moneys had been quite properly taken. I do not administer the act myself, as I have said; it is administered by several hundred or perhaps several thousand customs officers along the border, who act as agents for the board. Some of them may be arbitrary; that is perhaps inevitable in a situation of this kind.


John George Diefenbaker: I was not speaking of the border officials, but of the senior officials of the board.


Douglas Charles Abbott: I think this is a sound provision if you have a foreign exchange control law'. I agree with my hon. friend that there should be equal administration of the law, but my experience has been that if a man makes out a case of innocence or inadvertence the money is returned. There may be exceptions to that, but as I say I have seen a great many of these cases over the last two or three years.


James MacKerras Macdonnell: I am not
going to come to the defence of anyone who breaks the law, but I hope we will all remind ourselves of what a fantastic situation it is that our citizens have to be subjected to this sort of treatment at the hands of scores of people, probably not all of whom treat them with that delicate kindness which I am sure the minister would display. I can only hope that he is as distressed as he should be over the situation and that we can count on him to do his best to get rid of it.


Winfield Chester Scott McLure: I want to ask the minister a
question; it has to do with the exchange of money, but I do not know whether it comes under his department. A friend phoned me today and said he was in the unfortunate position of having had a friend in New York pass to the great beyond and will him $25,000 plus a Rolls-Royce, together with other things. He wanted to know about the money coming into Canada, what taxes he would have to pay on it, and so on. Would that come under this department?


Douglas Charles Abbott: I suppose it would, indirectly. We shall be delighted to see the $25,000 in United States money brought up here. That would be a legacy and would not be subject to any tax in Canada, as far as I am aware. The recipient would be a very lucky man.


[Stage Direction]
Item agreed to.
Administration of various acts and costs of special functions-
92.	Expenses of the tariff board, $100,080.
James MacKerras Macdonnell: I take it that our very able tariff commissioner is likely to be going to Torquay, and I wonder if the minister would say a few words on the Geneva
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situation, followed by Annecy and now Torquay, unless he tells me that is a matter for the Minister of Trade and Commerce. I should like to know what policy our representatives at Torquay are going to be asked to carry out, because after all that is a matter of very great importance and I think it desirable that we be informed to the greatest possible extent. The hon. member for York West has been pointing out the extent to which we seem to be deliberately making ourselves dependent upon the United States. However pleasant that may be while they have a tremendous boom going on over there, occasionally we must remind ourselves that to a certain extent we are competing with them, and that there are other parts of the world as well. Will the minister say something about that?


Douglas Charles Abbott: I do not know that I can add very much to what I said in my budget speech. I do not want to offend anyone, but may I point out again that the discussion on the estimates usually does not relate to the estimates as such. We deal with matters which are discussed on the budget, and we deal with questions of general policy.
Broadly speaking, in reply to my hon. friend, we are going to Torquay in the same spirit that we went to Geneva and Annecy. We hope it may be possible by mutual concessions to arrive at a lowering of tariff barriers. That is our policy. If I were one of the delegation that is the policy I would try to follow. We are not giving anything away; everything has to be on a reciprocal basis. As has been stated consistently for as long as I have been in the government, our policy is to press for the lowering of trade barriers by reciprocal agreement.
That is pretty general, but I should hope I would not be expected to enter upon a discussion of tariff matters on my estimates. I am sorry to say that I have only another twenty minutes at my disposal. I realize that I shall not be able to finish my estimates, and in a moment I am going to ask that the main estimates stand in order to deal with the flood relief items in the supplementaries.


[Stage Direction]
Item agreed to.
Administration of various acts and costs of special functions-[DOT]
93.	Expenses of the Royal Canadian Mint and the assay office, Vancouver, B.C., and to authorize commitments against future years in the amount of $200,000, $864,835.
Agar Rodney Adamson: What happens to the overages at the mint? What does the mint charge now for refining gold?


Douglas Charles Abbott: The amount of overages last year was $57,607.58, and it goes into the consolidated revenue fund.

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James MacKerras Macdonnell: There is a kind of super-commitment here, apparently, in the amount of $200,000. Is this in connection with your bullion transactions?


Douglas Charles Abbott: It is the Vancouver branch of the mint.


James MacKerras Macdonnell: I still do not understand:	"to authorize commitments
against future years in the amount of $200,000." That seems a large amount, and it doees not explain itself.


Douglas Charles Abbott: That is for the construction of an addition to the mint. I am sorry; I did not understand my hon. friend's question.


[Stage Direction]
Item agreed to.
Administration of various acts and costs of special functions-
The wartime prices and trade hoard-
94.	Administration, $1,907,142,
James MacKerras Macdonnell: I would like from the minister a general statement as to just how the reduction is progressing. I am surprised to find that it still costs nearly $2 million, though I realize that is a great reduction from previous years. I should like the number of employees as compared with a year ago, the amount of office space, the number of offices, and one or two other relevant details.


Douglas Charles Abbott: As my hon. friend is aware, the administration of the emergency import control comes under the wartime prices and trade board. He realizes that this is not simply price control administration, that it administers rental control, the cleaning up of payment of subsidies, and so on. As at April 30, 1949, there were 1,049 employees. As at April 1, 1950, there were 695 employees. I am afraid I have not the information at the moment as to the floor space, but I can get it.


John George Diefenbaker: I should like some information with respect to travelling expenses under this head. What was the amount spent on travelling' expenses last year?


Douglas Charles Abbott: The estimate this year is $168,000, which represents a reduction of some $32,000 from last year. The actual expenditure last year was $169,678. This year we estimate $168,000 or approximately the same amount as spent last year. I would hope that would not be aohieved, but until we know what happens to rental control it is rather difficult to say.


John George Diefenbaker: What was the total amount paid in legal fees last year?


Douglas Charles Abbott: Legal and audit are together, so I am afraid I shall have to get my friend

a break-down of that. It amounted to $125,000, but the major portion of that would be legal fees.


John George Diefenbaker: Will the minister give the three largest items for legal fees during the year, and to whom those payments were made?


Douglas Charles Abbott: I would have to get that information, I have not got it here. It is rather difficult to know what particular detail is required. Of course, the information is available and I can get it.


John George Diefenbaker: Will the minister place that on Hansard along with the other information I requested?


Douglas Charles Abbott: It is sometimes helpful if I know these questions in advance, but I realize that is difficult. Some hon. members do let me know when they want particular information.


John George Diefenbaker: I am learning all the time, Mr. Chairman. Now I learn that the minister is given the questions in advance.


Douglas Charles Abbott: The hon. member for Greenwood was very considerate in that respect.


John George Diefenbaker: I did not know that practice was followed. It is interesting.


Douglas Charles Abbott: I do not suggest it needs to be done on general items, but where particular questions are asked it is helpful.


James MacKerras Macdonnell: I want to know still more about this service. The minister has told us about the emergency import control and subsidies. I want to get a little more idea, because I am still not satisfied. Perhaps if I had a little more information I would be better satisfied.


Douglas Charles Abbott: What information is it my hon. friend wants?


James MacKerras Macdonnell: Here we have a reduction, it is true, of a million dollars. The minister has also pointed out that the number of employees in the department has been reduced. I want to know if that is the wartime prices and trade board itself that has been reduced from 1,049 to 695. Are the 695 dealing with subsidy payments, and if so-


Douglas Charles Abbott: No, I said the wartime prices and trade board, but it is really the next item, the commodity prices stabilization corporation. I was putting them together, but it is that corporation which is cleaning up the various subsidy claims.


[Stage Direction]
Item agreed to.

Public debt charges-
97. Commission for payment of interest on public debt, payment of premiums on government of Canada sterling securities, services of fiscal agents, London, registrar's fees, etc., $406,100.
Douglas Charles Abbott: I think I should ask the committee if they would be good enough to let this item stand, and turn to item 676 in the supplementary estimates which I tabled today. It is the item to provide for flood relief payments.
Item stands.
Special-[DOT]
676. To authorize and provide for an initial grant to the province of Manitoba to assist it in meeting costs incurred as a result of the Red river floods in 1950, $12,500,000.


Alistair McLeod Stewart: Mr. Chairman, a few weeks ago in discussing the flood situation in Manitoba, I suggested the government make an interim payment of $10 million to the province of Manitoba. I see the Minister of Finance is suggesting an amount of $12,500,000, which of course is just an interim payment. It will not nearly meet the cost of the damage which was caused. What I want to know specifically is: What does the $12,500,000 include? The item reads:
To authorize and provide for an initial grant to the province of Manitoba to assist it in meeting costs incurred as a result of the Red river floods in 1950.
Is it only for the cost of fighting the flood or is it only a payment towards repairing property damage or is it a combination of both? That is something which we have to get cleared up because the Prime Minister has already told us that Manitoba will be treated in exactly the same way as British Columbia. Obviously, therefore, we are not going to be satisfied with less.
In so far as British Columbia was concerned the federal government paid one hundred per cent of the total property loss; seventy-five per cent of the cost of the repair works; seventy-five per cent of the cost of permanent measures adopted to prevent a recurrence of the flood. The federal government paid in the neighbourhood of eighty-one per cent of the cost of the flood damage and the preventive measures in British Columbia. What the provincial government in Manitoba is doing is a bit of a riddle. A few weeks ago I was critical of what that government had done, and had the Minister of Justice been here I might have pursued further the line he adopted, namely that the province of Manitoba did not have an adequate public relations staff. As a matter of fact if the provincial government has secured the services of Baron Munchausen and Ananias they could have made nothing of
Supply-Finance
the wretched handling of the situation by the government. The mistakes cannot be attributed to faulty public relations.
In Manitoba today there has been developed a principle of limited aid. For property damage the aid will not exceed $3,000. I know that for a great number of flood sufferers that is a completely inadequate sum. What I want to see is one hundred per cent flood damage paid; that is on the same basis as was paid in British Columbia, and rightly so.


An hon. Member:: That is not right.


Alistair McLeod Stewart: A grant of $5 million was given to British Columbia and it covered property losses. As everyone knows the Carswell-Shaw commission was limited in its terms of reference. The report of that commission shows a total loss of $26,500,000, but it excludes of course personal property loss. Of that $26,500,000, $2,500,00 is for emergency precautions which are going to be carried out, I hope this year, along the lines of the Hurst report. What I want the minister to do now is to tell us the composition of this $12,500,000, how it is broken down, if indeed it is broken down, between fighting the flood and the cost of personal property.


Douglas Charles Abbott: I would be glad to do that, Mr. Chairman. The position with respect to this grant is as it says in its terms. It is to assist the province of Manitoba in meeting costs incurred as a result of the Red river flood of 1950. The extent to which rehabilitation payments will be made, the extent to which other people will be indemnified, will be determined by the province of Manitoba. The government of Canada, as was the case in the Fraser valley, is making first of all an initial grant to assist the provincial government in discharging its obligations, but the provincial government must determine the extent to which it will assist in the rehabilitation of private property; that is its responsibility.
The position with respect to the Fraser valley, as everyone knows, was that the dominion government paid seventy-five per cent of the cost of fighting the flood; seventy-five per cent of the permanent works to prevent a recurrence of that flood; and it made a grant of $5 million to the province of British Columbia so that the province would meet the other costs incurred. At the time the grant was made it was estimated the total damage would be something in the order of $10 million or $11 million. Ultimately, it proved to be somewhat less than that. I cannot say, nor do I intend to break down the $12 million between the various items of damage in Manitoba and restoring property damage. However, as the Prime Minister has said, the same principle will be followed in

Supply-Finance
assisting Manitoba as was followed in assisting British Columbia. That is the position as clearly and as succinctly as I am able to put it.


Alistair McLeod Stewart: In other words, this grant is for the province of Manitoba to do with as it sees fit?


Douglas Charles Abbott: It must decide the nature and the extent of the assistance it will provide individuals.


Stanley Howard Knowles: May I ask whether the Minister of Finance can indicate what was in his mind when he picked on this figure of $12,500,000. It strikes one that it could be one-eighth of $100 million or one-quarter of $50 million or one-half of $25 million.


Douglas Charles Abbott: It could be a percentage of a lot of things, Mr. Chairman. I do not know that I could indicate just exactly what was in my mind. I studied the report of the Carswell-Shaw commission, and I had an opportunity of seeing Winnipeg, rather briefly I am afraid. I had an opportunity of meeting the premier of British Columbia and the members of his cabinet.


Stanley Howard Knowles: I presume it was the premier of Manitoba.


Douglas Charles Abbott: Yes, the premier of Manitoba. I came to the conclusion that I would recommend to my colleagues an initial grant of $12,500,000 to be included in the supplementary estimates; and they accepted that recommendation. But I did not attempt to relate that to any particular percentage or to any particular figure. It seemed to me it was the appropriate amount to pay at this time.


Stanley Howard Knowles: Was there any discussion between federal officials and provincial officials as to the kind of losses they might cover? I appreciate what the minister has said and what the Prime Minister has said, namely that this is a provincial government responsibility, that they will make the decision and that Ottawa will offer what money it sees fit to offer. But I am wondering if there was with the Manitoba officials any discussion that might guide them in deciding how far they would go. For example, what about losses that farmers will suffer where they are not able to put crops in for the year? What about this question which the provincial government seems to have decided upon, namely that no compensation will be made out of government moneys for losses of personal effects, furniture and so on and that that matter has been left to the voluntary fund. I am wondering whether that matter was discussed with the Manitoba officials.


Douglas Charles Abbott: No. So far as I am aware, there were no discussions, Mr. Chairman.

The types of losses for which indemnity was given in the Fraser valley are, I understand, fairly well known and those were no doubt available to the officials of the Manitoba government. But there was no discussion either between myself and the members of the Manitoba government or, so far as I am aware, between my officials and the officials of the Manitoba government.


Stanley Howard Knowles: In other words, the complete responsibility as to what amount of money is to be asked for rests with the government of Manitoba?


Douglas Charles Abbott: I would think that is correct, yes.


Stanley Howard Knowles: Can the minister say whether it will be possible to pay an additional sum of money between now and the next session of parliament, if it should be called for? This is only an initial grant.


Douglas Charles Abbott: I would think that, under this heading, this would have to stand until there is a further vote of parliament. Under the subsequent grant-that is, 75 per cent for safeguarding against dangers of floods in future-I would think that if diking work were proceeding that would be an appropriate case for the use of a governor general's warrant if the money voted here were not sufficient to cover the dominion's share during the period in question.


Stanley Howard Knowles: I take it that one is justified in noting that this $12,500,000 is only an initial grant?


Douglas Charles Abbott: That is correct.


Stanley Howard Knowles: In other words, we are justified in assuming that there will be a further sum of money later on?


Douglas Charles Abbott: If the facts justify it, yes. As the Shaw-Carswell report indicated and as they pointed out clearly, while I think they did an extremely fine job and made what I think is a fair estimate, it is quite obvious that at this time it is not possible to evaluate fully the losses which may have been sustained.


Stanley Howard Knowles: I noted that the minister said that further money would be available if the facts justified the need for it. None of us here are experts in assessing these things, but from the reports that are still coming in of the extent of the damage that people find as they get back into their homes, I am sure that considerably more money than this will be needed; and I hope the Manitoba government will ask for it.


The Chairman:: Shall the item carry?


John George Diefenbaker: I should like to ask the minister the percentage basis upon which

items 678 and 679 were determined; that is the amount of grant to meet the cost incurred as the result of fire-


Douglas Charles Abbott: Are we going to try to pass this item? We are on item 676 at the moment.


John George Diefenbaker: I beg your pardon. I thought they were all together.


Douglas Charles Abbott: We could take them all together. I should be happy to do that. I have no objection.


John George Diefenbaker: I am sorry; as I say, I thought they were all together.


Douglas Charles Abbott: It is all right. Go ahead.


John George Diefenbaker: I thought those items were all under one heading.


Douglas Charles Abbott: They are four separate items.


John George Diefenbaker: I would ask the minister the basis upon which the determination was made for the authorization of the advance to the city of Rimouski and to the town of Cabano. In asking that question I immediately say that there is no suggestion of any criticism; for I come from a province that on more than one occasion has received assistance from the dominion as a whole, when drought and difficulty struck our people. It is in items such as this that we indeed show that no matter from what part of the country we come there is a comradeship that demands assistance by all Canadians. I know that there will be no criticism anywhere in this dominion of the assistance being given to Rimouski or Cabano, for people everywhere regarded those two disasters as deserving the assistance of the dominion as a whole.
Having regard to the report received from the province of Manitoba, I think the minister should be in a position to answer that one request made by the hon. member for Winnipeg North Centre with respect to farmers in the area of the Red river. I believe that some sixty per cent of the area affected will not be farmed this year, and the provisions of prairie farm assistance cannot and will not compensate in any way the farmers resident there for the loss that they will have suffered. I feel that the people as a whole-


Stanley Howard Knowles: Unfortunately, there is no mention of that in the Shaw-Carswell report.


John George Diefenbaker: I appreciate that fact. But I feel that consideration should be given to assisting the farmers affected by that flood, The Prime Minister was in Winnipeg. He visited the scene of the disaster. I know that the farmers there are asking for consideration. When I speak of the Red river, I know whereof I speak; for my fore-
Supply-Finance
bears were driven out of there in 1826, in the famous flood of that year. That is a long while ago, but none the less it indicates that this area is subject to floods which are disturbing in their intensity; and I feel that the farmers there deserve consideration by the government, even though it is not recommended in the report.


Douglas Charles Abbott: I expect that the Manitoba government, which has the responsibility, will take those circumstances into consideration.


Stanley Howard Knowles: There is no sign of it yet.


Douglas Charles Abbott: I think I am right in saying that crop damage was not the subject of compensation in connection with the Fraser valley floods of 1948.
To reply to my hon. friend's first question, the amount of the grant to Rimouski and to Cabano was arrived at on the basis of the report of the joint dominion-provincial commission composed of Brigadier Theriault and Mr. Laurent and is a matching grant with that which is being made by the provincial government of Quebec. Broadly speaking, that is the basis upon which it was arrived at.


[Stage Direction]
Item agreed to.
At six o'clock the Speaker resumed the chair and the house took recess.
[Stage Direction]
AFTER RECESS

The house resumed at eight o'clock. VACANCY
Mr. Speaker:: I have the honour to inform the house that I have received the following communication:
Dominion of Canada	House of Commons
To the Honourable the Speaker of the House of Commons:
I, Georges-Emile Lapalme, member of the House of Commons of Canada, for the electoral district of Joliette-L'Assomption-Montcalm, do hereby resign my seat in the said House of Commons, for the constituency aforesaid.
Given under my hand and seal at Ottawa, this 23rd day of June, 1950.
G. E. Lapalme
L. R. Beaudoin, M.P.
Witness
Jean Lesage, M.P.
Witness
Accordingly I have issued my warrant to the chief electoral officer to make out a new writ of election for the said electoral district.



PRIVATE BILLS


[Stage Direction]
The house in committee on Bills Nos. 223 to 234 inclusive, 238 to 248 inclusive, 253
[Stage Direction]
Private Bills-Divorce to 262 inclusive, 270 to 300 inclusive, 304 to 306 inclusive, Mr. Dion in the chair.
Bill No. 223, for the relief of Marilyn Ruth Cohen Novak.-Mr. Winkler.
Bill No. 224, for the relief of Mary Elizabeth Bernatchez Russell.-Mr. Winkler.
Bill No. 225, for the relief of Winnifred Evelyn Thompson Clift.-Mr. Winkler.
Bill No. 226, for the relief of Maida Maria Howard Martin.-Mr. Winkler.
Bill No. 227, for the relief of June Hedy Leshynska Thompson.-Mr. Winkler.
Bill No. 228, for the relief of Rosemary Smalley Carrier.-Mr. Winkler.
Bill No. 229, for the relief of William Arthur Goodson.-Mr. Winkler.
Bill No. 230, for the relief of Dorothy Melbourne Davis Wand.-Mr. Winkler.
Bill No. 231, for the relief of Frank Lear Rogers.-Mr. Winkler.
Bill No. 232, for the relief of Roma Leduc. -Mr. Winkler.
Bill No. 233, for the relief of Edna Rosaline Casavant Dufresne.

Mr. Winkler.
Bill No. 234, for the relief of Leo Berger.- Mr. Winkler.
Bill No. 238, for the relief of Katherine Madge Samworth Monty.-Mr. Winkler.
Bill No. 239, for the relief of Clara Rosen Freedman.-Mr. Winkler.
Bill No. 240, for the relief of Frances Berman Mellor, otherwise known as Sharie Sinclaire.-Mr. Winkler.
Bill No. 241, for the relief of Rodolphe Durand.-Mr. Winkler.
Bill No. 242, for the relief of Helen Leek Karaszi.-Mr. Winkler.
Bill No. 243, for the relief of Sadie Chernin Petruska, otherwise known as Sadie Chernin Prince.-Mr. Winkler.
Bill No. 244, for the relief of Audrey Phyllis Angela Blom Rochfort.-Mr. Winkler.
Bill No. 245, for the relief of Patricia Ruth Segall Wener.-Mr. Winkler.
Bill No. 246, for the relief of Sophie Piat-kowski Demyk.-Mr. Winkler.
Bill No. 247, for the relief of Hilda Brooks Nangreaves.-Mr. Winkler.
Bill No. 248, for the relief of Zemelia Katrina Ayoub MacDonald.-Mr. Winkler.
Bill No. 253, for the relief of Margaret Mary Hamel Whittaker.-Mr. Winkler.
Bill No. 254, for the relief of Lewis Benjamin Wyman.-Mr. Winkler.
Bill No. 255, for the relief of Edna Dora Tucker Conley.-Mr. Winkler.
Bill No. 256, for the relief of Dorothy Marguerite Lester McBride.-Mr. Winkler.
Bill No. 257, for the relief of Josephine Rood Trottier.-Mr. Winkler.
Bill No. 258, for the relief of Margaret Irene Sinden Brown.-Mr. Winkler.

Bill No. 259, for the relief of Camille Poulin.-Mr. Winkler.
Bill No. 260, for the relief of Elisa Macdonald Mitchell Brock.-Mr. Winkler.
Bill No. 261, for the relief of Theodore Levasseur.-Mr. Winkler.
Bill No. 262, for the relief of Mary Marguerite Harvie Fine.-Mr. Winkler.
Bill No. 270, for the relief of Joseph Lucien Andre Bergeron.-Mr. Winkler.
Bill No. 271, for the relief of Thelma Leggo Chicoine.-Mr. Winkler.
Bill No. 272, for the relief of Anna Kathleen Olga McCone Shaw.-Mr. Winkler.
Bill No. 273, for the relief of Martin Luke Marlow.-Mr. Winkler.
Bill No. 274, for the relief of Helena Wilhelmina Thornburg Lawton.

Mr. Winkler.
Bill No. 275, for the relief of Bonnie Ruth McNab Sarrasin.

Mr. Winkler.
Bill No. 276, for the relief of Lyndia Betsy Mayes Bernier.-Mr. Winkler.
Bill No. 277, for the relief of Sarah Modlinsky Markis.-Mr. Winkler.
Bill No. 278, for the relief of Anna Patiris Sarakinis.-Mr. Winkler.
Bill No. 279, for the relief of Julia Ann Ramsell Blane.-Mr. Winkler.
Bill No. 280, for the relief of Cyrile-Orance-Horence Presseau.-Mr. Winkler.
Bill No. 281, for the relief of Paul Edmond Meerte.-Mr. Winkler.
Bill No. 282, lor the relief of Charles George Storey.-Mr. Winkler.
Bill No. 283, for the relief of Mary Muriel Inez Larman Jarry.-Mr. Winkler.
Bill No. 284, for the relief of Mary Zilda Alix Runcie.-Mr. Winkler.
Bill No. 285, for the relief of Aili Esteri Kankaanpaa Toebben.-Mr. Winkler, i Bill No. 286, for the relief of Pierre Bouchard.-Mr. Winkler.
Bill No. 287, for the relief of William Aubrey Ricardo Aird.-Mr. Winkler.
Bill No. 288, for the relief of Marguerite Carmen Samson Wrigglesworth.-Mr. Winkler.
Bill No. 289, for the relief of Andrew Cerat.-Mr. Winkler.
Bill No. 290, for the relief of Marie Lucille Giselle Roy Veilleux.-Mr. Winkler.
Bill No. 291, for the relief of Mabel Pearl Speirs Lazor.-Mr. Winkler.
Bill No. 292, for the relief of Lena Grace Connolly Hibberd.-Mr. Winkler.
Bill No. 293, for the relief of Lilian Ferguson Gardner.-Mr. Winkler.
Bill No. 294, for the relief of Marion Leonard Ryan.-Mr. Winkler.
Bill No. 295, for the relief of Joseph Georges Neville Poirier.-Mr. Winkler.
Bill No. 296, for the relief of Marie Gisele St. Laurent Theirien.-Mr. Winkler.

Bill No. 297, for the relief of Norah Nichol Meighen Allan.-Mr. Winkler.
Bill No. 298, for the relief of Dora Eleanor Chalmers Grisley.-Mr. Winkler.
Bill No. 299, for the relief of Ruth Desiree Morrissette Chevalier.-Mr. Winkler.
Bill No. 300, for the relief of Richard Martello Johnston.

Mr. Winkler.
Bill No. 304, for the relief of David Allan Ferguson.-Mr. Winkler.
Bill No. 305, for the relief of Ann Louise Fuller Brais.-Mr. Winkler.
Bill No. 306, for the relief of Helen Leola Davidson Hunter.-Mr. Winkler.
Joseph-Alfred Dion: Shall I report the bills?


Stanley Howard Knowles: Will the hon. member for Lisgar (Mr. Winkler), the chairman of the committee that deals with these bills, tell us how many divorces this will make that we have put through at this session?


Mr. Winkler:: I cannot tell how many we have put through, but there are sixty-seven tonight.


Stanley Howard Knowles: About three hundred, is it not?
Bills reported, read the third time and passed.



ASSOCIATION OF KINSMEN CLUBS


[Stage Direction]
Bill No. 312, to incorporate the Association of Kinsmen Clubs.-Mr. Benidickson.


[Stage Direction]
On the order:
Resuming debate on the motion of Mr. Sinnott for the second reading of Bill No. 132, an act to amend the Pipe Lines Act, and on the proposed amendment thereto of the Minister of Trade and Commerce.
Howard Charles Green: Mr. Speaker-


Mr. Speaker:: Order. Bill stands. The sponsor is not here.


Howard Charles Green: Mr. Speaker, the debate on second reading was commenced on June 16 and an amendment was moved by the Minister of Trade and Commerce (Mr. Howe) for a six months' hoist. Several hon. members spoke, and then the debate was adjourned by the hon. member for Winnipeg South (Mr. Mutch). Therefore he would have had the right to speak first this evening, were he here. He is not here, but I submit if some other hon. member wishes to speak on this bill he is at liberty to do so.
Pipe Lines Act
The bill is now before the House of Commons and because someone wishes to shout "stands" is no reason why a member should not be permitted to go on and discuss the bill. I submit there is no such provision in the rules.


Mr. Speaker:: It has not been the custom in this house to proceed with a bill introduced by a private member unless that private member is here at the time. The procedure is similar to that followed in respect of bills introduced by the government. If the minister sponsoring the bill is not present, the bill stands, unless the government indicates otherwise. It has always seemed to me that a private member should have the same right in respect of a bill which he has sponsored. I have given the matter consideration and I would be prepared to give a ruling.


Stanley Howard Knowles: Before Your Honour gives a ruling may I say just a word. I realize that it has been the practice, for the most part, not to go ahead with a public bill when the sponsor was not here, but I submit that that is only a matter of courtesy, which in turn depends upon the circumstances involved. When a motion of this kind is in the possession of the house it should be the right of all hon. members who are here to debate it if they wish. I submit for Your Honour's consideration that if the other practice were made firm it would mean that a member could introduce a bill, start the debate with his own speech, and then prevent its being discussed further by the simple expedient of being absent.
I point out that when we have the debate on the address in reply to the speech from the throne we do not require that the mover and seconder be in the chamber when the debate is resumed; once the debate has been started and the matter is in the possession of the house, it goes on. So it is with bills. They are started with a minister in the house but many times we go on with a bill in the absence of that minister because the matter is in the possession of the house.
I suggest that it would be a dangerous practice to make firm that a bill should not be proceeded with because of that fact or it would make it possible for a member to introduce a bill, for whatever reason or motive he might have, and then prevent the house from going ahead with it. On .the other hand, I suggest that after those who want to speak have spoken, if someone wants to move the adjournment of the debate, that would be in order. I do not think the hon. member for Vancouver-Quadra (Mr. Green) should be prevented from speaking to this bill which is in the possession of the house, merely because the hon. member for Spring-

Pipe Lines Act
field (Mr. Sinnott) is not here or, shall I say, because the Minister of Trade and Commerce (Mr. Howe) is not here. It happens to be the minister's amendment for a six months' hoist that is now before the house.


Howard Charles Green: On the point of order, I submit that as the Minister of Trade and Commerce (Mr. Howe) moved the six months' hoist this bill should be given consideration by Your Honour. That fact should be in favour of permitting me to go ahead with my speech. Otherwise the result will be that the Minister of Trade and Commerce has been able to kill this bill without having his motion debated. As a matter of fact, he came into the chamber and moved the amendment and then did not offer any argument in support of it.
If Your Honour gives a ruling that we cannot go on now unless the hon. member for Springfield (Mr. Sinnott) is here, then all that needs to be done by the Minister of Trade and Commerce is to suggest to the hon. member for Springfield that he stay away and the Minister of Trade and Commerce will have achieved his desire for killing the bill without having given us an opportunity to discuss his amendment. I submit that that is beyond all reason.


Mr. Speaker:: I have never known of a private bill or of a public bill which has been introduced by a private member being proceeded with in his absence without his consent.


Howard Charles Green: We did that on the pipe lines bills.


Mr. Speaker:: Presumably with the consent of the hon. member who introduced the bill. At times bills have been proceeded with when the hon. members who introduced them were not in the chamber, but in such instances some member has stated that he has the approval of the member who introduced the bill to proceed with it. The hon. member for Winnipeg North Centre (Mr. Knowles) has referred to the speech from the throne, but it is assumed in that debate that the mover and the seconder approve of the debate continuing. If for any reason that debate were not to be continued I would think that arrangements would be made and that the house would be informed accordingly.
I do not think I should depart at this time from practice and allow the debate on this bill to continue in the absence of the hon. member who introduced it, and of the minister who moved an amendment. I therefore rule that under our practice an order for resuming the adjourned debate on the second reading of a private member's bill is proceeded with only at the instance of

the sponsor of the bill or of a member authorized to act on the sponsor's behalf. Otherwise the order is allowed to stand until the next sitting day. This would appear to be what is contemplated by standing order 18 which reads as follows:
(1)	Questions put by members and notices of motions, not taken up when called may (upon the request of the government) be allowed to stand and retain their precedence; otherwise they will disappear from the order paper. They may, however, be renewed.
(2)	Orders not proceeded with when called, upon the like request, may be allowed to stand retaining their precedence; otherwise they shall be dropped and be placed on the order paper for the next sitting after those of the same class at a similar stage.
Under this order a member of the government who has introduced a bill can, upon request, have it stand. A private member who has introduced a bill should be accorded, and is under our practice accorded, an equal right. It is also our practice to allow a bill to stand when the member who has sponsored it is not present and has not authorized another member to act on his behalf. In other words, the absent member is deemed to have requested that the bill stand until the next sitting day.


Howard Charles Green: Will the same ruling apply every time private bills come up?


Mr. Speaker:: If the member sponsoring it is not here or if someone is not authorized to speak on his behalf. Another bill was called tonight and it stood because the hon. member who had introduced it was not here. This bill is in the same position as the one introduced, I think, by the hon. member for Assiniboia (Mr. Argue).


Stanley Howard Knowles: If any hon. member wishes to debate that bill he oan go ahead.


An hon. Member:: Oh, no.


Stanley Howard Knowles: I say that on behalf of the hon. member for Assiniboia.


Mr. Mclvor:: I should like to say a word on behalf of the hon. member who is not present.


Mr. Speaker:: I have given my ruling and it is not debatable. The business under the heading of private and public bills having been concluded, the house will resume the business under consideration at six o'clock.
Order stands.

The house in committee of supply, Mr. Dion in the chair.
DEPARTMENT OF RESOURCES AND DEVELOPMENT National film board-
401. Administration, production and distribution of films and other visual materials, including authority

to finance temporarily work performed for other public authorities or other agencies as the public interest requires, $2,092,413.


[Stage Direction]
Item agreed to.
National film board-
402. Acquisition of equipment, $118,604.
Item agreed to.
Alphonse Fournier: I move that the committee rise, report progress and ask leave to sit again this day.
Progress reported.



NATIONAL FILM BOARD


Robert Henry Winters: the second reading of Bill No. 317, respecting the national film board.


Howard Charles Green: On a question of privilege, the statement made last night by the Minister of Public Works (Mr. Fournier) was that the film board estimates would be taken up before we went ahead with the bill. I am afraid some of our people are not here.


Robert Henry Winters: They were just passed.


Alphonse Fournier: Mr. Speaker, there
are two items in the estimates for the national film board, Nos. 401 and 402, and they were carried. Having nothing before the house we have reverted to the National Film Act.


Howard Charles Green: They went through in a rush. Will the minister make a statement?


Robert Henry Winters: Perhaps I should make a few remarks in moving second reading of the bill entitled "an act respecting the national film board". First, it might be helpful to hon. members if I again reviewed briefly the history of the development of the board which was established by the National Film Act in 1939. As early as 1914 there existed in the Department of Trade and Commerce an exhibits and publicity bureau whose functions included the production of motion pictures and still photographs designed to promote external trade. Later, in September, 1918, other government departments were required to consult with this bureau on their purchase of films. Then in 1921, this agency was reorganized as the Canadian government motion picture bureau.
For the next eighteen years, the motion picture bureau continued as the government film producing agency. At times, however, individual government departments entered into arrangements with outside private pro-
National Film Act	.
ducers for films. During this period motion pictures were growing in importance as an instrument of public policy. In due course it was considered expedient to establish a board comprising members from various phases of our national scene to advise the government as to how this medium might be used to best advantage to interpret Canada to Canadians and other countries.
Accordingly, in 1939, the national film board was set up under the National Film Act to be the co-ordinator, adviser and general supervisor of government film activities. The board, with the film commissioner as its chief executive officer, was given power to administer funds voted to it by parliament for making films. Actual production, however, remained with the motion picture bureau. In 1941, in a move toward greater efficiency, the motion picture bureau was transferred from the Department of Trade and Commerce to the control of the national film board, and the government film commissioner assumed the duties of director of the bureau.
In time it became apparent that the National Film Act of 1939 had not contemplated an operation of the kind in which the board had become engaged, especially under the impetus and stress of wartime conditions. Difficulties were experienced in fulfilling the purposes laid down in the act. Although the board had a continuing program of production, the great majority of its personnel were employed for three-month renewable periods. Other difficulties were experienced in financing and accounting, and in making contracts for the distribution of films.
Recognizing the difficulties under which the board was operating, and at the same time wishing to obtain an independent expert opinion about the business management of the board, on November 15, 1949, I asked Messrs. J. D. Woods and Gordon, a firm of business management consultants, to examine the board's organization and business administration, and I informed the house accordingly on December 7, 1949. The report submitted by this firm was tabled on March 29, 1950. Members of the house have had an opportunity of studying it, and will see that it recognizes the difficulties and offers certain solutions.
The recommendations contained in the report fall into two main categories, those relating to internal organization and administration, and those requiring legislative action. A number in the first group have already been implemented. To give effect to the changes which require legislative authority the bill, with respect to which I have the honour to move second reading, includes provisions which, if implemented, will:

National Film Act
1.	Define clearly the functions of the board in conformity with its actual operations.
2.	Reconstitute the board on a basis intended to make it possible to carry out these functions efficiently.
3.	Confer on the board powers appropriate to these functions and clearly establish the board's responsibility to parliament through a designated minister of the crown.
4.	Establish executive machinery designed to make efficient administration possible.
5.	Confer power to staff the board and to bring continuing members of the staff under the Civil Service Superannuation Act.
6.	Establish financial arrangements suited to the board's present operations.
The basic principles of the bill are that the board shall be responsible through a minister to parliament; that the powers necessary to carry out the functions of the board shall be vested in this board; and that the commissioner shall be responsible to the board and shall be its chief executive officer charged with the administration of its operations.
The bill defines the board as an agency to produce and distribute and to promote the production and distribution of films designed to interpret Canada to Canadians and to other nations. It seeks authority for the board to represent the government of Canada or any department thereof in the securing of motion picture films from persons engaged in film activity; to engage in film research, and to act as adviser to the governor in council in connection with film activities.
In accordance with the recommendations of the business consultants, the bill contains provisions whereby ministers of the crown would no longer be members of the board, that the number of members would be increased from eight to nine, that the commissioner be chairman, and that the number of members from outside the government service be increased from three to five. Power is sought for the board to enter into contracts, acquire copyrights and patents and, with the approval of the minister, to make bylaws for the carrying out of the purposes of the bill.
The duties of the film commissioner as the chief executive officer of the board are defined. It is proposed that he be given the responsibility for the administration of the board's operations and authority, subject to the bylaws of the board, to exercise its powers.
Under the terms of the bill authority is sought to formulate a plan of organization for the establishment and classification of the continuing positions necessary for the

proper functioning of the board and to enable the board to employ staff for these continuing positions during pleasure and for fixed terms. The benefits of the Civil Service Superannuation Act would be extended to staff employed on this organization plan. Over and beyond this organization plan, authority is sought to employ personnel for temporary work from time to time as conditions require. These employees would not be eligible for the benefits of the superannuation act.
A financial structure designed to enable the board to operate efficiently is proposed. As at present, finances would be obtained through direct appropriation by parliament, and by moneys transferred from other government departments in payment for film and other services. One of the most important financial provisions sought is the establishment of a national film board operating account in the consolidated revenue fund to which all operating expenditures of the board would be charged, and to which all moneys received from operations would be credited. There is a provision that expenditures shown in the operating account must not at any time exceed receipts by more than $700,000. The effect of this is to furnish the board with working capital to the extent of $700,000. Under this arrangement profits would be transferred to the receiver general and deficits would be met only by direct appropriation by parliament. All capital expenditures would require appropriation by parliament.
The receiving and paying of cash would still be handled by the comptroller of the treasury. The Consolidated Revenue and Audit Act would still apply to the board's operations. The board's account would be open to audit by the comptroller of the treasury, and the Auditor General's office would continue to review its operations.
Perhaps I should explain why the bill is being introduced at this late date in the session. At the last session I informed the house that where there were weaknesses and deficiencies in the board we would move as quickly as possible to rectify them. The new commissioner assumed his duties on February 1, and the report of the management consultants was dated March 22, 1950. It was natural to expect that the new commissioner would require some time to familiarize himself with the board and its operations, but nevertheless I asked him to take whatever steps were necessary to bring forward in legislative form the recommendations set forth in the Woods-Gordon report which it appeared desirable to have implemented but which required legislative action. The members of

the board co-operated wholeheartedly, and the commissioner and his staff, in co-operation with the officers of the Department of Justice, worked with speed and determination with the result that the bill was prepared.
It was then necessary to make a decision as to whether it should be introduced at this late date or deferred until the next session. When all factors were considered, it was decided that hon. members should be given an opportunity of dealing with the bill even at this late date, and to enact legislation which would enable the board to operate in a sounder, more efficient manner to perform its basic function of interpreting Canada to Canadians and to other nations.


Mr. Cardiff:: I do not know whether I am in order in asking this question now, but if not the minister will correct me.


Robert Henry Winters: If the questions are detailed I would suggest that we wait until the committee stage, if that is acceptable to the hon. member.


[Stage Direction]
Motion agreed to, bill read the second time and the house went into committee thereon, Mr. Dion in the chair.
On section 1-Short title.
Lewis Elston Cardiff: What was the total revenue received in 1949 from the sale or lease of the "Canada Carries On" series, in Canada? When the minister has answered that I will ask another question..


Robert Henry Winters: The net revenue last year from the series "Canada Carries On" in Canada was $6,430.40.


Lewis Elston Cardiff: And what was received from outside Canada?


Robert Henry Winters: For the "Canada Carries On" series the revenue was very small. The total theatrical revenue received last year was $21,271. As I explained when the estimates were before the committee, "Canada Carries On" is not carried as a series outside Canada.


[Stage Direction]
Section agreed to.
On section 2-Definitions.
Alistair McLeod Stewart: Would the minister tell us what is going to be the fate of the accounts receivable mentioned in the film board report? Apparently there is some $43,689 in unpaid accounts which have been outstanding for more than a year, including some $2,000 odd which is more than five years overdue. Will the board be given power to write off these accounts if they are uncollectable, or will it try to collect them?
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Robert Henry Winters: We have been trying to collect these accounts and in fact have collected some. Under the act we are seeking authority for the board to write off these old, uncollectable accounts.


[Stage Direction]
Section agreed to.
Sections 3 to 8 inclusive agreed to.
On section 9-Purposes for which board established.
Winfield Chester Scott McLure: Under this section I see the object and purpose of the board is to promote the production and distribution of films designed to make Canada known to Canadians and to the people of other countries. In this connection I want to deal with a little matter that was overlooked some time ago when we were going through the minister's estimates. For the advertising of the national park in Prince Edward Island to the outside world the greatest credit must go to a famous authoress, Lucy Maude Montgomery, who made known to the world not only her home of Cavendish but the province at large. I should like to know from the minister whether there is any co-operation between the provincial government and his department in reference to historic sites or memorials to outstanding people in Prince Edward Island.
When the national park was purchased by the provincial government and handed over to the federal government, with it was purchased the birthplace of that well-known lady. Now I understand that as a result of unsatisfactory arrangements between the provincial government and this department, this property has been sold to a private individual, and the people of that section of the country are very much up in arms about it. They understood this property was still in the hands of the national park people, which would: bring it under this item of resources. Now that they know it has been sold they are organizing a movement to see if they cannot get the federal government to buy back this property and make it into what it should be, an attraction, for tourists coming to that part of the country.
I should like to know from the minister, if he has any information on the subject, whether the provincial government sold this property without notice to the federal government, because it was generally understood that this quaint old building was in a part of the national park that had been handed over to the federal government. The people generally throughout Prince Edward Island resent the fact that this property was sold with no one knowing anything about it with the exception of the provincial govern-

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ment. If the minister would take some interest in it and suggest some way by which we could get this back for the people of that part of the country, to be handed over again to the government as part of the national park, they would appreciate it very much indeed.


Robert Henry Winters: That is a matter coming more within the jurisdiction of the national parks branch of the department than under the film board. I have no information at hand at the moment, but I shall be glad to look into it and get in touch with the hon. member later.


Winfield Chester Scott McLure: I brought the matter up under the film board act because last year and the year before the film board people were down there taking pictures, and I understand they took a good many pictures of this old residence. For some reason, however, all those pictures were cut out of the advertising. Whether that was done under instructions from this government or the provincial government I have yet to find out, but I am endeavouring to do so and I hope to get some information on it.


Mr. Smilh (Calgary West):: I have a number of questions to ask the minister on this section. The main portion reads:
The board is established to initiate and promote the production and distribution ot films in the national interest-
Who is to decide whether or not a film is in the national interest? That is my first question; perhaps I had better continue, then at one fell swoop the minister can take care of all my difficulties. I like the expression "interpret Canada to Canadians." I assume someone will decide that that is in the national interest, and I should like to know who the person or persons are.
Then paragraph (b) of section 9 reads: to represent the government of Canada in its relations with persons engaged in commercial motion picture film activity in connection with motion picture films for the government or any department thereof;
Does that mean that a department of government, feeling that it needs a film for advertising some activity of its own, must move through this board in dealing with other persons who might like to produce that film? Is that the meaning of the section?


Robert Henry Winters: Perhaps I might answer this question now, and answer the first question at the same time. Under this bill we are seeking authority to have a board set up. There is a board set up under the present act consisting of the chairman, deputy chairman, and six members. We are seeking authority to expand that board so as to get a better coverage of .the Canadian scene. We

think that such a board is the best means for determining whether or not a certain topic is in the national interest and to have it recorded on film.
With regard to the second point my friend brought up, I would say that, in the first instance, if a department wanted a film made and wanted some private company to produce the film, it would approach the problem through the national film board. But that does not mean that, once the arrangements were made with the private company, the contracting department could not deal directly with the private film maker.


Arthur Leroy Smith: Is the minister going to exclude this commercial corporation which we set up the other day with such tremendously wide powers? It may be that a department wants to buy a film already made. Does this provision mean that the department cannot buy it without going through this board? In other words, is this not what we are doing? We are taking away the discretion and authority of persons in government departments, who are assumed to know their business rather well. Are we not just saying: Here is a new agency-when I use the word new I realize that perhaps we have had similar agencies-and through this agency thou shalt act. Has the minister contemplated some of the real difficulties that might get the board into with the various departments of government?
In other words, we shall say the defence department has to buy through the Canadian Commercial Corporation. Has that company got to go to this board before a training film can be bought which was produced in the United States or England? Can they not just go out and buy it? Surely they should be able to buy it without being limited, both in the negotiations and in the purchase, by this or any other board.
I move on to the next paragraph, and I am going to ask the minister just why it is so narrow. Paragraph (c) reads as follows: to engage in research in film activities and to make available the results thereof to persons engaged in the production of films.
Why in the world are we going to have a research agency set up, paid for by the government, and permit that agency to make the results of its inquiry known only to persons engaged in the production of films? Are we not limiting the thing too greatly? In other words, we are going to assist certain people to the exclusion of other people. Let us say that the minister and I think we would like to go into the business of making films. We form our company, but we cannot get the benefit of anything done by this research organization for which the people

are paying. We have to be engaged in the production of films, and I assume that to mean the active production of films.
I am making the two suggestions that I have in no critical sense. But when we set this up we want something that is workable. I do not know why we do not leave it to someone, to the board if you like, to make this research information available to anyone. By the draftsmanship of this statute, what we may have done is to make it impossible for the research organization to make available to departments of government the discoveries which they have made. Putting in those words, persons engaged in the production of films, limits the provision. Before the section passes the minister might give some consideration to that, because I am quite sure he wants the board to be effective, and does not intend to make this narrow limitation which obviously arises from a reading of the section.


Robert Henry Winters: Mr. Chairman, this paragraph (b) of section 9 upon which my friend commented is intended to make the film board the agency of government for the field of films. It is, to all intents and purposes, a continuation of the function the film board is authorized to carry out under the existing act.
Paragraph (c) of section 9 was intended to be permissive rather than restrictive. It was to authorize the film board to make available the results of whatever research it carried out. The research it carries out is intended to be in the field of production, and it was contemplated therefore that the only people who would be concerned with it would be people engaged in the production of films. There is no intention to limit it at all. So far as I am concerned, I would be pleased to make any information available on a broader basis than would appear to be expressed in the interpretation my friend puts on this paragraph.


Arthur Leroy Smith: I am in agreement about what the intention is, and it is a very good intention. But when we are dealing with statutes, which are exact things, we should be particular. If a statute is passed giving A authority to do something in relation to B, then it becomes exclusive if it is a right set up in favour of A. It is for that reason I am somewhat concerned about it. I do not know why we want to tell the board that they may or may not make their findings available to anyone. Why could we not simply pass the paragraph in the following terms:
To engage in research in film activity and to make available the results thereof.
We would not need to add those last words, "to persons engaged in the production of
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films". Perhaps it is not so important, but these things are much better taken care of early, instead of waiting until perhaps we run into difficulties later on. I am not going to move any amendments or anything like that, but I suggest to the minister that the thought I have put forward is probably worth consideration in order to carry out his expressed intention of what he seeks to accomplish.


Mr. McCann:: 
Arthur Leroy Smith: I agree entirely with everything that the minister has just

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said. My worry is as to its exclusiveness. I am going to try to construct something for the minister who has just spoken. In surgery, about which the minister knows a great deal, we know that films are used much more now than they were many years ago. For example, I know of one institution in Rochester in which practically everything that is done is recorded on film.
Let us take, for example, a hospital in the city of Ottawa. Research in connection with operative matters is an important thing today. Let us take, for instance, the Ottawa Civic Hospital. Whether they make their own film or not, I do not know. It may be that the surgeons that are operating may do it. I am agreeing with what is intended, but what I am worried about is this. I do not want it limited so that we could not say to the civic hospital: Here, by way of research we have learned something. Assuming that the hospital itself is not engaged in the manufacture of film, nevertheless I think it would be something of importance to any hospital that they should have available to them the result of research in this organization. I am, however, not going to say anything more about it. But I submit that, instead of carrying out the intention expressed by both ministers, we are perhaps needlessly limiting the power of this board.


Mr. Cote (Matapedia-Matane):: I should like to add one word in reply to the hon. member for Calgary West. Paragraph (c) reads as follows: "to engage in research in film activity", and not in any other. Suppose, for instance, that the film board succeeds in developing a device with which to record the third dimension, something which has been tried by so many countries of the world. Suppose we are successful in this country. I do not think anybody but the industry or the film board would be ooncerned, to begin with. As the minister has said, I think it would be extremely costly to do as the hon. member has suggested. I know that my hon. friend for one and his party for another are extremely touchy about the expenditures of this government. If we limit the application of this paragraph (c) to research in film activity, I think that is proper. I do not think this information with regard to the third dimension, for instance, should be given to all kinds of people at the expense of the government, but only to people who are really interested in that particular thing. I think the paragraph should stand as it is. That is a mere suggestion. But as my hon. friend has suggested, I think there is no reason why there should not be ways and means to make available through films to all kinds of trades and human activities the results of human

endeavour. As far as the film board activities are concerned, however, I think the provision of information should be limited for the time being to the trade. The costs will be much less.


Mr. Jeffery:: If the hon. member for Calgary West, who was referring to the section dealing with the purpose of the board, will look at section 10, subsection 1, paragraph (h), I think he will see the answer to his question.


Howard Charles Green: Can the minister explain just
what the relationship would be between the national film board and the national research council in connection with research work? Some of us are on the special committee looking into the activities of the national research council, and we find that that council-whose business is, after all, research for all departments of government-has been doing effective work for many of the departments. Why is it not possible for the research council to do the research work for the national film board? I have not had time to check the old National Film Act but in a quick glance at that act I do not see any power there given to carry on research work. It does seem to me that in this method there might be a duplication of services. Why not have the problems of the national film board, which are research problems, performed by the national research council in co-operation with the film board? The research council seems to be able to co-operate with the other departments of government, including the Department of National Defence; and I should think we could save quite a bit of money and perhaps get more efficient research if we allowed the research council people, whose business it is to do research, to look after that type of work for the national film board.


Robert Henry Winters: Mr. Chairman, there is the
closest co-operation. In fact, some of the people in the national film board who are on research are actually working in the national research council. However the nature of the work is such that they must have, a good knowledge of film activity. Therefore it is a more efficient approach to have them on the strength of the national film board, although actually working in the national research council. There is that degree of co-operation.


Howard Charles Green: It seems to me that to state
that research is one of the purposes for which the board is established is to put the emphasis in the wrong place. It might be all right to include in the powers of the board under section 10 the power to do research. Here, however, we are saying that these shall be the important jobs of the national film board:
(a) to produce and distribute and to promote the production and distribution of films designed to interpret Canada to Canadians and to other nations;

(b) to represent the government of Canada in its relations with persons engaged in commercial motion picture film activity in connection with motion picture films for the government or any department thereof.
Then we come to paragraph (c) which refers to research, and go on to the next paragraph as follows:
(d)	to advise the governor in council in connection with film activities;
(e)	to discharge such other duties relating to film activity as the governor in council may direct it to undertake.
I suggest that to engage in research in film activities is out of place as one of the main purposes for which the board is established. If some power is needed, then let it be included in the powers of the board as they are set out in section 10, rather than make it one of the main purposes, particularly when we have such an efficient national research council.


Mr. Cote (Malapedia-Malane):: Supposing the experts of the national film board engaged in research are in some way transferred to the national research council; in such event what would be the saving of money? They would have to be paid the same salaries. If the hon. member is suggesting that there are in the national research council film experts not to be found in the national film board, then it would be different. However, if it is just a mere matter of switching accounts, then I do not see why we should spend the taxpayers' money in discussing it. Both organizations are on Sussex street; they work together.


Howard Charles Green: If the hon. member for Mata-pedia-Matane is correct in his submission, then he could just as well argue that each department of government should have a research branch to do its own research. Here we have an efficient research council with which the present film board apparently works well. I do not see why there is any necessity to state that one of the main purposes of the national film board shall be to do research. I am afraid that sooner or later it will lead to the development of an expensive research branch in the film board.


Mr.   Baler@: In connection with the $32,933 set out as proceeds from sales, would the minister tell the committee if the film board sells pictures to the theatres. I am referring to the Canadian news items shown on theatre screens.


Robert Henry Winters: There are revenues derived from those films. Earlier we were speaking more particularly about the "Canada Carries On" series. Then there are other pictures
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which produce revenue for the board all across Canada and in other countries.


Mr. Brooks:: What assistance is given in the matter of forest conservation work? I know the Canadian Forestry Association has been doing good work in that connection, and that in past years they have complained that they have not had the assistance from the film board they felt they should have had. In the issue of their monthly bulletin for February of 1948 they complain bitterly about this matter, stating:
Motion pictures, as an aid to forestry education, are an important medium employed by the Canadian Forestry Association. During 1948 the Canadian Forestry Association's own motion picture and lecture tours, its film libraries and co-operative tours recorded an attendance in all Canadian provinces of 400,000 men, women and youths, French and English.
It is regrettable to report that all the major motion pictures, in the 1948 program, dealing with forest management, forest protection, soil erosion, water and wildlife were purchased by Canadian Forestry Association in the United States and adapted (and translated for Quebec) in Canada. The principal producer of forest conservation films on this continent is the United States Department of Agriculture.
It seems to me that this is a rather sad commentary on the situation in Canada, because forest conservation is one of the most important matters with which the film board could assist. In 1948 they had to get their films from the United States, and they found the same condition in 1949. I should like to know from the minister what the situation is today, whether we are supplying the Canadian Forestry Association with film, how many we have supplied and just what the situation is at the present time. Unless our film board is doing work of that kind it seems to me they are failing miserably in the work for which the board was set up, and for which it was intended.


Robert Henry Winters: When the hon. member says the board is failing miserably in the purpose for which it was set up I can say only that we have a certain appropriation and try to spend it to the best possible advantage. When I say that I must add quickly that I think there is a great field in forestry for more motion pictures. We recently released one in British Columbia which I think is very effective, and through the Department of Resources and Development we also contributed to another picture made recently by the government of Alberta showing conservation on the eastern slopes of the Rocky mountains.
I feel there is a great field there for further exploitation, if one may use that word, through the motion picture medium to get across to the Canadian people the real importance of forest conservation.


Alfred Johnson Brooks: It is very necessary.

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Mr. Murphy:: I wish to make only one observation with respect to this section. I believe this point was raised last year, and possibly the year before and the year before that. I refer to the co-operation we should expect from the national film board in connection with the development of our tourist industry. I have always maintained that we have an opportunity to barter with the film industry on the other side. I have felt that while we may have derived some benefits, we have not really developed it to the extent it should be.
I know the minister and his associates will appreciate that this is a non-political subject because there is not an hon. member in the house whose riding is not affected by the tourist industry. I hope to deal with the tourist industry a little later on the minister's estimates but it seemed to me that somehow or other we are not getting as much as we could. There may be some reason for it. I am not blaming the minister because after all is said and done we are dealing with a country whose population is more than ten times our own and which has much to offer, not only in the way of films but in opportunities for recreation and that sort of thing. All this could be developed through films.
We have great hopes for the present minister who is in charge of this portfolio. This bureau has been kicked around to an extent not liked by any one of us. It was fathered by a former prime minister who was a member of a different party and it has always seemed to me that we in this house and the people in the country have been sort of sidetracked. The development of the tourist industry has been more or less a Topsy proposition, left to grow up by itself. We in this house, irrespective of party, do not like that. We think this industry can be developed much more than it has been today, and this is one avenue that could be explored to a great extent to our benefit. We have so much to offer to so many people.
I wonder if the minister, either now or when the tourist bureau estimates are before us, could tell us what has been done within the last year? We had a report a year ago. I hope he will be able to tell us that we are getting more distribution on the other side for our pictures. Heaven knows we certainly do not get it in the newspapers unless it is complaints about the importation of oil and that sort of thing. You would almost think that we were flooding Texas and Oklahoma. You have to expect that sort of thing, I suppose.
We must make direct contacts and one way of doing that is to bring Canada visually to these people who have money to spend in

this country. If we cannot get it any other way, let us be frank and put it on a barter basis. If they want to show pictures in this country, let them show them, but make sure that we are able to show ours to the people over there who have money to spend in this country.


[Stage Direction]
Section agreed to.
On section 10-Powers of board.
Alistair McLeod Stewart: Does this clause mean that the film board has more autonomy than the Canadian Broadcasting Corporation?


Joseph Warner Murphy: Is the minister prepared to answer the questions I have indicated.


Robert Henry Winters: I shall be glad to do it, but I think it could be done better when the estimates of the Canadian government travel bureau are before the committee. As my hon. friend knows, the first paragraph of section 9, which we have passed by the way, states that the board is established to promote the production and distribution of films designed to interpret Canada to Canadians and to other nations. We have been making a strenuous effort in that field. Speaking from memory and subject to correction, we have some 63 film libraries and film distribution centres in the United States for travel films. They receive quite a wide distribution and are seen by large audiences. We also get a great number of travel films on television programs in the United States, and some in the United Kingdom. The ones that are shown in the United States are those in which my hon. friend is particularly interested. We produced a number of travel films last year, I believe four in all. This year we have funds earmarked for the Canadian government travel bureau to provide more films designed to encourage tourists from the United States to come to Canada. We realize that this is a fertile field in which the film board can operate and we propose to do what we can to develop it.


Joseph Warner Murphy: 
Joseph-Alfred Dion: I do not like to interrupt the hon. gentleman, but section 9 is carried.


Joseph Warner Murphy: I did not understand that section 9 was carried because the minister was just replying to my question.


Robert Henry Winters: In doing so I reminded the hon. member that the section was carried.


Howard Charles Green: I submit that the hon. member could raise this matter under subsection 1, paragraph (a).


Joseph-Alfred Dion: Proceed.


Joseph Warner Murphy: I think the minister is as fully aware of the situation as I am. I have felt that this matter should be brought to the attention of the committee in order that it may be surveyed with more intensity, of course to our own benefit. May I make a suggestion in a truly business sense? In pursuing a policy of developing the tourist industry through the national film board you should go further than providing film libraries. They are all right, but they do not go far enough. As I have said before, if you are going to show Canada to the United States or any other country you must do it through closer contacts and on a more friendly basis, shall I say, than has been the case to date. It is true that we advertise Canada through the different magazines and that sort of thing, but my firm conviction is that the best approach for the development of the tourist industry is through the film board. I think we are not getting from the provinces the co-operation to which we were entitled. Looking at the advertising in different magazines and newspapers, it seems to me it is about time that the dominion, the provinces and the municipalities got together. A two or three day conference is not enough because we could develop a billion dollar industry and we are not doing it. A 5, 7, or 10 per cent increase per year is not enough for this country when we have so much to offer to so many people. I can visualize the minister going before the treasury board and saying that he wants another $50,000. Apparently it all goes into advertising in newspapers, magazines and periodicals of different kinds.
I may be out of order in what I am about to say, but if I am I hope you will pardon me, Mr. Chairman. One of the best advertisements that the maritimes have had this year was an article written in a United States national magazine, with a circulation of some two million in that country, describing a trip through the maritimes. Let us be serious about the business because we certainly have not been in the past, and let there be no mistake about that. I think the value of the article which appeared in that magazine a few
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days ago is comparable to what we could accomplish with the film board. That article is worth a quarter of a million dollars to the maritimes this year.
That is the kind of thing we want. Let us try to develop it through films. We can tell the Hollywood moguls that if they want to show pictures in Canada they will have to show pictures of Canada in the United States. Within recent years everybody in the United States has at least two weeks or three weeks for vacation. They are a vacation-minded people. Yet our tourist industry is not even as large as that of Florida, and is about half that of California. We are not going after it. I hope the minister will not take these remarks personally. I am speaking on behalf of every member in the house when I say we want to develop the tourist industry. I think that department has not had a show since it was inaugurated by a former leader of another party. It has been treated as a Topsy. I think it is about time that the people of this country realized that we can develop a billion dollar a year industry instead of having a little increase of $10 million or $15 million. I do not blame the minister one bit, and I hope he will not take my remarks as criticism of him. I think parliament should accept greater responsibility for what we have to offer, and I think the film board provides a good opportunity to do so.


Robert Henry Winters: Before section 10 carries, I should like to suggest a change in subsection 2 in order to make the wording conform with that of the act to amend the statute law recently passed by the house. I suggest that subsection 2 read as follows:
Actions, suits or other legal proceedings in respect of any right or obligation acquired or incurred by the board on behalf of His Majesty, whether in its name or in the name of His Majesty, may be
(a)	brought or taken against the board, without the governor general's flat, or
(b)	brought or taken by the board, in the name of the board in any court that would have jurisdiction if the board were a corporation that is not an agent of His Majesty.
That will make the wording conform with what the house recently approved. I would ask my colleague, the Minister of Veterans Affairs, so to move.


Mr. Gregg:: I so move.


Robert Henry Winters: Mr. Chairman, I did not have the latest reprint of the bill before me and I understand that it already contains that wording.


John George Diefenbaker: Is this section 10?


Robert Henry Winters: Yes.


John George Diefenbaker: As a matter of fact, does the section cover the situation at all? I have

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just come into the house, and I do not know whether there has been any discussion of the subject. In any event, I think there was a great deal of dispatch the other day in the passing of a bill in this house which was accepted generally as a tremendous step forward in connection with the right of action against crown corporations. When one looks at the matter more closely, I begin to wonder whether or not there has been very much of an advance at all. Right of action as against the crown is still dependent upon the issue of a fiat excepting within the circumscribed limits of amendments similar to the one in question in this act. Section 10, subsection 2, now reads:
Actions, suits or other legal proceedings in respect of any right or obligation acquired or incurred by the board on behalf of His Majesty, whether in its name or in the name of His Majesty, may be
(a)	brought or taken against the board, without the governor general's fiat, or
(b)	brought or taken by the board, in the name of the board in any court that would have jurisdiction if the board were a corporation that is not an agent of His Majesty.
I submit that the section as now framed will not cover any action in tort. I read it again:
Actions, suits or other legal proceedings in respect of any right or obligation acquired or incurred by the board . . .
The words "obligation acquired or incurred by the board" merely cover the right to civil action and do not in fact cover the question of proceedings in tort.


Mr. St. Laurent:: Not criminal proceedings, but civil proceedings.


John George Diefenbaker: I am speaking of civil proceedings. If the Prime Minister will read the Exchequer Court Act, as I remember it, provision is made in section 19 and following that the exchequer court shall have certain exclusive powers to try actions as against the crown. As I read the section in the bill, and I do so with the greatest of deference to those who drafted it, I do not think it would cover a civil libel action or an action of that type in tort against the national film board. If a person were libelled in consequence of a film issued by the board I submit it would not be covered by the wording of this section. I think the law officers of the crown should be asked whether or not this section in fact covers such a case. I think the present wording will only cover contractual rights or obligations acquired or incurred in the name of His Majesty, and in fact is not an advance along the road of granting to the private citizen the right of proceeding against the crown without a fiat.
The bill already passed by the house is now before a committee of the other place.

I do not know what conclusion they are going to come to or whether or not the matter has arisen at all. Nevertheless I believe consideration should be given to the question whether or not this section in fact only goes a part of the way that the draftsmen believed, and I presume intended, that it should go. Whether or not it was intentional, while hon. members believe the bill already passed actually extends beyond the contractual liability of a crown corporation to the right of action by a private citizen, nevertheless as it is at present constituted any person who wanted to take proceedings by way of libel or slander, alternative actions for defamation, or on other torts, would find that he still required a fiat from the attorney general.
Having made that statement I suggest to the minister that the law officers should be consulted, for either they intended that it should cover torts such as I have mentioned, or by its draftsmanship they intended that it should not. If it does not cover torts the right of action is of no great consequence and would in fact amount to a very small step forward toward the point where ultimately the individual in this country, in his actions against the crown, will be on the same footing he enjoys in his actions against private citizens.


Alistair McLeod Stewart: Twenty minutes ago I asked the minister a simple, easy, elementary question, which has not been answered. Perhaps he was talking to someone else and did not hear me, or perhaps he has forgotten. This was the question. Does this board have the same autonomy as the Canadian Broadcasting Corporation?


Robert Henry Winters: This board is not being set up as a crown company in the same way as the Canadian Broadcasting Corporation. My hon. friend will see in the act that the board is set up in a capacity which enables it to exercise general control over its operations, but that the minister in turn has control over the board. Section 3 of the act provides:
For the purposes of this act and subject to its provisions', the minister shall control and direct the operations of the national film board.


John George Diefenbaker: Since sitting down I have been informed that the legal adviser to the other place has given a tentative opinion similar to my view on that section. I was not aware of that at the time I was speaking. Either the minister intends that an individual shall have full rights as against a crown emanation or crown corporation or whatever one may call the film board, or he does not. If it is intended to grant the individual that full right, and the law officer of the crown in the other place doubts that the section contained in the act amending the

statute law, which passed this house, is sufficient, then I submit this section certainly should stand until an opinion is secured, in order to make certain that the right of the individual as against this crown corporation shall extend to the right to take action in respect of torts without a flat.


Robert Henry Winters: As the hon. member knows, this section was drafted and then redrafted to make more certain that it would give private individuals rights against the board in case of legal action. I suggest that if there is any question about it, and the statute law is being considered in the other place, perhaps this legislation should go forward on the same basis. If an amendment is required in the other place the same consideration can be given this bill, and it can be brought into line there.


John George Diefenbaker: The only difficulty is that it would have to come back here again.


[Stage Direction]
Section agreed to.
On section 11-Production of films for departments.
Howard Charles Green: Will the minister give us some further explanation with respect to subsection 1. It appears to give the film board very wide power over all other departments of government, in that it provides that the production and processing of all motion picture films by or for departments shall be undertaken by the board, unless the board is of the opinion that it is in the public interest that it be otherwise undertaken and authorizes it to be so undertaken. Under this it would appear to me that the Department of National Defence could not produce or process any motion picture film without the approval of the film board. I would like the minister to say whether my interpretation of this subsection is correct and, if it is, why the film board is given such drastic power over the other departments.


Robert Henry Winters: As I explained before, the national film board is the government's agency in the field of films. The Department of National Defence, which has been referred to previously this evening, does take a considerable amount of film footage, and there is nothing in this act which could bar it from continuing to do so. When it comes to producing a film, however, they are required, as they have been heretofore, to work through the national film board.


Howard Charles Green: This section would not apply to their defence films, that is to films taken purely for the purposes of the defence department?


Robert Henry Winters: It would not bar them from having their motion picture cameramen go
National Film Act
into camps or stations or any other places they wanted and take films. If the question is one of producing a motion picture for the Department of National Defence, however, then under this section it must be done through the national film board.


Howard Charles Green: Does this mean that if the defence department want to make a picture of some phase of their training they cannot produce and show that film to their own troops without the consent of the national film board?


Robert Henry Winters: That is true, Mr. Chairman.


James MacKerras Macdonnell: Does this mean that the film board has an absolute monopoly on the production of films for government use?


Robert Henry Winters: Not at all, Mr. Chairman; it does not mean that in any sense. It just means that if another department of government wishes to produce a motion picture, or to have one produced, it must work through the national film board which, let us say for purposes of discussion, could put it in contact with a private producer, and it would then work with that private producer to obtain the film.


George Alexander Drew: But this seems to be more far-reaching than that. Any film taken with a moving picture camera is a motion picture film, and "film" is defined in section 2 of the act, where these various films are described in such a way as to cover anything that would be taken by a moving picture camera. The Department of National Defence has in its different branches a number of cameramen. Does this not mean that those cameramen would not be in a position to go out and take pictures without the authority of the film board? I cannot read it in any other way.


Alcide Côté: If I may
interject a word, after what the leader of the opposition has just said, if I am not mistaken, there is an historic fact that perhaps justifies this section. During the first world war we had no film board and no motion picture bureau, but we had private operators who took both moving films and still pictures. In 1950, however, there are not available to this government for record purposes either still pictures or moving picture films taken at that time. They were taken by operators over whom there was no control. When the war was over and the government tried to secure those films and still pictures, they were not made available. It became impossible for the government to secure them because of the freedom that was given to those who took the pictures. The result is that the government has not those pictures.

National Film Act


Howard Charles Green: May I ask the minister why it is that the national film board must approve of all films made by the Department oi National Defence before any such film can be shown to the troops? That is what the minister said a few moments ago.


Robert Henry Winters: No, I did not say we had to
approve of all films. I simply said we had to approve of the channels through which films are produced.


George Alexander Drew: This is more than just taking
exception to the narrow meaning of the words, Mr. Chairman. This subsection says that no department shall initiate the production or processing of a motion picture. Now, the initiation of the production is the taking of the moving picture. This wording means that the Department of National Defence would have to obtain the consent of the film board before it had its photographers initiate the production of films. In other words, the national film board determines what is proper or not proper to be taken by the Department of National Defence. I do not believe it can be read in any other way.


Robert Henry Winters: I think it can. Section 11, subsection 1, says:
... no department shall initiate the production or processing of a motion picture film without the authority of the board, . . .
If the Department of National Defence wants to shoot footage, there is no reason why they should not do it. But if they set out, having in mind the production of a film, this section- says the approach is through the national film board.


Mr. Fulton:: I do not want to interrupt the discussion on subsection 1, but I want to ask a question on subsection 2. It provides that where the film board undertakes a film for another department, then there may be transferred out of the moneys appropriated by parliament for expenditures by that department to the national film board, such sums to defray the cost incurred by the board as such minister or other persons and the board may agree upon. What I should like to know is why it is not provided that the sums to be transferred shall be the actual cost incurred by the board. I should like to see it provided that in every case the actual cost of producing the film shall be charged and paid by the department for whom it was produced. In that way we will be able to keep track easily of the film producing activity costs, instead of having to look in two departments to find the amount. Why is that not stated specifically, instead of being left to agreement between the ministers?


Robert Henry Winters: It is put in for a specific reason. Heretofore the board gave an estimate to another department, and if the work overran the estimate the board, in almost all cases, absorbed the amount of the overrun. If the film cost less than was anticipated, the board collected only the lesser amount. It is felt that, in accordance with the Woods-Gordon recommendation, it should be done in a commercial way. The board should agree upon a realistic amount related to the work contemplated and that amount should then be turned over to the board for the production of the film.


Edmund Davie Fulton: That would be regardless of the fact that the film may cost more than the estimate?


Robert Henry Winters: It would only be the amount that was agreed upon that would be turned over. That is what is contemplated now, but I suppose these agreements will be capable of being renegotiated.


Edmund Davie Fulton: It seems to me that will produce a complicated system of accounting so far as accounting to parliament is concerned through the public accounts. We will have to look through several departments to find out what the actual cost was. Say the Department of National Defence has made a film, we shall not be able to find the cost in the part of the public accounts devoted to that department, but we shall have to turn to the national film board to find the extra cost, if any. I do not see why it is not possible to provide that the amount to be paid by the department for whom the film is produced shall in all cases shall be the actual cost to-the board.


Robert Henry Winters: The actual cost of course can always be obtained from the national film board account. It seems to me it is a realistic arrangement. It is the arrangement that, would prevail between a contractor and someone for whom he undertook to do a job. A price is agreed upon and that is the price that prevails; that seems to me to be the businesslike, normal arrangement.


George Alexander Drew: Mr. Chairman, I believe that subsection 1 should be very carefully considered. I do urge the minister to think carefully about what these words mean. "No department shall initiate the production" of a motion picture film. The initiation of the production is the instruction to some cameraman to go out and take a picture.
That means that the Department of National Defence cannot even give instructions to a cameraman, let alone have him take a picture, without the authority of the board. I am not going to press this, because if the minister does not see the words in this.

way and will not accept this recommendation, then he will proceed with what I regard as a serious defect.
There is another consideration here which I think should also be brought to the attention of the house. This provision places the right of the department to do something under the control of an agency of government outside the ordinary government structure. This film board is the creature of the government, and that creature of government is given the authority to say to the departments of government whether they can or cannot do something that they would ordinarily do. I think the principle, notwithstanding the object, is one that is a definite departure from our ordinary procedure.


James MacKerras Macdonnell: I should like to refer to section 11, subsection 1. When I asked the minister if the effect of this subsection was to rule out private production agencies, he said no. I believe the effect of it really will be that, because his answer went on to say, if I correctly understood him, that it would still be possible for the film board to act as intermediary for another department to employ a private agency. Now, to me that is so unlikely that I think it can be disregarded. No one is going to believe that the film board will want to have that done. Unless they are superhuman people, it is going to be almost impossible for them to fall over backwards to the extent that they could act as a genuine agent for the employment of someone else.
Is this not a definite change in the practice? In the past, if I recall the information we had in this house last December, other departments had been able to deal directly. It is not merely a case of the initiation, but under this section as it stands there will be no dealing directly between any department and any private agency. In other words, unless I have misrepresented the situation, what we are really doing, and we may as well face it, is stating that this agency will exclude private producers.


Robert Henry Winters: No, as the Prime Minister has just suggested it is just like the king's printer. There is no departure here, and I can assure my hon. friend that there is no intention of insulating government departments from private operators in the motion picture field. The section of the present act reads:
All processing and production of films by and for government departments shall be undertaken by the bureau, except where the commissioner agrees that the work can be done through officers of other departments and that the results obtained will be technically adequate and economical, or where the board considers the use of commercial firms advisable in the public interest.
55946-259i
National Film Act
The same practice is being followed.


James MacKerras Macdonnell: The minister referred to the king's printer. May I ask whether there are any private producers entering that field?


Robert Henry Winters: Yes, a great deal of the government printing is done by private producers through the printing bureau, the king's printer.


[Stage Direction]
Section agreed to.
Section 12 agreed to.
On section 13-Plan of organization.
James MacKerras Macdonnell: This section seems to be setting up a separate kingdom with a vengeance. I notice particularly subsection 3 which enables the board to disregard the provisions of the Civil Service Act. Will the minister deal first of all with subsection 1 which in itself seems to give unusually broad powers? May I ask if I am correct in taking it that these are powers beyond what the ordinary department of government has? Would that be correct with regard to subsection 1?


Robert Henry Winters: It is powers beyond or different from those where the Civil Service Act applies, but it is not extraordinary powers in the light of the way the film board operates and has been operating. This subsection says that for the permanent employees of the board a plan can be set up, provided it is recommended by the minister and approved by treasury board. Once that plan is approved, the board then has, under this section, the power to appoint employees to fill the establishments. That is what the section purports to do.


James MacKerras Macdonnell: What is it necessary to deal with it so differently from the ordinary civil service department? Is it because it is thought that the employees that are required to be obtained by the board are of a different type and will not come in under ordinary civil service conditions?


Robert Henry Winters: It has always been considered that the making of films is a different sort of operation. It is a creative field in which you normally expect and get a different type of personnel. In this field there are people who are experts whom you could never get through competitive arrangements under the Civil Service Act. They are nevertheless people who have been doing and who will continue to do an excellent job for the board. Having regard to the nature of the operation, I think that the power to appoint people is a necessary one if the board is going to remain a live and creative organization.

National Film Act


James MacKerras Macdonnell: I can understand that there would be certain people, of a highly skilled and highly artistic nature, and perhaps particularly expert in other ways, who would be included in the description which the minister has just given. But will that apply to all the people in the film board? Does not this organization plan apply to all the people?


Robert Henry Winters: There is another section, section 14, which provides for people other than those in the plan approved by the treasury board on the recommendation of the minister.


Edmund Davie Fulton: Again notwithstanding the
Civil Service Act.


James MacKerras Macdonnell: Can the
minister say roughly how many people would be affected by this provision and what woul: be the likely and probable division between those under section 14 and those undei section 13? What I mean is this. Are there going to be a few exceptions under section 14 or under section 13?


Robert Henry Winters: The majority of the peonle employed would be under section 14. The people employed under section 13 are those people who would have employment of a continuing nature. The work of the film board fluctuates from production to production. There is a high turnover of employees for that reason. Section 14 gives the board the power to employ temporary personnel to take care of this situation.


James MacKerras Macdonnell: The minister speaks of a large turnover. Nevertheless there is reference here to pension and retirement privileges. I suppose the minister's answer to that is that it would depend on how long, in fact, they stay.


Robert Henry Winters: I presume we are discussing section 13, Mr. Chairman.


Joseph-Alfred Dion: Yes, section 13.


Robert Henry Winters: The effect of section 13 is to enable the people on the approved plan, under section 13, to become eligible for the civil service superannuation benefits; but the people employed under section 14 do not.


James MacKerras Macdonnell: In other
words the answer is that, under certain conditions, for certain duties they are taken out of the Civil Service Act and for certain other duties the Civil Service Act applies. Is that the answer?


Robert Henry Winters: It is not the Civil Service Act; it is the Civil Service Superannuation Act; it is to entitle the people on the permanent staff in continuing positions to become

eligible for civil service superannuation benefits, whereas the temporary employees are employed under section 14 and do not qualify for civil service superannuation benefits.


Howard Charles Green: May I ask the minister a question concerning subsection 4 of section 13. That sec.ion apparently provides that the ' oard has absolute discretion with regard to positions up to $5,000 a year. For any positions over that figure they must get the approval of the governor in council. Does he minister have any jurisdiction whatever over the employment of persons who do not et $5,000 or more or is that entirely in the hands of the board?


Robert Henry Winters: There are bylaws to which his act refers and which may well have a bearing on that point. Section 3 reads:
For the purpose of this act and subject to its ,:![DOT] visions, the minister shall control and direct the p: rations of the national film board.
That enables the minister to exercise control over any of these matters he so desires.


Howard Charles Green: Is it the intention that the minister shall have power over these salaries below $5,000?


Robert Henry Winters: Oh, yes.


Stanley Howard Knowles: Subsection 1 deals with that matter.


Mr. Charlton:: The minister has just said with regard to subsection 4 that, no matter what the salary is, the Civil Service Act does not apply other than for superannuation purposes.


Robert Henry Winters: Unless the employee comes under subsection 6 of section 13, or subsection 7, which states in effect that if he were an employee under the Civil Service Act before this act came into effect, he continues under the Civil Service Act.


John Alpheus Charlton: This board then is being set aside from the Civil Service Act with regard to appointments, whether the salary is under $5,000 or over $5,000.


Robert Henry Winters: That is substantially correct,
except for the subsections I have quoted.


John Alpheus Charlton: That is only if they have been in the employ of the civil service and are continuing under the eivil service.


Robert Henry Winters: That is right.


Edmund Davie Fulton: I do not think the minister has given us any full explanation as to why it is necessary to do that at this time when there was no similar provision, or at least no such widespread provision in the old National Film Act. There practically the

only person who was exempt, and completely exempt, from the provisions of the Civil Service Act was the commissioner himself. Now every employee of the board virtually is or may be exempt from the provisions of the Civil Service Act. Why is it necessary to make this sweeping change?


Robert Henry Winters: I think this is of great importance. It is a step in the direction recommended by the Woods-Gordon report and a step in the direction which I think is correct. Under the old act the only people who were eligible for civil service superannuation were the people who were civil servants before the old act came into effect. All the others were employees on a temporary basis, the term being three months, except of course for the commissioner, who was on a three-year term.


John Alpheus Charlton: Why should the permanent employees of this board be outside the civil service when every other department of the government is inside the civil service, and is governed entirely by the Civil Service Act?


Robert Henry Winters: There are, of course, other agencies, but that does not necessarily explain why this should be so in this case. I could refer to the Central Mortgage and Housing Corporation, the Canadian Broadcasting Corporation and others where the nature of the operation and the nature of the talent required make it expedient and necessary to be able to appoint people rather than to have them qualify under the Civil Service Act.


John Alpheus Charlton: In other words a supercivil service committee is set up outside the actual civil service?


Robert Henry Winters: No.


John Alpheus Charlton: When there are thousands of people who have to abide by the Civil Service Act.


Howard Charles Green: What about the ordinary clerical staff? Will they not be under the Civil Service Act? Is the national film board being taken completely away from the Civil Service Act, from the top down?


Robert Henry Winters: It is not being taken away, because it never was there. We are bringing it closer to the civil service regulations now than it has ever been before. We are trying to regularize it and get permanency and stability


Edmund Davie Fulton: So far as superannuation is concerned.


Robert Henry Winters: Yes.


[Stage Direction]
Section agreed to.
Sections 14 to 17 inclusive agreed to.
National Film Act
On section 18-National film board operating account.
John Alpheus Charlton: I would refer particularly to section 18 (4) which refers to expenditures made by the board and shown in the account not at any time exceeding the receipts shown in the account by more than $700,000, or such lesser amount as may be fixed by treasury board. Does that mean that the expenditures of the board shall not exceed $700,000?


Robert Henry Winters: No, that is a working fund set up to enable the board to continue its operations from year to year. Section 18 (4) states that expenditures must at no time exceed by more than $700,000 the receipts of the board.


John Alpheus Charlton: The amount of the appropriation for the operation of the board?


Robert Henry Winters: This is not related to the
appropriation for the board. It gives the board a working fund, and is not voted by parliament as such. It means that the board can take accounts receivable, for example, and carry them on what I understand accountants refer to as an accrual basis. They can accumulate receivables and things of that nature until they arrive at the figure of $700,000, beyond which they cannot go. It is a working fund for the board.


James MacKerras Macdonnell: I would ask the minister to look at this section again. I take it that this is really the same problem we have in the Department of Transport, where there was the grant of a working fund. I would ask the minister to look carefully to see if it gives the effect he intends. It says-
The expenditures made by the board and shown in the account shall not at any time exceed the receipts shown in the account.
That is to say, the receipts of the board, if my understanding is correct-
-by more than $700,000 or such lesser amount- And so on. Is that what is really intended? It does not say, "Shall not exceed the amount voted by more than $700,000," but rather it says, "shall not at any time exceed the receipts." I have not studied it carefully, but I suggest it should be looked at again to see that it states what is intended.


Robert Henry Winters: I am told that it is all right in this form. It has been checked carefully by treasury, by the Auditor General and by others who are familiar with these matters, and they say it does conform with what is required and what was recommended in the Woods-Gordon report.


James MacKerras Macdonnell: All I have
to add is that it does refer merely to receipts.

National Film Act
It has not anything to do with grants by parliament at all. However, if the minister is satisfied, I have nothing more to say.


[Stage Direction]
Section agreed to.
On section 19

Application of 1931, chapter 27.
James MacKerras Macdonnell: What is the significance of this section?


Robert Henry Winters: This measure refers to the
setting up of a special account known as the national film board operating account, and authorizes the board to set up its own internal accounting system. Beyond that the payment of cash disbursements and so on will be handled by the comptroller of the treasury, and in other ways the Consolidated Revenue and Audit Act will apply.


[Stage Direction]
Section agreed to.
Section 20 agreed to.
On section 21-Reports to minister.
William Joseph Browne: I cannot
help feeling that there is a good deal of weight in the point drawn to the attention of the minister by the leader of the opposition in regard to the position in which, for instance, the Department of National Defence would be placed. It seems to me a strange procedure to give the national film board such powers. I suggest that section 11(1) be considered carefully.


Alphonse Fournier: That was passed.


William Joseph Browne: Yes, but
this section 21 states that the board shall furnish statements or reports to the minister at such times and in such manner as the minister may require. It seems to me the minister would have power to make inquiries and to see if other departments had violated the provisions of the act. I am wondering, for example, if in the Sweetbriar operation, having taken pictures, the Department of National Defence each time it started a new roll of film would have to get permission?


Robert Henry Winters: No, I have already assured the committee that that would not be so.


[Stage Direction]
Section agreed to.
Sections 22 and 23 agreed to.
On the schedule.
James MacKerras Macdonnell: How would one know the meaning of the expression "due authority"? Would there be a regulation, or would it just be a case of being told by one's boss? Sometimes that becomes rather important.


Robert Henry Winters: This is the standard oath of security, the same as is found in other legis-
[Mr. Macdonnell (Greenwood) .1
lation. The one I have in mind is the act setting up the Central Mortgage and Housing Corporation.


James MacKerras Macdonnell: It is in general use.


Robert Henry Winters: Yes, it is in general use.


[Stage Direction]
Schedule agreed to.
Bill reported.
Mr. Speaker:: When shall the bill be read the third time?


Some hon. Members:: Now.


Stanley Howard Knowles: By leave.
Bill read the third time and passed.

The house in. committee of supply, Mr. Dion in the chair.
DEPARTMENT OF RESOURCES AND DEVELOPMENT Forestry branch-
381. Forest research division, $819,675.


Clayton Wesley Hodgson: Mr. Chairman, I notice that under this vote for forestry research there are 29 engineers, and increases in almost every figure in the item. Travelling expenses are shown as $87,000, and casuals and others as $190,466. In that case the increase is $30,000. I do not understand that item. Is it an item into which you stick anything when you cannot find any other place to put it?


Robert Henry Winters: That is casual labour.


Clayton Wesley Hodgson: Is that part-time labour?


Robert Henry Winters: Yes, as required.


Clayton Wesley Hodgson: You have an item for temporary assistance.


Robert Henry Winters: Those are civil servants generally who are classified as temporaries rather than permanents.


Herbert Wilfred Herridge: I understand that this forest research division is carrying on some research in the use of sawmill machinery and equipment. I may say that I advocated this for five years in the provincial legislature and every year since I came here. Many other hon. members are interested in this matter, particularly in the saving of waste occasioned by sawmill equipment, especially the equipment in small sawmills. I am particularly interested in knowing that the department is going ahead with this research and I wonder if the minister could give us some information as to the results.


Robert Henry Winters: A building has been acquired in Ottawa and the machinery is being

obtained. As soon as it is set up a program, which has been laid out, will be undertaken.


Clayton Wesley Hodgson: Can the minister describe one thing this forest research division has developed for the benefit of the lumbering industry?


Robert Henry Winters: I am told by the officials that there is general research in the field of forestry. As an example of what they have brought forth I would mention aerial photography.


Clayton Wesley Hodgson: Aerial photography was developed five or ten years ago, and I can show you aerial photographs in my office which were taken that long ago. I want to know what has been done in the past five years that has been of benefit to the industry in which I am interested.


Robert Henry Winters: That specific question could be answered more appropriately under item 385. The department has done a great deal of work in the field of kiln-drying, utilization of waste products from lumbering operations and developments of that nature.


Clayton Wesley Hodgson: Would you prefer to leave it until the next item?


Robert Henry Winters: If you like.


William Joseph Browne: Has the
work carried on under this item and the following item been extended as yet to Newfoundland? We have a lot of birch down there that we do not know what to do with.


Robert Henry Winters: The operations have been extended to Newfoundland. Last year one of the officials went to Newfoundland to conduct a study into the density of Newfoundland woods, such as balsam.


Clayton Wesley Hodgson: This item totals $820,000, an increase of approximately $80,000 over last year. The minister and his officials ought to be able to tell us what is being accomplished for that amount of money. There are 29 engineers and $87,000 for travelling. Are they just travelling around looking at the country and taking pictures, or what are they doing?


Robert Henry Winters: This vote is for the advancement of forestry research and conservation in Canada; the investigation of forest conditions and rates of growth; the development of scientific management methods on the basis of sustained yield; forest fire protection studies; technical investigations into the operation of the industry; investigation, development and application of aerial photography methods; development of techniques concerning the interpretation of forestry data; silviculture research and so on.
Supply-Resources and Development Mr. Hodgson: What has been done in connection with fire fighting, for example? So far as I know that has always been handled by the provinces.


Robert Henry Winters: As my hon. friend says, that work comes within the provincial field, but the department has done a great deal in the way of assessing forest fire hazards. The results of the work done by the department are used fairly generally throughout Canada, and they are used in the national parks.


Clayton Wesley Hodgson: Tell us one place where they have done anything along that line.


Robert Henry Winters: Forest fire hazard evaluation and forest fire forecasting is used in Quebec and in the maritime provinces. That use has developed out of the work of this branch.


Clayton Wesley Hodgson: Specify something that they have done. Have they developed anything besides the use of water to put out a fire, or the use of a shovel? Just what have they done? We are being asked to vote $820,000 and we should know something about it.


Robert Henry Winters: My hon. friend will see from the break-down on page 256 that a considerable amount goes into total salaries and wages which of course are paid for research as well as other work. As a specific instance of what they do, they have broken ground in the assessment of fire hazards and it has found wide application.


Stanley Howard Knowles: Can the minister tell us whether this research division has carried on any work in connection with various kinds of cigarettes insofar as they may cause forest fires? We have asked about this under various items; I do not think I have had occasion to ask the present minister about it, but I have asked others.
There seems to be some question whether there are certain chemicals in the paper used in the manufacture of tailor-made cigarettes which makes it possible for them to burn more steadily than is the case with the other kind. I do not happen to use the things myself but my friend from Saskatoon and I conducted a little experiment not many weeks ago. There was no doubt about the result. The roll-your-own cigarette refused to burn by itself but the tailor-made burned by itself until it was completely consumed.
It has been represented to me that in forests the use of tailor-made cigarettes, the stubs of which are tossed about, may be the cause of many forest fires. It has been said to me, as a matter of fact, by people who are connected with woods operations that they require their workers in the bush to use roll-your-own cigarettes rather than tailor-made, particularly when there is any

Supply-Resources and Development fire hazard. It would seem to me there are at least two phases of this matter which the research division might investigate. On the one hand, it might gather statistics as to the number of forest fires caused by discarded cigarettes, and on the other hand it might conduct some scientific research into what is contained in these cigarette papers that makes for the difference in burning that my friend from Saskatoon and I found in the experiment we conducted some time ago.
After one of the occasions when I raised this matter in the house I had a communication from one of the big tobacco companies assuring me that there was nothing in the paper used in tailor-made cigarettes that would create any greater fire hazard than the other kind. It was after that that my friend and I conducted the experiment. Other people have spoken to me about the matter and have assured me that there is that difference. I have taken the matter up with the office of the dominion fire commissioner. I have had correspondence with other people in the country who are interested in the question, including officials of the dominion fire chiefs association. I believe there is something here that needs to be investigated.
I know that the dominion fire chiefs association feels that action should be taken. In fact not long ago they passed a resolution which was sent to the government, copies of which were sent to all members of parliament. So far as the office of the dominion fire commissioner is concerned, if I recall correctly, the answer I received from them was that it was difficult to deal with a matter of this kind by legislation. Once upon a time that view was taken with respect to matches, but now we have legislation to reduce the fire hazard in matches. Although there might be a pretty high-powered lobby against such legislation, I submit it is in the national interest that this matter should be investigated. I must say I was not greatly impressed by the letters we had a short while ago from one of the tobacco companies urging us to get behind fire prevention week because I have noted a lack of co-operation on the part of the tobacco companies with the fire prevention people in connection with this whole matter. There is nothing more I need to say on the subject at the moment, but I should like to have an answer from the minister as to whether any research has been conducted by this division into the two aspects I have mentioned. If not, I hope that he will indicate that these people will make some study of the matter.


Robert Henry Winters: Mr. Chairman, we all know that cigarettes are one of the causes of fire. 
The department is doing everything it can, in co-operation with the provincial governments, to create an awareness in the minds of the people of Canada of the serious loss that results every year from forest fires. The manufacturers of cigarettes are co-operating in that work, and I think perhaps they are helping to create an awareness of the problem. The actual -work on development of a cigarette that will not be so dangerous in the woods is something that I think is beyond the jurisdiction of this department, and in fact we have not undertaken any work on the problem.


Stanley Howard Knowles: I remind the minister that that used to be the argument against safety matches, but the day came when there was legislation in that field, and I think the day should come when we will have legislation in this field as well.


Alfred Johnson Brooks: I should like to ask the minister whether anything is being done about the spruce budworm infestation in the different provinces and also as to dieback disease which infests birch trees particularly in the maritime provinces.


Robert Henry Winters: There is a forest insects control board which is active in the field of trying to combat this pest. The work is done by the Department of Agriculture.


Alfred Johnson Brooks: It is not under this item?


Robert Henry Winters: No.


Herbert Wilfred Herridge: I do not take quite the same attitude as the hon. member who was talking about what our research people are doing. Personally I think they are doing an excellent job. I keep pretty well informed of the major projects that are being undertaken. I want to repeat one criticism, and the only criticism I have ever made of this department. They are not getting the information over to the Canadian public. I know that information is published in the trade journals about the projects that are being carried on. I take the lumbermen's magazine, and I presume the hon. member who has spoken also does. There is a limited circulation of some of the information, but I think it is so vital to create an interest in forest conservation and the use of forest products that some scheme should be found to make the public aware of what is being done. The information should also go to the high schools of this country. A great deal of valuable work is being done but it is not appreciated by the majority of Canadians.


George Matheson Murray: This is a good opportunity for the national film board.


Winfield Chester Scott McLure: The amount of item 384 is $819,675. For salaries for permanent positions the amount is $190,050. There is a list given of those and the amounts that they receive. The amount for temporary assistance is $207,210, over 25 per cent of the total, and we do not know anything about it. We know this much now that we never knew before, that one hundred people are receiving that money, but we do not know whether they are engineers, brakemen, or what they are. Then we have a new bunch growing up called "casuals". I looked that up in the dictionary and it means happy-go-luckies. The amount for these happy-go-luckies or casuals involves another 25 per cent of the total amount of the item, and we are asked to vote it without any details whatsoever. There is $190,466 for casuals. Next year I think you should certainly direct the officers who prepare these estimates to give the committee some information, even if they only tell us that there are 500 casuals or happy-go-luckies. We know that at election time these are the most useful things you can have; and, as I have explained on many occasions, this item is largely used for that purpose. I believe we should have a breakdown of it. If we cannot get it for this year, let us have it for another year.


James MacKerras Macdonnell: It seems to me, as the hon. member for Queens has said, that we are being given very little information about this. We know the fire hazard in our forests is terribly serious. I am not doubting for a moment what the hon. member for Kootenay West said about the excellent work being done by these forest engineers, but it seems to me that for the good of his own department the minister should be able to make some general observations about this problem. I think we should know to what extent it is being dealt with; to what extent, for instance, there is co-operation between the dominion and the Ontario department, and what the great obstacles are. If they are cigarettes, then that is worth knowing. Here is something which is taking a terrible toll of our natural resources, and we get just a few bits and pieces of information without any general, organized attempt to let us understand the problem. It might be that we would insist on the minister having several million dollars more to publicize this situation if we knew what the problem really was.


Robert Henry Winters: Well, Mr. Chairman, I can say we could use several million dollars more to good advantage. The operations of the federal government in the field so far have been in attempting to forecast forest fires by evaluating fire hazards. Last year, as hon. members know, we enacted the Canada 55946-260
Supply-Resources and Development Forestry Act, by which parliament authorized the government to exercise wide powers in the field of forestry. Most of those powers, however, are in fields of prior responsibilities of the provinces.
I felt that something should be done, and one of my first acts when I assumed this responsibility was to write to all provincial governments asking them how in their opinion we could most appropriately co-operate under the terms of this act to develop and conserve our forest resources. I have heard from several of the provinces; I have spoken to the representatives of a number of others. So far the talks have been exploratory. There is one thing on which I think we all agree; that is that the long-term forest policy of this country can be nothing short of the type of forest management that will result in sustained yield, and any steps we take now must be considered as stepping stones toward that end result. But we have a great many steps and processes to go through before we arrive at sustained yield. In the first place we must know what the forest inventories are, and we have not a clear picture of our forest inventories on a national basis. We not only have to know those inventories as of a certain date; we have to be able to evaluate those inventories at some time hence, in order to tell whether we are achieving sustained yield.
There is no doubt that forest fire protection is one of the greatest factors in the over-all consideration and one of the most important steps toward the goal of sustained yield. We know that; all the provinces have raised that point with us. But before we commit ourselves to an over-all forest program, before we make our final commitment in the field of forest fire protection or suppression, or the control of insect pests, or whatever commitment it might be, I think we have to formulate with the provinces an over-all concept of what the policy should be and how we can best use the financial and other resources available to us to arrive at that goal of forest management on a sustained basis.


James MacKerras Macdonnell: Well, Mr. Chairman, I think the minister has made an admirable statement of the problem, but I got the impression that really we are just sort of scratching the surface now and that we may be doing so for a long time to come. If that is a fair impression it seems to me rather disturbing and definitely raises in my mind the question of whether we are doing enough and whether the minister should not steal some money from some of the other departments that in our opinion perhaps do not need as much as they are getting. It seems to me the minister has stated the problem but has left me, at any rate, with a very

Supply-Resources and Development disturbed feeling. He said that before we commit ourselves to a program we must make further investigations. No one can argue against that as a general proposition, but one can at least express concern that it would seem we are going to be a long time at it.


Robert Henry Winters: Of course I do not deny that. We must first of all recognize the problem before we can attack it, and as a step in the attack on the problem we have written to the provincial governments, who have a prior responsibility in the field. We have said to them, "Tell us how you think we can best co-operate under the terms of the Canada Forestry Act to achieve the greatest possible conservation and development of your forest resources." As I say, we have heard from some of the provinces and I have had personal conversations with representatives of a number of others, which have been very helpful to me and I hope in some measure they will be helpful to them. We hope that out of these exploratory talks and preliminary stages we will in due course arrive at a forest policy which will result in the further development and conservation of our forest resources.


Clayton Wesley Hodgson: I am not going to ask any more questions on this item. The minister is new to this department, but the department itself has been operating for a number of years, and the only thing the minister can tell me it has developed is aerial photography. That is almost as old as I am, and was developed a long time before this department was thought of. Next year we will expect these specific questions to be answered. We will also expect to be told what all these casuals are, costing in the neighbourhood of a couple of hundred thousand dollars. I have one more question, but it will be on the next item.


Robert Henry Winters: In reply to the hon. gentleman I think I should say that aerial photography as a means of assessing the value of a forest was started by this department, which pioneered in that field, in 1929.


[Stage Direction]
Item agreed to.
Forestry branch-
385.	Forestry operations division, $61,290.
Mr. Knight:: I want to take this opportunity to congratulate the government and to urge more of the same type of action that has earned my praise. Close to my home city of Saskatoon we have what is commonly known as the forestry farm, an institution first started as a place where young seedlings could be grown to be distributed throughout the province to form timber belts around the various farms for purposes of shelter. I want to pay tribute here to the manner in which

that farm is kept. It has become a place of beauty. It is close to the city and to the railway town of Sutherland, and now almost serves the purpose of a national park. They have also made a small attempt at an animal park, putting in a few animals and birds. It is a place where thousands of people congregate on warm Sunday afternoons, and is used for picnics and that sort of thing.
I want to add a special word of praise for something that has been done which I have been advocating in this house ever since I have been here. I refer to the hard surfacing of the road from highway 27 to the gates of that park, and the actual road through the park itself. I have stated in this house on many occasions that the rest and pleasure which one may obtain when one gets there has been continuously spoiled by the dust. Anyone who has lived in the province of Saskatchewan as long as I have knows that if you put a thousand cars over that road on a warm Sunday afternoon, the result will be a heavy cloud of dust. I want to congratulate the minister on putting a hard surf ace, on the road in that particular place.
I want to say this, too. If that place is a place which brings ease and rest to the people of that city, I think perhaps the lawn area should be extended. The lawn areas are so small that when you get one or two thousand people milling around it is a miracle how that grass survives. Again I pay tribute to the people who are in charge of those lawns. They are beautiful, and that is the way we would like to keep them. If they are to be kept that way, with the increased use of the park through the hard-surfaced roads, this lawn area will have to be extended. I admit that the dominion government has no responsibility to create a pleasure ground for the people of Saskatoon, but looking at the thing from the larger point of view, it could perhaps be good work in the right direction. This place is situated so close to the city, with a bus service running to the town of Sutherland and the park itself on occasion, it simply means that the thousands of people who have no cars, as well as the thousands who have, flock to that place as a place of rest and pleasure. I take pleasure in congratulating this department on the good work, and I hope it will be continued.


Lewis Elston Cardiff: I should like to tell the minister that perhaps there is no one in the house who enjoys roaming through the timber and bushland more than I do, but I usually have to do it at my own expense. In looking through this particular vote, No. 385, I find the increase in travelling expenses is

$90,000 for the department, and in this particular item it is almost $21,000. Will the minister give us some idea of why there is an increase?


Robert Henry Winters: This is the item my hon. friend refers to, $4,600 for travelling expenses as against $2,500 last year.


Lewis Elston Cardiff: Yes.


Robert Henry Winters: As I mentioned earlier, we passed the Canada Forestry Act last year which enables the government to enter into agreements with the provinces, with corporations, with individuals, or almost anyone who is interested in the conservation and development of forests. It was felt that the wider powers conferred upon the government by that act would mean more travelling, so we are asking for an increased amount of money to cover that.


[Stage Direction]
Item agreed to.
Special projects grant-
393. Trans-Canada highway division, $300,000.
Mr. Gillis:: I should like to ask the minister a question on this item for the purpose of clarification. I brought	up	the matter of
the change in ^he specifications for the bridge across the strait of Canso on the estimates of the Minister of Labour. A member on the other side of the house, who comes from Cape Breton, made the	assertion that the
reason for the change in the width of the bridge from 22 to 24 feet was due to the fact that the trans-Canada highway would cross the bridge. My impression was that that change was suggested by the province of Nova Scotia, and the trans-Canada highway had nothing to do with it. It sounds rather illogical to me that the bridge would have to be the width of the highway, because that condition certainly does not prevail all across this country. Will the minister state whether the trans-Canada highway had anything to do with the change in the specifications?


Robert Henry Winters: Mr. Chairman, the agreement for the trans-Canada highway specifies a 24-foot paved surface. It was agreed that the width of the bridges would be related to the width of the highway. There is a sound argument for that, and certain changes in the specifications of this bridge were made. The statement was made officially by the Minister of Transport, and I believe at the same time by the government of the province of Nova Scotia, that the change in the design of the bridge was necessitated by the specifications agreed upon by the provinces for the trans-Canada highway.


Mr.   Coie@Maiapedia-Malane: Is the minister in a position to state why the premier 55946-2601
Supply-Resources and Development of Quebec has so far refused to concur in the building of this trans-Canada highway?


Robert Henry Winters: Mr. Chairman, the statement made by the Quebec minister of highways at the signing conference on April 24 was the last word I have had on the subject from the province of Quebec. The statement made at that time is a matter of public knowledge, and I understand that hon. members are familiar with it.


Percy Chapman Black: I should like to know whether the province of Nova Scotia and the province of Quebec are the only two provinces that have failed to sign the agreement so far. The minister told us earlier, when announcing that an agreement had been entered into with Newfoundland, that he could not give the house the reasons for the delay in signing by the province of Nova Scotia. As I understand, the province of Nova Scotia has announced the location of the trans-Canada highway and, to that extent, has approved the agreement. I have already gone on record as not approving, to some extent, the location of the trans-Canada highway in Nova Scotia.
It would appear to me that the interests of the province would be better served if this road ran to the capital city of Halifax. We should also have as great a mileage as possible. Having that in mind, the road should run to Halifax, and should also take the shortest route to serve the province of Newfoundland. This would be along the Northumberland strait, across the Canso bridge when it is built, and down to North Sydney. This was approximately the location of the road as established during the depression in the early thirties. I cannot altogether agree with the member for Cape Breton South that a 22-foot bridge would be sufficient. The province of Nova Scotia adopted, twenty years ago or more, the twenty-four foot width for bridges. I think we are entitled to some explanation as to why the engineers adopted the twenty-two foot width for this bridge, when it was so well known and so well established that all these bridges should be the full standard width of twenty-four feet. The engineers must have had some instructions either from the minister's department or from the province of Nova Scotia to justify them in starting their plans on the basis of a twenty-two foot width rather than a twenty-four foot width. Then as to why these plans should progress as long as they did or to the extent that they did, so that it postponed the calling for tenders, so that little or no work can be done this year is something as to which I think we are entitled to some explanation.
4110	HOUSE OF
Supply-Resources and Development
I should further like to know from the minister what proportion of this $20 million that is in the estimates now, as a statutory vote, is going to be expended in each province this season, and in what way it is going to be distributed to the different provinces. Is it going to be according to their order of application: first come, first served? Or is it to be a certain percentage having regard to the population of the different provinces and having regard to the mileage in the different provinces? I should like to know what the policy is in that regard.
As to the province of Quebec and the province of Nova Scotia-they are the only provinces that failed to sign the agreement-
I should like to know whether the proportion that was properly due to those provinces would be set aside. I should further like to know from the minister if the report is correct that 50 per cent of the appropriation being made by the federal government is to be applied to the payments for work already done on the trans-Canada highway in the different provinces; and if a province makes application for 50 per cent of the amount voted by the federal government and now under consideration, I should like to know whether this amount will be made available to them for the payment of their other 50 per cent on the new work to be done.
If this has been the case, I am disappointed.
I think the minister, in his agreement with the provinces, should have required the full 100 per cent of the federal appropriation to be spent in new construction of the trans-Canada highway in all the provinces. The full amount of $300 million should be available for new construction rather than applying up to half of the federal grant for reimbursing the provinces for their old expenditures. There are sections of the trans-Canada route that require complete new construction and most of the old sections require rebuilding. Many of the culverts should be renewed and many of the bridges should be rebuilt, widened and strengthened, and given a better alignment. That is the case in the province of Nova Scotia.
Another question I should like to ask the minister is whether he is able to make available to the committee a copy of the correspondence between the federal government or his department and the province of Nova Scotia. I have asked for that correspondence on different occasions but up to the last report made by the minister he did not feel free to lay this correspondence on the table. I think we are entitled to it. I should be glad to hear from the minister.


Louis-René Beaudoin: Shall the item carry? Carried.


Percy Chapman Black: No, Mr. Chairman. Give us a chance. Let us get an answer to some of these questions. I do not like the idea of trying to railroad this through.


Louis-René Beaudoin: Order. I must explain-


Percy Chapman Black: I asked these questions and you, Mr. Chairman, said "Carried".


Louis-René Beaudoin: I must explain to the hon. member that I did not hear the latter part of his remarks because I was discussing with the assistant clerk a matter which will have to come up later. As I always do, I asked "Shall the item carry?" I am sorry if I did that too soon.


Percy Chapman Black: I am sorry for what I said. I apologize.


Louis-René Beaudoin: No. I should like
to make it clear that it is not necessary for the hon. member to apologize. This time it is the chairman who should do so; and I do so accordingly.


Robert Henry Winters: I should be happy to answer
the questions of my hon. friend whom I always like to hear speak in this chamber. I know his particular concern with the highway in the province of Nova Scotia. For that reason among others I am more than glad to answer his questions to the best of my ability.
The minister of highways acting on behalf of the province of Nova Scotia, when in Ottawa on April 24, made a statement to the effect that he thought the agreement was a good one and that he would seek authority from his legislature to enable him to sign the agreement. Since that time I have had no correspondence from the minister, and I have had no indication as to why he is withholding the completion of the agreement.
The question of the bridge at the strait of Canso and of the design of it is a matter for the Department of Transport, as my hon. friend knows; and I am not in a position to comment on that matter.
As to the question about payment by the government for roads already built, I may say that is in accordance with the act passed by parliament last year, under which the federal government contributes half the cost already incurred by the provinces in highway construction.
The hon. member asked about the $20 million in the vote this year. That was put in because it was felt that that would be

about the maximum amount of money the provinces could spend on this project and it is roughly related to the period of time over which the project will be developed, namely seven years. It is approximately one-seventh of the total amount voted by the federal government for that purpose.
What were the other questions?


Percy Chapman Black: How will it be
distributed?


Robert Henry Winters: The distribution will be in
this way. As the provinces get on with their work they will be paid for work completed; and the payment for work already done will be related to the payment for work completed. Does that answer all the questions?


Percy Chapman Black: I asked the minister about the money. If it can be shown that the costs of these highways being taken over as part of the trans-Canada highway are paid for by the 50 per cent of the costs paid to the respective provinces, then the provinces would not have to contribute anything. If they can take that money contribution of the federal government for the purpose of paying half the cost, they will not have to put up any new money for the trans-Canada highway. Personally, I want to register my complaint as to that. I think the entire $300 million should be used for the rebuilding and improving of the highways, bridges and culverts, widening out rights of way and so on and making it a worthy trans-Canada highway not only for today but for all time. I am opposed to this agreement, and 1 am sorry that the minister entered into it.


Some hon. Members:: Eleven o'clock.


Mr.   Baler@: I should like to ask the minister if the route across the province of Saskatchewan has been decided upon between the province and the federal government. If not, I would ask the minister to be sure to have his engineers check over what we consider to be the one and only route, namely the Yellowhead route across the province of Saskatchewan.


Robert Henry Winters: In reply to the hon. member, may I just say that the route across the province of Saskatchewan has been chosen. It was chosen by the government of the province of Saskatchewan.


Alcide Côté: I should like to ask a question respecting a highway in my riding, which is of course the entrance to Quebec from New Brunswick. The road is paved, with the exception of about fifty miles, to Montreal. This is a good highway. Will the provincial government be in a position to bill the federal government to the extent of 50 per cent for the road now in existence?
Supply-Resources and Development


Robert Henry Winters: If the government of the province of Quebec enters into an agreement with the federal government under the Trans-Canada Highway Act; if there is a road already in existence which conforms to the standard laid down in the specifications drawn up under the terms of the act, and if the accounts are submitted as set out in the act and meet the scrutiny of the federal government as provided in the act; then they will receive half the cost of construction.


James MacKerras Macdonnell: Five jumps to get over.


Gordon Francis Higgins: The minister announced today that the new province had signed the trans-Canada highway agreement. Is there any significance between the signing today and the event that takes place tomorrow in Newfoundland, the 453rd anniversary of the discovery?
Item stands.
Progress reported.



BUSINESS OF THE HOUSE

Alphonse Fournier: There being no more legislation, except the appropriation bill, on Monday we will consider estimates. The following departments are ready:	national
defence, trade and commerce, post office, resources and development, secretary of state, transport and justice.


An hon. Member:: In that order?


Alphonse Fournier: For the first two, at least.


[Stage Direction]
At eleven o'clock the house adjourned, without question put, pursuant to standing order.
[The following items were passed in committee of supply]:

[Stage Direction]
General administration-
85.	Departmental administration, $1,392,488.
86.	Comptroller of the treasury-central office and branch offices administration, and to authorize payment to Norman Bell of compensation at a rate equivalent to £4-10-0 per week in respect of injuries received while employed in the overseas office of the comptroller of the treasury, $11,302,552.
Administration of various acts and costs of special functions-
87.	Superannuation and retirement acts, administration, $188,700.
88.	The Bank Act-salaries and expenses of the inspector general of banks' office, $28,400.
89.	Administration of the Farmers' Creditors Arrangement Act, 1943, and the Municipal Improvements Assistance Act, 1938, $34,202.
90.	Administration of the Farm Improvement Loans Act, 1944, and the Veterans' Business and. Professional Loans Act, 1946, $55,520.
[Stage Direction]
Supply
91.	Foreign Exchange Control Act, 1946-administrative costs (other than those provided by the Bank of Canada), $205,500.
92.	Expenses of the tariff board, $109,080.
93.	Expenses of the Royal Canadian Mint and the assay office, Vancouver, B.C., and to authorize commitments against future years in the amount of $200,000, $864,835.
The wartime prices and trade board-
94.	Administration, $1,907,142.
95.	Commodity Prices Stabilization Corporation'- adjustment payments in respect of subsidies previously paid, and costs of administration, $500,000.
96.	Administration of employees' instalment purchase plan including sale and delivery of Canada Savings Bonds to government employees, $79,125.
Special-
676.	To authorize and provide for an initial grant to the province of Manitoba to assist it in meeeting costs incurred as a result of the Red river floods in 1950. $12,500,000.
677.	To provide for costs to be incurred in the planning and construction of emergency works to safeguard against the dangers of floods in the Red river valley and the Winnipeg area generally, under an agreement or agreements with the province of Manitoba which shall provide that Canada shall meet 75 per cent of the costs of such works, excluding the costs of land, and that Manitoba, or its municipalities or residents, shall meet the remaining cost, including the cost of land, $1,000,000.
678.	To authorize and provide for a grant to assist the province of Quebec to meet costs incurred as a result of the large fire in Rimouski in May, 1950, $2,500,000.
679.	To authorize and provide for a grant to assist the province of Quebec to meet costs incurred as a result of the large fire in Cabano in May, 1950, $300,000.

[Stage Direction]
Forestry branch-
383.	Administrative division, $70,000.
384.	Forest research division, $819,675.
385.	Forestry operations division, $61,290.
386.	Forest products division, $644,450.
387.	Grant to Canadian Forestry Association, $4,000.
Eastern Rockies forest conservation board-
388.	To provide for the salaries and expenses of federal members of the board and their alternates, and sundry expenses in connection with the maintenance and operation of the Ottawa office of the board, $22,300.
389.	Federal contribution towards annual maintenance, including staff and expenses, $175,000.
390.	Forest insects control board, $13,780.
Special projects branch-
391.	Administrative division, $58,080.
392.	Projects division, $32,550.
B-National film board-
401.	Administration, production and distribution of films and other visual materials, including authority to finance temporarily work performed for other public authorities or other agencies as the public interest requires, $2,092,413.
402.	Acquisition of equipment, $118,604.
[Stage Direction]
Monday, June 26, 1950