1952-06-10

[Stage Direction]
Fifth report of standing committee on banking and commerce.-Mr. Cleaver.

['Mr. Speaker, I thank the Minister of Citizenship and Immigration (Mr. Harris) for making it clear that we are consenting to the introduction and first reading of this bill today without prejudice to our right in the house to take a position similar to the one that we took in the committee. I have in mind the particular stand I took this morning, which is totally different from that of the leader of the opposition (Mr. Drew). On those terms we are prepared to consent to the introduction and first reading of this bill at this time.\nMr. Harris (Grey-Bruce) thereupon moved for leave to introduce Bill No. 331, to amend the British North America Acts, 1867 to 1951, with respect to the readjustment of representation in the House of Commons.\nMotion agreed to and bill read the first time.']
Hon. Douglas Abbott (Minister of Finance):: Mr. Speaker, I move:
That votes 420, 421 and 557, of the main estimates for 1952-53, approved and reported upon this day by the standing committee on banking and commerce, be referred back to the committee of supply.


[Stage Direction]
Motion agreed to.

[Stage Direction]
Third report of standing committee on marine and fisheries.-Mr. Ashbourne.
Second report of special committee on redistribution.-Mr. Viau.

Hon. W. E. Harris (Minister of Citizenship and Immigration):: Mr. Speaker, if I may
refer for a moment to the report on redistribution which has just been presented by the hon. member for St. Boniface (Mr. Viau), we did not ask the Clerk to read the report because it contains the legal description of some 97 constituencies on which the committee has so far been able to agree. It also further recommended to the house a course of action with respect to the presentation of two bills, first a bill to amend the British North America Act to provide for the new rules as indicated in the motion setting up the committee; and second, a representation bill which would have in it the various schedules of constituencies as decided upon.
I am asking leave of the house now for permission to introduce a bill in the form recommended by the committee in its report. I should add that the purpose of this request is to enable us to have the bill printed tonight and available tomorrow, rather than have it printed tomorrow and available the following
day, so that members may see the procedure we have in mind and will have more time to consider the bill. I might add that the report this morning received the unanimous approval of the members of the committee, subject to certain reservations which they made as to the course they would adopt in the house when the bill was presented. I hope to have leave to introduce this bill now.


Mr. George A. Drew (Leader of the Opposition):: In consenting to the introduction of first reading of this bill without the customary notice, Mr. Speaker, it is to be understood that this is simply for the purpose of facilitating the redistribution procedure upon which the government has decided, and to which objection has been taken on behalf of the members of this party. Consent to the introduction of the bill at this time is without prejudice to the position that we have taken at various stages that the provinces should be consulted in regard to the details of redistribution.
I place that on record at this time so that there may be no interpretation that, in consenting to this as a matter of procedure, we consent to the general course that is being followed.


Mr. Sianley Knowles (Winnipeg Norlh Centre):: Mr. Speaker, I thank the Minister of Citizenship and Immigration (Mr. Harris) for making it clear that we are consenting to the introduction and first reading of this bill today without prejudice to our right in the house to take a position similar to the one that we took in the committee. I have in mind the particular stand I took this morning, which is totally different from that of the leader of the opposition (Mr. Drew). On those terms we are prepared to consent to the introduction and first reading of this bill at this time.
Mr. Harris (Grey-Bruce) thereupon moved for leave to introduce Bill No. 331, to amend the British North America Acts, 1867 to 1951, with respect to the readjustment of representation in the House of Commons.
Motion agreed to and bill read the first time.



REPORTS AND PAPERS


Right Hon. C. D. Howe (Minister of Trade and Commerce):: Mr. Speaker, I wish to lay

Inquiries of the Ministry on the table the annual report of Polymer Corporation Limited for the year ending March 31, 1952, and also the annual report of the Crown Assets Disposal Corporation for the year ending March 31, 1952. Copies of the Polymer report will be available at the distribution office after tomorrow, and copies of the crown assets report will be at the distribution office as soon as the report can be printed.



THE DUKE OF EDINBURGH


[Stage Direction]
On the orders of the day:
Mr. Jean Francois Pouliot (Temiscouaia):: Yesterday, Mr. Speaker, the guns roared on the occasion of the birthday of Her Majesty the Queen. They roared today, and I inquired from the Department of National Defence what the reason was and I should like the minister to tell the house.


Hon. Brooke Claxton (Minister of National Defence):: Mr. Speaker, in answer to the hon. member for Temiscouata I might say that this is an occasion which has not occurred for a good many years. The guns roared in celebration of the birthday of the consort of the reigning sovereign, as the regulations call for a twenty-one gun salute on that occasion. I am asked to add that the Prime Minister sent a message of congratulations to the Duke of Edinburgh.



POTATOES


[Stage Direction]
On the orders of the day:
Mr. Robert McCubbin (Parliamentary Assistant to the Minister of Agriculture):: Yesterday, Mr. Speaker, the hon. member for Cape Breton South (Mr. Gillis) asked a question about potato prices, and why they were so high. I shall endeavour to give an answer. On May 31 of this year the storage holdings of potatoes totalled only 723,000 bushels, whereas a year ago they totalled 3,489,000 bushels. The surplus this year is very small as compared to last year. A short time ago the United States removed the price ceiling from potatoes, so the small surplus we had went to the United States and paid the 37-J cents per hundred pounds tariff.
It will not be long before new potatoes are available; in fact they are available now in the United States.



LIVESTOCK


[Stage Direction]
On the orders of the day:
Robert McCubbin: Yesterday a question was asked by the member for Vancouver-Quadra (Mr. Green) as to why no support price was being applied to cattle originating and sold in British Columbia. The Prime Minister said that an answer would be available today.
I wish to assure the hon. member that there is a support price for British Columbia, but as British Columbia is a deficiency province and only produces a small percentage of what they consume it has not been necessary for the board to step in and buy meat in that province to send overseas. If the hon. member can tell me that a surplus of cattle is being offered in the market, and the producers are not receiving the support price, I will immediately investigate any case he brings to my attention and see that the producers receive the support price.



IMMIGRATION ACT


Walter Edward Harris: the second reading of Bill No. 305, an act respecting immigration.


George Alexander Drew: Is the minister going to make a statement?


Walter Edward Harris: Mr. Speaker, this bill is the first revision since 1910 of the Immigration Act. It retains the principles of the present act and modernizes those principles. If passed, it would enable this department to function more efficiently and effectively in the light of present-day conditions. I shall speak only of the new proposals, although there are additions and extensions to many of the present sections.
The bill provides for the definition of those persons who are by law entitled to enter Canada, that is those who are Canadian citizens and in most cases those who have Canadian domicile. It deals with those who are not entitled to enter but are in what is known as prohibited classes. This follows the pattern of the present act which defines those admissible as of right and those prohibited, and vests in the governor in council authority to make regulations for the admission of others.
In the section dealing with prohibited classes there is a comprehensive definition of

those engaged in subversive activities. These persons are not admissible, nor is a person, unless the minister authorizes it, who has Canadian domicile and who engages in activities prejudicial to any action taken by Canada under the United Nations charter, North Atlantic Treaty Organization or other similar instruments for collective defence. Dealing still with prohibited classes, there is a modification of the rules now having to do with persons who have committed a crime involving moral turpitude. I indicated during previous discussions that we were considering a relaxation of this rule so that the minister might have authority to admit someone who had made a mistake, had paid the penalty and had rehabilitated himself and who had an otherwise good record. The house knows of instances where the application of the present rule has resulted in the separation of families with results not entirely desirable. We believe that absolute prohibition against admissibility under those circumstances should be modified.
Our suggestion is that we might admit a person who has had a clear record for five years if the conviction occurs after 21, or two years if before 21, if he has rehabilitated himself. We have also provided for the kind of case mentioned by the hon. member for York West (Mr. Adamson) in the preliminary stage of this bill, namely the person who, arriving in apparent good health, becomes ill of a disease which would bar him if he were seeking admission. Deportation will not now be mandatory in these cases.
There is a provision repealing a section of the Opium and Narcotic Drug Act. That section provides for the deportation of addicts or other persons engaged in the unlawful use or sale of drugs. In a somewhat different form it will now appear in the Immigration Act.
During the discussion last year on the loss of citizenship the question arose about the loss of domicile. I think hon. members know that domicile confers some rights for admission into Canada. We have provided that a Canadian citizen by naturalization shall lose his Canadian domicile if he ceases to be a Canadian citizen by reason of voluntarily acquiring the nationality or citizenship of another country or if he, having dual citizenship, serves with the armed forces of another country against Canada, or if he in war has committed certain other acts in communication with the enemy or by reason of having shown himself disaffected or disloyal to Her Majesty, or by having resided for more than two years in the country of
Immigration Act
which he was a citizen or a national prior to his becoming a Canadian citizen.
There is a group of people who have been in Canada without status for some time. As the house knows, under the present act the minister has authority to admit anyone by permit for a period of a year and these permits are renewable yearly. This authority has been used sparingly by successive ministers and the non-immigrant never does attain the status of a landed immigrant. It is proposed that the minister may have the authority to grant permanent landing to any person in this group who has been here for ten years or more, if the landing would not be dangerous to the public health, or contrary to the public interest. These are persons, as a rule, who have been admitted despite mental or physical infirmities as members of a family and are being looked after by the family concerned.
Recently a question was asked in the bouse with respect to a gentleman who had been in jail for some time pending deportation. At the time I was asked if there had been any incompetence on the part of this department, and I answered no, which was the proper answer because all the steps which were taken in that case to effect deportation were taken in accordance with the act. Nevertheless I am free to confess that the situation was not very satisfactory and in the bill, which was under preparation prior to that particular incident, we have made provision for one method of eliminating the delays which sometimes occur in effecting deportation. These delays occur in a number of ways, both at the ports of entry and within Canada, and it is our desire to make it possible to effect deportation at the earliest possible moment, especially at the request of the person concerned.
The present procedure is that the person concerned must be examined by a board of inquiry consisting of three officers, and there is an appeal to the minister. We recognize that this is an opportunity for the minister to exercise his judgment in the light of what he thought parliament would expect him to do; and I am satisfied that all my predecessors have exercised that authority in that manner. But there is no doubt that this procedure has caused delays, and delays which have in some cases been costly to the person concerned. We are, therefore, proposing that the board of inquiry shall now consist of one person, because in this way we can in some cases convene a board of inquiry sooner, and that the appeal be taken to an immigration appeal board which will


Mr. Donald M. Fleming (Eglinlon):: Mr. Speaker, it is obvious that two factors have an important bearing upon the nature of the debate which might be held at this particular time. The one relates to the procedure proposed, namely that following second reading this bill be referred to a select committee of the house for further study. The other relates to the scope to be allowed with reference to discussion of questions of policy in regard to immigration.
When the resolution preceding this measure was before the house last week the minister urged that the house defer discussion on immigration policy until his estimates were before the house in committee of supply, and that the house should confine itself, both at the resolution stage and on the present bill to discussion in general as to the desirability of consolidating the Immigration Act and other matters pertaining to the structure of our machinery in the department and in connection with immigration generally.
The house did comply with the request of the minister at the resolution stage, Mr. Speaker, and I gather that the minister is making the same request today, and he has so indicated. I, for my part, am prepared to comply with that request and to defer observations in regard to immigration policy until the minister's estimates are before the house. In saying that I think I might fairly reiterate what I tried to say on the resolution stage, namely, that this subject of immigration is of such great importance that before the house prorogues at the conclusion of this session there should be opportunity for a thorough discussion in the house with regard to immigration policy. With the assurance that that opportunity will be provided when the minister's estimates are before the house, I propose to confine myself to the bill without trespassing on the field of policy, and in doing so, Mr. Speaker, I shall be brief.
The reason one can be brief on a matter of this kind is that there can be little question that it is desirable that the Immigration Act should be consolidated and reviewed.; and since a committee is to be appointed, for that purpose I am sure there will be ample opportunity for the committee to conduct a searching review of the bill.
I think it should be clearly understood, Mr. Speaker, just what the house is doing in giving second reading to the bill. Having regard to the fact that the bill is to go to a special committee, and that the principal work of the house in reference to this bill will be done in that committee, there should be a clear understanding in the house now as to the effect of giving second reading to the
Immigration Act
bill, if the house does give that second1 reading and thereby approves the principle of the bill. I ask, Mr. Speaker, that it be clearly understood1 that in so doing we are giving approval to the principle that there should be a consolidation of the Immigration Act, and that in the committee there will' be the most complete freedom of expression of view on any section of this bill, without being trammelled by the adoption of the bill by the house and its approval on second reading. I think the minister can give us that assurance; it will help to curtail discussion now.


Walter Edward Harris: I do that.


Donald Methuen Fleming: Thank you. On that basis I submit that the principle of this bill should be endorsed by the house.
As the minister has indicated, there has been no effective revision of the Immigration Act for forty-two years, and any department of government and any statute of parliament which have been in effect that length of time and have been submitted to the stresses that the Immigration Act and the department have been- under in recent years are due for review by the house. I am sure that the house will welcome the opportunity of reviewing the Immigration Act.
The minister did indicate at an earlier stage of the session that he hoped it might be possible to bring this bill before the house at the present session. He was not sure at that time whether it would be possible to bring it before the house in time to be fully disposed of at this session. I should like to say to the minister that I am very glad he has brought the bill along. It is true that we are at a late stage of the session, if one can judge by the condition of the order paper, but there will be, I have no doubt, every indication of co-operation throughout the house in giving this measure immediate and searching study.
I do not propose to make extended comment on any of the features of the bill to which the minister has made reference in his brief statement this afternoon. The importance of adequate definition of domicile I am sure requires no elaboration, and whatever is done by way of amendment to the present act must subtract nothing, sir, from the importance of Canadian citizenship. We must see that the possession of Canadian citizenship is recognized as a very great privilege, and we must seek to attach to the acquisition of Canadian citizenship all that sense of privilege that goes with, and ought to go with, the possession of citizenship in the great country of which we are ourselves proud to be citizens.

Immigration Act
The proposal lor expediting the handling of appeals through boards of inquiry and immigration appeal boards will naturally be considered sympathetically. Anything that will contribute to expeditious handling of these appeals is naturally desirable, provided that nothing is done to subtract anything from the rights of those concerned. We shall have inquiry to make concerning the relationship of those boards of inquiry and appeal boards to the right of access to the courts in proper cases where that access exists today.
The minister opened his comments on the bill by reference to the changes that are being made in the case of persons who, having been convicted of crimes involving moral turpitude, have nevertheless established themselves in society or, as the bill puts it, are rehabilitated. Sir, I think that will be a useful change in the act. The terms of the present Immigration Act in that respect are harsh in their rigidity. I do not doubt that many hon. members have had cases brought to their attention where persons, who have been guilty in earlier years of crimes involving moral turpitude, but have fully re-established themselves in society, have nevertheless found themselves under the rigid ban of the present act. This bill does give such a person, after paying his debt to society, and after having rehabilitated himself into society for a period of years, an opportunity of proving that he is a fit person to be admitted. And with all proper safeguards, Mr. Speaker, it seems to me that that is a change in the law which is worthy of support and is desirable.
There are provisions in this bill, sir, which have reference to persons engaged in subversive enterprises, persons who show by their activities that they do not value the opportunities that they have in a country like ours of enjoying freedom, ordered freedom, under parliamentary institutions. And looking at what is happening in the world today, I do not think that there need be very much sympathy wasted by this house on persons who come within the scope of definitions of the type of persons I have just now referred to in the new bill.
I do not intend now to make any further or more extended comments on the terms of the bill. I am sure the house will welcome the opportunity of reviewing this legislation, and of giving it in committee the careful scrutiny it demands.


Mr. Alistair Stewart (Winnipeg North):: Mr. Speaker, I should like to think that the introduction of this bill might be a precursor to an immigration policy in Canada. Whether or not that is so, of course we shall find out in committee. It appears to me that we have

never had a coherent plan of immigration in Canada. Our approach has been essentially pragmatic. In times of depression we keep people out, and when things are booming in a time of prosperity we bring them in. During the thirties we almost insisted that the only ones who could come here would be farm workers, and there was a tendency to exclude skilled artisans and those belonging to professional groups. I think that is unfortunate for people of all classes in this country.
In the days after the war there seems to have been a hangover of that policy. There may have been a change in the department by this time, but I can remember when doctors of medicine were working in lumber camps and doctors of philosophy were working on farms. As a matter of policy we should go after a more diversified group of immigrants for this country.
Of course there have been reasons for this. Immigration today is not altogether a spontaneous matter, as it was in the early part of this century, when people just pulled up their roots and came over to this country. Today there are political and, at times, economic bars to their coming. The political reason, of course, is that those nations who have immigrants wishing to come to this country do not like to see their young people leaving them and going to another country. They do not want to see those who are the most adventurous and aggressive coming over here. They do not want to lose those of military age who would be able to defend their own country. That, of course, is a problem.
Then, there is the economic problem, when so many people cannot come to Canada and bring capital with them. But I am wondering if there is not a solution to that problem. Would it not be possible, as a matter of deliberate policy, to try to enter into some agreement among the northern members of the North Atlantic Treaty Organization whereby we could have among those countries an agreement respecting immigration? Under such circumstances those countries conceivably would find that immigration would be beneficial to them, and there would be no net loss to the Atlantic community as a whole; rather there would probably be a strengthening of it.
This would imply a certain amount of planning; but that is not beyond our ability. It would imply a closer degree of integration among those nations which I, for one, would welcome. Were we to indulge in immigration on a planned basis it might be possible to think of an increase in the population in Canada for a number of years ahead at a. rate of two per cent increase per annum.

One per cent of these would be from natural births-and, as has been said so often, the babies born in Canada are our best immigrants. The other one per cent would come from overseas immigration. I do not believe that that one per cent would involve such a great number that it could not be integrated pretty closely into our own economy. But it is imperative that an agreement of some sort be reached, especially with those nations with which we are now on such close terms.
I should not want it to be inferred from what I say that I am suggesting our immigration policy should be totally and completely exclusive. I would resent any such policy as that, and consider it a wrong one. Yet there would seem to be words in the bill before us which suggest to me that the concept of exclusion still lingers in the minds of those in charge of the department.
One thinks, for instance, of the fact that British subjects from the British West Indies have found difficulty in gaining entrance to Canada, because it was believed that they would find it difficult to adjust themselves to the climatic conditions of this country. That, as a matter of fact, has not been the experience at all. However, it is a subject which can be considered in committee, and when we are considering the estimates of the department.
I should like also to mention that while under the bill we are prepared to ban individuals for good reasons, it would seem that we are equally prepared to ban people on racial grounds. Indeed, the word "race" is actually used in the measure. Experience has shown that it is a word which has very little scientific validity. The other day I had a meeting with some representatives of the Armenians in this country. Apparently Armenians are considered by the department as people of Asian extraction. Naturally the Armenians say that they are nothing of the sort, that in fact they are Caucasians.
But what is the meaning of "race" as it is used in the bill? Can one talk, for instance, of the Scots race or the Irish race or the English race, or of any such absurdity as that? After all, the people of the United Kingdom and of northern Europe at some far distant time came from the Middle East. Unfortunately a reference to race is used all too often in the Hitlerian sense; and as it is used in the bill I hope it is used in the sense that there is a Caucasian, a Mongol or a Negroid race. I doubt if that is so.
During the thirties it was used in an even unhappier sense, when there was a deliberate exclusion against certain groups such as Ukrainians, Jewish, and Polish immigrants.
Immigration Act
We regarded them as second-class citizens. Fortunately that is not so today, and we are glad of it.
I agree that it is right and proper for Canada to decide who should come to this country; but we have used these racial concepts viciously in the past. The immigrants who have come to this country despite such barriers have turned out to be among our best citizens.
Another matter which will come up before the committee is as to how screening is carried on. I am tempted to think that in the past it has been inadequate, for we have had persons come to Canada who have had no past at all, in the sense that they came here with purely fictitious names, and yet apparently they had been screened. However, matters of that kind can be discussed before the committee. That is one reason why I welcome Bill 305 at this time.


Mr. Victor Quelch (Acadia):: Mr. Speaker, as I believe it would be out of order to discuss the general immigration policy at this time, and as the minister has given us the assurance that the bill is to be referred to a special committee, we in this group are prepared to support second reading, without further discussion.
Motion agreed to and bill read the second time.



MOTION FOR SPECIAL COMMITTEE ON IMMIGRATION

Walter Edward Harris: Mr. Speaker, by leave I move:
That a special committee be appointed to consider the bill with respect to immigration; with power to send for persons, papers and records, to print its proceedings and to report from time to time to the house; and that the provisions of section 1 of standing order 65 be waived with respect to this committee; and that the committee shall consist of certain members to be appointed hereafter.


[Stage Direction]
Motion agreed to.
Walter Edward Harris: I move that Bill No. 305 be referred to the special committee.


[Stage Direction]
Motion agreed to.


[Stage Direction]
The house resumed, from Wednesday, June 4, consideration of the motion of Mr. Gregg that the house go into committee to consider the following resolution:
That it is expedient to introduce a measure to amend the Unemployment Insurance Act, 1940, to increase certain rates of benefit under the act; to
[Stage Direction]
Unemployment Insurance Act
reduce the number of waiting days before the receipt of benefit; to extend the period of entitlement for supplementary benefits; and to make provision for certain administrative changes.
Mr. George H. Hees (Broadview):: Mr. Speaker, I should like to deal now with some aspects of the unemployment insurance operations in this country which I think could be improved upon. To illustrate my point I should like to cite an experience one of my constituents had in dealing with the unemployment insurance commission. This man was laid off from his job last November, and applied for unemployment insurance, to which he had been contributing ever since the scheme started eleven years ago. He drew benefits for thirteen days, but when his eyesight became so bad that he had to enter hospital for an operation, his benefits were cut off.
I was advised of this, and I wrote to the unemployment insurance commission asking why these benefits had been cut off. In reply I received a letter under date of February 20, 1952, from Mr. B. G. Sullivan, Ontario regional director of the unemployment insurance commission, reading as follows:
Further to mine of February 13, I have now had this request looked into and have had an officer call on Mr. and Mrs. Monk. According to our records Mr. Monk filed claim for benefits on December 10, 1951, at which time he established a credit of 303 days at $3.05 per day. Thirteen days' benefit were drawn, up to and including January 3, 1952. However, on January 5, he was taken ill, and was in hospital until January 21, when he was discharged as being permanently blind.
I am sure you understand that one of the five statutory conditions governing the payment of benefits under our act is that the claimant must be capable of, available for, and unable to find suitable employment. Obviously Mr. Monk would not meet this requirement while in hospital, and his condition on discharge being as described, he could no longer be considered capable of employment. Regardless of the distress, and I assure you it does cause us distress for our insurance officers to have to make some decisions, the matter is entirely beyond our control.
I thought you might be interested to know that our officer who called on Mr. and Mrs. Monk prefaces his report with the following;
"I found Mr. and Mrs. Monk to be a fine old couple whose recent path in life has been anything but a bed of roses."
Our officer assures me that both of these good people now fully understand our inability to pay them benefits under our act.
I believe that this letter indicates a shocking bureaucratic tendency to treat people merely as cases in a file, rather than as human beings. It seems to me that the employees of the unemployment insurance commission are interested only in getting a file off their desk, rather than in seeking a humanitarian and constructive solution to each case.
This letter shows that it never occurred to the employees of the unemployment insurance commission to contact the Canadian

National Institute for the Blind to see if it would be possible for Mr. Monk to become once again usefully employed. To them he was blind; he could no longer be employed; and so they could file his case and forget about it.
Most people know, and certainly those connected with employment services should know, of the tremendous strides which have been made in recent years in rehabilitating the physically handicapped. Those who are blind, deaf, dumb, or who have lost the use of one or more of their limbs, have been fitted into jobs which they can handle, often better than those who have full possession of their faculties. The record of progress and achievement in this field during the past few years is a very remarkable one indeed. Therefore, one would think that the first thing the employees of the unemployment insurance commission would do would be to contact the Canadian National Institute for the Blind to see if Mr. Monk could be found suitable and useful employment.
Upon receipt of Mr. Sullivan's letter, I requested that the Canadian National Institute for the Blind should be contacted to see what could be done in Mr. Monk's case. The Canadian National Institute for the Blind got in touch immediately with Mr. Monk's employer, and they found that he was a valued machine operator, whom they would be glad to have back if satisfactory guards could be designed for his machines. These were provided, and Mr. Monk is once again usefully and happily employed.
However, the important thing is that none of this rehabilitation would have taken place if reconsideration had not been requested of the unemployment insurance commission. They simply washed their hands of Mr. Monk as soon as they learned he had lost his sight.
If a man or woman develops a disability, I believe that the first thing to do is to try to cure the disability. If that cannot be done, then the person should be taught a trade. This will require a well planned and well executed government rehabilitation program, both physical and occupational.
An example of physical rehabilitation is the case of a man who is suited only to heavy manual work, and who has developed a bad hernia. If the hernia is not cured, the man will not be able to earn his living at the only kind of work he is capable of doing. However, if it is made possible for him to have an operation, his hernia can be cured, and he will be able to earn his living at the trade which he is capable of handling.

An example of occupational rehabilitation is the man who loses his sight, and is thereby unable to earn his living at his regular trade. In many cases, as in the case of Mr. Monk, this man can be taught how to handle his old job by using special guards or aids designed by the Canadian National Institute for the Blind. If the nature of his old job is such that it is impossible for him to continue at it, then the likelihood is that he can be taught a new trade.
These are merely two examples of what can be done to enable those who have become incapacitated, either by accident or by disease, to continue to earn their own living. No worth-while person wants charity or to remain in idleness. They want to continue to earn their living and retain their independence. A well-planned and well-executed rehabilitation program, carried out in co-operation with the provinces, would, in the majority of cases, make this a reality.
At the end of the last war a great number of disabled veterans were taught new trades or were shown how to continue their old trades despite their disabilities. If the same program were carried out in industry, far more disabled persons would be able to earn their own living today.
I	believe it is the responsibility of this government, in co-operation with the provinces, to institute such a rehabilitation program. Such a program will ensure that those who are disabled will be given every opportunity to cure their disabilities or, failing that, to learn a trade by which they can earn their living.
Now let us turn to the case of the man or woman who, because of disability, finds it impossible to continue in useful and satisfactory employment. In the case of Mr. Monk, the commission cut off his benefits as soon as they learned that he was blind, even though he still had nearly $900 unemployment insurance standing to his credit. This $900 credit was his by right, because it had been built up solely by contributions made by Mr. Monk and his employer for the sole purpose of maintaining him if he should become unemployed.
There is no time when a man or woman needs the unemployment insurance credit they have built up quite so much as when a physical disability prevents them from working. Not only do they have to maintain themselves, but they have doctor and hospital bills to pay as well. The important thing to remember is that whatever credit a man or woman has built up is his or hers by right. It exists only because the man or woman and the employer have contributed 55704-194J
Unemployment Insurance Act toward it for the specific purpose of its being available if the employee, for some reason or other, is unable to continue to work.
Therefore, I believe that the Unemployment Insurance Act should be amended to allow for payment of benefits if the commission's doctors certify that the disability prohibits the man or woman from continuing to work. I urge the minister to give this matter serious consideration and to bring in an amendment to the act at the earliest possible opportunity. I also urge the government to give consideration to paying a disability pension, equal to the old age pension, and to be paid irrespective of age-


Mr. Speaker:: Order. I think the hon. member is now going beyond the provisions of the resolution. In fact during his remarks I think he has at times gone quite beyond the provisions of the resolution. I allowed him to continue because there is a clause in the resolution with respect to certain administrative changes, but I doubt if what he is saying now refers to administrative changes.


George Harris Hees: Mr. Speaker, I only have half a sentence to finish. May I finish the sentence? -to all persons whose disability makes it impossible for them to continue to earn their own living.


Mr. Sinnoil:: That is a good written speech.


Mr. C. E. Johnston (Bow River):: Mr. Speaker, I think the Department of Labour should be congratulated on introducing legislation concerning the Unemployment Insurance Act. When the minister was speaking the other day I noticed that, as was pointed out by the hon. member for Winnipeg North Centre (Mr. Knowles), he indicated what was to be in the bill. That is the first time that has happened, and it is of assistance to all members in discussing the resolution. I am going to read the resolution because I want to refer to the four separate points outlined in it. When the minister was speaking the other day he put the resolution on the record. It reads as follows:
That it is expedient to introduce a measure to amend the Unemployment Insurance Act, 1940 to increase certain rates of benefit under the act; to reduce the number of waiting days before the receipt of benefit; to extend the period for entitlement for supplementary benefits; and to make provision for certain administrative changes.
The problem of unemployment is a very great one. It is a most important question to the people concerned. The total of registered employable unemployed amounts to 385,100, pretty close to half a million people. When you consider that there are many others unemployed in Canada who are not registered with the unemployment insurance [DOT]commission then you can see that the figure

Unemployment Insurance Act of half a million people is very close to being correct. The resolution indicates that there is going to be an increase in the rate of benefit from $21 to $24. That is only an increase of $3; nevertheless it is welcome. Whether it will be sufficiently large to meet the increased cost of living is another question. When one stops to consider that the fund has now reached the very large amount of $782,231,826.91, it does seem that possibly the minister might have gone a little farther so far as increasing the rate of benefit is concerned without affecting the solvency of the fund.
Last year the increase in the fund was over $109,470,000. It will be remembered about a year and a half ago the contribution rates to the fund for employers and employees were increased. With the workers now required to pay a greater amount, and with the fund increasing and in good condition, it would seem that we might have gone a little farther this time when we are making changes and might have given the worker a little more by way of increased benefits without endangering the solvency of the fund. I quite understand that if we were to go into a period of depression such as we had in the 1930's this amount of money, although large, would not go very far toward taking care of the tremendous unemployment problem that might develop. However, the fund was never intended for that purpose, and I do not think it is the intention now that it should be used to carry us over a long period of depression. It could not do that in any event. It was only intended to take care of-I was about to say "an emergency condition" but that is hardly the term a period of six months or a year. If we were to go into a period of depression other legislation would be required to solve the problem.
Most of the labour organizations requested a greater increase than is suggested. However, as I said, the increase is welcome. I am sure that labour organizations throughout the country, and particularly the men concerned, will welcome even the small increase of $3 a week. There is one other matter for which I think the minister should be commended, the lessening of the number of days of waiting. The statutory period was eight days. It seemed to me that was a rather long time to have to wait. As was pointed out by the minister, the required period of waiting is now to be only five days. In actual fact that is six days because there is one day that is non-compensable. I think that the waiting period could very easily be reduced to two days without endangering the operations of the fund. In actual fact it would be three days because


there would still be one day which would be non-compensable. The period for supplementary benefits has been extended to 15 days, and that will be a welcome change.
There is one other point that I want to mention, Mr. Speaker, and it concerns married women. Under the statute 90 days is required before they can receive re-establishment benefits. I know of the difficulties that are attendant upon a problem of this kind. We have discussed them in committee and on other occasions. Problems are presented that are sometimes difficult to iron out. In many cases the privileges which are extended under the act are abused. On the whole, however, I believe the percentage would be rather small. I would suggest to the minister that 90 days seems to be a rather long period and that, without interfering with the functions of the act, that period could be reduced to 60 days at least.
I should like to mention another subject which comes under the act, and that is the unemployment insurance assistance which is given to people who are unemployed, but is suddenly cut oft if they become sick. This act serves a useful purpose in the city of Drumheller, because the people in that locality do become temporarily unemployed and must seek assistance from this fund. But it does seem to me to be an odd situation that a man who becomes ill when he is in receipt of unemployment insurance should suddenly have those benefits cut off. I know the underlying principle well, that being that the man should be in a position to accept employment when it is offered. I would venture to say that in almost 95 per cent of these cases when the man who is receiving unemployment insurance suddenly becomes sick, there is no work immediately available. I feel that there should be some elasticity in the regulations. Some consideration should be given to those individuals, and they should be allowed to receive unemployment insurance assistance even though they are sick.
It is extremely difficult for a workingman to carry on when he is sick. When his unemployment insurance assistance is cut off, he is in a much more difficult position than he was the day before when he was able to go to the unemployment insurance office to see whether or not there was work available. I cannot understand why we should create unnecessary hardship for individuals, particularly on that occasion when they need assistance. I do not know just what complications might arise if we were to endeavour to amend the act in order to overcome this problem, but when some obvious hardship presents itself I am sure the minister could find some way of amending the act to give the necessary assistance.

If my memory serves me correctly, Mr. Speaker, there are only about 5 per cent of the total people employed in Canada who come under the unemployment insurance fund. The minister will correct me if I am wrong, but I think that is about the figure. Those who are casually employed, such as agricultural workers, do not come under this fund. Now, that is particularly noticeable in western Canada where agricultural work is, on the whole, seasonable employment. During the harvesting the men are only employed for two or three weeks. There was a time when harvesting would employ the men for two or three months, but that time has long passed, owing to the development of modern machinery. This represents a large proportion of our population that is not covered by this act. There are other people who are only employed for short periods of time who are not covered by this act.


Mr. Gregg:: Might I interject a correction?
I am sure the hon. member would not want the statement he made a moment ago to go uncorrected. I presume he will admit that it was the paid workers he was thinking about when he suggested that percentage, and I think he would like to have the correct figure. Of the paid workers of Canada 2,915,000 do come under the insurance act, and only
934,000	do not. Then, of course, there is the great field of farmers and self-employed in addition.


Charles Edward Johnston: When I was speaking I mentioned that the figure was subject to correction, so I am glad the minister has put the correct figure on the record. I wonder if the figure which the minister gave a moment ago includes those who are employed for only a short period of time, such as the agricultural workers, who do not come under the act?


Milton Fowler Gregg: No, that does not include agricultural workers.


Charles Edward Johnston: That would make a difference, and when you consider all those people it may be that the figure which I quoted would not be so far out. That is what I had in mind when I made that statement. It does seem that if we are going to have an unemployment insurance fund to assist people when they are unemployed, then we should endeavour to have a greater coverage. I believe it would be a help to those people who are in need on certain occasions.
There is a great deal more that could be said in this respect, Mr. Speaker, but I do not want to delay the introduction of the bill itself. While the minister has been good enough on this occasion to indicate some of the changes that are going to take place when
Unemployment Insurance Act the bill is introduced, I believe we can discuss the sections more intelligently when we see the bill itself.


Mr. J. W. Noseworthy (York South):: have a few comments to make on this legislation, Mr. Speaker, and I think I might as well make them at this stage as wait for the introduction of the bill. In so far as the bill will increase the amount of benefits payable, in so far as it shortens the waiting period from eight days to five and lengthens the period in which supplementary benefits may be payable, the bill will be welcomed by those who are interested in or affected by our unemployment legislation. Labour throughout the country has for some time been asking for amendments to this act. They are not going to be content with the improvements that are being made. I suppose it is possible that the minister may take the position that labour is never satisfied with the improvements he makes to such an act as this in any case. But labour is not convinced that the amount in the fund does not warrant benefits of more than $24 a week. The fact that the fund has grown to nearly $800 million indicates to workers that the government is apparently more concerned in building a fund and in having available a few hundred million dollars than it is in using those dollars for the benefit of those who are concerned with the payment of them. The primary purpose of the unemployment insurance fund is to provide assistance to men and women when they are unemployed. The question now is whether the department is using that fund, and the millions available in that fund, to the limit in rendering that assistance.
As to the waiting period, labour groups ask that it should be eliminated altogether. The fact that the bill states that the waiting period is to be reduced to five days does not, in many instances, mean much. In the days when the waiting period was supposed to be eight days, many an unemployed person had to wait two and three weeks and sometimes longer, before he could get his claim adjusted. If the five days were the maximum number that any unemployed person had to wait to get his claim adjusted, there would not be so much criticism. But whether it is because of inefficiency within the administration of the act, or whether it is because too few are employed in the administration of the act, or whether it is because, when there was a great deal of unemployment during the past winter months, sufficient help was not provided to take care of the work, or whether it is because of cramped quarters and lack of accommodation, unfortunately the fact is that in many instances workers have had

Unemployment Insurance Act to wait and have had to suffer serious inconvenience by having to wait more than the allotted eight days, as the waiting period was formerly; it is now to be five days.
Some months ago when I was speaking on this matter, I suggested that if the government insists on a waiting period, and so long as these waiting periods are quite extensive, as they sometimes are, the government should make some arrangements between the administration of the Unemployment Insurance Act and the welfare department of the municipality in which the office is situated, whereby a man can get from the welfare department an advance against his unemployment insurance. I pointed out that that procedure is adopted in connection with workmen's compensation, that it works quite satisfactorily and that in many cases, where there is a serious delay, workers are able to get relief immediately from their welfare officer, and the welfare officer is repaid later when the unemployment insurance becomes due. Some drastic changes are needed to avoid the unnecessary suffering that has been caused in the past to workers who have had to wait for unemployment insurance adjustments much longer than the legal waiting time.
Then as to the Toronto district, there is this question of providing accommodation. I have pointed out before that in the Toronto district we need an unemployment insurance office somewhere in the vicinity of Eglinton avenue and Dufferin street or even a little bit farther north. To hundreds of unemployed the department is causing unnecessary expense and trouble by forcing them to go down to the central unemployment insurance offices. I am sure the minister's own officers who are employed at Spadina avenue and out at the junction can assure him that this administration of the act in the Toronto district could be improved considerably if more spacious accommodation were provided farther north. I think people are now obliged to come all the way from Richmond Hill down to Spadina avenue in order to collect their unemployment insurance.
I have called attention before to the fact that there seems to be altogether too much bookkeeping involved in this matter of unemployment insurance. One experienced unemployment insurance official remarked to me that there is just about as much bookkeeping involved in connection with unemployment insurance as there is in running the whole Canadian National Railways. It would seem to me that the department should concern itself with finding some simpler way of handling this problem. I think it may be possible to consider the whole basis upon which payment is made. Here the officials of the

department have to keep an employment record of the worker, and they have to go back through the years to find out how many days of unemployment insurance benefit he is entitled to when he reports for unemployment insurance. The number of days, of course, is determined by the amount that he has built up in the fund.
It would seem to me that it would be a much more satisfactory service to the unemployed if that fund were to be used as a co-operative enterprise or a co-operative fund to provide the unemployed with unemployment insurance for whatever period the department determined was a reasonable one or for whatever period it thought the fund could stand. As the situation now is, a man can get unemployment insurance only on the basis of the number of days or years during which he has contributed to the fund; but that provision is hedged about by a number of regulations which deprive many a man of benefit to the full extent of his contributions to that fund. If, for instance, during the period while he is contributing he becomes an employer and ceases to make contributions for a number of years, he may find himself in a position where, having contributed to unemployment insurance for years, he becomes an employee again, becomes unemployed but because he has not built up a sufficient fund within a given period of time, he does not get any unemployment insurance. I have had a number of instances of people who, in my opinion, should have been provided with unemployment insurance; they were men who had made the necessary contributions but because of some rigid regulation which required that there had to be a certain number of contributions within a given period of time, these people had to forgo all that they had placed in the fund at an earlier period, and they received no unemployment insurance at all.
It would seem to me that if there is available an unemployment insurance fund, and if a man becomes unemployed, he should receive payments from that fund at whatever rate is fixed by the government and for whatever length of period the government decided that payments should be made. It should not be related to the number of contributions that he has made. A younger man, for instance, gets a job. For many years he has not had an opportunity of contributing to unemployment insurance. He gets married and begins to raise a family. He suddenly finds himself out of a job, and it is too bad if he has to depend upon the government employment service to get him a job. He remains unemployed. He has not been contributing through any fault of his, and yet he finds that he is not entitled to unemployment insurance. It seems to me that if ?

man is unemployed the fund should be available to take care of him either for whatever period is decided upon by the government or until he himself, with or without the assistance of the government officers, can find a job.
They tell me that in the state of Michigan they have adopted the payment of unemployment insurance on some such basis as that. A man becomes unemployed, and if he can satisfy the authorities that he is genuinely unemployed he is entitled to unemployment insurance for whatever length of time the regulations permit the department to pay unemployment insurance, and there is no relation between the insurance he gets and the amount of contributions he has made. There is no necessity for the government to keep records of the man's employment over the years and the amount he has paid into the fund.
It would seem to me that by adopting something of that nature you should be able to get away from all this bookkeeping which requires a small army of bookkeepers to take care of the unemployment insurance fund. These are just a few of the things that I have learned from close association with the unemployed and with the unemployment insurance officers and from long conversations with the men who are close to this problem and who have to deal with it day by day.
I have one other suggestion. I think the government would be well advised to take some measures to step up the efficiency of the unemployment end of these offices. These offices today are degenerating into offices that hand out unemployment insurance and that administer unemployment insurance and do very little more. It may be because of the conditions; it may be because during the last winter it was difficult to get jobs; but the people who become unemployed find themselves with very little confidence in the ability of those government offices to assist them to get back into employment. Probably something could be done to improve that side of the department's work, namely, the finding of employment, as well as the administering of the unemployment insurance fund.
(Translation):


Mr. Maurice Breton (Jolielle-L'Assomp-tion-Montcalm):: Mr. Speaker, I wish to congratulate the Minister of Labour (Mr. Gregg) for having introduced amendments to the Unemployment Insurance Act designed particularly to increase the benefits for the unemployed and reduce the number of waiting days. I would like to say a few words only, in order to bring the government to
Unemployment Insurance Act see to it that the regulations the unemployment insurance commission may lay down in connection with the administration of the act be such that the unemployed will not be compelled, in practice, to wait more than the nine days mentioned in the act. In fact it often happens, although the regulations provide for a period of nine days. Sometimes people are unfortunately compelled to wait more than two or three weeks before receiving their benefits.
The point I wish particularly to stress, however, has to do with the court of referees. As a matter of fact, section 52 of the Unemployment Insurance Act provides that the commission may establish a court of referees in each district. Section 53 is more specific; the commission may establish courts of referees wherever it deems necessary to do so. The discretion thus left to the unemployment insurance officials results in a tendency to centralize the appeals to the unemployment insurance commission more and more in the larger centres-in Montreal and Quebec, for instance-in our province, and I suppose that it is the same in the other provinces.
I must say that, in our district, approximately twenty thousand employees come under the Unemployment Insurance Act. We had, at one time this winter, about two thousand unemployed. I respectfully submit that wherever there is an unemployment insurance office, there ought to be also a court of appeal.
These courts of appeal are said to have been eliminated-or rather there is a tendency to abolish them-for so-called reasons of economy. Such economy measures are detrimental to the working class and to those who are entitled to unemployment insurance benefits. Much too often, unfortunately, decisions rendered under the unemployment insurance regulations with regard to benefits are rather arbitrary, and the insured is justified in filing an appeal, in which case he is then compelled to assume his transportation costs to Montreal or Quebec, where the appeal will be heard, or again to some place seventy-five or a hundred miles away from his home. I maintain that the whole thing is unfair to the insured and that in each and every district where there is an unemployment insurance office, the government should also maintain a court of referees.
(Text):
May I draw the attention of the minister to the fact that the liberty given to the commission to establish a court of referees in such districts as the commission may think fit is unjust to the great number of employees

Unemployment Insurance Act in such districts where there are perhaps
30,000	employees under the jurisdiction of an unemployment insurance office. I believe it would be fair to these employees if they could appeal to a court of referees in the same district in which they work instead of being obliged to go perhaps a hundred miles to Montreal, Quebec or to some such place to place their appeal.
The tendency of the commission, in virtue of the law, is to centralize the courts of referees in any place that they may see fit. I think it would be unfair to the employees; and I receive many protests in my district from the workers association to the effect that this decision made by officers of the government, who perhaps are competent, indicates that they do not understand clearly the local conditions. I am referring particularly to those who work in the bush, and who hold other seasonal employment.
With this in mind I would ask the government to amend the act, by changing the word "may" to "must" or have it read in this way:
Panels of persons chosen to represent employers and Insured persons respectively shall be constituted by the commission for such districts where there is an office of unemployment insurance.
I think that for the small difference in economy which would be brought about by centralizing the courts in Montreal or Quebec, it would be much better to give a chance to the employees. No one could complain that it is a waste of money.
(Translation):
I have no more to say on the subject for the time being; I have formulated my request on behalf of the working class and I hope that the government will see fit to take appropriate measures in that connection; indeed, if we abolish the courts of referees in the small towns of the province of Quebec, and establish them instead in the large cities, ostensibly for reasons of economy, everybody will have a right to complain; for the working people, who represent a large proportion of our population, are absolutely entitled to ask that certain expenses be incurred on their behalf.
(Text):


Mr. J. W. Murphy (Lamblon West):: Mr. Speaker, I should like to place before the minister representations on behalf of the farmers in my constituency who work in industry during what they describe as the off season.
Let me say at the beginning that, having received representations from a group of farmers, I took the matter up with the chief commissioner of the unemployment insurance commission who, in turn, was kind enough
[Mr. Breton.)

to interpret the act. I am wondering if when he replies the minister would indicate whether some fqrther consideration could be given to a condition which I believe is unfair to this group of farmers.
In the first paragraph of his letter to me on May 15, the commissioner said:
A farmer is generally considered not available for employment and therefore not entitled to benefit during the farming season.
There may be some question in the minds of the officers in the department as to what constitutes the farming season. It is true that in some areas in Canada the farming season might be described as beginning with seeding and closing with the harvest. Then there are other sections in which the farming season extends from one end of the year to the other. I am wondering if there could be some clarification of that point, because it affects a number of people in the Sarnia area, many of whom for a good many years have been engaged in the industrial development there. They now complain that many of them are laid off on the first of April because those in charge of industry assume that they are going to take part in farming operations. It is pointed out that no farmer in the area has ever collected unemployment insurance.
There is another angle which does not seem fair. The third paragraph in the letter, explaining the act, says:
For example, if he becomes unemployed in January, 1953, and shows that during the offseasons in the winters of 1950-51 and 1951-52 combined he has paid a total of 180 contributions or more, he may qualify for benefit until March 31, 1953, or for such part thereof as the number of contributions he has paid entitles him to.
I do not believe the problem can be settled properly until we have some further explanation of the meaning of "off-season". Let us take the case of the man who has made unemployment insurance payments for several years, as many of these people have. This man we will say is let out on March 31. Would the minister explain his position after that date? We will assume, first of all, that he is not what would be described as a fulltime farmer. He is in a position to work even in the months of April or May, and undoubtedly could have someone take care of what small numbers of stock he may have. If this man is let out on March 31, and his unemployment insurance does not apply at that time, I think he is receiving unfair treatment-and I hope the minister will agree with me.
I am not suggesting that this would apply to a full-scale farmer, but I am referring only to those people who make it part of their business to farm part of the year, and to work in industry as much as they can. Those are the only points I wish to raise, in the hope that the minister will refer to them when he speaks again.


Mr. W. Ross Thaicher (Moose Jaw):: Mr. Speaker, I should like to say, in common with the other hon. members who have spoken, including the hon. member for Bow River (Mr. Johnston), that I support the five amendments before us today. I believe however there is an additional amendment which should have been brought in at this time. This would increase the coverage of people in my constituency who otherwise would be available for farm work, but who are most reluctant to go out on farms because they cannot receive unemployment insurance. I believe that, as a result of this, farm production in Canada today is suffering. These people cannot get the insurance automatically.
In company with other hon. members who have spoken, I would ask the minister to tell us what consideration has been given to extending the provisions of the act so that it would take in agricultural workers generally. Certainly if the government would give that consideration I believe a great deal would be done by way of increasing our dairy production, as well as other production on the farms.


Mr. Robert Cauchon (Beauharnois):: Mr. Speaker, on April 17, 1951, I considered it advisable to draw to the attention of the house the unhappy lot of the older worker when he is faced with the necessity of seeking employment.
Certainly now, as then, officials of the unemployment insurance commission must be aware of the gravity of this problem. To the best of my knowledge, however, no further steps have been taken by the unemployment insurance commission to alleviate the financial worry and mental distress which haunts these Canadian workers.
At the time the matter was not as urgent as it now is, in the light of our immigration policy-which, understandably, tends to give preference to younger immigrants-and of recent unemployment statistics.
I feel strongly that the unemployment insurance commission has a duty to our ageing Canadian workers, the duty of directing them info new fields of employment or, if need be, of training them in skills suitable to their aptitudes and age.
Though the commission has done nothing in that matter it has not been reluctant to adopt a new policy in respect to appeals. Without, I am certain, consulting the minister it has adopted a policy surely not designed to promote the best interests of those whose welfare it was set up to serve. I am speaking particularly of those of the unemployed who wish to appeal the decisions of the unemployment insurance commission.
Unemployment Insurance Act
No longer are these appeals heard in their local courts of referees. An appellant in my constituency must travel to Montreal. Do the gentlemen responsible for this reversal of policy not realize the financial hardship it imposes? Being without a job, the labourer cannot afford the expense of his fare, his meals and transportation costs within the city, all in addition to the expenses of his witnesses. He may then find that his case is delayed and that he will perhaps have to make another trip. Under such conditions, and a natural fear of becoming involved in legal "red tape", he may forgo his right of appeal.
Upon inquiry, I have found that the principal arguments advanced in support of the policy are as follows:
1.	Certain courts of referees are not qualified. Does that mean that the entire system is bad, that we should scrap it? I contend that it does not, that there are many quite capable of handling the cases brought before them. No system is perfect; certainly not the one which is now being put into effect.
2.	Decisions of many boards are unwise and, consequently, costly. If that be true, the commission would be better advised to appoint competent men. The responsibility is theirs.
3.	The costs of appeals heard in Montreal are lower than the costs of appeals heard in local courts of referees. This, the commission contends, is due to the longer time taken by the local courts and to the fewer cases tried. The cost of each case is thus proportionally higher.
If this argument be valid, let us adopt the same principle in the administration of justice. Imagine, if you can, accused, plaintiffs, defendants, their lawyers and innumerable witnesses, all trekking to Montreal from St. Hyacinthe, Joliette, Drummondville or St. Jean, or those from the towns and villages of the Gaspe travelling to Quebec city. Obviously, this is in the best interests of economy, but is it in the best interests of justice?
Our system of justice I am proud to say ranks second to none, and I speak from my twenty years' experience as a court reporter in the province of Quebec. This is also true in the nine other provinces. As for the judges, for them I have only praise. They fulfil their duties conscientiously and well, without for a moment forgetting their responsibility and privilege, the responsibility and privilege of guarding the rights of the individual. Indeed, it is fortunate that the judges throughout Canada do not administer justice as the unemployment insurance commission now seeks to administer it, that is,



S088 HOUSE OF COMMONS

[Stage Direction]
Unemployment Insurance Act after the manner of cars rolling off the assembly line where one must come off the line completed in a given unit of time. Moreover, the aim is to reduce the overhead by producing more cars.
I can prove that this is the method advocated. To call the local courts, five cases must be tried within a seven-day period. Only under these conditions can the unemployed in our constituencies be spared needless expense, worry and loss of time. Perhaps the commission would likewise abolish sittings of local criminal assizes on the ground that only one case is tried in a year.
The commission has charged these courts with incompetence; nevertheless, it would seem that they are incompetent to try only one case, but quite competent to try five cases in seven days. Is this logical?
If our system were in need of improvement or change our Prime Minister (Mr. St. Laurent), who is recognized in Canada and elsewhere as an outstanding lawyer, would have introduced legislation into this house to effect such improvement.
Today, the tendency is towards decentralization, certainly in industry, and that we insist upon it in government is proved by the system we have adopted. Is decentralization any less desirable in the matter of a citizen's right to appeal to a higher tribunal?
Mr. Speaker, I contend that this commission was set up to serve the workers. We of this house know it, the hon. minister knows it; it might be well to remind the commission of it.
An unemployed worker, faced by expenses he either cannot afford or cannot possibly meet, may thus be deprived of a basic democratic right, the right of appeal. Democracy recognizes that right. His payments to unemployment insurance are for the express purpose of assuring his right to a degree of economic security. Should he be deprived of it? We expect efficiency in our government agencies; we laud their efforts to reduce costs and prevent waste, but I do not believe that-as in this case-we want it at the sacrifice of right and justice. The purpose of the legislation was not the cheapest possible administration.
That the commission has full authority in these matters is unquestioned, but all authority carries with it responsibility and must be subject to scrutiny to assure that these responsibilities are carried out in the spirit of equity and justice. Upon the commission lies part of the responsibility of maintaining industrial peace, of providing security for the industrial worker, thereby laying the surest foundation of a democratic government, which is a happy, contented [Mr. Cauchon.l
people. Such a foundation can be best laid by giving our people tangible proof that their government is continually alert to protect their rights.
I should like the minister to request the commission to take steps to improve the lot of the older workers whose productive years can contribute much to Canada's growth. At the same time it might be asked that we stay within the status quo with respect to appeals from the decisions of the officials of the unemployment insurance commission.
Motion agreed to and the house went into committee, Mr. Robinson in the chair.
Milton Fowler Gregg: Mr. Chairman, at this stage I should like to make a few comments on points that were discussed the other day and some that were raised this afternoon. I was of course greatly pleased by the approval expressed by hon. members with respect to the establishment in the operation of our national employment service of the principle of non-discrimination. While there may be a good deal of difference of opinion as to the method of accomplishing this, I am quite sure that in general all members of the house are in full accord as to the principle. Therefore, while it has been in the manual of instructions of the unemployment service, I and the government felt that we might well assert the will of parliament in this matter in the statute itself in the field of federal placement of workers seeking employment.
The operations of our employment service are very closely associated with the personnel departments of private industry. Therefore I feel we may be able to help by example, persuasion and precept to forward the progress that is being made in Canada toward tolerance and non-discrimination. I am quite sure it is in that field of persuasion and example that the greatest progress can be made rather than by the use of policemen, law courts and prisons.
The hon. member for Hamilton West reviewed the present status of the unemployment insurance fund and expressed her confidence that it was in a healthy state. She made a rather mild suggestion that the commission and the government might be a little less cautious in the improvements that are suggested at this time. I think we must bear in mind that, in spite of the fact that we have had some years of heavy unemployment, particularly during the past winter in the great cities of central Canada and two years ago in the far ends of the country, the unemployment insurance fund has not yet met its great test. We may have differences of opinion with respect to whether it was

intended to cope with such a situation as existed between 1930 and 1939, but even so an intermediate test has not yet been imposed upon it. This was kept firmly in mind during all the hearings and the studies, which have taken almost two years, of the commission and the advisory committee whose duty it is to advise on the protection of the fund.
I shall touch briefly upon some of the points raised and perhaps might discuss later in the estimates any I happen to miss. First of all I should like to say something more about the fund itself. The extent of unemployment upon which the finances of the act were based was that prevailing during the years 1921 to 1931, both inclusive. On the average during those years the percentage of idle time to total working time amounted to 11-4 per cent. The best year of all was 1926, when idle time represented 7 * 5 per cent of the total potential man hours, and the worst year was 1931 when the percentage rose to 21-8 per cent.
The rates of contribution were set on the assumption that the fund might have to carry an unemployment load averaging 12-5 per cent over the years. In 1933 the percentage of unemployment rose to 30-4 per cent during three months, and for the whole year averaged 26-6 per cent. The balance in the fund at 30th April, 1952, was $782 million in round figures. The number of people contributing to the fund varies from month to month, of course, but it is safe to assume that there are over four million people who have some claim on the fund should they become unemployed. Therefore it will be seen that there is a little less than $200 in the fund for each person who might claim.
If the average benefit is assumed to be $20 a week, this would mean ten weeks benefit for everybody who is insured. If we had a 25 per cent unemployment, which is less than we had in 1933, there would be forty weeks benefit for those needing assistance, and this would be short of the amount required to carry an unemployment average of 26-6 per cent for a full year. The unemployment insurance advisory committee, of which I spoke a moment ago and on which are representatives of both national labour and national employer organizations, has a statutory responsibility to inquire into and report on the state of the fund. I am going to quote paragraphs 8 and 9 from their report covering the fiscal year ending on March 31, 1951. They read as follows:
It is of interest that the ratios of benefit payments to regular contributions for the two fiscal years 1949-50 and 1950-51 were high having regard to the level of employment. After excluding (1) the amounts paid out in supplementary benefit; (2) the
Unemployment Insurance Act special contributions made in respect of such benefit; (3) the cent a day of contributions not taken into account up to July 1, 1951, in computing benefit payable to claimants in the new class 8, and (4) contributions made by the government on behalf of veterans of the armed services, these ratios of benefit payments to contributions are: 1949-50, 71-2 per cent; 1950-51, 65-7 per cent. The high percentage of payments as compared with contributions was noted by the committee.
The fact that so large a proportion of the contributions was required to meet the benefit payments in a year of high employment shows that there may not be an unduly large margin for bad years. It is reassuring, therefore, that as a result of the sustained high level of employment ever since the act came into effect the fund provides a substantial reserve against adverse conditions.
The four major amendments which are being proposed at this time will all increase the outgo from the fund. All these amendments have been unanimously recommended to the government by the unemployment insurance advisory committee. In reply to some hon. members who spoke this afternoon, I might say that that unanimity includes representatives of the great national organized labour bodies. Had the committee felt that we could justify a greater increase in benefits, a shorter waiting period or other concessions, I am quite sure they would have so reported. It is quite true, as was pointed out the other day by the hon. member for Winnipeg North Centre, that certain parts of the social security legislation may possibly be operated without accumulated reserves. The new federal old age pension plan might be an example of that. In the case of unemployment insurance, however, the amount of unemployment which will occur at any given time or for any given period is not nearly as easily forecast as the number of people who will reach the age of 70 at any given date in the future.
It was further suggested, I think by the same hon. member, that "a plan which operates on a comparatively short term financial basis of ten years with reserves sufficient to cover two years of benefit payments is socially a sounder instrument of policy than a fund which piles up reserves." From the portions of the report of the advisory committee which I read a little while ago, it does seem that that committee is fully aware of this line of thought, and it would appear that reserves are not being built up to a greater extent than are necessary under a sound unemployment insurance plan.
Strong suggestions have been made concerning cutting down the number of waiting days, or even cutting them out altogether; certainly the suggestions go beyond what is recommended here. Before discussing that point, I think I should like to take a moment to discuss this tricky little thing known as

Unemployment Insurance Act the non-compensable day, upon which everyone seems to get caught just as I did. The rule is that the first day in any period of unemployment is known as non-compensable, unless it follows a period of unemployment of less than four days. There may not be more than one such non-compensable day in one week. There are reasons for that, other than just sticking in the odd day of grace.


Stanley Howard Knowles: Is that a good term, "day of grace"?


Milton Fowler Gregg: No, it is not. If an insured person loses no more than one day in a calendar week, he is not badly off. If he is fully employed except for one day here and there, there would be no call for unemployment insurance in this case. It is rarely possible to place an unemployed person on the very first day of his unemployment, and to pay benefits for such single days of unemployment would add greatly to the administrative costs. The rule prevents the dissipation of an insured person's benefit in payment for single days, and encourages him to conserve his benefit for periods of longer unemployment. A provision of this kind is essential to any plan of unemployment insurance to eliminate petty claims and keep contributions within bounds. In the financial calculations made in 1940, it was estimated that the elimination of the one non-compensable day would have cost an additional 3-5 per cent in benefits paid.
Perhaps I should say a word about the waiting period proper. I think perhaps the members who made suggestions here are seeking, as were the framers of the act, to provide the maximum for the unemployed person at the time the need is greatest for the least possible deduction from his pay. The same thing holds true in automobile insurance, where all petty claims that the ordinary person could fairly readily handle are cut off. The amounts deductible are for $25 or $50, and are based on the man's ability to pay. In this way he might be protected against those things that will affect him most. It is usual to exclude small claims up to those figures I mentioned. A great many persons lose a day of employment here and there in the course of a year, and that is not so very serious. Normally they can take up this slack within their regular budget. Such small losses are practically a certainty in many industries where weather conditions, shortages of material or of orders may be a factor.
By excluding a limited number of such days the cost of the contribution is kept much lower for the insured persons, and claimants are encouraged to conserve their

benefits for occasions when loss of employment is of material extent and the real claims of other claimants are not buried by a large number of applications for one or two days benefits. The exclusion of the first week, or six days if you insist on including the non-compensable day, in a benefit year is not I think to be considered unreasonable.
The opinion has been strongly expressed in this debate that the Unemployment Insurance Act should be extended to cover just as many categories of workers as it is possible to cover. I can tell the committee immediately that that is the view of the commission, the view of the minister and the policy of the government. It is not quite so easy, as hon. members know, to do that. Referring to what the hon. member for Bow River said this afternoon, I should like to give a brief breakdown of the figures. As of August 18, 1951, the Canadian civil labour force was estimated to be as follows: Paid workers and insured, 2,915,000-I am giving the round figures- paid workers, non-insured, 934,000. Then there are other non-insured persons, own account workers, 933,000; unpaid family workers, 364,000; employers, 197,000. The total in that second category is 1,494,000. The grand total, including paid workers, is
5.343.000.
Now, of the paid workers 2,915,000 or 76 per cent were in insurable employment;
934,000	or 24 per cent were not insured, including three main groups. First, there were employees of the permanent public service, federal, provincial and municipal employees, and employees of hospitals and charitable institutions. The number of these is approximately as follows: Federal public service, 60,000; provincial, 65,000; municipal, 30,000; hospitals and charitable institutions,
115.000.	This makes a grand total of 270,000. The question of bringing them under the act, or parts of the categories I have mentioned, is under continuing study.
I believe I should point out to the members of the committee that the solution to this problem is not as easy as it sounds. For some time a very careful study has been made as to the advisability of bringing a portion of the hospital workers of Canada under the act. It worked out to about one-fifth of the total number, particularly those in the nonmedical categories and those who normally, outside the hospitals, would come under the Unemployment Insurance Act. Rather than be dictatorial and place it on whether or not the hospitals could raise the money to add this little bit extra, the hospitals were advised as to the intention; and I think perhaps some hon. members might be surprised at the forceful way in which they expressed themselves to the effect that it

would be extremely difficult for them to adjust their budgets to take care of this extra cost. I might say the commission has not receded from its position, but it has felt that the hospitals ought to be given a longer period in order to see how they can adjust their budgets in this regard.
The second group includes persons engaged in agriculture, fishing, private domestic service, private duty nursing and teaching.
They are distributed as follows:
Agriculture	 120,000
Fishing (excluding self-employed) ....	7,000
Private domestic service	 80,000
Private duty nursing	 21,000
Teaching	 108,000
Total	 336,000
Those are the wage earners who are difficult to bring into a scheme of unemployment insurance. The possibility of a further extension of the coverage to include these groups is under continual review. For instance, as I think some hon. members know, when the horticultural association met here a short time ago they had that subject on their agenda and members of the commission went over and discussed it. If you have read the report of that convention of the horticultural association you will know that they could not see yet how their employees could be fitted in; and perhaps their employees would be more fitted to the scheme than those of general farmers.
The chief problem is to determine when such workers are unemployed. Other difficulties affecting some or all of these groups are the problems of determining who is an employer; how the collections are to be carried out; the large extent to which the same individual passes back from month to month between the status of wage earner and "own account" worker; the seasonability of employment, the large amount of family employment, and the remoteness of the area where the employment is carried out.
The remaining group includes persons who work only in part-time or seasonal employment and who do not particularly desire or need unemployment insurance, and persons whose remuneration is over the insurable limit; that is over $4,800. This group numbers approximately 70,000; seasonal, parttime, miscellaneous number 258,000, making a total of 328,000 in that group. With the interest shown this afternoon I thought it might be worth while, Mr. Chairman, to break the figures down into those various groups.
As to the hon. member for Broadview, I will undertake to look into the special case to which he made reference this afternoon. I cannot quite agree with him that, based on the letter which he quoted, the activities of the
Unemployment Insurance Act commission personnel in Toronto were "bureaucratic". At least there was some evidence there of sympathy. I agree with him that in the related field of rehabilitation of the physically disabled or the physically handicapped, much can be done. Perhaps, Mr. Chairman, as Mr. Speaker suggested that matter might not be relevant to this resolution, I could deal with it when the estimates are dealt with. I assure the hon. member that we will take into consideration that special case which he mentioned.
As to the suggestion made by the hon. member for Bow River and also the other day by the hon. member for Winnipeg North Centre, namely that a sickness benefit feature be added to the unemployment benefit feature under this act, I should like to assure hon. members that the matter has been and will continue to be studied; but up to the present time at least the opinion has been held that sickness benefit should be a part of whatever health plan is developed for this country rather than incorporated into this plan. Even under a more limited plan than this one, and providing insurance against temporary disability only, there would have to be coordination between cash benefits, medical care and rehabilitation services. Basic questions that would have to be decided would include the following: the scope of such a plan; whether it would apply only to wage earners or to other groups such as selfemployed; who would administer the plan; whether provincial and federal jurisdictions conflicted; what sort of disability should be covered; for instance, could a distinction be made between incapacity arising from a specific illness and incapacity which is nothing more than infirmity from old age? How long and how often should benefits be paid to the same claimant? What should be done about contracting out in the case of firms with their own sickness insurance plans; how could claims be supervised in a country like Canada with great distances and sparse population? There are many other questions. I do not want to appear to be raising difficulties just for the sake of raising them; but although they are not directly related to what the hon. member for Bow River said, I think some of them are hindrances in the matter of a sickness plan.
The hon. member for York South again brought forward his suggestion with regard to cutting down delays. That is something, of course, which is separate from the waiting days, because even though there may be some delays after the completion of the waiting days the payment becomes retroactive or will become retroactive now after the five waiting days.
3092	HOUSE OF
Unemployment Insurance Act
Last winter when we looked into the matter there seemed to he some difficulty in working out with the municipalities an estimated basis while the paper work was being caught up with. I should like to assure my hon. friend that the matter is going to be studied during the comparative lull in unemployment during the summer months. Without a radical change in the conception of the plan, I do not think that my hon. friend's suggestion, that benefits should not be related to the number of contributions, could be worked out. However, we shall look into the matter.
The hon. member for Joliette-L'Assomption-Montcalm and the hon. member for Beau-hamois referred to the question of courts of referees. In this experiment perhaps I could give them what the commission have had under way in that regard. There are 68 courts of referees established in the larger centres throughout Canada. In the year ended September 30 last those courts held 1,584 sittings and heard 11,754 oases. It can therefore be seen that those courts have quite a heavy task. A review of the work of the courts discloses that the cost of hearing each case in this period averaged $5.38 and that in some of the smaller centres, because of the comparatively few cases heard, the cost per case was much higher than that. A half day sitting of the court now costs $50 as against a previous cost of $33, and a full court day costs $70 as against $44. But perhaps more important than the cost [DOT]was the fact that in the smaller centres, where comparatively few cases arose, there were longer delays in hearing the claimants' appeals than in the larger centres. For example, in four of the smaller courts the time taken to hear an appeal has been 30 days; whereas in the larger courts appeals were generally heard within an average of 16 days.
In order to reduce the delays and help reduce the costs the commission decided that in the case of the 19 courts hearing the fewest cases the following changes be made on a trial basis; and I would like to emphasize trial basis to both the hon. members who mentioned this matter. A summary of the trial basis is this. Appeals emanating from the above 19 offices will be prepared as usual and will be held for a period not exceeding seven days. If at that time there are not at least five cases ready for the local court the cases will be transferred to the nearest court where a sitting is being held. And if the chairman of that court thinks that the man should be heard, he can authorize the payment of the man's travelling expenses.

COMMONS	?
No courts have been disbanded at all, and no further action will be taken until those trial procedures have been fully tested.
I know I have not covered all the points that were made, but perhaps hon. members will bring any others to my attention.


Stanley Howard Knowles: We appreciate the very full statement the minister has made with respect to a number of the points that were raised during the debate while the Speaker was in the chair, even though we may not be satisfied with some of the arguments that he has adduced at this time.
The minister had a fair amount to say with regard to the principles underlying the funding operations under this act. It seems to me that what the minister and those who advise him have not taken into account is the fact that we are living under conditions today that are altered to a considerable extent from the period from 1921 to 1931, both inclusive, on the experience of which the act was drawn.
As the minister knows, and as all hon. members know, we have won a number of pieces of social legislation of no mean importance since the days of the 1920's. We have universal family allowance legislation; we have universal old age pension legislation, at least for those 70 years of age and over. These and other measures mean that there is a certain amount of purchasing power available at all times which was not available in the 1920's, which acts as a cushion against unemployment, other things being equal, that was not possible in the 1920's or 1930's.
We fully agree with the minister that account has to be taken of the possibility of a pretty serious test being faced by the unemployment insurance fund; nevertheless we feel that fuller consideration could be given to these changed conditions. I refer to the changes from the 1920's to the present time. The fact that these huge amounts are salted away in the unemployment insurance fund does seem to me to bear out the point we are making. The minister answered our claims that it would be possible to pay larger amounts than are now being proposed by suggesting that if all those covered by unemployment insurance became claimants the fund would last for only a certain length of time. I suggest with great respect that that is a bit fictitious. No life insurance company would base its solvency on the hypothesis that all of its insured people were going to die in the same year. No fire insurance company would base its claim to solvency on the hypothesis that all of the buildings insured were going to burn down in the same year. I submit that it is equally

fallacious for the minister to claim that the unemployment insurance fund must be tested by its capacity to provide benefits to all of the people who are insured under the fund.
I am glad to note that the minister paid attention to the quotation from Professor Morgan which I put on the record the other day. I agree with him that there is a difference between old age security and unemployment insurance, for the same reasons he pointed out, namely that one is predictable and the other is not so predictable. But I do suggest that there is room for consideration of the principle that Professor Morgan and others have enunciated, namely that you should try to provide that the benefits of a fund such as an unemployment insurance fund will be made available to those who in a current period, during ten years or fifteen years, are paying into that fund. Let us not make the mistake of asking the workers today to provide an unemployment insurance fund for their children or their grandchildren. The minister is right in saying that we cannot put it on exactly the same pay-as-you-go basis as you can with old age security, but you can put it on a more current basis than it seems to us is the case at the present time.
I do not intend to pursue that point any further, Mr. Chairman, but I thought I should express our view on it in the hope that further consideration might be given to our contention that it would be fair to declare a little larger dividend to the insured by increasing by more than the minister has done the amount of the benefit. Speaking of the amount of the benefit, I would hope that before this stage is over the minister might be good enough to tell us what the other increases are. He indicated when we were at the earlier stage that the $21 benefit would be increased to $24 a week. Perhaps he might give us the other increases as well.
The minister also dealt with the contention that some of us have been making that the coverage of this act should be extended, and we are glad to note that consideration is being given to that point. We are not surprised to learn that whenever it is suggested a certain group should be brought under the act their employers immediately object. Some of us who are in the chamber at the present time will recall one occasion in Winnipeg last winter when we were called in by a certain group of employers who wished to protest against their employees being brought under the provisions of the Unemployment Insurance Act. All of us recognized their particular problem, but still there is no point to social insurance unless you put it on as universal a basis as possible. Our feeling is that some of those who, be they employers or employees, do not want to be
Unemployment Insurance Act covered by unemployment insurance would be the first to expect assistance from the state if they became unemployed. Therefore I am glad to note the minister has said that the government has not receded from its position, but that it is still the government's policy to widen the area of coverage. I wish him to know that he has the support of those of us in this group in the pursuit of that policy.
I feel I must say a word further with respect to another of the matters the minister dealt with. He gave consideration to the case that some of us have made repeatedly across the years with regard to those who go on unemployment benefits, then take sick and are cut off from those benefits, even though there is still no work for them.
I fully agree with the minister that this problem of sickness benefits generally will best be covered under a health insurance plan. I am glad to note that the minister referred to a health insurance plan as something possible in the foreseeable future; and he used a little more hopeful language than we got from the Minister of National Health and Welfare the other night. At any rate that is a question on which the Minister of Labour and I are agreed, namely that we should have such a plan and that it should include sickness benefits.
However, this afternoon the minister confused the issue we have raised from time to time by taking in too much territory. He said he did not want just to be putting up objections for the sake of objections; but f must confess, with great respect, that I thought that was exactly what he was doing. We spelled out a very limited area. We did not introduce the whole broad question of sickness benefits as something that should be attached to unemployment insurance. We want sickness benefits, but we want them under a health insurance program. In this instance we spelled out for the minister a very narrow and limited problem. We pointed out to him that there are persons who become unemployed, qualify for benefits, begin receiving those benefits, and then become sick and are cut off from their benefits because they are sick, even though there is still no work for them. It is that particular group in connection with which some of us feel a start could be made. In his list of objections the minister really took in the whole gamut of the problems associated with health insurance and sickness benefits. As a matter of fact I know that on one occasion when I tried to get consideration of this matter by officials in the minister's department, during the days before he was minister, what I got was a

Unemployment Insurance Act document which went over the whole broad question, rather than over this narrow, restricted problem.
Let me say again, in its narrowest and most restricted terms, what we mean: Here is John Jones who qualifies for unemployment benefits. He starts drawing those benefits, and continues to draw them for a week or two. He becomes ill. The day in the third week when he should go down to pick up his unemployment insurance benefits, and report for work if there is work, he is ill. Mrs. John Jones goes down to collect the benefits. John Jones has never been through this experience before, and he does not know what happens. Of course the man behind the desk says, "Where is John?". "He is home, sick in bed." "Too bad; he cannot draw his benefits." Mrs. John Jones may ask the man behind the desk if there is any work for her husband, and he will reply, "No, there is no work; but that does not matter. He is not able to report for work, and therefore his benefits must be cut off." It seems to me that if a start must be made with a very limited approach, we could at least start with a provision that would specify that a person who was on benefits shall not be cut off from those benefits when he is sick, unless a job has turned up which he is not able to take. In my viewpoint we could go further, but at least let us start with that aspect of the problem, that narrow definition of it. It is this, as I say, which does annoy these people most of all, and which does seem most unfair, when they see that the benefits to which they have become entitled and which they have been drawing are cut off merely because they are sick, even though there is still no work for them.
I hope I have not done the minister an injustice in suggesting that by broadening it he has confused the issue. I do plead once again for a consideration of this point. I fully agree with the minister that the solution of the problem of sickness benefits generally lies in an over-all health insurance program, and I hope he will support me in my efforts to get that. He can give support in places where I cannot give it, namely in the cabinet itself. Meantime let us do something for John Jones, to whom I referred as an example.


Mr. Browne (Si. John's West):: Mr. Chairman, I should like to support the remarks of the hon. member for Winnipeg North Centre. It seems to me there would be very little hardship in the operations of the unemployment insurance commission if it were to continue to pay benefits to persons unemployed during their illness, so long as there is no employment for them. I do not think


there is the same difficulty about that question as about some of the others to which the minister referred this afternoon.
Among those persons for whom he had difficulty in arranging insurance the minister included fishermen, but he did not enlarge on the matter. I wonder if he has anything to say about the progress being made. I believe I read a little while ago some newspaper comment in which it stated that when he was in St. John's, Newfoundland, the Minister of Fisheries was asked a question on this subject, and replied that the matter was receiving consideration. I would like to know if there has been very much consideration, and if any progress has been made.


The Deputy Chairman:: I am sorry to interrupt the hon. member, but I do not believe the question as to who shall be covered by the measure is contained within this resolution.


William Joseph Browne: Mr. Chairman, it was the minister who raised the matter; and I suggest if he is entitled to discuss it, hon. members should have the same privilege. This is the only question I am asking at the moment. I might add that I am appreciative of the difficulties attaching to this type of worker; but it does seem anomalous that people who work in big plants can be covered by unemployment insurance while the men who bring in the fish are not covered.


Mr. Fair:: Mr. Chairman, the minister has referred to farm workers. Have representations been received by him or the department in connection with the inclusion of farm workers under the unemployment insurance scheme? I have not heard very much about that class of workers. I have not heard that they are to be included, and I would ask the minister to answer my question when he replies.


Milton Fowler Gregg: Mr. Chairman, replying to the hon. member for St. John's West, I believe I cannot add very much to the answer I gave some time ago in response to a question along the same line. The difficulties of collection and of classification I hope are not beyond solution. I can assure him the matter has been under constant study. The same applies to farm workers.
I am hoping the bill will soon be in everyone's hands, but perhaps I could run through the list of weekly benefit changes. The $21 figure becomes $24; $18.30 becomes $21; $15.60 becomes $18; $12.90 becomes $15; $10.20 becomes $12. Then the two lowest grades remain as they are, because they are already about 83 per cent of the average pay-

Those two lowest grades remain at $7.50 and $4.80. Perhaps I could give a more complete explanation in committee on the bill.


Robert Fair: The minister did not answer
the questions I asked, whether representations had been received from farm organizations or individual farm workers with regard to being included in the unemployment insurance scheme. I suggest that if he has not had such representations he take up the question with farm organizations throughout the country before including farm workers.


Milton Fowler Gregg: Perhaps I could answer that a little later. I do know that we have had representations from the horticultural association, to which I referred a little while ago, but I cannot recall offhand all the representations we have received.
Resolution reported, read the second time and concurred in.
Mr. Gregg thereupon moved for leave to introduce Bill No. 332, to amend the Unemployment Insurance Act, 1940.
Motion agreed to and bill read the first time.



BOUNDARY WATERS TREATY ACT


Hon. L. B. Pearson (Secretary of State for External Affairs) moved: that the house go into committee to consider the following resolution:
That it is expedient to introduce a measure to amend the International Boundary Waters Treaty Act to increase the maximum salaries of the members of the Canadian section of the international joint commission: to bring the secretary and all other employees under the provisions of the Civil Service Act; and to provide that all expenses incurred in carrying out the provisions of the act and the treaty shall be paid out of moneys appropriated by parliament for the purpose.
He said:	This resolution deals with an
amendment to the International Boundary Waters Treaty Act, 1911, which provided, among other .things, that the salary of each member of the Canadian section of the international joint commission should not exceed $7,500; that the salary of the secretary should not exceed $4,000; that the expenses of the commission for office accommodation, equipment and supplies should not exceed $6,000 per year, and that the governor in council may appropriate annually out of the consolidated revenue fund an amount not exceeding $75,000 to meet the expenses of the commission.
The purpose of the amendment is to provide that the maximum salaries to be
Boundary Waters Treaty Act paid to the members of the Canadian section of the commission shall be increased, the salary of the chairman not to exceed $15,000 per year instead of $7,500 as at present, and the salaries of the other two members of the Canadian section not to exceed $10,000 each per year. The amendment will provide also that the secretary and all members of the staff shall be brought under the provisions of the Civil Service Act and that all the expenses of the commission, including salaries, cost of office accommodation, equipment, supplies and one-half of the reasonable and necessary joint expenses incurred by the commission under the terms of the treaty, shall be paid out of moneys appropriated by parliament each year.
The proposal would permit the governor in council to determine what that amount should be and also what the salaries of the Canadian members of the commission should be from time to time within the limits of the new statutory ceilings. I do not think there is anything else I need say at this time.


William Joseph Browne: How many members are on the Canadian section of this commission?


Lester Bowles Pearson: I had hoped that questions of that kind might be addressed to me in committee, but that is a simple question. There are three Canadian members, the chairman and two others.
Motion agreed to and the house went into committee, Mr. Robinson in the chair.


Stanley Howard Knowles: Mr. Chairman, I am sure we all agree that an act which has not been amended since 1911 might well come under review. I might say that before coming down to the house this afternoon I thought I would look up this statute. Although I have a great many volumes up in my office I could not find one that included this act. It was not even included in the Revised Statutes of Canada, 1927, although the index indicates that it was passed many years ago.
The point that struck me about the minister's suggestion is that if these salaries have not been changed since 1911, no doubt it is time for an increase; but could the minister say a little more by way of defending an increase in the chairman's salary which amounts to 100 per cent. That seems quite a sizeable boost. Could the minister also say something about the work of this commission and the reason for the government suggesting such a big jump in salaries?
Progress reported.
At six o'clock the house took recess.

Boundary Pipeline Corporation AFTER RECESS
The house resumed at eight o'clock.



PRIVATE BILLS


[Stage Direction]
The house resumed from Friday, June 6, consideration in committee of Bill No. 62, to incorporate Boundary Pipeline Corporation- Mr. Larson-Mr. Beaudoin in the chair.
On section 1-Incorporation.
Mr. McLure:: Mr. Chairman, when the bill was last before the house I spoke for a few moments on it. I am very glad to be back here now and see you in the chair because it is an inspiration to me to have you there for the few remarks I am about to make. Sometimes you and I do not agree on the relevancy or irrelevancy of the subject being discussed, but that is only a small matter when all is said and done.


The Chairman:: I hope we will agree on relevancy during this debate.


Winfield Chester Scott McLure: I had dealt with the incorporation of the company and the incorporators. That is about as far as I had gone in my remarks last Friday. Since that time I have read some of the many speeches that have been made. I find that a great number of speeches have been made against the bill and very few in favour of it. However, I intend to look at the matter tonight from the point of view of whether gas should be exported from Canada for the benefit of another nation instead of keeping it at home. As I said, I had dealt partially with the matter of incorporation and the individuals concerned. The five men who have been instrumental in having the bill brought before the house are unknown to me. That does not matter. They must be known to quite a few of the western members. One of the things that surprised me was that no member from the west rose and spoke with respect to the incorporation of the company and the men who are behind it. However, the company may never be incorporated to export gas through the pipe line they plan to build.
In reading some of the speeches that have been made, also newspaper articles, I found that there seemed to be a doubt in the minds of some people with regard to the quantity of gas and oil to be found in the western provinces. Quite a number of people have said that it is only a flash in the pan. Twenty-five years ago I visited the northern part of that country and passed through the section which is today honeycombed with drills which are being used to search for oil and gas and are finding it in tremendous quantities. I started through that part of the


country a little over 25 years ago with the idea of visiting the northern section. I stopped one night at the Ranchmen's club in Calgary. The next day I was taken to see what I thought was the burning bush. I did not realize what it was. Finally I was told it was caused by gas forced up from the earth under tremendous pressure. It was rising into the air to a height of ten feet or more and then bursting into flames. When I saw it that night it was illuminating the heavens for miles. I thought at that time if it could have been harnessed and pipe-lined-of course I had never heard of a pipe line then for gas or oil-there was certainly enough pressure behind the gas to blow it through any pipe line clear down to the maritimes. I am not an engineer, but the quantities of oil and gas in the western provinces are one of the great resources of Canada. The eyes of the world are focused on the western provinces of Canada because of their gas and oil.
It is really wonderful, but when I saw the gas being wasted there I never conceived that anything would come out of it. However, capable engineers and men who knew their business turned the gas back down into mother nature's bosom, and there are countless cubic feet of it there ready to be made use of by those who want to speculate in the procuring of gas as well as oil.
By way of a little diversion, I might say that I extended my trip farther north. When I got into the north I commenced to realize what wonderful natural resources were there. I had seen this sprinkling of gas and oil, but when we got into the north I saw great farmlands. Further north one could see the waterfalls scattered all over the country which would be little Niagaras once they were harnessed. With the west now opening up due to the oil and gas developments, the day is not far distant when these waterfalls will be harnessed.
This Bill No. 62 is presented for the purpose of piping this natural product down as far as Winnipeg, then south into the United States. If we had a surplus of gas, as I said the other night, that would be all right. We have to look after ourselves and take a leaf out of the book of success of the United States; namely, Canada first for the products we need. Let us consider the provinces of Ontario and Quebec for a moment. At the present time Ontario is crying for more power, notwithstanding the considerable amount of power already developed in that province. Look at Ontario from a manufacturing point of view, and you will see what has been done with the power. Ontario may be -small in population, but it is growing; and why? It is because of this power;

and if Ontario can get more power there is no limit to what her manufacturing industries can do, not only for Ontario itself but for the rest of Canada as well.
A few years ago the population of my province used to start off for the New England states in order to look for employment. Where are those people going today? The majority of them are going to Quebec and Ontario, simply because of the industrial development of those provinces. Thousands of people are finding employment there. If cheap power is obtained, more factories will be built. If Ontario cannot get this cheap power some other form of power might be obtained; but I for one would favour subsidizing the producers in order to make the power available at a lower price as long as it would be used for manufacturing. If there is manufacturing in a province, it develops the whole province. It does more for the farmer than anything else, because the labourer must be fed and well fed. It is good for the lumberman also because more houses must be built. Manufacturing carries with it, in a province like Ontario, something that will develop not only that province but the whole of Canada.
There is not much more I desire to say about this measure. I should like to mention one thing; that is, if Canada has these great natural resources, as we know she has, let us endeavour to develop them in the interests of our own people and our own country. That is the most important thought in connection with the bill that is before us. I am going to vote against this bill, because if gas is required in one or two of our provinces those are the people who should have it. I am very anxious also to find out how many of these men who are in favour of this bill will produce arguments to show why the gas that is being produced should be sold to some other country when it can be used more profitably in Canada. The building of this pipe line will provide employment, as will its maintenance. As I said earlier, let us look to Canada first; and I hope the men who will be speaking now, especially those on the other side of the house, will give their reasons for being in favour of it. Some of them seem very anxious to have this bill passed.
Up until this evening there have been some wonderful speeches on this bill, and wonderful arguments used. I am .glad, Mr. Chairman, to say right now that I shall vote against this measure if it comes to a vote. Let us keep the gas at home, and let us think in terms of the slogan we should have: Canada first and Canada for Canadians, as well as all those we can bring in as long as we can provide employment for them.
Boundary Pipeline Corporation


Mr. Cardiff:: Mr. Chairman, I hope if I diverge a little bit from the pipe line that I shall stick to the gas. I am speaking against this bill tonight because I feel that it does not give Ontario any chance to get gas from this particular line. As I understand it this bill is being sponsored by the Fish Engineering Corporation, and the company only proposes to build a 16-inch pipe line. It would start in Alberta, go through Saskatchewan and Manitoba to Winnipeg, then south to the United States, That is not going to do Ontario or Quebec any good. I feel that we should have a line that will come to Ontario and serve this province as well as Quebec.
From what 1 have learned in the committee this company has no intention of building a line from Alberta through Saskatchewan and Manitoba unless it goes to the United States. A question was asked in the committee as to whether it was the intention of the company to build a pipe line in the provinces of Ontario and Quebec, and the answer was that it was not the intention to do so. If they are not going to build this pipe line past Winnipeg I do not see any reason why we should vote for it.
Some years ago when I entered the township council my sole purpose was to see that everything possible was done for my own township. Then in later years I became reeve of the township and went to the county council. I then had to raise my sights and do all the things necessary to support all the municipalities that went to make up the county to which I belonged. From there I came to the House of Commons, and again I had to raise my sights and look to the Dominion of Canada. I try to see things as others would see them from other parts of Canada. I do not see any good this pipe line will do us if it goes to the United States. I love our United States friends, but I love my own people better than I do the people of that country. I do not see any reason why we should pipe our gas over to the United States until we have been served. We have no reason to believe that gas from Texas will come into Ontario in any guaranteed quantity; and if we are going to get gas at all, we must have a guaranteed quantity before it will do us any good.
That is the reason I intend not to support this bill. Canadians should support their own product. We do not want to be subjected to foreign authority. If we have control of our own product we can have that product when we want it and in whatever quantity we need it. But if we are obliged to depend on a foreign authority we get it only when they want us to have
3093	HOUSE OF
Boundary Pipeline Corporation it. For that reason I think we should support a pipe line that will come through the western provinces and on down through Ontario into Quebec, and will serve Canadians. We want Canada served first.


John Sylvester Aloysius Sinnott: The hon. member is talking through his hat.


Lewis Elston Cardiff: My friend says that I am talking through my hat. I have not my hat on, so that statement is not correct. He always makes statements like that when he does not know what he is talking about. As a matter of fact I do not think the hon. gentleman knows how much he has to know in order to know how little he knows.


John Sylvester Aloysius Sinnott: Just a minute. I should like to ask one question. Since the hon. member seems to know so much about this pipe line, I should like to ask how many million feet of gas it is proposed to pipe in this line. Can the hon. gentleman give me an answer to that question? Oh, do not ask for any assistance.


Lewis Elston Cardiff: I would say just about as many as the hairs on the hon. gentleman's head. If we could count the hairs on his head, we could pretty nearly tell how many.


John Sylvester Aloysius Sinnott: That is about all the hon. member knows about the bill.


Louis-René Beaudoin: Order.


John Sylvester Aloysius Sinnott: The hon. member had better cut out the personalities.


Lewis Elston Cardiff: As I said before-


John Sylvester Aloysius Sinnott: What has the hair on my head to do with the bill?


Louis-René Beaudoin: Order.


Lewis Elston Cardiff: -we are not guaranteed any quantity of gas from Texas, and this is the only other hope we have of getting gas in Ontario. If we were assured of getting all the gas we wanted from there perhaps it would change our ideas. For the life of me I cannot see why Alberta would want to export gas before Canada was served first. I am one of those who believe in developing our own country and in using our own products as much as we can. By using the gas from Alberta we certainly will help our own people much more than we would by importing gas from the United States. We know that if, with regard to gas we do not get any more support from the United States than we have had with regard to the seaway, we are not too well assured that we shall get any gas at all other than as they want to give it to us. For that reason I intend to vote against the bill. I will, however, support a pipe line that will come right down through Ontario and serve Canadians in this


end of the dominion, rather than one that will come part way down, then turn off to the south to serve our United States friends.
(Translation):


Mr. Balcer:: Mr. Chairman, the bill now
before the committee deals with the exportation of natural gas and oil products from the province of Alberta.
This is one of our most important natural resources. Well, everybody is aware of the usefulness of natural gas, first as a fuel and also as a raw material which can be put to a thousand different uses in industry. Every province in Canada, from Newfoundland to the Yukon, has need of it and wants it, and in none of them it is to be found in sufficient quantities, except in Alberta.
This natural gas, which can be used both for cooking and heating, is indeed an extremely useful product, as I had the opportunity to see for myself during a visit to Calgary. I was then able to make a comparison between prices paid in the province of Quebec and Eastern Canada for fuel like coal or electricity, with prices paid for natural gas, and I noticed a great difference in the cost of cooking meals and heating houses.
We are all happy to see that Alberta abounds in such an important natural resource. We are proud to find that one of our provinces is blessed with such wealth, to such an extent, in fact, that a short time ago the prime minister of that province went so far as to predict that within ten years the people of Alberta would not have to pay any more taxes and that the provincial debt would be wiped out. To my mind this defies imagination. At any rate, very few people could foresee this state of affairs ten or fifteen years ago.
I hope to see Alberta reach this degree of prosperity. I am happy to see that today they are in a position to share with the people of other provinces these magnificent and superabundant natural resources.
We see that this province is ready to export natural gas and even oil in substantial quantities. As a matter of fact, as experts discover new fields the government of that province are willing to authorize the establishment of pipe lines which will make it possible for other parts of this country to benefit from them. That was evidenced quite recently when the Alberta government authorized a company to export large quantities of gas from the Peace river valley to southern British Columbia. We have seen what reaction this has brought about, since Alberta's neighbouring province considers this product very important. This we have been able to

ascertain by the speeches of the various members from that province and by the very exhaustive survey of the matter made by certain members, including the hon. member for Vancouver-Quadra (Mr. Green) who has always fought to preserve for the Canadian people natural resources which belong to them and from which they are entitled to benefit before the peoples of other countries and especially of the United States.
The bill now under consideration specifies that exports of natural gas must go first of all to the provinces of Saskatchewan and Manitoba. I am convinced that the members of this house will be delighted to know it is now possible to supply this fuel with such great industrial potentialities to provinces which really need it. As a matter of fact, everyone will recall the various representations made in this house by members from Saskatchewan, for instance, when they urged the government to exert pressure upon Canadian industrialists to make them build factories and develop a practically nonexistent industry. We have all, on several occasions, seen members from the prairie provinces exert pressure upon the Minister of Defence Production (Mr. Howe), asking him to do everything in his power to decentralize our industries, so that the prairie provinces should not be dependent upon a single crop, the wheat crop, a very important one, but one which nevertheless cannot make for a stable economy in the western provinces.
However, the unfortunate thing about the bill now under consideration is that, once the proposed pipe line will have crossed into Saskatchewan and Manitoba, nothing indicates that it will continue towards the other provinces of this country, thus enabling other segments of the Canadian people to benefit thereby. On the contrary, we see that, in the English version of the bill, it is the intention of the promoters to lay their pipe line in Saskatchewan or Manitoba or outside of Canada.
As you may have judged by the remarks of those who spoke before me, therein lies the basis of this whole discussion, for it is evident, from the study that has been made of the natural gas situation in that province and the different speeches we have heard in this house on the subject, that, in the national interest, only one pipe line can be built from Alberta to eastern Canada.
Boundary Pipeline Corporation
It would be unfortunate if this house were to encourage a company to use its powers to build a pipe line which, after crossing the city of Winnipeg, would immediately turn towards the southern United States, where it would supply American centres which may need that gas, for there is no doubt that cities like Chicago and Cleveland, for instance, have a pressing need for gas, as have also the other great industrial centres of the world. But it would be unfortunate it we were to supply those large cities with gas at the expense of our own large cities and our own industrial centres.
Besides, if no pipe line is built from Alberta towards the east, the provinces of Quebec and Ontario will have to depend on the United States for supplies of that product. The hon. member for Vancouver-Quadra was quite right in pointing out that those provinces will have to overcome all kinds of technical difficulties and will have to go begging from various governmental commissions in the United States, who will grant them very small quantities of natural gas, but only after the remaining large American cities have been taken care of.
The provinces of Quebec and Ontario, it is said, could very well get their supply of natural gas from companies in Texas and from other large natural gas centres in the United States. But they forget that cities like Philadelphia, for example, which is situated practically half-way between Texas and Canada, if not even farther south, are not yet properly taken care of and bring pressure to bear on the government or on any governmental agency concerned with the distribution of that product, so that they may be looked after before .anyone else.
And so it is rather fanciful to rely on the utopian proposal according to which our central provinces, Quebec and Ontario, should get their supply of natural gas from our American neighbours.
Anyhow the situation has been weighed very aptly by the governments of the provinces of Quebec and Ontario. They have both stated clearly their respective policies in the matter. May I be allowed to quote in that connection an article which appeared in the Star on March 29 of this year:
Quebec was in favour of importing natural gas from Alberta rather than from Texas, he said, to support Canadian industry. He said representatives of United States and Canadian pipe line construction firms had been in touch with him about the possibilities of exporting natural gas.

Boundary Pipeline Corporation
The premier said nothing had yet been decided as to whether pipe lines would be built or not into Quebec province. But he said, if natural gas is to be imported it will not be United States gas.
The premier said Quebec preferred to import the gas from Alberta because it was preferable to support a Canadian industry, not subject "to a foreign authority."
So much for the policy of the Quebec government, which, I think, is to be congratulated. This also applies to the province of Ontario, as can be seen from the statement made by the minister of mines of our sister province, who said, according to the Vancouver Province, of January 22 of this year:
Hon. W. S. Gemmell, Ontario Minister of Mines, said at a press conference that "our policy is going to be to encourage a trans-Canada pipe line both as a source of fuel for Ontario and Quebec and as a national defence safeguard."
"We see no other answer than an all-Canadian pipe line."
Mr. Gemmell made it clear the Ontario government backed the principle of the pipe line but no individual company, although the Trans-Canada Pipe Line Company has made the only application to the board of transport commissioners to build the line east.
Mr. Gemmell said Ontario backed a trans-Canada pipe line because of uncertainty of supply under the proposal to bring United States gas into Ontario. Such supplies would be subject to export permit rules of the United States federal power commission.
Besides, the views expressed by the prime minister of the province of Quebec and the minister of mines of the province of Ontario, both speaking on behalf of their respective governments, were reproduced in every newspaper in these two provinces and received favourable editorial comment in most of the leading papers of these provinces.
It would be most regrettable if the Canadian government, in its desire to hurry matters, took a step which would be actually detrimental to Ontario and Quebec, because this bill, if it were adopted, would place those two provinces at the mercy of the United States. Even if the American gas production were intensified, the United States require such large quantities that we need not hope that the American companies will ever let us have more than a very small share. By passing this bill, we would act against the best interests of Ontario and Quebec.
I am surprised to see that the only member from my province who took part in this debate is the member for Chicoutimi (Mr. Gagnon); he stood up for the industries of Quebec and endeavoured to prevent the government from making a blunder. If today Alberta's natural gas does seem to be rather


out of reach, it must nevertheless not be forgotten that in a not too distant future we would have cause for bitter regret. If Ontario and Quebec, but especially the latter, possess water power which might have appeared well-nigh inexhaustible at the turn of the century, we now have harnessed more than half of these resources because of the industrial expansion of the last few years and of the constant demands made upon our supplies of white coal. Already, in their wisdom, our leaders have looked to a new fuel which the industries of the province of Quebec may well put to such wonderful use.
Last year I took part in a pipe line discussion. I did so because I wanted to follow a Canada first policy, a policy which has always been that of this party. And, Mr. Chairman, I would very much like this house never to lose sight of this Canada first motto.
Before exporting our natural resources, before allowing companies or gentlemen of fortune to waste, export or use up our natural resources to the detriment of the Canadian people, I believe it to be the duty of every member of this parliament to ensure that these natural resources, whatever they are, and especially a natural resource as interesting and as potentially rich in industrial uses as natural gas, shall always be developed to the advantage of Canada.
We may possibly be able to export our natural resources but before doing so, we must see to it that we ourselves have been generously served. We must see to it that we export nothing but our surpluses.
Before I conclude this speech, I wish to thank the hon. members from the other provinces and especially the hon. member for Vancouver-Quadra who have come to the defence of the Quebec consumers. They did not hesitate to stand up and protest strongly against the adoption of this bill while bringing forth indisputable arguments to the greatest advantage of the population of my province.
I feel that the hon. members from other provinces are to be commended for coming to the rescue of the population of Quebec, in order to protect its industrial future and ensure that all the great natural resources which our country possesses in abundance will always be developed in the best interest of the people generally; we must always think about Canadians first.

For these reasons I shall consider it my duty to vote against the adoption of this bill. I was glad to lend assistance tonight to the other hon. members who have stood up and protested, and I hope that the remarks made by the speakers who opposed this bill will bear fruit and that we will not witness such a colossal blunder in this house.


Mr. Gauthier (Porineuf):: May I ask the
hon. member a question?


Léon Balcer: With pleasure.


Mr. Gauthier (Portneuf):: Is the bill on which the hon. member spoke so eloquently a government bill or a private bill?


Léon Balcer: The energy with which members on the government side tried to crush any criticism of the bill in the committee has shown that if this bill is not a government measure it has at least a lot of supporters amongst them.
Besides, the silence maintained by the Quebec and Ontario members on the government side in connection with a bill which would deprive their respective province of the use of so valuable a product indicates that if the bill is not a government bill its supporters make it practically a bill of their own.


Pierre Gauthier: Just as the hon. member has made it exclusively a provincial measure by praising his leader, Mr. Duplessis. (Text):


George Harris Hees: Mr. Chairman, the question we have to decide on this bill is whether it is preferable to have a small gauge pipe line delivering gas to southern Saskatchewan and Manitoba, which would be the case if the Boundary Pipeline bill went through, or whether it would be preferable to have a large gauge pipe line such as Western or Trans-Canada delivering gas to the people in southern Saskatchewan and Manitoba, as well as the people in eastern Canada, all at a far lower price than would be possible through the small gauge pipe line which Boundary would lay down. The reason the two large gauge pipe lines could deliver gas more cheaply in southern Saskatchewan and Manitoba is the greatly increased volume of gas which they could carry. In the case of Western Pipe Lines, gas would be delivered to the northwestern United States in exchange for an equal volume of gas to be delivered from the southern United States to eastern Canada. In the case of Trans-Canada Pipe
Boundary Pipeline Corporation Lines the gas would be delivered direct to eastern Canada over an all-Canadian route. It is obvious that the greater volume of gas carried by a pipe line, the cheaper will be the gas which will be taken from it at the intermediate points.
At the present time sound economics in the operation of a major pipe line running eastward from Alberta requires the inclusion of the markets of southern Saskatchewan and southern Manitoba, in addition to the much larger markets of the provinces beyond the prairies. If the prairies market is captured by a company like Boundary operating on a relatively small scale it will rule out for some years to come an economically sound large-scale pipe line to deliver gas to eastern Canada, either by a direct route from Alberta to eastern Canada running through Canada all the way, or by the use of the exchange principle I have outlined.
Another objection to the Boundary project is that it would provide only a limited market for Alberta's gas resources and would thereby impede the development of Alberta's gas and petrochemical industries. For these reasons I believe the Boundary project is neither the best means of getting cheap gas to Saskatchewan, Manitoba and eastern Canada nor of assisting in the development of the Alberta gas industry. Therefore I intend to oppose the bill.
We must ask ourselves: What is the best means of developing Alberta's gas and petrochemical industries and of getting the cheapest possible gas to southern Saskatchewan, southern Manitoba and southern Canada? Gas from the southern United States delivered to eastern Canada under the exchange principle would be considerably cheaper than Alberta gas delivered by a trans-Canada route to eastern Canada. The reason is the long haul from Alberta to eastern Canada and the fact that there are few take-off points available over this route. For that reason I believe the government should approach the government of the United States as soon as possible to see if a long-term gas exchange agreement cannot be worked out.


Louis-René Beaudoin: I think the hon. member is going outside the scope of the bill. I do not think we ought to be concerned over what is the best and cheapest route to bring gas from Alberta to eastern Canada. That is a matter for the company asking for incorporation. This is a private bill and I do not think the hon. member should suggest that the government should enter into an agreement with the government of the United States.

Boundary Waters Treaty Act
All that we should be considering at the moment is the bill before the committee. May I take advantage of this opportunity to say that a general discussion has taken place on the first section of this bill during the last twelve hours during which private bills could be considered. We have spent almost eight hours in a general discussion of that section. I think it will be admitted that so far hon. members who have taken part in this general discussion have been allowed ample latitude, and I think from now on the rules should be observed. I am sure hon. members will want to co-operate in observing the rules and will speak directly to the bill.
Section stands.
Progress reported.


Mr. Deputy Speaker:: The hour for private and public bills having expired, the house will resume the business which was interrupted at six o'clock.



BOUNDARY WATERS TREATY ACT


[Stage Direction]
The house resumed consideration in committee of the following resolution-Mr. Pearson-Mr. Beaudoin in the chair:
That it is expedient to introduce a measure to amend the International Boundary Waters Treaty Act to increase the maximum salaries of the members of the Canadian section of the international joint commission; to bring the secretary and all other employees under the provisions of the Civil Service Act; and to provide that all expenses incurred in carrying out the provisions of the act and the treaty shall be paid out of moneys appropriated by parliament for the purpose.
Mr. Graydon:: Unfortunately I was out of the chamber during the first part of the minister's explanation of this resolution and there are one or two points about which I should like to inquire. Perhaps the minister will not mind answering them, because I have not had an opportunity of reading today's Hansard. As I understand it, it is proposed to raise the maximum salaries to be paid the commissioners to $15,000.


Lester Bowles Pearson: The bill will establish a maximum of $15,000 for the chairman and $10,000 for the other members of the Canadian section. Salaries would be established within those maximums by order in council. It does not necessarily mean that the salaries will be set automatically at $15,000 for the chairman and $10,000 for the other members.


Gordon Graydon: Is it the intention of the government to proceed on that basis and pay the chairman $15,000 and the other members $10,000 each?
[The Chairman.]


Lester Bowles Pearson: It is the intention of the government to recommend that the chairman be paid a salary of $15,000 and the members $10,000 each. It is for the present membership of the commission that it will be recommended that these salary scales should be established. With respect to the chairman of the commission, he is of course entitled to receive a substantial pension from the government now so that the additional amount from the public treasury will be the difference between the pension to which he is entitled and the $15,000, if that amount is adopted.


Gordon Graydon: I take it then that in the case of the chief commissioner the total amount he will receive will be $15,000. I never feel very happy raising questions about people's salaries. I do not suppose anybody in the house is anxious to do that, because there are always personalities involved. I think the committee will understand that so far as I am concerned that is the most remote thing in my -mind with respect to the principle involved in the legislation. With reference to the work of the international joint commission, up to the present time of course it has not been often involved in what one might term major undertakings. In the details of the estimates respecting the international joint commission, which were considered:	by the standing committee on
external affairs, one finds that their work is fairly well confined in the present fiscal year to studies and surveys of the midwestern watershed, an investigation into the matter of air pollution in the vicinity of Detroit and Windsor, the Niagara Falls reference and the Saint John river reference.
Some of these projects of course have been under way for quite a long time. I have no doubt that in their own sphere they are very important matters. However, with respect to the composition of the commission one notes that there are three commissioners, one secretary, one engineer, an administrative assistant, one clerk grade 4, two stenographers grade 2B and one stenographer grade 1, which may indicate the amount of work involved from an administrative and secretarial point of view.
There is one question I wanted to raise. I refer to the bits and pieces approach to the matter of raising of salaries generally. I do not want it to be understood for a moment that I am concerned particularly about the personnel of this commission. I do not want anything I say to reflect upon them, but it seems to me there is something wrong in our

approach in parliament to the question of salaries of this nature. When one considers the heavy responsibilities of cabinet ministers not only in their own departments but in parliament and also in the international field; and when one couples with that the fact that they also have their constituencies to take care of, it makes one wonder whether or not their salaries are not sometimes completely out of line with the salaries we pay to certain other people in the government service.
In this particular case we are raising the salary of the chief commissioner to a level almost equal to that of a minister of the crown. There may be very good reasons for that, but it seems to me that somehow a good look should be taken at the whole picture throughout the government service. I am not suggesting that in most cases people are overpaid in any way, but so far as the salaries paid to cabinet ministers as compared with those paid to others employed in the service are concerned there is certainly a very great difference in responsibility and very little difference in the return.
I know that the minister cannot comment because he is one of those involved in what I am saying, and I do not expect any comment from that quarter. However, I think there comes a time when these things do get out of line. The Prime Minister's position is another instance. It seems to me that he does not receive as much money as some people who are employed by the government. I suppose if I were out on the hustings in an election campaign and somebody said, "Well, is he worth it?", I might be tempted to keep quiet when that question was asked.


Mr. Fournier (Hull):: You would not do that.


Gordon Graydon: But I think in the house we have to take .into consideration the responsibilities the Prime Minister carries.


Alphonse Fournier: You would not do that.


Gordon Graydon: If it were my hon. friend I certainly would not keep quiet. In any event when you compare the Prime Minis-ster's salary with those paid to certain other people, and when you contrast the responsibilities they carry, I think the Prime Minister's salary is out of line. I think most members of the house would say that it is out of line. I am not arguing for an increase in the Prime Minister's salary nor in those of other members of the cabinet, but I think we ought to stop and take a good look whether or not we are being fair right across the board to those who have the heaviest and most serious responsibilities
Boundary Waters Treaty Act of government and administration. I have taken the opportunity tonight on this occasion to raise this subject because it seemed to me that it provided an opportunity to say what I have been thinking for a long time. As I said, I do not want it to be taken that I have singled out this particular item because of the personalities involved. That is the furthest thing from my mind. Now I should like to say something about the work of the international joint commission. I was pretty disappointed a couple of years ago on an occasion when I thought we should have had one of the members of the international joint commission appear before the external affairs committee respecting the flood in the Red river valley. It was a matter of very grave importance but the committee decided they were too busy. Apparently they have been busy ever since, because we have never at any time had a member of the commission appear before the committee. It was represented at that time that they were so busy in the field it was not possible for them to come.
If the international joint commission is doing a major job in Canada I think we ought to examine that job in order to see what they are doing, what the extent of their work is and, more than that, what the future of the commission itself ought to be. Very few commissions or departments of the government have had less publicity and less investigation of their work than the international joint commission. I hope that as time goes on an opportunity will be provided to investigate the work of the commission and see what they are actually accomplishing and achieving. I think it is only fair to say that the international joint commission may of course be faced with more serious and heavier responsibilities in the very near future in connection with the St. Lawrence seaway reference and also the question of erosion. In that connection I should like to say to the minister that it seems to me it takes a long time before any conclusion is reached on these references to the international joint commission. What little experience I have had in connection with them would indicate that it takes a very long time to get any decision.
One problem with which we are faced in my province at the moment is the question of lake levels. I understand that is being referred to the international joint commission for some action. I suppose by the time the commission renders a decision the lake levels will have gone down from natural causes, and we shall never find out why the water went so high. I want to suggest to the minister that careful consideration ought

Boundary Waters Treaty Act to be given to just how efficient this commission is and how comprehensive their work is, in view of the fact that this amendment is to be made.
I want to mention as well the act which established the international joint commission. That act was assented to on May 19, 1911, by the parliament of Canada. It set out of course the purposes and the extent of the jurisdiction of the commission. Altogether it is a rather comprehensive act which has to do with a waterways treaty, of course, for which the commission was originally set up. The minister may have spoken about this matter before I came in, but I am wondering whether he intends to make a complete review of the whole act, which has been in operation now for 41 years, or whether he is only going to make the one change which the resolution seems to envisage, dealing with the question of salaries and the basis of the employment of certain people in that commission. I should be glad to have some information from the minister on that point.


Stanley Howard Knowles: When this matter was before us at six o'clock I expressed the hope that the minister would give us the reasons as to why the government feels these salary increases should be provided, as well as the reasons for the other changes indicated in the resolution. I hope, in view of what the hon. member for Peel has just said, the minister will do that when he speaks again. I think it is fair to the minister to say that in his introductory statement all he did was to tell us what changes were envisaged by the bill to be based upon this resolution. He indicated that at the present time there are maximum salaries of $7,500, as set out in the statute of 1911, and that the amending [DOT]bill would provide a maximum of $15,000 for the chairman of the commission and a maximum of $10,000 for the other two members on the Canadian side.
Similarly he indicated that it would raise the amount that could be paid to the secretary, and that it would make provision for the staff to come under the civil service, as well as for the expenditures of the commission to be provided by an annual appropriation. Nowhere in his statement did the minister indicate an increase in the volume of work, increased responsibility or any other reasons as to why these changes should be made. No doubt to the minister there is no argument about it. No doubt he feels this should be done, and has probably already recommended it to the treasury board. However, I suggest parliament should not be asked to approve
CMr Oraydon.]
these increases, which percentagewise are rather great, without being given reasons for doing so.
While I am speaking I should like to ask the minister one other question. He referred to the fact that the salary of the secretary at the present time, according to statute, must not exceed $4,000. I would point out that in the original statute of 1911 the ceiling was $3,000. The change to $4,000 was made by chapter 5 of the statutes of 1914. One other change was made by that statute of 1914. However, it is true, as the minister said this afternoon, that there is at present a statutory limitation which says the salary of the secretary must not exceed $4,000. The proposal is to increase the amount to $6,000, I believe, or rather to bring the secretary under the civil service. But in the estimates now before us on page 15 one finds a general item for the international joint commission, and then is referred to page 171 where it appears that we are already being asked to appropriate the sum of $5,088 for the secretary. I checked with last year's estimates and found it was the same figure. I should like to know, justifiable though it may be, why the secretary should get a larger amount when the statute says his salary must not exceed $4,000. I should be glad if the minister would answer that point at the same time he gives reasons for these proposed increases.


Lester Bowles Pearson: If I did not deal with these questions before six o'clock it was not because I thought there was no argument about them. I agree there should be argument in the house about every proposal to increase salaries and amend statutes. The only reason I did not refer to the matter then was because I thought it was probably better to deal with such questions when we were in committee. I am quite happy to answer some of them now.
The question raised by the hon. member for Peel, and also referred to by the hon. member who has just spoken, about the justification for increases of this kind becomes very important. I listened incidentally, Mr. Chairman, with great interest to some of the observations of my hon. friend about salaries generally and the necessity of trying to keep them on a comparable basis. Some of those observations which dealt with cabinet ministers' salaries, for instance, may have evoked a warm response within me, but it is a matter about which it would be improper for me to say anything, as the hon. member himself indicated. I should like to add that whatever he may say about the Prime Minister outside the house, we shall always recall with gratitude the estimate of the high value

of the Prime Minister's services which he has made inside the house, and with which we agree.
It is quite true, as the hon. member has indicated, that this question of the salaries of different officers should not if possible be dealt with piecemeal. Indeed it is not, because there is a continuing review of these salaries, and there has been an effort to bring them all up to a reasonable level in view of changed conditions. That was the case with this particular commission, and the salaries of its chairman and its members. The work of the international joint commission has grown in value and in importance over recent years. I do not think there is any doubt about that. I believe I could confirm that statement by a comparison of the references which are now before this commission with those which were before the commission eight or ten years ago. The hon. member for Peel mentioned only a comparatively small number of references. If hon. members will recall the annual report of the Department of External Affairs for 1951, on page 19 there is a chapter devoted to the work of the commission, which shows how important and how widespread are the references which are now before it.
The main reason it is proposed that these salaries be increased is because of the increased work, and the increased importance of that work, as well as the fact that a salary which might have been appropriate in 1911 might be considered not so appropriate in 1952. I think I am right in saying that until fairly recently the work of the members of the international joint commission has not been such as to occupy all the time of the members of the commission on either the Canadian or the United States side. But certainly that is not the case now. It is now a full-time job for all the members, as even a cursory survey of the work now before the commission would show. For instance, at the present time there is before the commission a reference on the pollution of boundary waters; the Sage creek reference; the Niagara river reference; the Saint John river reference; the question of atmospheric pollution; the Souris-Red rivers reference; the Waterton-Belly rivers reference, which is an extremely important one; the Columbia river reference; the flood control projects on the Okanagan river; the Kootenay river projects; the project to construct a dam near Waneta, British Columbia, to say nothing of the St. Lawrence reference which we hope will be before the commission shortly and indeed the reference on lake levels to which the hon. member for Peel has referred, and which we are trying to work out with the United States government at the
Boundary Waters Treaty Act present time in a form which is satisfactory to both governments. One of our preoccupations in that attempt is to make sure that a reference of this kind, of such great importance, will not get in the way of or unnecessarily postpone the St. Lawrence waterway reference which will include proposals fundamentally related to the control of lake levels.
I therefore think it is fair to say that the work of the commission has grown in volume and in importance. A proposal of this kind that the salaries of the members of the commission should be increased is not merely a recognition of changed conditions since 1911 but also a recognition of the growing importance of this work.


Donald Methuen Fleming: Will the minister permit a question?


Lester Bowles Pearson: Yes.


Donald Methuen Fleming: The minister has given a list of references before the commission. Will he indicate at what stage they are at present? Some of them may not be advanced to the stage where they are actually imposing heavy duties on the members of the commission as such.


Lester Bowles Pearson: I think I can say that these references are in fact imposing extremely heavy duties on the members of the commission at the present time. I know it is hoped by the commission to clean up as many of these references as possible before the other questions of the St. Lawrence waterway and the lake levels have to be considered.
Some reference was made by the hon. member for Winnipeg North Centre to the proposal in this resolution that the salary of the secretary of the commission be altered by raising the maximum to $6,000. He called attention to the fact that in the estimates there is at present, I believe, an item which would indicate that the present salary is above the present maximum of, I think, $4,000. I had, of course, noticed that discrepancy myself. On making inquiries as to the reason for it I was informed that in November of 1946 the then Secretary of State for External Affairs inquired of the Department of Justice as to the position of the secretary of this commission in relation to the Civil Service Act. The information which was secured on this matter is contained in a letter from the then Secretary of State for External Affairs to the chairman of the Canadian section of the international joint commission. Perhaps I might read from that letter. I think it will be an answer to the

Boundary Waters Treaty Act question raised by my hon. friend. This letter, which is dated November 29, 1946, reads as follows:
It is true that originally authority for appointing a secretary to the Canadian section of the international joint commission may have been vested in the said Canadian section. This would appear to be justified by the wording of article 12 of the Boundary Waters Treaty of January 11, 1909, which was confirmed and sanctioned by section 1 of the statute 1-2 Geo. V., c. 28. Further evidence of this authority can be found in section 7 of statute 1-2 Geo. V., c. 28 as amended by 4-5 Geo. V., c. 5, section 2.
However, this power of the Canadian section appears to have been repealed by 8-9 Geo. V., c. 12, section 53 (Civil Service Act 1918).
53. "Subject to the provisions hereinbefore contained . . . the power under any statute of any board or commission situated at Ottawa either with or without the approval of the governor in council, to appoint or promote any officer, clerk or employee . . . are repealed."
On 19th November, 1918, Mr. Newcombe, then deputy minister of justice, expressed the view that the officers and servants of the Canadian section of the international joint commission are a part of the civil service and as such subject to the provisions of the Civil Service Act. This view has now been confirmed by the acting deputy minister of justice by an opinion dated 12th November.
From the foregoing, it would appear that the appointment of a secretary of the Canadian section of the international joint commission must be made pursuant to the provisions of the Civil Service Act with which you are undoubtedly familiar.
Therefore I suppose that strictly speaking, Mr. Chairman, it was not necessary to amend this act to deal with this question of the secretary's salary; but it was felt that it was desirable to do so in order to bring it in harmony with the other act. That is why that situation arose.


Stanley Howard Knowles: Mr. Chairman, I appreciate the answer the Secretary of State for External Affairs has given to this point. However, it is a bit disturbing when one discovers on an occasion such as this that we are paying, through the estimates, a salary in excess of what the statute allows. It makes one wonder if there are any other cases like that scattered through the estimates. Maybe not. Maybe this is the only one. But here is one that we have not known about, and it has come out in this way.
I was going to say this to the Secretary of State for External Affairs, when he read that letter. If that was the case, namely that it had already been decided that the secretary of the international joint commission is a civil servant rather than an appointee of the international joint commission, why should there be the provision in the resolution now before us that the secretary and other employees are to be brought under the provisions of the Civil Service Act? I would presume that when this resolution which is now before us was drafted, the drafters must have known of that matter which came to

light in 1946. All I can suggest at this point is that this proves the desirability of fairly close scrutiny of things of this kind by members of the House of Commons.
I hope that there is not too much of this sort of thing going on; that is, statutory provisions being altered by means of getting some decision from justice or somewhere else that the statute does not really mean what we have always thought it to mean. When this resolution now before us was drafted, apparently it was thought by whoever drafted it that the secretary is not covered under the provisions of the Civil Service Act, because the drafter of this resolution said that the secretary should be covered. Now when we complain about the fact that we are already paying this secretary more than the law allows under the statute of 1911 as amended by the statute of 1914, the Secretary of State for External Affairs says the secretary does not come under the provisions of the Civil Service Act. That is not being unduly critical of the Secretary of State for External Affairs because, from what he said, I imagine that he discovered the same disparity I discovered. He apparently, on his own initiative, made the same sort of inquiry that I have been making here on the floor of the committee. I cite this as an example of the need for pretty close scrutiny of these financial matters by members of the House of Commons.


Gordon Graydon: Has the auditor general drawn this to the attention of the government at any time to the minister's knowledge?


Lester Bowles Pearson: I think reference is made to the secretary's salary in one of the auditor general's reports; whether it is in this context, I am not sure. But I should like to add that there is nothing sinister in this matter. The fact that the salary of the secretary was established in the original act and that a subsequent act of parliament in essence repealed that particular provision merely means, as I understand it, that the secretary's salary has been paid subsequently by virtue of the Civil Service Act provision which, according to an opinion of the Department of Justice, has in fact repealed the earlier provision; and the bill which will be based on this resolution will make that clear.


Mr. Murray (Cariboo):: I should like to point out the very great importance to Canada of safeguarding our water resources, which on the west coast begin with the Skagit river.


Louis-René Beaudoin: I am sorry to interrupt the hon. member, but this resolution should not serve as a pretext to discuss the safeguarding of our waterways. This resolution deals merely with the International Boundary Waters Treaty Act and maximum salaries of

the members of the Canadian section of the international joint commission, and to bring the secretary and all other employees within the provisions of the Civil Service Act.


George Matheson Murray: I bring that out to show the importance of these men who are charged with that responsibility. They should be men of the very highest quality and character, because they are charged with safeguarding one of our greatest resources, particularly in the west, where these waterways originate in Canada and are used in the states of Washington, Oregon and Montana for the development of power and irrigation. I refer to waters flowing from and having their source in Canada. That is true right across Canada, and in the north where the Yukon river is a potential source of power for proposed industry in the territory of Alaska. We must have men who are experts to safeguard our interests where international waterways are concerned.


William Joseph Browne: Until we had an explanation from the Secretary of State for External Affairs that this commission is now very busy, it was very hard to understand why we would want to increase their salaries or make the extension proposed by this resolution. I notice in the list of submissions that are before the commission, which the minister set out, he mentioned the pollution of boundary waters. I hold in my hand a report of the international joint commission of the United States and Canada on the pollution of boundary waters, and I note from that report that they were requested by references made to them by the governments of the United States and Canada in April, 1946, to make an investigation. They immediately referred it to experts and technical advisers who reported to them on August 24, 1949. On that date they made their report to the commission and the commission made their report in October, 1950. It took them fifteen months after they received a report from the experts before they sent the report to the government, and that report was not published until 1951.
The minister admitted that until recently he did not think the commission had very much to do. I do not say he used exactly those words, but he certainly gave the impression that they were not overworked. He now says that they have all these references. What has been done with regard to the references? Where are the offices of this commission? Are they situated in Ottawa? Are they holding inquiries all the time? I was under the impression that they did not seem to be holding many hearings during the five years this inquiry was going on, and on which a report was made.
Boundary Waters Treaty Act As has been pointed out by the hon. member for Winnipeg North Centre, the resolution proposes to bring the secretary and other employees of the commission within the provisions of the Civil Service Act. Some of these are temporary employees. Is it the intention to bring temporary employees under the Civil Service Act? I understand that this year an engineer has been added to the staff and one or two other officials. There are four permanent positions, including the three commissioners. These other members of the staff are temporary. Can the Secretary of State for External Affairs tell us whether it is the intention to bring these three commissioners under the Civil Service Act, with the idea of giving them pensions? How long have they been employed, and how will that arrangement be carried out? [DOT]
I notice that in the bill there is to be provision that all expenses incurred in carrying out the provisions of the act shall be paid out of moneys appropriated by parliament for the purpose. Surely that is the way it has been done. Is there some other way by which these expenses have been paid, because I notice in the public accounts for 1951 there appears the following item:
To provide for preliminary studies and surveys of the mid-western watershed, $10,000, expenditures, $7,888.88.
Then the following appears:
To provide for Canada's share of an investigation on the matter of air pollution in the vicinity of Detroit and Windsor, $40,000, expenditures, $27,052.29.
In the estimates this year there is a vote of $10,000 for the purpose of studies and surveys of the mid-western watershed. In connection with the investigation into the matter of air pollution in the vicinity of Detroit and Windsor, $52,000 is to be voted. I notice in the estimates this year there are two new items. I think the matter of the Saint John river reference has been dropped this year, judging by the estimates. I should like to have some information from the minister.


Lester Bowles Pearson: I should say in the first place that I believe the details of the work of the international joint commission can, I think, be more usefully discussed when we have the estimates of my department up for consideration, and I shall have all these details with me. I just mention that, Mr. Chairman, because there will be another opportunity to discuss the work of the international joint commission.
However, the hon. member who has just spoken has brought up a few questions, and I should like to try to deal with them now in the hope that they will not be brought up

Army Benevolent Fund Act again when our estimates are under consideration. He has asked where the offices of the commission are situated. They are situated in Ottawa. The commission does a great deal of its work travelling around, holding investigations and hearings in all parts of the country and indeed in the United States.
If I said a few moments ago that the commission in earlier days had, as my hon. friend put it, not much to do, I did not want to give the impression that they were idling on the job. I wanted to give the impression that the references they had were not as numerous or as important as the ones they have now. The particular reference quoted by my hon. friend is one example of the work of the commission. I have a feeling that if he studied that reference in detail and had an opportunity to learn something about its complications and difficulties and the work required in negotiations with other governments, not only the United States, because the provinces came into it, he would appreciate that the work was well done and that there was no undue delay.
So far as the staff of the commission is concerned, the bill based on the resolution will merely state that the secretary and other officers, clerks and employees as required for the purposes of this act might be employed under the provisions of the Civil Service Act, so they would all be employed under that act and as such would become civil servants. At the present time there are two permanent civil servants and four temporaries on the staff of the commission.
Resolution reported, read the second time and concurred in.
Mr. Pearson thereupon moved for leave to introduce Bill No. 333, to amend the International Boundary Waters Treaty Act.
Motion agreed to and bill read the first time.



ARMY BENEVOLENT FUND ACT


Hon. Hugues Lapointe (Minister of Veterans Affairs) moved: that the house go into committee to consider the following resolution:
That it is expedient to introduce a measure to amend the Army Benevolent Fund Act, 1947, to increase the rate of interest from two and one-half per cent per annum to three and one-half per cent per annum on minimum monthly balances to the credit of the fund not in excess of five million dollars.


Mr. Brooks:: Will the minister make a statement at this time?


Hugues Lapointe: Mr. Speaker, as hon. members are aware, following a report submitted by

a special committee of the House of Commons on canteen funds during the session of 1947, an act was passed to establish the army benevolent fund, from the army canteen and other service funds. This fund is administered by a board set up under the act, composed of five members who sit voluntarily under the chairmanship of Lieutenant General Murchie.
According to the terms of the act it was provided in part that plans would be formulated on the assumption that there would be prospective beneficiaries for 50 years from the establishment of the fund, and the actuarial schedule assumes that the bulk of the expenditures from the fund will take place during the first 30 years at a rate of $400,000 per annum. In fact, the board's current annual expenditures are higher than this sum.
Another section of the act provides that the fund shall be credited with interest at the rate of 21 per cent per annum, semiannually, on the minimum monthly balance. With the fund at approximately $9 million at the present time the income from this interest would amount to $225,000. It appears that in order to finance operations on the current basis the board would deplete the capital at a greater rate than is planned for in the present actuarial schedule. Hence if the fund continues to spend at the present rate, and there is no increase in revenue, it will be unable to continue in operation for the 50 years as planned originally.
In order to avoid this, and having regard to the interest rates being credited to other comparable funds now, it would seem reasonable to increase the rate of interest paid on the army benevolent fund to 3J per cent; and this it is proposed to do.
Another amendment is proposed to the act. Members of the board have recommended that, should persons interested in the welfare of army veterans wish to make donations or bequests to the army benevolent fund, the board should have authority to accept such donations or bequests. This authority the board does not possess at the present time. The amendment proposed would permit to credit such receipts to the army benevolent fund. It has also been found that some veterans to whom grants have been made voluntarily offered to refund such grants. Under the act as it stands at present such refunds go to the consolidated revenue fund, and not to the army benevolent fund. Similarly, any recovery of sums that may have been obtained through fraud or misrepresentation at the present time fall into the consolidated revenue fund. This other amendment would make it possible for such recovery to benefit the army benevolent fund itself.

I do not think there is anything further I wish to say, at this time. I would like, however, to take this occasion to express on behalf of the government and the Department of Veterans Affairs our deep appreciation of the efforts of the men who are serving voluntarily on the board, and of the members of the various provincial committees set up to administer the fund in each province. The work and energy they have devoted to this task have been of the greatest value to a considerable number of veterans in this country.


Alfred Johnson Brooks: Mr. Speaker, I do not think anyone will criticize in any way the resolution before the house. We are pleased indeed to see this increase in rate from 2J to 3| per cent so that, as the minister said, the fund may be made available for 50 years, as set out in the act. He also explained, by way of justification for the increase, that the new rate of 3J per cent is being obtained in respect of similar funds at the moment.
I wish to join with the minister in congratulating those in the different parts of Canada who are in charge of the fund. I know there are boards set up in every province, as well as in the United States and the United Kingdom and, I believe, the Yukon Territory. As has been pointed out, on a voluntary basis these people have been doing good work. I know the disposition and the general administration of the fund has been well handled.
This fund gives relief to many veterans who otherwise would not receive it, because no other source of relief is available to them. I do not think I can add anything more at this time. I was curious to know why the monthly balance to the credit of the fund is not in excess of $5 million. I think under the old act no limit was set, though there is in the present one. Probably when we get into committee the minister will explain just why there is a limitation. As I said at the outset, I think those who are administering the fund deserve our appreciation and thanks for the splendid work they are doing.


Mr. Clarence Gillis (Cape Breton South):: Mr. Speaker, the amendments proposed by the minister are all right; there is nothing wrong with them. They are steps in the right direction, designed to build up the fund; but I have an amendment in my mind which I had in mind when the act was set up and which I am disappointed the minister has not brought in. I refer to the definition of "veteran" in the act, which is that a veteran means a person who was on active service in the military forces of Canada during world War II.
Army Benevolent Fund Act That definition excludes from the benefits of the act many veterans in Canada who served in the auxiliary services and who also saw service in world war I. These auxiliary service personnel were known as supervisors, and they served in Canada not because of their own choice, as they made their services available to the government in any capacity. Most of them were quite willing to go overseas and serve in any capacity in which they might be useful.
However, the government decided at that time to use these auxiliary supervisors in Canada because of their experience. In the great majority of cases the decision as to where they would serve was made by the government. I think it was a mistake to write the present definition into the act when it was set up, and I do not think it was the intention of the government or of the committee to deal out that particular classification because they were granted every other right granted to veterans who saw overseas service in the last war.
These supervisors came from such organizations as the following:
The Canadian Legion war services National Council of the Young Men's Christian Association
Knights of Columbus Canadian army huts Salvation Army war services They served with the army, navy and air force. The acts that have been made applicable to this particular classification are the following:
Veterans Land Act Veterans Insurance Act Veterans Rehabilitation Act War Veterans Allowance Act Unemployment Insurance Act Veterans Business and Professional Loans Act
Department of Veterans Affairs Act War Service Grants Act Civil Service Act Pension Act
Every piece of legislation made applicable to the veterans of world war II was made applicable to these supervisors. At the time the act was passed I felt that the definition was too narrow to include many people who in the years that lay ahead might require the benefits available under the act.
Many of these men were in the older age group and were more likely to run into hardships which would qualify them under the act than the younger returning personnel.
I have had many cases of veterans who ordinarily would have been able to qualify for benefits under the army benevolent fund

Army Benevolent Fund Act but who icould not because of this definition to which I have referred. I have had considerable correspondence with the officials administering this army benevolent fund, both nationally and provincially, and I know that most of them are sympathetic. I was led to believe that in January 1952 there was to be a meeting at which consideration would be given to broadening that definition and bringing the war service supervisors within the scope of the act. It looks as though the minister has not been advised as to the necessity for that particular amendment, because apparently it is not going to be made.
I was quite pleased when I saw this resolution on the order paper concerning the army benevolent fund. There are three of them. I then thought that the amendment I had in mind was going to toe brought in. As I said before, the amendments proposed are fine. They are designed to build up the fund, increase the interest rate and so forth, but I think it is much more important to amend the act in order that deserving people who should have come under its provisions in the first place may be able to receive benefits which the act was designed to provide for veterans who are unfortunate enough to get into circumstances which qualify them for participation in the benefits of the army benevolent fund.
I again suggest that the minister give consideration to changing the definition of "veteran" in the act. As it is now, it is pretty narrow. Unless a change is made many deserving people are going to be left on the outside. The minister was not in charge of the department when this act was set up, and possibly he did not know much about it at that time. I think it is axiomatic that supervisors should be included within the provisions of this act because every other piece of veterans legislation has been made applicable to them. I think there has simply been an oversight on someone's part.
The Minister of Veterans Affairs (Mr. Lapointe) and the hon. member for Royal (Mr. Brooks) may pat the administrators of this fund on the back and say it has worked beautifully and all that sort of thing; but while I have had the pleasure of meeting some of these very nice people I have had considerable difficulty getting anything from the fund in connection with those cases in which I was interested. In one instance the man lived in the home province of the hon. member for Royal. It is not easy to get anything from the fund as there is a lot of red tape about it. Of course they are operating within the scope of the act, and a case that
[Mr. Gillis.)

can be handled in the municipal or provincial fields or in any other way is outside of the act regardless of how bad the need may be.
If the minister could see his way clear to have a change made in the definition of that word I can assure him that it would relieve quite a few cases-not a thousand but quite a few-where there is considerable hardship, and which I have been trying to iron out for some time. I plead with the minister that some consideration be given before this thing is finalized. When you are opening the act for amendments and are making amendments along financial lines to build up the fund, I urge the minister that consideration should also be given to making a slight change in order that certain people in very poor circumstances may receive the benefits that the act was intended to bestow upon them. I would ask the minister to comment upon that angle before he proceeds with the amendments he has introduced.


Victor Quelch: Mr. Speaker, the provisions of the resolution appear to be fair. Like the majority of amendments moved in relation to veterans affairs, I think this is a step in the right direction. I should like to join with those who have expressed appreciation* of the work being done by those peopie who have given their services on a voluntary basis in helping to administer the fund. I wonder if the minister intends to send the bill to the veterans affairs committee.


Hugues Lapointe: Yes.
Motion agreed to and the house went into committee, Mr. Robinson in the chair.


William Joseph Browne: What
amount of interest will be paid on the amount of the fund which exceeds $5 million?


Hugues Lapointe: The interest which is being paid at the present time, 2J per cent.


William Joseph Browne: According to the auditor general's report I believe there is a sum of $300,000 on which 3 per cent is paid.


Hugues Lapointe: Yes.


William Joseph Browne: That will still continue?


Hugues Lapointe: Yes. I think the amount is $309,000, which represent bonds bearing interest at 3 per cent. They axe in the oare of the securities division of the Department of Finance. The balance of the fund is an account in the consolidated revenue fund.


Victor Quelch: Can the minister give the committee an idea of the approximate number of veterans who have benefited under this act?


Hugues Lapointe: I am afraid I have not that figure. As a matter of fact I was trying to get it just before I came into the house. However, I think that information will be available when the bill is referred to the special committee.


Alfred Johnson Brooks: I asked the minister a question about the $5 million.


Hugues Lapointe: 
Alfred Johnson Brooks: Was it because you were paying 3J per cent on similar funds like the annuities fund,?


Hugues Lapointe: No. My understanding is that will meet the actuarial requirements to carry the fund for 50 years.
Resolution reported, read the second time and concurred in.
Mr. Lapointe thereupon moved for leave to introduce Bill No. 334, to amend the Army Benevolent Fund Act, 1947.



COMBINES INVESTIGATION ACT TO PROVIDE FOR ADMINISTRATION


Hon. Stuart S. Garson (Minister of Justice) moved: the second reading of Bill No. 306, to amend the Combines Investigation Act and the Criminal Code.
He said: Mr. Speaker, the bill which is now before the house for second reading is the product of the report of the MacQuarrie committee which engaged in the first over-all review the act had had since 1923. It therefore seems appropriate at this time to review the principles and objectives of this legislation, and particularly the purposes which are intended to be served by combines legislation generally. The economic organization of our business in Canada is essentially one of free enterprise in a system of privately-owned business. It is true that there are exceptions such as certain kinds of public utilities of 55704-196
Combines Investigation Act which public ownership or public regulation has been considered more appropriate, but these are exceptions to the general rule.
The greater part of our industry consists of private business conducted without specific government regulation. We continue to rely upon a system of free enterprise because we are convinced that this system will produce the greatest benefits for the people of this country in terms of material well-being and political freedom. When we look around the world and see the results of other systems we are even more convinced of the soundness of our own. It is no accident, even when due allowance is made for the abundance of our natural resources, that the highest standard of living in the world today is enjoyed by Canada and the United States which are at the same time the outstanding examples of competitive free enterprise economies. However the winds of theory may appear at times to favour the socialist barque, this is the rock of fact upon which it must founder.
Our system of free enterprise cannot continue to produce these material gains unless the spirit of enterprise inherent in it is continually maintained and rejuvenated. It is competition which performs this function, but competition is not automatically self-perpetuating; and this is the reason we must constantly strive and take positive measures to maintain effective competition in Canadian business. If we fail to maintain competition; if we are beguiled by the argument that certain small groups of businessmen should regulate business in the interests both of themselves and those with whom they deal or whom they supply; if we once concede the regulation of business to those who want the gains of private business without having to meet the tests of efficiency, then we will lose the advantages of free enterprise and incur the disadvantages and restrictions of socialistic control but without any of the compensating advantages of that system.
This has been the experience of many industries in European countries. There great efforts have been made since the war to try to reawaken the spirit of competition and remove trade restrictions which hold back industrial recovery and growth which such countries need so much. Too frequently, perhaps, we are inclined to talk about maintaining competition in a free enterprise system in an abstract way without dwelling in sufficient detail upon the concrete considerations involved.
Sometimes it must seem to the man on the street that what is involved are mainly arguments among economists and other experts, which are very interesting for those who have the time and the inclination to follow

Combines Investigation Act them but which are of little practical significance to the ordinary man in his daily life. This, of course, is not the case; and that is one of the reasons it has seemed to me desirable to review, if only briefly, the major principles and objectives of our Canadian combines legislation.
At some danger, perhaps, of oversimplification I should like to put the point that the material welfare of the workingman-and in that term I include those who work at desks, in factories or the fields-depends upon two factors: the amount of currency he earns and its purchasing power. Some persons might say that in making this statement I am simply looking at two sides of the same coin. But I suggest that it helps the thinking of the man who is not an economist to break it down in this way. The entire significance in a pay increase of say from $1.50 to $2 per hour lies in what the original $1.50 and the additional 50 cents will buy in goods and services. To put it shortly, every earner has a natural and legitimate interest in the highest possible wage and the lowest possible prices.


Mr. Benidickson:: We are all consumers.


Stuart Sinclair Garson: As the hon. member says, we are all consumers. The only way to be able to pay the high wages and still have the low prices is by increasing the efficiency of the methods of production and distribution. Put a number of horsepower at the disposal of a skilled workman operating an ingenious machine, he can far out-produce a large number of workmen who are working with their bare hands. The same principle holds for all other technological improvements, whether they be by way of plant, process or materials, in either production or distribution. Good wages can be paid to the man who builds the machine and improves the process, and to the man who operates the machine or applies the process, and still a product can be turned out which can sell at reasonable prices and because it is sold at reasonable prices, it can be sold in large quantities.
It has been calculated that today's workman has available in his own physical resources an average of 1/5 0th horsepower, but in the machine he operates he has, on an average, in this country about 8 horsepower. New and better machines, improved processes, and new and improved materials- all that we include in the expression technological advances-mean more production per man hour. Under some less fortunate systems of society than that which we have in Canada the workman immediately concerned may derive little or no benefit from such increases in technological advances.

Under our system, however, each such improvement works in the direction of higher wages, lower prices and additional leisure. Here then is the point. Competition among producers and distributors encourages the creation of the improvements to which I have referred, and makes them available to all. Illegal price fixing agreements amongst purchasers and distributors, by destroying competition, discourages those improvements and operates to prevent existing improvements being as generally available for the benefit of all as would otherwise be the case.
The existence of arrangements relating to prices lessens the necessity to toe on the lookout for a better machine or an improved process lest another find it first. Not only does a combine decrease that necessity; it may also enable the participants to defer the use of improvements already known but the utilization of which would involve the group in some immediate outlay for new capital equipment. By the same token the drive to seek economies of operation and administration is tempered. In the train of the principal arrangements upon prices come other restraints upon production and distribution. When consumer demand falls off, as it must from time to time, we encounter under such an arrangement the ability and frequently the tendency to keep prices up, even if it may mean less production for the time being or even over a longer period. This, of course, means a fall-off in employment. So all along the line, when industry is governed by combines and not by competition, the natural results are likely to be lower wages, less leisure, higher prices and often failure to adjust to consumer demand, which results in recurrent unemployment.
It will be seen from the foregoing that competition affects -more than today's price on an article or a commodity. Competition produces not only better immediate prices but the development as time goes on of greater efficiency. It necessitates the improvement of existing processes and products and the introduction of new processes and new products. In a genuinely competitive market no manufacturer can rest upon his laurels. Continued success for him depends upon keeping in the vanguard of industrial advances. This benefits the whole society. Moreover the maintenance of a free enterprise system under competitive conditions is, I suggest, closely linked with a healthy democracy. The expansion of the economy produced by competition provides more equitable distribution of wealth and savings amongst most of the people.
Competition provides, moreover, economic opportunities for the talents and diligence of

those who have only talents and diligence to offer, and who might not get a chance to offer them under a business system which was under the control of a small minority of businessmen responsible to themselves alone. The results of private industrial control would be a serious curtailment of economic freedom which, in turn, would inevitably have its effect upon our democratic way of life.
There are those who would contend that in our efforts to maintain competition we are overlooking the changes that have taken place in industrial organization since anti-combines laws were first adopted sometime before the turn of the century. It is true that the competition we have today, under conditions of large scale industry and mass markets, is not the competition envisaged by early economists looking at local markets and small scale industry. But because the structure of industrial organization has changed, and may continue to change, is no reason to abandon our conviction in the efficacy of competition. We can look around and see what results follow when restrictive practices are tolerated or even in some cases encouraged. Pessimism over the ability of competition to exert itself effectively is by no means a phenomenon of recent years. A writer of authority, the late E. R. A. Seligman, of Columbia university, in an article in the Political Science Quarterly of 1887 said:
Competition has had its day and has proved ineffective.
That was his suggestion at that time.
Recognize the combinations but regulate them.
One could only imagine what the result might have been if the United States had accepted the principle suggested by Professor Seligman and had undertaken the governmental regulation of business instead of seeking to maintain competition. But in contrast with this 1887 quotation from Professor Seligman is another very recent statement of Professor R. B. Tennant in a recent volume of the Yale studies in economics when he says this with respect to the continued effectiveness of the Sherman Act in the United States:
It is strange and unsatisfactory that criminal prosecution of actions which result from market structure should produce desirable results, while the planned reform of that structure does not seem desirable. But in the present state of knowledge this may be the best that we can do. We are not yet ready to blueprint a new economic order, yet the effects of the anti-trust laws seem clearly desirable. The latent power of the Sherman Act is undoubtedly unpleasant for businessmen to live with, yet the act still appears to be, for all its untidiness, one of the most useful expressions of public policy.
55704-196i
Combines Investigation Act
Sometimes it is suggested-and I think wrongly so-that what are frequently attacked under the anti-combines legislation are situations that arise inevitably from today's conditions under which in many fields of industry the country is supplied by a small group of manufacturers. Such, of course, I would submit is not the case. It would not be denied that in a field where suppliers are few, each will have a fairly good idea of what reaction any step taken by this manufacturer or that manufacturer will produce among the others, and for this reason he may change his prices more slowly and with more regard to what his competitors will do than if all the suppliers were smaller and more numerous. That natural regard for the counteraction of others, however, is an entirely different thing from the positive degree of collusion which is the subject of attack under anti-combines legislation.
I think no one can look at the development of industry on this continent during the present century and fail to be impressed by the effective part which competition has played and continues to play in our industrial life, and the beneficial results which flow from such competitive activity. The fact that in a particular industry, whether from technological or other causes, production is concentrated in a few large producers does not necessarily result in the disappearance of competition in that industry. Vigorous competition may exist among a few large firms; and while it may not be the automatic competition envisaged when there are a multitude of sellers, it may still be effective competition benefiting consumers and others-dependent on the industry. The policy of the Combines Investigation Act directed against collusive agreements is thus an effective force even when competitors are so few that each acts with the knowledge that no significant change in his activity will pass unnoticed by his competitor.
Investigations under the Combines Investigation Act have disclosed the elaborate and persistent efforts which are made by large firms when they seek to eliminate price and other competition. Typical investigations show, for example, that seldom can a combine rest upon price arrangements alone. If manufacturers who are parties to price arrangements on certain lines of goods can make substitute lines and price them at will, the principal agreement will be ineffective. The usual combine therefore involves some restriction upon production.
Again, a price arrangement may be upset if one supplier ships collect and another freight prepaid; so frequently a combine embraces strict rules governing this and all

Combines Investigation Act other significant conditions of sale. The great variety and detail of the arrangements which are considered necessary to suppress competition in such ways demonstrate how various and how pervasive competition will be if it is not blocked. These elaborate arrangements to prevent competition also point to the value *of legislation such as the Combines Investigation Act; for the more difficult it is made to effect such arrangements to stifle competition, the more opportunity there obviously will be for competition to make itself felt. To the extent, then, that combines legislation assists in preventing rigidities and restrictions and in maintaining flexibility in the industrial field, it will contribute to the health of Canadian business.
Many of those who would deny the vitality of the competitive system fail to grasp that it stands as the only real alternative to state control. If competition is not to be maintained as an effective means of seeing that the benefits of industrial progress are equitably shared among the different sections of the population, it is clear that the mass of the people would not remain content to have industrial control exercised by large corporations not subject to government regulation. If we consider the abandonment of competition because of the difficulties which certain situations create in maintaining it, we must be prepared to face the much greater difficulties which would be created in trying to develop effective government regulation over widespread and complex industrial and trade operations. Not only would there be the difficulties of administration of such detailed regulations, but more serious by far in the long run would be the depressing effects, on innovations and industrial improvements, of the imposition of such government controls. Ultimately they would lessen in significant degree the standard of efficiency throughout our business life. Such a prospect, it seems to me, would dismay all but the most outright socialist. I think the majority of Canadians remain convinced -that the maintenance of competition is a much more advantageous and effective course of action.
The next question is "How best can we assure and protect competition?" This is most important. We require a method, I suggest, which will provide continuity in policy and some measure of zeal in administration. A brief examination of the various types of agencies which have been provided over the years will serve as a useful background for the consideration of the present proposals. When the Restraint of Trade Act was passed in 1889, which eventually became section 498 of the Criminal Code, no special provision was made for the investigation of

alleged offences and no special administrative agency was established to enforce that law.
The Combines Investigation Act of 1910 provided for a preliminary inquiry by a supreme court judge and subsequent investigation by a board of three members nominated for the purpose of the particular case which was under consideration. It is of more than passing interest, I think, to refer to the debate which took place in the House of Commons in 1910 when this important measure was introduced by the late Right Hon. W. L. Mackenzie King who at the time was minister of labour. The legislation then introduced was entirely novel, providing for the first time in democratic countries an orderly procedure for investigating the operation of business combines and providing further for publicizing the results of such investigation. These are the two principles which have governed combines legislation since that time; and in considering the present bill the house will understand that it is affirming the principles of anti-combines policy enunciated in 1910 and following the historic pattern of this legislation in devising means whereby those principles can be given greater practical effect at the present time.
There is some topical interest in recalling the legislation of 1910, and that it was passed at a time when prices had risen very substantially; and those hon. members who are familiar with that interesting address made by Mr. King on this occasion will recall that he devoted a considerable amount of his time-I think he spoke on that occasion for four hours, which I shall not attempt to emulate on this occasion-to a discussion of the basic causes for the movement in price levels which was taking place then. Indeed, 1910 was a time not unlike our own, when the nation was expanding, when the productive resources of the nation were being strained to the utmost to meet the demands of a rapidly-growing and prosperous economy. A good many of the things which Mr. King said on that occasion still have considerable validity more than forty years after.
In discussing prices Mr. King said, as reported in Hansard of 1909-10 at column 6810:
The legislation we are proposing is legislation which will afford an examination into the business of every large concern, where there is reason to believe that a combine is operating to an undue disadvantage of the public; and until an examination of its business had taken place, I would hesitate to say that it has been acting unfairly. The fact that the increase in prices, and the formation of these large mergers, and combines have taken place simultaneously, has created in the minds of the people a strong impression that the two are intimately connected, and the public are demanding some kind of legislation which will enable them to see whether they are right or wrong in that particular.	[DOT] .

Mr. King then felt that it was imperative that these combines should be exposed, as he said, to the "light of day" in order that people should understand their significance in the nation.
The legislation of 1910 provided for a preliminary inquiry by a supreme court judge, which could be instigated by any six persons applying to the judge for an order directing an investigation into the alleged combine. If the judge so ordered, the investigation was conducted by a board of three members, one selected by the applicants, one by the parties against whom the application was made, and the third to be a judge nominated by the other two members.
In practice certain weaknesses were revealed in this legislation, but the outbreak of the first great war postponed any fundamental reconsideration of the problem of those weaknesses. At the end of the war, in the year 1919, under the union government, parliament passed the Board of Commerce Act, creating a board of commerce which was to administer the Combines and Fair Prices Act which supplanted the statute of 1910. This legislative scheme was declared ultra vires in 1921, but it did add to the scheme of the legislation the creation of a continuing enforcement authority.
Under the Combines Investigation Act of 1923, which is the one, with a number of amendments, which is still on the statute books, and to which the bill now before us provides for a number of amendments, it was contemplated that investigation could be made by special commissioners appointed for the purpose of each inquiry; but preliminary investigations were to be made by a permanent official, the registrar. In introducing this legislation in 1923 Right Hon. Mr. King said in Hansard for that year at page 988:
Now, it is recognized that there are distinct limitations in the matter of the protection of the public under the provisions of the Criminal Code. The legislation which the government is introducing proceeds on the theory that the reason why section 498 of the Criminal Code is of so little effect is not that there are no combinations that are detrimental to the public or that such combinations are rare, but rather that the existence of these combinations, and their method of operation is difficult to discover; that what is needed is effective machinery of investigation which will disclose the existence of combines operating to the detriment of the public, and afford the information whereby proceedings under the Criminal Code can be made really effective in the case of individuals who are violating its provisions, or who are associated with combines that are operating to the detriment of the public. The legislation to be introduced provides machinery for investigation, which it is hoped and believed will be effective toward this end.
Combines Investigation Act
Later, on second reading, Mr. King explained the fundamental principles underlying the legislation at page 2522 of Hansard, in the following terms:
. . . what is fundamental in this legislation is summed up in the words that private rights cease when they become public wrongs. In other words,, the bill does not in any way seek to restrain private individuals in the making of any contracts or agreements, tacit or implied or open, which they may wish to make, so long as in the exercise of their private rights they do not carry matters to, a point where their joint action becomes a public wrong in the form of a combination operating to the detriment of the public.	.,
This act of 1923 carried on very effectively' from that time until 1935, when the dominion trade and industry commission was set up; consisting of three members. But these three members were also members of the tariff board, who had the responsibility for making-tariff inquiries and then were given the added duties of administering the Combines Investigation Act. The functions of this commission under the Combines Investigation Act itself were somewhat in opposition to one another, because on the one hand the commission was to approve certain agreements between firms in an industry which fixed prices and regulated production when it seemed that this course was advisable; and on the other hand they had also to administer the Combines Investigation Act which applied against arrangements unduly restricting competition. Therefore the same body was in the one case expected to investigate companies in respect of agreements, and in other cases they were authorized to approve of other types of agreements. However, that did not present a problem for too long because thp Dominion Trade and Industry Commission Act was also declared unconstitutional in part by the privy council, and in any event its period of administration was of brief duration.	,
The third great development in this legislation occurred in 1937 when the Combines Investigation Act was substantially amended,, and the act was passed as we know it now, apart from amendments which have since been effected. The main departure here was to provide for a single commissioner to conduct both preliminary and full investigations. The purpose of these amendments was stated by the then minister of labour, the late Hon. Norman McLeod Rogers as being "to restore the vigour of the Combines Investigation Act." And dealing more generally with the. new legislation Hon. Mr. Rogers said in Hansard of 1937 at page 1347:
The Canadian legislation in connection with combines represents an orderly and progressive development over a period of almost fifty years. In reshaping the legislation, as we are seeking to do at this time, we have sought to incorporate the best features of the several acts which have preceded

Combines Investigation Act the present act. The type of administrative agency is naturally one of the most important considerations to be kept in view.
This outline of legislative history shows that, as experience has indicated, the anticombines administration has been strengthened and confirmed by successive Liberal governments. In a very real sense the important changes now being proposed in this bill represent a continuance of this historical evolution of our combines legislation.
Looking back on these various developments, I think it can be said that the process has been one of working out within the constitutional powers of this parliament the most effective machinery possible. On the constitutional side, the goal has been to develop general principles which apply in all cases. When the procedure has been found to go beyond federal authority, as was the case with respect to the Board of Commerce Act and with respect to section 14 of the Dominion Trade and Industry Commission Act, it was because attempts were made to apply particular forms of regulation to local industries or trades. Aside, however, from constitutional considerations, it is obvious that a system which proceeds by a statement of general principles to be applied in a judicial or quasi-judicial manner has the advantage, among others, of getting as far as possible away from direct state intervention, which is necessarily present when an administrative body may give particular direction in every particular case which arises before it.
This brief historical review serves, I hope, to point up the fact that in all the various forms of administration I have mentioned, with the possible exception of the short-lived attempt to supervise price and production agreements in the depression period, the endeavour has been to find the most effective machinery to apply the principle of maintaining competition.
It is also noteworthy that the general principle of public policy in this regard as expressed in section 498 of the Criminal Code has remained the basic feature and has retained its significance through the lengthy period from its enactment in 1889 until the present time of 1952.
When I discussed this legislation during the debate in the house on the resolution I indicated in general terms the main changes which are included in the bill now before the house. I do not think it is necessary for me to repeat any of my remarks, but I believe I should indicate in a somewhat more definite manner the changes in procedure which are contemplated in the present bill. The act which is now to be amended provides for the initiation of an inquiry either by IMr. Garson.]

formal application of six citizens or by direction of the minister, or by the commissioner himself on his own motion whenever he, the commissioner, has reason to believe that a combine exists or is being formed. The first two bases of inquiry have been used rarely in recent years and ordinarily an inquiry is commenced because of information coming to the attention of the commissioner, either directly from members of the public or through the minister; that is, letters I receive from members of the house or members of the public, and which I pass on to the commissioner with the suggestion that he investigate them immediately.
The bill now before us makes no change in the ways in which an inquiry may begin, except that the director will have the status of the commissioner in this regard. That is to say, we have divided up the functions now being discharged by the commissioner into those of investigation, which the new director will discharge, and those of considering the material gathered by the director, and passing upon it in a quasi-judicial manner and making a report, which will be done by the new commission. The director in the first instance will initiate the inquiry and the investigation.
The progress of an inquiry normally extends through a number of stages from the informal collection of information, to begin with, to the examination of witnesses under oath, if the proceedings culminate in a formal investigation. At the preliminary stage, therefore, there is the assembly of information from available sources bearing on the question of whether there is a possibility of a situation existing in contravention of the act.
After a few preliminary inquiries of this kind it may appear to the commissioner that there is no ground for suspicion of contravention; the inquiries may end there, and the files would be closed. If the information obtained, however-and this is what happens in the minority of cases-does not dispel but rather strengthens the suspicion of the existence of practices in contravention of the act, then more intensive inquiries are undertaken, usually involving the examination of business records obtained from the premises of those believed to be involved in these arrangements.
Under the present act powers to issue orders for the entrance into and examination of premises and records are conferred on the commissioner. Under the bill similar authority is given to the director, subject to a certificate being issued by a member of the commission on ex parte application of

the director. That is, where the commissioner now can proceed to take these steps on his own motion, under the new arrangement he will have to apply to the commission on ex parte application for authority to do so. In effect, the initiative with respect to the commencement of investigation will rest with the director, but where he finds it necessary to exercise formal powers of entry and examination he will inform a member of the commission of the need for such action and secure a certificate such as that to which I have referred.
Somewhat the same situation will prevail with respect to the examination of witnesses under oath in the course of an inquiry. At present such witnesses are summoned by and examined before the commissioner or his delegate. Orders for the attendance of witnesses henceforth will be issued by a member of the commission on ex parte application of the director, or on the member's own motion. The witnesses will be heard by the member or by a person designated by the member of the commission.
Under the present act, hearings before the commissioner have usually been conducted by counsel appointed for the purpose by myself as Minister of Justice, and provision is made in the present bill for the appointment of counsel to conduct hearings before a member of the commission. The usual procedure under the present act, after the hearings have been concluded and if the circumstances then appear to warrant it, has been for the commissioner to request counsel appointed by the minister to review the evidence in the inquiry and prepare a statement as to its effect, including what are called allegations of misconduct, so that these may be submitted to the parties concerned for the purpose of affording them an opportunity, as the Inquiries Act requires, to be heard before the commissioner reaches conclusions and makes his report. In other words when a case has been built up it is submitted to the concerns affected, and an opportunity is given them to appear and show cause before the commissioner as to why no adverse report should be made against them.


Mr. Applewhaile:: Is that new?


Stuart Sinclair Garson: No, that is now in the act. The separation of functions, however, contemplated by the present bill between the director and the commission, makes it desirable to provide in the bill specifically for the procedure to be followed, and this has been done. As the director's functions are confined to those of securing information and presenting it for the consideration of the commission, the responsibility is placed
Combines Investigation Act on him of preparing for submission to the commission a statement of the evidence obtained in the inquiry which will serve also as notice to the parties concerned of the situation which the commission is being called upon to appraise.
The commission is to allow any person against whom an allegation is made in the statement submitted by the director full opportunity to be heard at the hearings to be held for that purpose, and to enable the director to submit representations with respect to his review of the evidence. So the two sides in the matter will be heard in a judicial manner by the commission. In one sense the provisions in the bill will codify the present practice under the Combines Investigation Act in this respect rather than introduce any change other than that arising out of the separation of functions as between director and commission. When this hearing has taken place, upon conclusion of the final argument the commission will prepare a report and submit it to the minister for publication.
More express provisions are also provided in the bill covering the removal and handling of documents required in the course of an inquiry. The present act provides for the copying of documents secured in an inquiry and for the return of such documents at the conclusion of an inquiry. No provision is made for furnishing the person from whom such documents were obtained with copies during the course of an inquiry, although this course has normally been followed if documents are required for any length of time. The bill provides that in the case of any documents removed for purpose of examination or copying, the original or a copy thereof shall be delivered to the person from whom it was obtained within sixty days unless the commission authorizes a longer period.
During the debate on the resolution the hon. member for Eglinton (Mr. Fleming) made particular reference to the recommendation of the MacQuarrie committee with reference to research in the field of monopolistic situations-I hope he will correct me if I am wrong when he takes part in the debate, if he chooses to do so-and I gathered that he thought greater emphasis on the work of research would be very desirable and advantageous. Hon. members will find that a section of the bill provides for investigation of monopolistic situations and authorizes for such purpose the same powers of investigation as are provided for other inquiries under the act.
It would not be appropriate for me to discuss at this stage the detailed provisions of
31X8

Combines Investigation Act the bill, but I think I should elaborate to some extent on the brief comments I made on the resolution in regard to the new remedy of court order of prohibition which has some parallel with injunction orders in civil proceedings. Hon. members are aware that orders, of the nature of cease and desist orders, to be issued in discretion of an administrative tribunal were ruled ultra vires in the Board of Commerce cases.
The MacQuarrie committee stressed the desirability of providing for some form of judicial order which could be used to deal with combines offences in the incipient stage or to reach situations which might not be corrected by criminal prosecution. The committee pointed to the constitutional problems involved in devising legislation of this kind and suggested that the matter be studied by the law officers. The section in the bill is the result of such study, and in the opinion of the law officers there are strong reasons for believing that the section is within federal competence.
The orders envisaged by the section are, in contrast to those in issue in the Board of Commerce cases, to be granted by the courts by the application of general principles. In the case of a conviction for a combines offence it will enable the court to prohibit the continuance or repetition of the offence; and if the conviction is with respect to a combine by way of merger, trust or monopoly, the court may direct its dissolution. It will also be possible for the court to prohibit acts which are directed toward the commission of a combines offence or which are likely to constitute such an offence. In other words, it will not be necessary for the administration to wait until an offence has been committed before taking action in cases where it is apparent that restrictive practices are being developed which are likely to operate against the interest of the public.
Having indicated, in this and in previous speeches, the main provisions of the bill, I think this would be an appropriate time to indicate also some matters which it does not contain, and the reasons. At page 43 of the printed MacQuarrie committee report will be found the following recommendation:
2.	That section 29 of the act dealing with tariff action and section 30 of the act dealing with patent action be amended in order to make the requirements of the public interest the condition justifying a recommendation and action in these respects.
Section 29 of the present act provides in effect that whenever as a result of an investigation or a court decision it appears to the governor in council that a combine exists to promote unduly the advantage of manufacturers or dealers at the expense of the public, and that the tariff has facilitated


such abuse, the governor in council may modify or remove the tariff from the article concerned. Section 17 of the Customs Tariff Act provides in effect that where a producer takes advantage of a duty to enhance prices the governor in council may remove or reduce the duty on the article concerned.
The MacQuarrie committee suggested that the provision which I have described, contained in the Combines Investigation Act, is too rigid since the governor in council has to find to his satisfaction that there exists a combine and the committee therefore proposed that the provision be amended and that the requirements of the public interest be made the condition justifying a recommendation by the new commission for remedial tariff action.
The decision not to modify section 29 at the present time is not by way of rejection of the MacQuarrie committee's recommendation. Having in mind, however, the really substantial powers that presently exist in section 29 of the Combines Investigation Act and section 17 of the Customs Tariff Act, to which I have referred, the government deemed it advisable to wait before making any change until a number of cases have come before the new commission which will point out in some detail the lines along which any amendment should proceed. To endeavour to catch the spirit of the recommendation in legislative form at the present time might result either in missing it or in vesting in the governor in council powers that would be so general as to be too arbitrary.
Similar considerations apply in respect of patents. The present section 30 of the Combines Investigation Act provides in effect that in any case where use has been made of a patent to restrain or injure unduly manufacture, trade or commerce in respect of any article the exchequer court on the information of the Attorney General of Canada may grant relief including the declaring void in whole or in part of any agreement relating to the use of the patent and including the directing of the grant of licences under the patent. The Patent Act also contains certain provisions for the safeguarding of the public interest in respect of patents.
Having regard to these existing remedies and to the same difficulty that was encountered in the case of tariffs, of trying to catch the spirit of the recommendation in legislative form without at the same time being too arbitrary, it was decided that no harm would result and that it would be the better course to have a number of cases before us that had come before the new commission and which

would assist in defining carefully the additional area to which the remedies might be extended.
The MacQuarrie committee recommended that the new commission should envisage the possible effectiveness of tariff action in every case presented to it and report its findings in this respect. It also recommended that the commission should consider the impact of patents in every case presented to it and report its findings. These recommendations will no doubt be carried out by the new commission, and their reports will enable the government to give the further consideration to these important matters which they deserve. In the meantime the existing provisions will enable a very considerable degree of remedial action in appropriate cases.
In conclusion, Mr. Speaker, I would say that the bill now before the house widens substantially the scope of the present act and introduces more suitable and workable provisions to carry out the administration of the legislation. It reaffirms public policy
Combines Investigation Act with respect to restrictive trade practices and demonstrates the desire of this government to see that policy applied in the most effective manner possible.
On motion of Mr. Fleming the debate was adjourned.



BUSINESS OF THE HOUSE

Alphonse Fournier: Tomorrow we will take up first the resolution in the name of the Minister of Agriculture to amend the Cold Storage Act; then the resolution in the name of the Minister of Finance respecting war risks insurance; then Bill No. 306, to amend the Combines Investigation Act and the Criminal Code. If we have time left we will take up Bill No. 279, to amend the Industrial Development Bank Act and the resolution in the name of the Minister of Resources and Development to amend the Northwest Territories Act.


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

		
		
		
		
		
		
		
		
		
		
		
		
		
		
		
		
[Stage Direction]

Wednesday, June 11, 1952