1952-05-14

ANIMAL CONTAGIOUS DISEASES


Mr. E. D. Fulton (Kamloops):: Mr. Speaker, I rise on a question of privilege. I wish to refer to a matter which affects the rights and privileges of all members of this house. A telegram which just reached me this morning advises me of a news dispatch as appearing in the Vancouver Sun. It reads in part as follows:
The following dispatch appeared In the Vancouver Sun appearing Ottawa date 13 begins:
Dr. E. Christie, federal veterinarian told the parliamentary foot-and-mouth disease investigators today that most people in Saskatchewan feel the investigators are wasting a lot of time. The only dissatisfaction appears to have come from politicians in Ottawa, Dr. Christie states. Ends.
In view of the grave anxiety felt throughout all of Canada at this terrible scourge it is disgraceful that any official should make such a statement and the seriousness of the matter should be squarely put before the minister of that department and a public withdrawal instantly made.
Mr. Speaker, I am not a member of the agriculture committee but I have checked and I find that such a statement was made there. There are two respects in which the privileges of this house have been affronted in connection with this statement. The first is that it is suggested that a group of members of this house investigating one of the most serious situations ever to confront the agricultural industry of Canada and seeking to arrive at the facts surrounding the outbreak of that disease should have been accused of wasting time.
The second way in which the privileges of this house and of the members of parliament are involved is that this statement, outrageous wherever it might come from, comes from a civil servant, an official of the department under investigation in that committee.
In view of the seriousness with which this matter is viewed by the agricultural industry throughout Canada and the necessity of the fullest possible investigation by this house, I feel that that statement should be withdrawn, that the minister himself should require from the official who made it a withdrawal, and should further make it perfectly clear that the statement made does not reflect the official attitude of the government or of
the minister. Unless the minister takes that course, the only conclusion we can come to1 is that the minister himself and, through him, the government condone this affront to the position of parliament and to the urgency of the inquiry.


Mr. Pouliot:: Did you remove the mote from your eye?


Edmund Davie Fulton: That is another of your empty-headed statements.


Right Hon. J. G. Gardiner (Minister of Agriculture):: Mr. Speaker, I am sorry that my hon. friend did not give me any intimation that he was going to raise this question, as is the usual custom.


Some hon. Members:: Oh, oh.


James Garfield Gardiner: But first on the matter of privilege, as the minister of the department I should like to suggest to him that there is not any reason for repeating what has been said quite often by members of the opposition, namely that the Department of Agriculture is under investigation. That is not the fact. As a matter of fact, we have had certain correspondence placed before the house and before the committee, we have had that correspondence referred to the committee on agriculture, and there has been some discussion on the question. In so far as Dr. Christie is concerned, he is to all intents and purposes no longer a civil servant. He was given superannuation leave as of the 1st day of April, so that he is now giving service-


Some hon. Members:: Oh, oh.


James Garfield Gardiner: -he is now giving service to the people of the Dominion of Canada that is no longer required of him by employment.


Mr. Rowe:: Giving it free?


James Garfield Gardiner: Yes, to all intents and purposes free. He is on the period of release that all civil servants have, as of the 1st day of April, and is drawing pay up to a certain date; but he is not required under any engagement to the people of this country to be there at all. He has been serving since the 1st day of April, and even before that, simply because of his long service in the department. Dr. Christie began his service in 1910, and has been constantly with the department from 1910 to the present. He is leaving on superannuation, or is already

Foot-and-Mouth Disease entitled to leave on superannuation, but is simply staying there helping with this job because of his long experience in it.
Now, someone asked him a question in the committee and he answered. It was not a *government representative who asked it. He .answered that question as to what he himself .believed was the attitude of the people in Saskatchewan, and the opinion that he [DOT]expressed was his own. I have not any reason for saying it was wrong. Judging [from what I know, I think it was very correct.
I do not know just what I would punish him for, if I had any way of punishing him, since he is no longer really a civil servant but doing this job for us in the manner in which he is. I do not know that there is any action which I can take in the matter. I thought the committee itself was satisfied yesterday that they had heard the best evidence from Dr. Christie that they have heard from anyone who has appeared before them. He did not come as a result of our suggestion that he should be there; it was suggested by the opposition members of the committee that Dr. Christie ought to be called.
I knew he was on superannuation leave now, and was not insistent on his doing anything in any particular, but Dr. Christie came on call and he gave his evidence, and I do not think it comes in very good form from those who insisted on his being there now to be exhibiting so much opposition to the man whom they wanted to hear, simply because he did not say what they thought he was going to say or what they thought he ought to say. He told his story, and told it in a straightforward way; he answered all questions asked him, and as a matter of fact I think everyone was pretty well satisfied then with the answer that my hon. friend has referred to.


Edmund Davie Fulton: The Minister of Agriculture has indicated that-


Some hon. Members:: Order.


Edmund Davie Fulton: I am pursuing the question of privilege.


Mr. Deputy Speaker:: I cannot allow a debate on this question of privilege. The hon. member for Kamloops rose and said that he wished to put forward a question of privilege, and he stated his question of privilege. He asked that the minister give a reply. That reply has been given by the minister. The minister answered the points which could be replied to in the House of Commons. It seems to me that with respect to a matter arising from a statement which has been made by a witness in a standing committee, the proper procedure is to discuss

the matter in that committee. The hon. member has said that he is not a member of that committee; but, as he knows, he has the right to be heard there if he makes the request, and I am sure the chairman will advise him of the meeting to attend when it is called, and he can discuss fully the matter of privilege there.


Mr. Cruickshank:: I rise on a question of privilege.


Edmund Davie Fulton: On a point of order with reference to this matter of privilege, may I direct your attention to citation 198 of Beau-chesne's Parliamentary Rules and Forms, third edition, which reads;
Scandalous charges or imputations directed against members of a select committee are equivalent to libellous charges brought against the house itself.
It is under that citation that I am raising this matter, and in my view the question of privilege put forward is still before the house and has not been dealt with in any way. Indeed, it has been aggravated by the answer of the minister, because he stated that he supported the stand of Dr. Christie.


Mr. Deputy Speaker:: Order. I listened very carefully to the point of privilege as stated by the hon. member, and as I was listening to him I was examining as to whether or not it was a matter which could be raised here. In accordance with this citation he did make his point so that a reply in this house was forthcoming from the minister responsible for the department, the Department of Agriculture, in this instance. The minister has replied. What the hon. member has asked for is a reprimand to be addressed by the minister to the civil servant, and secondly for the minister to disagree, or declare it was not the policy of his department that was stated in the reply given to the committee by the witness referred to.
The minister has replied to these two points; therefore the hon. member should be satisfied with the reply given. He may not like the reply given by the minister; he may not agree with it; but I think the matter has been disposed of.



REPORTS OF COMMITTEES


[Stage Direction]
Fourth report of standing committee on railways, canals and telegraph lines.-Mr. McCulloch.

Fourth report of standing committee on external affairs.-Mr. Bradette.
Fourth report of standing committee on miscellaneous private bills.-Mr. Winkler.
Questions
Bill No. 223, for the relief of Marie Maude Louise Ladriere Cook Tooby, otherwise known as Marie Maude Louise Ladriere Cook-Salisbury Tooby.-Mr. Winkler.


Hon. Brooke Claxlon (Minister of National Defence):: I would like to announce that negotiations between the French and Canadian governments concerning the construction and the use of airfields in France by units of the Royal Canadian Air Force have recently been concluded. As a result of these negotiations, which have been carried out within the framework of the North Atlantic treaty, an airfield has been placed at the disposal of the Royal Canadian Air Force in the region of Metz. Construction of additional facilities is proceeding and tactical squadrons of the Royal Canadian Air Force will, I expect, occupy this airfield next fall. These squadrons will form part of the North Atlantic tactical air forces of central Europe.


Mr. Pearkes:: Will the construction of that airport be carried out by the French government, or will the government of Canada deal directly with the contractors in France?


Brooke Claxton: It will be carried out for us by the French government, which will deal with the French contractors engaged.



PRIVATE BILLS


[Stage Direction]
Bill No. 211, for the relief of Jeanne Antoinette Sophie Helena Kessler Meyer.- Mr. Winkler.
Bill No. 212, for the relief of John Stachy-shyn.-Mr. Winkler.
Bill No. 213, for the relief of Theodora Dunska Williams.-Mr. Winkler.
Bill No. 214, for the relief of Marguerite Mary Winn Nelson.-Mr. Winkler.
Bill No. 215, for the relief of Irene Mary Johnson Muirhead.-Mr. Winkler.
Bill No. 216, for the relief of Roger Pilon.- Mr. Winkler.
Bill No. 217, for the relief of Winnifred Shirley Nice Perry.-Mr. Winkler.
Bill No. 218, for the relief of Ursula Runge Kniewel Fijalkowski.-Mr. Winkler.
BiR No. 219, for the relief of Bella Sybil Feinman Brenton.-Mr. Winkler.
Bill No. 220, for the relief of Vera Kathleen Martin Lightfoot.-Mr. Winkler.
Bill No. 221, for the relief of Helen Kouri Cumas.-Mr. Winkler.
Bill No. 222, for the relief of Cora Marguerite Blume.-Mr. Winkler.

Mr. Higgins:: 1.	What Is the estimated value of the fishing industry in each province?
2.	What is the estimated number of persons in each province engaged in the fishing industry?


Mr. Mcllraiih:: 1.	Estimated marketed value of production of the fishing industry:
Thousands of dollars 1950
Newfoundland	 30,000
Prince Edward Island.. 3,321
Nova Scotia	 38,165
New Brunswick	 18,053
Quebec	 5,496
Ontario	 7,034
Manitoba	 6,791
Saskatchewan	 1,360
Alberta	 768
British Columbia		68,821
Northwest Territories.. 2,298
Thousands of dollars 1951
29.000
3.000 37,500 19,320
5,700
8.000 8,000 1,500
85.000 2,300
Totals	 182,107	200,120
2.	Number of persons employed in the fishing industry*:
Newfoundland	
Prince Edward Island ....
Nova Scotia	
New Brunswick	
Quebec	
Ontario	
Manitoba	
Saskatchewan	
Alberta	
British Columbia	
Northwest Territories....
Totals	
1950 Number	1951
25,000 3,982 20,396 15,246	Not
9,600	yet
3,886	
5,904	avail-
1,322 2,825 16,066	able
671	
104,898	
""Includes persons employed in fish processing establishments.



NEW INDUSTRIES ESTABLISHED BY FOREIGN INDUSTRIALISTS

Mr. Higgins:: }* Have new industries been established in Canada within the past two years by foreign industrialists?
2.	If so (a) in what provinces; (b) what industries have been established in each province: (c) what is the nationality of the promoter of each such industry?

Questions
3.	Has financial assistance been granted by the provincial governments to such industrialists to establish the industries? If so, what is the basis of the financial assistance so provided?


Mr. Mcllrailh:: 1.	Yes.
2.	(a), (b) and (c).
Information as to the nationality of the promoter in each individual case is not available. 'Origin' as shown in the following refers to the location of the non-resident firm involved.
Province	Industry	No.Ontario	Food and beverages	
6Rubber products	
2Textile products (except clothing)..	2Clothing (textile and fur)	
1Wood products	
6Paper products	
1
Printing, publishing and allied
industries	 1
Iron and steel products	 39
Transportation equipment	 11
Non-ferrous metal products	 8
Electrical apparatus and supplies ..	7
Chemical products	 25
Miscellaneous manufacturing
industries	 9
Non-metallic mineral products ....	1
Quebec	Food and beverages	 4
Rubber products	 1
Leather products	 1
Textile products (except clothing) .	12
Clothing (textile and fur)	 7
Wood products	 3
Printing, publishing and allied
industries	 1
Iron and steel products	 13
Transportation equipment	 2
Non-ferrous metal products	 4
Electrical apparatus and supplies ..	4
Non-metallic mineral products _______ 1
Chemical products	 15
Miscellaneous manufacturing industries	 3
Newfoundland	Leather products	 2
Textile products (except clothing). .	1
Clothing (textile and fur)	 1
Iron and steel products	 1
Alberta	Chemicals products	 2
Miscellaneous manufacturing industries	 1
British Columbia Wood products	 1
Transportation equipment	 1
Non-ferrous metal products	 1
Nova Scotia	Food and beverages	 1
Iron and steel	 1
New Brunswick Printing, publishing and	allied
industries	 1
Origin U.K. (2); U.S. (4).



U.S. (2).

[Stage Direction]
U.K. (1); U.S. (1).

[Stage Direction]
Germany (2); Sweden (1);
U.K. (1); U.S. (2).

[Stage Direction]
Holland (1); Sweden (1);
U.K. (13); U.S. (24).
U.K. (3); U.S. (8).
U.K. (2); U.S. (6).
Germany (1); U.K. (1); U.S. (5). Australia (1); U.K. (2); U.S. (22).
Czech. (1); U.K. (1); U.S. (7). U.K. (1).
Czech. (1); U.S. (3).

[Stage Direction]
Holland (1).
Belgium (1); France (4);
U.K. (5); U.S. (2).
Czech. (1); Hungary (1);
Switz. (1); U.K. (1); U.S. (3). Iceland (1); U.S. (2).

[Stage Direction]
France (1); Germany (1);
Switz. (1); U.K. (5); U.S. (5). U.K. (1); U.S. (1).
Czech. (1); U.S. (3).
Switz. (2); U.K. (1); U.S. (1). Germany (1).
Germany (1); U.K. (2); U.S. (12).
Czech. (1); U.S. (2).
Germany (2).
"	(1).
"	(1).
"	(1).
U.K. (1); U.S. (1).
Sweden (1).
France (1).

[Stage Direction]
Czech. (1).

[Stage Direction]
3.	No information available. fMr. Higgins.]

Questions
YUKON TERRITORY MILITARY RESERVE	6. YeS.
Mr. Pearkes:: 1.	Has any action been taken to set aside an area northwest of Whitehorse, Yukon Territory, which includes some of the Kathleen lakes, as a military reserve?
2.	If so, is the said area required for any other military purposes than as a leave or recreational centre?
3.	Have any army buildings been moved from Whitehorse to the Kathleen lakes?
4.	If so, are these buildings being used as fishing lodges?
5.	If any buildings have been moved from Whitehorse to the Kathleen lakes, what was the cost of the operation?
6.	If any cost was involved, was this charged against the department?
7.	Are civilians prohibited from entering the area?


Mr. Blanchette:: 1.	No.
2.	Not applicable.
3.	No. However, two skid mounted huts, abandoned by road construction companies, previously engaged on work on the northwest highway system, were moved from the camp at Haines Junction to Kathleen lakes. It is intended to use these huts for recreational purposes for service personnel working on northwest highway system and otherwise engaged in the Yukon.
4.	No.
5.	$7.20.
7. No.



H.M.C.S. &quot;MAJESTIC&quot;

Mr. Brooks:: 1.	Is H.M.C.S. Majestic now being overhauled and/or refitted?
2.	If so, what company is doing this work?
3.	If the above mentioned ship is not being overhauled or refitted at the present time, is it the intention of the department to have this work done in the near future?
4.	If so, what arrangements are being made, and with whom?


Mr. Blancheite:: 1.	The Royal Canadian Navy has no ship of the name Majestic but it is understood that the question refers to H.M.C.S. Magnificent. H.M.C.S. Magnificent completed major refit and docking, exclusive of trials, on, April 15, 1952.
2.	The work was carried out under contract placed with Halifax Shipyards Limited, Halifax, N.S.
3 and 4. See answer to No. 1.



CONVICTIONS SET ASIDE BY HIGHER COURTS

Mr. Diefenbaker:: How many convictions for murder, by provinces, have been set aside by (a) courts of appeal; (b) the Supreme Court of Canada, since the first day of January, 1949?


Mr. Mcllraiih:: (a)	Convictions for Murder set aside by Courts of Appeal, Calendar Years 1949-1951.
1949	1950	1951*	Convictions Quashed	New Trial Directed	Convictions Quashed	New Trial Directed	Convictions Quashed	New Trial DirectedNewfoundland	Not available	Not available	Prince Edward Island	-	-	-	-	-	-Nova Scotia	-	i	-	-	-	-New Brunswick	-	-	-	-	-	-Quebec	-	2	-	i	-	4Ontario	i	-	-	i	-	-Manitoba	-	-	-	-	-	1Saskatchewan	-	1	-	i	-	-Alberta	-	-	2	2	-	-British Columbia	-	2	2	-	2Totals	i	6	2	7	-	7
* Preliminary.
(b)	Convictions for Murder set aside by the Supreme Court of Canada, Calendar Years 1949-1951
1949	1950	1951	Convictions Quashed	New Trial Directed	Convictions Quashed	New Trial Directed	Convictions Quashed	New Trial Directed-	-	-	2	-	-
Questions



John George Diefenbaker: How many convictions for indictable offences, courts of appeal; (b) the Supreme Court of Canada, other than murder, have been set aside by (a) since the first day of January, 1949?


George James McIlraith: (a) Convictions for Indictarle Offences, other than Murder, set aside hy Courts of Appeae,
Calendar Years 1949-1951
1949	1950	1951*	Convictions Quashed	New Trial Directed	Convictions Quashed	New Trial Directed	Convictions Quashed	New Trial DirectedNewfoundland	Not available	Not available	Prince Edward Island	-	-	i	-	-	-Nova Scotia	2	-	-	2	-	2New Brunswick	-	i	2	1	i	1Quebec	9	5	12	1	n	4Ontario	49	10	46	7	66	13Manitoba	4	5	1	8	1	-Saskatchewan	1	-	4	1	2	-Alberta	15	2	12	7	4	7British Columbia	7	7	23	15	29	8Totals	87	30	101	42	114	35
* Preliminary.
(b) Convictions for Indictable Offences, other than Murder, set aside by the Supreme Court of Canada,
Calendar Years 1949-1951
1949	1950	1951*	Convictions	New Trial	Convictions	New Trial	Convictions	New TrialQuashed	Directed	Quashed	Directed	Quashed	Directedi	3	1	-	-	i
* Preliminary.



ARMED FORCES-DESERTIONS AND ABSENCE WITHOUT LEAVE

Mr. Low:: With reference to the corrected table of increases and decreases in the Canadian armed forces (active) 1951, tabled by the parliamentary assistant to the Minister of National Defence on Tuesday, April 1: (a) how many desertions are included in the decreases of officers and men from the navy, army and air force; (b) how many officers and men in each service were absent without leave?


Mr. Blanchette:: (a)	3,133, of whom 1,214 returned to duty or were apprehended during the year and are included in the increases in the table, so that the net figure is 1,919.
(b)	The offence of absence without leave covers absences as short as one hour and most cases are dealt with summarily.



CANADIAN NATIONAL RAILWAYS


Mr. Higgins:: 1.	Are new ships to be provided for Canadian National Railways, Newfoundland services?
2.	If so (a) how many such ships are to be provided; (b) what will be the size of the ships; (c) when is it expected they will be placed in service?


Mr. Benidickson:: 1.	Yes.
2.	(a) Two; (b) the vessels are to be built to the specifications of the S.S. Bar Haven, which has a gross tonnage of 1,138; (c) the contract for construction of the vessels has not yet been awarded. Delivery dates will not be known until details have been settled.
Note: In addition to the above coastal ships, construction is now proceeding on the autoferry vessel for service between North Sydney, N.S., and Port aux Basques, Nfld.



NATIONAL DEFENCE HEADQUARTERS PERSONNEL

Mr. Jones:: 1.	How many of the following ranks are employed at national headquarters in Ottawa: warrant officers, class 1, warrant officers, class 2, staff sergeants, sergeants, lance corporals, corporals, and privates?
2.	How many officers are employed at army headquarters in Ottawa, and what is the number of each rank?


Mr. Blanchette:: 1. Army personnel employed at army headquarters, Ottawa, Ontario, as of April
30, 1952:
Men
Warrant officers I	 45
Warrant officers II	 80
Staff sergeants	 92
Sergeants	 164
Corporals	 118
Privates	 152
Officers
Lieutentant general	 1
Major generals	 3
Brigadiers	 7
Colonels	 28
Lieutenant colonels	 79
Majors	 169
Captains	 160
Lieutenants	 74
Second lieutenants	 3



ARMED FORCES


Mr. Fraser:: 1. How many (a) passenger automobile tires; (b) truck tires; (c) other type of tires, were purchased for the armed services during (i) 1950; (ii)
1951?
2. How many (a) passenger automobiles; (b) trucks; (c) other types of vehicles, were operated by the armed services during (i) 1950; (ii) 1951?


Mr. Blanchette:: 1. (i) 1950-51
(a)	1,826
(b)	10,392
(c)	5,240
2.
(i) 1950-51
(a)	899
(b)	7,069
(c)	4,734
(ii)
(ii)
2,553
7,751
1,692
1,209
7,734
5,001



WAR VETERANS ALLOWANCE


Mr. Balcom:: 1.	How many allied service men are receiving war veterans allowance?
2.	What is the total disbursement?
3.	How many widows of allied servicemen are receiving war veterans allowances?
4.	What is the total disbursement?
Orders jor Returns Mr. Mutch:
Return at March 31, 1952:
1.	2,325 (includes also former members of Her Majesty's forces, other than Canadian forces).
2.	$1,363,088.
3.	536 (includes also widows of members of Her Majesty's forces, other than Canadian forces).
4.	$248,654.



QUESTIONS PASSED AS ORDERS FOR RETURNS


Mr. Pearkes:: 1.	What grants, if any, were paid to the corporation of the municipality of Esquimau, British Columbia, during the fiscal year 1951-52?
2.	What was the purpose of these grants?
3.	By which departments of the federal government were the grants made?
4.	On what basis were the grants awarded?



TORONTO SUBWAY


Mr. Brown (Essex West):: 1.	Has the federal government contributed in any financial way to the establishment of the new subway now under construction in Toronto?
2.	If so, in what amount, and over what period of time?



FOOT-AND-MOUTH DISEASE    COMPENSATION TO PACKING HOUSE WORKERS

Mr. Thatcher:: 1.	What representations, if any, have been made by the united packing house workers for compensation as a result of unemployment caused by the foot-and-mouth disease?
2.	What compensation, if any, has been paid to packing house workers in the Regina and Moose Jaw districts?
3.	What procedure has been set up for packing house workers to make claims for compensation?



GOVERNMENT OFFICIALS, MINISTERS AND CIVIL SERVANTS  TRAVEL BY AIR

Mr. Diefenbaker:: 1.	How many cabinet ministers, government officials, and civil servants travelled by T.C.A. since the first day of January, 1951, on official business?
2.	What is the total of expenditure paid or incurred in such transportation?



MOTIONS FOR PAPERS


John George Diefenbaker: For a copy of all correspondence between the government of the United States and the government of Canada in the months of January and February, 1952, relative to the United States government placing an embargo against Canadian cattle in consequence of foot-and-mouth disease.


James Garfield Gardiner: Mr. Speaker, the motion i: accepted, subject to all established privileges

Inquiries of the Ministry Mr. Fleming: What are they?


Mr. Knowles:: Are there any new ones? Motion agreed to.
IRREGULARITIES AT PETAWAWA CAMP Mr. Fulton:
For a copy of the letter or minute of instructions or other document or documents containing the terms of reference and/or outlining the powers of Mr. G. S. Currie relative to his inquiry into the irregularities at Petawawa military camp; and also for a copy of all letters, telegrams and other correspondence exchanged between the Minister of National Defence or the government and Mr. Currie, relative to the terms and scope of such inquiry, but not including any initial or interim report except insofar as there may be specific discussion therein of the terms of reference, etc.


Brooke Claxton: The correspondence is now tabled.


[Stage Direction]
Motion agreed to.

John George Diefenbaker: For a copy of all correspondence received by the minister, or the deputy minister, or any of the officials of the Department of Agriculture, from or on behalf of owners of cattle slaughtered in the campaign for the eradication of foot-and-mouth disease in the province of Saskatchewan, approving or complaining about the settlements that have been made for such cattle.


James Garfield Gardiner: This is accepted, again subject to all established privileges.


Mr. Fleming:: What are they?


Mr. Graydon:: That is a new adjective. Motion agreed to.



ANIMAL CONTAGIOUS DISEASES


[Stage Direction]
On the orders of the day:
Mr. H. R. Argue (Assiniboia):: I should like to ask a question of the Minister of Agriculture. Did the minister agree to Dr. Christie's returning to Regina without the knowledge or approval of the committee, and before the members of the committee had had the opportunity to conclude their questioning of him?


James Garfield Gardiner: That is not a matter which would be referred to me, under any circumstance. I am not sure that Dr. Christie aas gone back to Regina yet.


Hazen Robert Argue: Well then, I have this supple-nentary question: Will the minister agree ;o have Dr. Christie appear again before ;he committee so that members may complete heir questioning?


James Garfield Gardiner: Mr. Speaker, the committee was adjourned at the call of the Chair, and the question as to when the committee can be called together again will no doubt be considered from time to time. But I would just state that if the committee is going to sit it would be necessary to have many other officials there, besides Dr. Christie, in order to carry on the activities of the committee. At present it is not possible to have these men here, before the committee, and at the same time carrying on activities in connection with fighting the disease and also in connection with the marketing of farmers' products.



BUSINESS OF THE HOUSE

Mr. Fournier (Hull):: Mr. Speaker, may I suggest that we change the order I announced last night in connection with the consideration of Bill No. 193 respecting the New Westminster harbour commissioners. I am told that a delegation from New Westminster, British Columbia, were present in Ottawa within the last few days. This bill is being referred to a committee and, if there are no objections, we will proceed with it first.



MARKETING OF CATTLE WITHIN BUFFER ZONE

[Stage Direction]
On the orders of the day:
John George Diefenbaker: Before
the orders of the day are called I wish to ask a question of the Minister of Agriculture arising out of the statement he made yesterday in the house regarding the sale and purchase of cattle in Saskatchewan. What is the method he has in mind for the marketing of cattle within the buffer zone as compared with those within the quarantined area? I am referring particularly to heavy livestock. The minister will have received representations in the matter, and I am asking him this question because a number of municipalities wish to know what the plan is so far as heavier livestock the packing companies will not take is concerned.


James Garfield Gardiner: There is no change in the plan as a result of anything I said yesterday or as a result of any new set-up being established in Saskatchewan. There is no change whatsoever in the plan so far as the buffer zone and quarantined zone are concerned. Those are set up in connection with the fighting of the disease, and no changes are being made with respect to them whatsoever.
My information is that the meat within that area is all required within the area. As a

matter of fact suggestions have been made that we may have to bring in more from outside in order to keep them fully supplied. But it is true that within the area, as outside the area, it is a little difficult to find people who wish to have the heavy animals. Heavy animals have been developed for the United States trade and there is some difficulty in finding a market for them in this country.


John George Diefenbaker: If the minister would allow a supplementary question because of the interest in the area in the plan which was announced yesterday I should like to ask one. The minister states that there is no change as far as the buffer area is concerned. What is the position of the farmer there with heavy animals weighing 1,100 or 1,200 pounds with the packing companies wanting to take only animals weighing 800 pounds? What is his position with regard to marketing or disposing of those cattle within that area? What is the government doing to protect farmers from having to take too low prices for these heavier cattle?


James Garfield Gardiner: There is only one packing house to which they can take them, the one in Moose Jaw. When they apply to that packing house for the admission of heavy cattle the tendency is for them to say that they prefer not to take them. So far as I know they have eventually taken the cattle but sometimes at a price which the individual thinks is lower than he ought to receive. I think that that has been adjusted in most instances. If it has not and the individual will write in about it we will take his case up at the plant.



TELECOMMUNICATION


[Stage Direction]
On the orders of the day:
Mr. W. J. Browne (St. John's West):: should like to direct to the Minister of Transport a question of which I have given notice. Has he any further information to give regarding the proposed installation of radiotelephone services at Colinet island, Newfoundland?


Hon. Lionel Chevrier (Minister of Transport):: None.


William Joseph Browne: May I ask
when we may expect some information, because this was promised by the end of April. I have been trying to find out when it is going to be done as the people are anxious to know.


Lionel Chevrier: I do not think it was promised before the end of April. It was hoped that by the end of April we would
Inquiries of the Ministry have the materials necessary to build the line in the area. I do not know that there has been any change in that position. I am unable to add anything to the statement made by the parliamentary assistant on April 3.



STRAIT OF CANSO CAUSEWAY


[Stage Direction]
On the orders of the day:
Mr. P. C. Black (Cumberland):: Is the Minister of Transport in a position to make a statement with regard to tenders received for the construction of the Canso causeway?


Lionel Chevrier: No, I am not, except to say that a number of tenders were opened yesterday but have not yet been tabulated. It may be some time before I will be able to make an announcement, although perhaps I might be able to make it tomorrow or the next day.



AGRICULTURAL PRODUCTS


[Stage Direction]
On the orders of the day:
Mr. P. E. Wright (Melfort):: I should like to ask the Minister of Agriculture what publicity has been given by the department to the statement made yesterday by the minister that refunds may be secured by farmers who have not received a fair price for products which they have sold and which are covered by floor prices now in effect.


James Garfield Gardiner: The story would be a rather long one. An hon. member who spoke yesterday after I did gave the details of one case where he said, I believe, that some $15,000 odd had been added to the payments previously made. One could go right across the country and find similar stories being told, but I would not like it to be said that we are giving publicity to them. We are simply dealing with the cases as they come up.



QUESTION AS TO PRICE ASSISTANCE

[Stage Direction]
On the orders of the day:
Mr. G. J. Tustin (Prince Edward-Lennox):: Yesterday the Minister of Agriculture intimated that the government would consider whether a floor price under cheese would be put into effect. Is the minister in a position to make a statement now?


James Garfield Gardiner: I probably should have said at an earlier time that the situation has changed
2206	HOUSE OF
New Westminster Harbour Commission since the hon. member for Glengarry (Mr. Major) asked a question yesterday and I intimated that I had had no word from the cheese board in Ontario. Yesterday afternoon I received a telegram from the cheese board in Ontario saying that they were prepared to consider carrying on under our act of 1939. We expect to meet them tomorrow to discuss the matter and attempt to enter into an arrangement with them.



EXCISE TAX ACT


[Stage Direction]
On the orders of the day:
Mr. W. G. Dinsdale (Brandon):: I should like to ask the Minister of Finance (Mr. Abbott) or his parliamentary assistant if the government has reached any decision concerning the possibility of tax rebates to automobile dealers and distributors with heavy inventories of new automobiles on which-


Some hon. Members:: Order.


An hon. Member:: Order paper.


An hon. Member:: Go ahead.


Walter Gilbert Dinsdale: -on which taxes were paid before the recent reduction in excise tax was announced?


Mr. James Sinclair (Parliamentary Assistant to the Minister of Finance):: Refunds are a matter of administration which would come under the Department of National Revenue. Perhaps the minister might answer that question.


Hon. J. J. McCann (Minister of National Revenue):: The answer is that no rebates will be made.



HARBOUR COMMISSIONS


Lionel Chevrier: the second reading of Bill No. 193, respecting the New Westminster harbour commissioners.
He said: Mr. Speaker, when the resolution was being considered I made a short statement which perhaps I might amplify by saying that the bill can be divided into two parts. The first part has to do with the extension of the boundaries of the New Westminster harbour to a point northeasterly as far as Grants narrows and to a point eastward as far as New Langley. The second part of the bill has to do with the approval of a loan in the amount of $1,250,000 by the governor in council for the purpose of allowing the harbour commissioners of New Westminster to build additional dockage facilities.


I stated on the resolution the number of berths now in existence, but both the harbour commissioners and the city of New Westminster are of the view that additional facilities are required. The harbour commissioners have already obtained two loans from the federal government, one in the amount of $700,000 as authorized by chapter 10 of the statutes of 1948 and the other in the amount of $274,000 roughly as authorized by chapter 40 of the statutes of 1931.
I have nothing more to add at this stage. After the debate is completed it is my intention to move that the bill be referred to the standing committee on railways, canals and telegraph lines for further study by that committee.


Mr. Howard C. Green (Vancouver-Quadra):: Mr. Speaker, there is very little that I can add on behalf of the official opposition to what I said on the resolution stage. We approve of the measure and we are glad that it is to be referred to the standing committee on railways, canals and telegraph lines. I should like to point out to the house that this harbour commission has an excellent reputation for keeping up the interest payments on the loans which have been made. I believe it has never defaulted on these payments and I can see no possibility of there being any default if the loan as set out in this bill is granted. We believe that the council of the city of New Westminster and the New Westminster harbour commissioners are very wise in looking ahead and planning this additional dockage. It is my understanding that a bylaw will be referred to the citizens of that city to approve of the transfer of the water lots upon which the dockage is to be built. The whole project seems to be in line with the progressive and enterprising spirit that the citizens of the city of New Westminster have demonstrated for so many decades. We are very happy to support the bill.


Mr. T. H. Goode (Burnaby-Richmond):: Mr. Speaker, I think I should say something on behalf of the people of the constituency of Burnaby-Richmond. Part of the new territory that is being taken over by the New Westminster harbour commission is in my riding. In correspondence with my people they have emphasized the fact that the New Westminster harbour commission is consistently bringing forward new business ideas. I thought the minister would like to know that the people of my riding support the bill.


[Stage Direction]
Motion agreed to, bill read the second time and referred to the standing committee on railways, canals and telegraph lines.


[Stage Direction]
1952 AND 1953
The house resumed, from Tuesday, May 13, consideration of the motion of Mr. Prudham that the house go into committee to consider the following resolution:
That it is expedient to introduce a measure to extend the application of the Emergency Gold Mining Assistance Act to the years 1952 and 1953 and to clarify the provisions of subsection five of section three so as to provide for the assistance intended when this subsection was enacted in 1951.
Mr. Rodney Adamson (York West):: Mr. Speaker, the principle at stake in this legislation is a simple one. Should we in this house ask that the gold mining industry be bonused? A number of members have expressed the opinion that it is of doubtful value to dig gold from one hole in northern Canada and put it in another at Fort Knox or in some private hoard elsewhere. That is a justifiable doubt. I can sympathize with those members who feel that way because today the average citizen does not use gold and does not see gold.


Mr. Gibson:: He does not have any.


Agar Rodney Adamson: He does not have any.


Mr. Weir:: He cannot eat it.


Agar Rodney Adamson: Therefore they may question what good the entire industry is doing for the economy of Canada. The details of the legislation can be discussed in committee. At the present time I merely wish to deal with the principle of the measure. I think the first question we must ask is whether gold is of any value to the Canadian economy. I wish to give three reasons in support of the contention that it is. In the first place many northern municipalities are entirely dependent on the gold industry. There is a belt running from the town or city of Timmins for three or four hundred miles right through to Val d>'Or which is entirely dependent upon the gold industry for its existence. If the gold industry ceases to exist each of these municipalities will become a ghost town because, with the exception of the base metal industry at Rouyn-Noranda, there is no other industry that would keep these towns in existence.
Therefore we have to make a decision whether these municipalities, towns and settlements are to be preserved or whether we should ruthlessly allow them to disappear and become ghost towns. From every point of view I think that would be an unthinkable action for parliament to take. The second point about gold is that it is the colonizing metal which has been instrumental in pushing the farm frontier northward. The great
Gold Mining
clay belt of northern Ontario and the great colonizing efforts of the government of Quebec are dependent upon the mining industry for the disposal of farm produce. These northern farms operate under climatic conditions somewhat more severe than their competitors in the south. They are much farther from the markets of the south. Therefore in order to exist at all there must be a market for their farm produce close at hand. The employment of men in the gold mining industry provides a market for the farmers' produce.
There is another point about gold mining and colonization. Gold has been the magnet that has developed a great part of this continent. It was the gold rush of 1849 that brought about the development of California and opened up the Pacific coast. It was the discovery of gold in the Yukon that opened the great Northwest Territories and the Yukon. It was the discovery of gold in New South Wales, Australia, that resulted in the development of the great agricultural industry of that part of that continent. The gold mines in that district of Australia have long ceased to exist but it was the magnet of gold which brought people into the area where they subsequently established a stabilized farm economy.
In reality it was gold in the Elizabethan era that prompted the Spaniards to develop the Spanish Main, and the English, under Drake, to explore that part of this continent. Gold was the magnet that brought the adventurer. Gold is still the magnet which will bring adventurers.
The third point is that in Canada gold has brought about the development of many other metals. Gold was really responsible for the development of the Eldorado uranium mine. Eldorado was originally a gold company. When their original deposits proved to be non-commercial in value La Bine and the others in that company continued their prospecting and discovered the uranium at Great Bear lake. Much more recently it was gold that brought the original prospectors to Lynn Lake, which I think it is fair to say may prove to be one of the great nickel producing areas of the world. So, Mr. Speaker, we have gold maintaining our northern municipalities. We have gold responsible for pushing back our northern frontier, and we have gold, the metal of discovery, bringing other metals into production. On those three counts I say gold is of supreme value to this country.
Let us look at it as a matter of dollars and cents, from the point of view of our mineral production last year. I include both ferrous and non-ferrous metals, oil and other minerals. Our total mineral production

Gold Mining
approached $1,200 million, a staggering production for a country with such a small population. Not only did this form a very large part of our gross national product; it provided the sinews for our manufacturing industry, making possible many of our primary and secondary industries. With the raw materials right at hand our manufacturers have an advantage over those in countries which have to import raw materials. So taken as a whole our mineral industry is probably the most important industry in this dominion. Now let us look at the figures for last year, which I obtained from the dominion bureau of statistics. I must say they rather surprised me. The production of our twelve leading minerals was valued as follows:
Gold	 $159,407,000
Nickel	 150,600,000
Copper	 149,300,000
Aluminum (ingots)	 133,000,000
Zinc	 132,900,000
Petroleum	 121,400,000
Coal	 110,000,000
Asbestos	 78,800,000
Lead	 56,100,000
Sand and gravel	 42,900,000
Cement	 40,200,000
Iron ore	 26,675,000
It is interesting to note that our petroleum industry, of which we hear so much, ranks considerably below many metals, particularly gold. On these figures, showing gold to be the most valuable mineral produced in Canada, can we afford to jeopardize this industry? In my opinion, it is obvious that we cannot.
As the minister correctly stated, the gold mining industry finds itself in a very serious situation because of the fixed price. I shall deal with that later; at present I wish to deal with the routine of selling on what is known as the premium market. That market cannot by any stretch of the imagination be called a free market; it is a premium market. This is the routine. The mine produces the bullion and sends it to the mint, where it is refined into pure gold of a fineness of at least -995 plus. As a matter of fact pure gold from the Royal Canadian Mint is -9999 fine, or one part in ten thousand impure; and the mint deserves a great deal of commendation on the efficiency with which it produces pure gold. Then this pure gold is sent to a commercial refinery, where it is adulterated down to 22 carats or '9166 fine. This 22 carat gold is sold f.o.b. Malton to a broker, but of course only the pure gold content of the bar is paid for. The gold is then sent to Europe, generally to France, in 22 carat form. There it is resold for export as 22 carat or industrial gold. The 22 carat bar is exported to a nation which is not a member of the international monetary fund, where it is then re-refined into pure gold. That pure

gold is then re-introduced into France by clandestine means. In Paris it is sold for United States dollars or other hard currency. The gold is then shipped to private hoards, where it is lost to the monetary authorities of the free world. Other countries than France carry on this trade, of course, but that is the general procedure in the marketing of gold on the premium market.
Does this fantastic procedure make sense? To start with, the gold is lost to Canada. Second, the cost of this strange manoeuvre is in the neighbourhood of $3 an ounce. Third, the bullion is finally lost to international trade; it goes into hoards and can be used by individuals and countries whose interests may be inimical to those of the democracies. This procedure defeats every intention of and is contrary to every principle enunciated by the international monetary fund; yet this procedure is forced upon us by the rules of the fund. Therefore the whole question of our continued membership in the fund must be considered.
I wish to mention very briefly that in fact there is no such thing as industrial gold. There is some use for gold architecturally, as gold leaf, but it is very small. Gold jewelry is frequently used for monetary purposes, particularly in the east. As far as the dental trade is concerned gold has many superior substitutes. In fact, "industrial gold" is in reality a misnomer, although there is a little bit so used. Gold is a monetary metal. It has practically no other use. In my remarks I shall consider it purely as a monetary metal.
We now come to the actual plight of the gold mining industry, and I wish to put on the record this year's statements of many of the presidents, mine managers and directors of our straight gold mines. I first want to start with the statement of Mr. Emery, vice-president and managing director of Kirkland Lake Gold Mining Company Limited. He says:
The proven ore reserves in the mine at the end of 1951 amount to 333,000 tons having a gross value of $5,268,990, calculated at $35 per ounce. An appreciable tonnage that had been carried as ore reserves was eliminated again this year as, under the present price of gold and increased cost of production, it could not now be classed as reserves.
Mr. Thomson, president of the Malartic Gold Fields Limited, says:
The total of developed and indicated ore reserves was lower than at the end of 1949. This situation arose because of the lower price obtained for gold and because estimated lower costs were not realized and therefore substantial quantities of ore, previously included in the reserves, had to be eliminated.

Mr. Jules R. Timmins, president of Hollin-ger Consolidated Gold Mines Limited, says:
Due to the reduction in the amount received per ounce of gold, the value of the gold recovered decreased 30 cents, labour costs increased 53 cents and the cost of supplies increased 19 cents per ton milled in 1951. Accordingly, the margin of profit in 1951 as compared to 1950 was reduced $1.02 per ton milled, which indicates serious difficulties for the years ahead.
I mention that particularly because the average grade in Porcupine, in the years past, has been about $8, $9 or $10 a ton. If you take $1.02 from the value per ton last year, and almost an equal amount the year before, you will soon find that what you classed as ore has ceased to exist and becomes waste rock. Once that happens there is no solution in the maintenance and the continuance of the gold industry. It is dying.
The general manager of Dome Mines Limited says:
Ore reserves were maintained at substantially the same figure as last year. In this connection it should be pointed out that rising costs make it increasingly difficult to maintain the reserve position in that the unit cost of the work necessary to develop ore is advancing and additional material to be classed as ore must contain more gold than was formerly the case. Putting it another way much material which under former conditions would be classed as ore has become worthless waste rock.
One more statement is that of Mr. A. L. Blomfield, president of Lake Shore Mines, Limited. He says:
The picture of operating conditions in the industry has deteriorated even more rapidly than heretofore. The rise in the Canadian dollar In United States dollar values, since January, 1951, decreases the gross value of the gold by 5 per cent in Canadian money; its value to the mines in Canadian money is at a lower price than at any time since 1939, except for the fixed parity in 1947 and 1948. The operating cost handicap has risen in the past year by 14 per cent, a greater rise than in any previous year.
The taxes, another item that cannot be passed on to consumers, are now up to 35 per cent of the operating profit. This industry has no power of self-help, such as all other industries in a free enterprise country enjoys. The emergency gold mine assistance, the basis of which has been reduced since 1950 in the face of swiftly rising costs, taxes, etc., is still of course a help in preventing a complete shutdown. It preserves for a while the present community, while sacrificing its future. Under this system the mines now shutting down have approached final exhaustion and many will probably never open again. If these had shut down before this gutting operation, re-opening would be a normal procedure. Meanwhile, stockholders' dividends have been almost completely sacrificed.
The working force of your mine, including all sections, have loyally done their job and, while sincerely thanking them I very much regret it has been impossible to compete with the base metal mines and other industries, the price of whose produce has risen with or higher than the handicaps to operating. I hope the not-too-distant future will produce a brighter picture.
Gold Mining
The last statement I shall read is that of Mr. Miller, president of Wright-Hargreaves Mines, Limited. He says:
In my report to shareholders just one year ago I stated the Canadian government had announced that, commencing immediately, they would allow the dollar to seek its own level in the free market and I implied that as a consequence the exchange or premium we were then receiving might be considerably reduced, resulting in less earnings to the company. This prediction has come true in part, to the extent that we lost more than 4 per cent in exchange benefits the past year which, together with continued increasing costs of taxes, labour and supplies generally, and lower tonnage milled due to labour shortage, has reduced our earnings somewhat for this current year. A re-reading of the annual report of October, 1950, would be interesting by comparison.
What does this gutting of the mine mean, Mr. Speaker? It used to be called high grading. It means this. As costs increase with a fixed price, more and more of what was once ore-a great asset, a tangible national asset-becomes waste rock. For instance, if this chamber were an ore body and if the section between the desks were high grade and the section on the outside were lower grade, as the costs went up, more and more of the section outside of the centre aisle would become waste rock and worthless; and as costs went up, as they are doing, the centre section itself would shrink until it became about the size of the desks occupied by the Hansard reporters. That shows the sort of shrinkage in ore that is going on today in our straight gold mines. I say without any fear of contradiction that if the present trend of increasing costs continues, with a still fixed price, despite the legislation we are discussing today we shall find that in five years' time there will not be one straight gold mine producing profitably, and possibly not one producing at all in Canada.
That is how serious the situation is. Now, what are the alternatives to this policy? What are the alternatives to bonusing the industry to keep it temporarily alive? There are, I think, iust two. First, raising the internal price by unilateral action, or the establishment of an unrestricted free market in Canada. Both are contrary to the rules of the international monetary fund. I would be opposed to Canada, or for that matter any government, raising the price of gold by decree; although this may happen, it is wrong in principle. Gold must stand as the arbiter of value, not because of any action by a government or treasury, but because of its free acceptance by men as such arbiter, its value being determined solely by the open market economy known as the law of supply and demand. I wish to quote in this connection an authority who is a deputy

Gold Mining
governor of the international monetary fund, Dr. J. K. Holloway. He has this to say on that point:
It is perfectly true that, until the price of gold in a free market becomes reasonably stable, a government cannot restore convertibility. Convertibility assumes a definite figure at which the unit of money of account can be converted into gold. That figure cannot be fixed until the price of gold has been determined by the arbitrament of a free market, the only agency that can now determine it. There would, therefore, be an interval during which dealings in gold would be free but the right of the citizen to demand gold for paper could not yet be exercised. But no government, intent on monetary reform, would render itself more vulnerable to a demand for gold at such times as the right to demand it is restored, by inflating its currency during this interval.
Now I come to the question of the value of the free market in bullion form in Canada, which I have advocated for a number of years in this house. The question of whether it would assist the mines is not as important as whether it would assist international trade. The four proposals put forward by the Ontario mining association should, I submit, have received more consideration by the government, and I sincerely believe that their adoption would be helpful to the country as a whole. They were as follows. One, spot delivery from stock of 22 carat gold. That means that the mines would be allowed to store 22 carat gold for sale on spot delivery, immediate sale, whenever the demand, or whenever the sale could be put through. The form "spot delivery" is a technical one. Two, to sell fine instead of debased gold. Three, allowing Canadian gold in Canada to be held for foreign account. And, four, the repeal of section 28 (2) of the Bank of Canada Act. The first was granted and the others were refused. I believe that the opinion of the Ontario mining association and the gold mines in question should have been given more consideration. However, the government, through the Minister of Finance (Mr. Abbott), turned the proposal down, and I think a retrograde step was taken.
The question of a free market, however, involves two considerations. First, would it bring about an established price for gold in terms of our currency; and second, would it bring about a degree of international free currency exchange in Canada? The only way to arrive at a price for gold is by the operation of the law of supply and demand; but certain conditions must exist. The gold must be freely and openly purchased and sold. It must have no restrictions on it with regard to export and import, and it must be allowed to be stored within Canada.
One of the reasons today that gold is selling for only between $38 and $40 on the free market is that it must be held by its owners in countries whose political stability is certainly questionable. I ask any hon. member whether he would be happy in holding gold in such places as Tangier, or for that matter, in Paris, even though it were held in a Canadian bank. I have been informed that there are a number of Europeans who have deposited their securities in the North American continent for this very reason. Therefore the security of the bullion is a paramount matter to the holder, and were we to allow private individuals or corporations to hold gold in Canada, or in Canadian banks, I am convinced the procedure would be very attractive, and in consequence the price would unquestionably advance.
The other point concerning currency is, however, more important. It is here, I believe, that the establishment of a free gold market in Canada would be of greatest use. The owners of soft currencies today are prohibited from using them outside the boundaries of their own countries, except under government control or for certain rigidly prescribed purposes. No one, however, has ever thought of restricting anyone from purchasing anything and paying for it in gold. If therefore the owners of the soft currencies were provided with the machinery by which they could exchange these currencies, through the medium of our gold market, into gold they would have a much more useful counter, no matter what it was called. There would have to be of course a buyer for the soft currencies, but the productivity of the sterling area in itself indicates a market for those currencies for those who wish to buy in that area.
I do not say or claim that this would overcome the embargoes, or the currency restrictions, but I believe it would be a step along that path, which although small and possibly halting to begin with, would lead to further lifting of restrictions. There is no simple way out of the impasse, Mr. Speaker. The steps will be halting; progress will be slow; but, as I hope to show in a minute, the way to begin is to begin.
We in Canada are in a peculiarly advantageous position in the matter. Establishment of a free market would also make Canada one of the great international banking centres of the world. We are today the world's greatest traders on a per capita basis. Our chartered banking system is international in scope. It has been nurtured on world trade. Let us give it the opportunity of making Canada one of the world centres of banking and exchange. Some of the functions carried on so profitably

by British banks and insurance companies in the nineteenth century and in the first quarter of the twentieth should be assumed by us. We must not submit to domination in this matter from New York.
Coming to the international monetary fund, the bona fides of this fund is open to question. Its two principal architects were Lord Keynes and William Dexter White, both now dead. Keynes' proposal for a world currency or a bill of exchange, which he called the bancor, had much to recommend it, in that it was apparently designed to prevent the world being divided into currency blocs operating within geographical and economic barriers within which trade was reasonably free, but between which trade was made almost impossible by currency restrictions and exchange controls, and embargoes of one kind and another.
The White plan, as it was called, was adopted, with the result that we now have currency controls, embargoes and restrictions on an almost world-wide basis designed, not to sponsor and expedite trade, but to restrict it. Recent severe restrictions imposed upon various members of the sterling bloc against the dollar countries are most destructive to world trade. Surely it need not be restated in this House of Commons, nor in fact by any Canadian, that without world trade there can be no lasting prosperity.
The White or American plan has resulted in making a currency exchange almost impossible. Nowhere outside the North American continent is there any degree of really free exchange; and I submit, Mr. Speaker, that on that evidence alone we must consider that the international monetary fund has not served its primary reason for existence, which was the freeing of exchange.
We know from recent evidence submitted to a grand jury in New York, and by the revelations of Whittaker Chambers that Dexter White was at least a fellow traveller, if not an outright communist. I do not suggest that the international monetary fund is in any way a communist front. To do so would be, of course, improper. However, the one thing the fund was set up to do was to free currencies, to re-establish convertibility and, by so doing, promote international trade. The sad fact is that by its very regulations the fund has been a deterrent to convertibility and at least in part an instrument of promotion for currency blocs whose very existence destroys that international trade which the world must have.
Therefore I think we can regard the operations of this body, if not with suspicion at least without hope. The reports received after
Gold Mining
the Torquay conference on tariffs and trade and the high hopes held by the delegates have proved to be a delusion and a chimera, simply because of the breakdown of the machinery of currency and exchange.
As a member of the banking and commerce committee who was privileged to hear the glowing reports of our delegates at Torquay,
I can only regard with despair the recent action of the United Kingdom, Australia and others in putting even tighter and more drastic controls on their exchange and trade. Until we can make world trade more free we will not encourage it. Unless we encourage it we will not have international prosperity. Unless we have international prosperity we cannot exert our maximum effort toward the defeat of communism. I mention this matter of trade because it is overlooked in the development of what used to be known as the have-not countries, and what are now known as the undeveloped or underprivileged countries.
Mr. Speaker, trade can do more for the well-being of the people than any amount of gifts, any amount of handouts, any amount of subsidies or any amount of well-wishing that any rich country may do. It is on trade that the well-being of a people exists; and the greatest thing that we in the free world can do is to do everything possible to promote that trade.
In my opinion the establishment of a free market, so that gold could once again be used in part as the lubricant for international trade, would do more for the well-being of the world than all the pious resolutions passed by all the conferences, national or international, anywhere in the world.
That the international monetary fund has failed must be apparent to all. We must therefore take steps to make it an instrument of trade promotion, or else we must withdraw from it and the restrictions imposed upon us by membership. I would still hope that it could be made into a useful organization; but there are certain clauses in its regulations which will have to be amended before it can become so.
One of these clauses is that concerning monetary gold. Less than 15 per cent of last year's newly mined gold went into the hands of the monetary authorities of the free world. The figure is approximately $130 million out of a production of some $850 million. The remainder went by devious means, of which our own regulations form a part, into hoards where they can be, and I suggest are, used to foster international unrest. Certainly they are out of circulation, so far as being an effective lubricant to international trade is concerned. This in itself

Gold Mining
is a severe reflection on the fund's policy. As a matter of fact, the hoard at Fort Knox, by the very restrictions placed by the United States government upon the holding of gold by its citizens, can also be considered as sterilized or hoarded gold, not fulfilling its function in international trade. With all due respect I consider that that policy is detrimental to the world.
The scarcity of gold in international trade is not only having the restrictive effect which I have indicated, but has encouraged private barter deals and uneconomic trading at prices which have little relationship to the open market or the free economy price of the goods so traded. This further compartmentalizes trade and makes transactions more unrealistic. For example an English manufacturer who is able to get a great deal more in pounds for his produce in a sterling area country than if he sold it in the comparatively competitive economy of North America would, of course, infinitely sooner sell the goods to that sterling country, because he is allowed by the law of the United Kingdom to receive payment in sterling only. This has a bad effect on the morale of the British manufacturer and destroys his efficiency.
I do not wish to be considered critical of any other administration but as long as any country, whether it be the United Kingdom, France or even a South American republic with a favourable balance of payments, resorts to currency restrictions, quotas, embargoes, rationing or any of the other devilish devices of scarcity, there will be no prosperity in that country. No matter what glowing predictions are made in the United Kingdom there will be economic crisis after economic crisis unless and until she gives up this unrealistic and economically unsound principle.
I come now to the question of inflation and the use of gold as a deterrent to inflation. World money supply expressed in terms of United States dollars has increased from $60 billion in 1940 to $170 billion in 1950. The relationship of currencies other than North American to the United States dollar shows this increase in the money supply for non-North American countries to be far more severe. The money supply in terms of francs or pesetas, for instance, shows a far greater numerical increase. Whether the increase in the money supply is the whole cause of inflation is certainly questionable. However, it is significant that the ratio of money supply to physical production of goods bears a close relationship to price.
For instance, in Canada the cost of living, the wholesale price index and many commodity price indices have about doubled

during the war decade and the money supply has increased by approximately three times, or from $1,370 billion in 1939 to $4,730 billion in February, 1952, for active deposits, or from $6,193 to $17,938 for the total of both active and inactive deposits. The physical volume of production or the gross national product has of course increased enormously since 1939, tout in terms of goods it has not gone up as fast as the increase in the money supply.
Take carloadings, for example. There is now twice as much money in existence for every car loaded as there was in 1939. The cost of the goods loaded into the car has for all practical purposes also doubled. I shall not deal with the subject in any great detail as economists are not in entire agreement as to the actual relationship between the increase in the money supply and inflation. I think they are generally agreed that it is one of the major contributing factors and I suggest that the rough figures which I have given are significant.
The function of the gold standard is not to restrict economic expansion but to restrict monetary expansion not represented by physical growth in production. The return to the gold standard is the only measure which, by making currency both a medium of exchange and a store of actual value, will prevent inflation by a constantly decreasing power to purchase by the national unit of currency. This is a step which cannot be taken immediately or perhaps even in the near future. The danger of action by governmental restrictions is that they create deflation rather than disinflation. Credit restrictions produce the former condition, as recent results of the present government's policy have shown.
I have spoken on the question of inflation and the gold standard before. The gold standard is desirable, but we cannot arrive at a gold standard until we determine the price at which gold can be traded in terms of our own currency. That should not be done by government decree. Pegging the price, rigging the price of any commodity is dangerous, and doing it with regard to gold is probably the most dangerous of all.
There must be a period of time when gold can find its own level. What that price will be, I suggest, no one knows. How long it will take to find that price is also a question which cannot be answered at this time. However, when that price has been arrived at gold will tend to stabilize itself, just as I predicted the Canadian dollar would stabilize itself when it was freed from restrictions; but it will probably take longer. When that happens we can return to a fixed exchange

value for our currency. However, to do so now would drain what little gold reserves we have in this country. Certainly if the United States embarked on it it would drain the gold reserves at Fort Knox in a very short time.
Therefore there must be a period in which by free action a proper price can be evolved. Even though the monetary fund set the artificial price of gold at $50 or even more and still restricted trading in gold, I would be opposed to it as being an unsound move. One thing about the capitalist system is that capital, exchange and money can be free to come in and go out. I submit that one of the first and most important moves for us to take in Canada is to allow gold that freedom, to restore the right to hold and own gold.
In conclusion I want to make the following points:
1.	This bill is a palliative, not a cure.
2.	The gold industry is threatened with extinction.
3.	Canada cannot afford to lose this industry.
4.	The international monetary fund has proved to be a costly failure.
5.	Its rules prevent a rise in the price of gold either artificially or by the operation of the free market.
6.	Gold is not going into monetary funds but into private hoards under present regulations. This is dangerous.
7.	Canadian gold should be used by Canadian individuals and corporations to assist them in international trade. The return to a gold standard must be preceded by the operation of a truly free market to establish a price for gold which can be maintained.
8.	A gold-backed currency is the only sure cure for inflation. The return to a gold standard is desirable but is not an immediate prospect.
9.	The free market is the only method of arriving at the true price for gold. Just as the free Canadian dollar has stabilized itself, so will gold if all restrictions are removed; but the period of stabilization may be considerably longer.
10.	No agency can prevent price fluctuations. It has generally proved disastrous to try.
Finally, I believe that Canada stands on the threshold of becoming a great international banker in her own right. I believe that we must accept this challenge. I do not believe we can afford to accept the domination of New York on this continent; certainly we cannot stand political domination from Washington. I am convinced that despite our small size in population, despite
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our small production compared with that of the United States, because of our potential production, because of our great storehouse of wealth as yet undeveloped, we must accept the challenge of freeing our currency, as we have done, and be prepared to stand alone if necessary and fulfil the functions of an international banker. The twentieth century can really be ours if we have the courage and the vision.


Mr. Armand Dumas (Villeneuve):: Mr. Speaker, we have before us for consideration a resolution preceding the introduction of a bill to extend the application of the Emergency Gold Mining Assistance Act to the years 1952 and 1953 and to clarify-I would have preferred it if the word used had been "amplify"-the provisions of subsection 5 of section 3 of the act. I do not wish to take any more time of the house than is necessary, but hon. members will understand that when such legislation is being introduced I would fail in my duty if I did not bring to the attention of hon. members the views of my constituents.
First I wish to say that the Canadian gold producers are facing a very difficult situation. The employees in the mines are in danger of losing the main if not the only source of their monthly payroll. Modern communities are liable to become ghost towns. Everyone concerned has serious cause to be worried regarding the ever-increasing difficulties which have to be met by the gold mines. At the same time I wish to say that all those concerned with the plight of the gold mines are also aware of the sympathetic consideration which the problems confronting the industry have received from the federal government in the past, and they gratefully acknowledge the steps taken by the government to continue its aid to the industry.
Mounting costs of production and a fixed price for the final product are the causes which have seriously hampered the operation of the gold mines of this country more and more since the early years of the second world war. In addition to the above, we now have the Canadian dollar at a premium, and I would say that this is another handicap to the gold mines. Figures published by the bureau of statistics show that the operating costs of Canadian gold mines have risen by 40 per cent between the year 1941, when the price of gold was $38.50 an ounce, and the year 1948 when the price of gold was $35 an ounce. In 1949, when the average price of gold was $36 an ounce, the cost of producing an ounce of gold exclusive of taxes was approximately $32.

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Figures compiled by the department of mines of the province of Quebec are even more convincing. They show that the operating cost of producers in that province during the year 1939 was $24.65 per ounce exclusive of taxes. The average price of gold for the same year was $36.67 an ounce. In 1949, again in the province of Quebec, the cost of producing an ounce of gold had jumped to $35.56, an increase of 44 per cent. However, the price of gold for the same year had remained practically the same as that of 1939, namely, $36.16 an ounce. For the first nine months of 1951, again in the province of Quebec, the cost of producing an ounce of gold has exceeded by 18 cents the average price paid by the mint during the same period. During the month of April, 1952, while the cost of producing an ounce of gold in the province of Quebec amounted to $37 the average mint price was $34.35.
Of course one serious feature that has added to the difficulties of the industry during the last few months has been the sharp decline in the price of gold. During 1941 the average mint price was $38.50 an ounce. During 1950 the average mint price was $38.04. But for the first nine months of 1951 the Canadian dollar was at a discount of 5 per cent in terms of the United States dollar, and from September to the end of the year at a discount at less than 2J per cent, resulting in an average price for gold per ounce of $36.82. These figures can be verified in a publication of the bureau of statistics. With the Canadian dollar at a premium instead of a discount the average mint price for gold during April, 1952, was $34.35 an ounce. For the first week of May the price was $34.31. For the week ending May 10 the mint price was $34.40J. With these figures before them I am sure hon. members will realize the critical situation facing this industry on which so many people depend.
At this point I should like to say a few words on this matter of our money being at a premium. We may be inclined to be somewhat proud of the fact that our dollar, which was at a discount for so many years, is now at a premium as compared with United States currency. However, to my mind if the Canadian dollar remains at a premium for a long time it will result in more harm than good. Our dollar at a premium simply means that it will be more costly to those who live outside our country, south of the border for instance, when they wish to obtain Canadian dollars. It is bound to check the flow of capital from the United States; and putting the brake on United States capital coming to Canada will certainly retard the development of our natural resources. Our basic industries such as lumbering, mining, agriculture 
and fishing are bound to be seriously affected by the increased cost of Canadian money. Other industries, such as the tourist trade, are bound to be handicapped for the same reason.
The premium on the Canadian dollar has added to the numerous burdens already being carried by the gold mines of Canada, and I hope the government will see its way clear to try to correct this situation. Recent legislation permitting the sale of gold of industrial grade on premium markets has been warmly received by the industry. At the annual meeting of Noranda Mines the president, Mr. Murdoch, had this to say in regard to that legislation:
Last October the government took a courageous step in permitting the mines to sell gold to domestic fabricators for use in Canada and for export to the free world markets. South Africa and Canada, in attempting to assist their respective gold mining industries have, in my opinion, taken constructive action which will ultimately benefit all the trading nations of the world in breaking away from the restrictive controls and currency regulations of the international monetary fund.
A little further in his report Mr. Murdoch also said that were it not for this feeling of confidence and the recognition by Ottawa of the serious position of the industry, he would recommend	that Pamour be	closed	down in ajiffy. That	mine,	by the	way,	is in the
Timmins district, and the full name of the company is Pamour Gold Mines Limited.
The general terms and conditions under which the sale of gold on the industrial market is	made,	though	they	met withapproval and commendation by the industry, could be improved at no expense to the country, in order to give more revenue to the producers. For instance, the sale of fine gold rather than	debased	gold	should be
permitted. Such an amendment to the regulations would mean approximately 50 cents more an ounce to the producers. Other regulations relating to this legislation should also be amended.
The critical situation which confronted the gold mining industry in 1948 caused the government to enact the Emergency Gold Mining Assistance Act. Since that legislation came into effect it has been of great assistance to the gold mines, to the miners and others working for these companies, and to all the communities depending on the gold mining industry. Those of us who are closely connected with and depend upon that industry for our livelihood were very pleased with the enactment of that legislation. We have also appreciated the amendments that have been made, and we are grateful to the government for the past and present extensions of the act. I would like also to record my warm appreciation of the opportunity granted

on many occasions by the Prime Minister (Mr. St. Laurent) and members of the cabinet to the Canadian Metal Mining Association and other delegations to come to Ottawa and lay before the government problems of great concern to the industry.
The gold producers have always been aware of the willingness of the government to co-operate, and to this end they themselves have done everything possible to increase the efficiency of their operations in order to keep down costs. Extraordinary efforts have been made to stem the rising tide. Every practicable method has been adopted to improve efficiency. Obviously there is a limit to such process, and I want to point out the need to stabilize the position and if at all possible improve the prospects of the industry. For the gold mines the crux of the problem is the price of gold. If today the gold mining people are greatly concerned over the present situation, they are not at all pessimistic. Far from it; they feel that eventually the price of gold will have to be adjusted, and they think the day is not far distant when the important trading nations of the world will return to the gold standard. It is fully appreciated that this is a highly complex problem concerning which the Canadian government is not in a position to take entirely independent action.
We must not forget that the gold mining industry has been and will continue to be of vital importance to this country. It has produced the gold required for monetary backing and for the settlement of trade balances with other countries. It is the one thing above all others on which Canada depends for opening up new areas of settlement and potential resources. I repeat what I have said previously in this house. Gold mining is the stimulus which provides encouragement to the prospectors. Just a few days ago I saw an article in a weekly paper in Rouyn-Nor-anda. It is the Rouyn-Noranda Press of May 8, 1952. The article is entitled "Gold Still Glitters" and it reads in part as follows:
During a week-end visit to Toronto-
That was a visit by the editor of that newspaper.
-we were surprised at the number of people not connected in any way with mining that were interested in gold the moment we mentioned coming from Rouyn-Noranda.
It shows that in other parts of the nation the importance of gold mining is recognized by even the average citizen. But at the same time gold mines are having a hard time making ends meet.
Further on in the article we find this statement:
To many, gold still glitters as brightly as ever but the gold mining situation could be much brighter.
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I agree with that statement. I also think that the gold mining situation could be much brighter.
Gold has always been the spearhead in the search for mineral wealth. It has led in the past, is leading now in spite of the many difficulties encountered-and will, if permitted to do so, lead again to the discovery of valuable deposits of base metal and strategic materials.
Last week there appeared in the Globe and Mail two articles which substantiate what I have just said. In the issue of May 7 we find an article which reads as follows:
Amos-There are high hopes in this busy northwestern Quebec community that the success at Barvue Mines will once more direct the attention of the mining industry to an area that was one of the first regions of the province to be prospected before more attractive developments 70 miles to the southwest at Noranda turned the tide of prospecting away.
Further on the article states:
Gold was the magnet which drew prospectors into the area in the early days and many times since. The Barvue mine, originally staked as part of a gold rush which found no gold became, instead, a big zinc operation.
In the article in the Globe and Mail of May 6, we read this:
A windfall of zinc and silver from a small tract of land staked as a gold prospect, combined with engineering ingenuity and $7 million in cash, is rapidly transforming a stretch of muddy, hungry-looking farm land lying 22 miles east of this town,-
That is Amos.
-into a bustling community of building construction and townsite planning.
Further on in the article we read this:
Contracts for the sale of the zinc are on a firm basis covering 175,000 tons of zinc concentrate at 17-5 cents a pound U.S. funds and American Zinc has an option on a further 175,000 tons of concentrate at the same price, with the addition of an escalator clause covering possible cost and wage increases.
Mr. Speaker, you can see that mining is certainly the broad foundation of Canada's internal structure. The service of mining in pushing back the frontier has given our country a pioneer quality, a spirit of independence, self-reliance and confidence.
Canadian mining is still capable of great expansion. To be convinced of this fact, we have only to look at the map and read of what is going on in the Yukon, the Northwest Territories, northern Ontario, northwestern and northeastern Quebec and the Labrador section of Newfoundland. The lead and zinc ore of Keno Hill; the uranium of Great Bear lake; the copper deposits of Victoria island; the nickel finds of Ferguson lake and Chesterfield inlet; the big nickel mine of Lynn Lake; the

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ever-expanding rich mining deposits of northern Ontario and northwestern Quebec; and the iron and titanium ores of northeastern Quebec and Newfoundland are convincing evidence that there lies a land of fabulous riches. We also realize immediately that the future of Canada lies as far north as man can travel.
I will conclude by saying this. Gold is and always will be the stimulus of encouragement in the search for new mineral wealth, and we should do everything possible to restore the gold mining industry to its former health and vigour. Having done this, we shall have made a major contribution to the economy of our country.


Mr. Ray Thomas (Wetaskiwin):: Mr. Speaker, we in this group on all previous occasions supported this act and the extensions of it, and we support this measure because we realize that when the price of gold was pegged at $35 under the Bretton Woods agreement of 1945, the cost of production was a great deal lower than it is now, and that the rise in costs have made it almost impossible for the gold mining industry to make a go of it. However, I hope the minister does not intend to include under this act at the present time those companies which chose to break away from the agreement. We think that all those who remained under the agreement and who are selling at the $35 should be given some sort of assistance. However, those who chose to go on the open market should, I believe, remain on it.
During the past four years that this act has been in force we have paid out something like $40 million-$10 million a year- towards subsidizing the gold mining industry. That is all very well. However, we must realize that this industry has engaged in it only something like 32,000 people. I regret that the minister who is sponsoring this bill did not show the same concern when the proposed final wheat payment was before the house a year ago. I want to make it perfectly clear that we are supporting this measure because the other countries will give us goods in exchange for our gold, and not because we believe in the principle of convertibility of currencies or convertibility of gold. As long as gold is the medium for international exchange, and as long as we have the gold production potential, I believe it should be helped. However, in times like this, when we are in the midst of an arms race or a huge defence program,
I think these gold miners could possibly be better employed elsewhere in mining for some of the base metals that we need for our armament plans. In other words, Mr. 
Speaker, I think that in times like these we should discourage the production of useless goods and encourage the production of goods that we need so badly for our defence production. However, as we are members of the international monetary fund and are encouraging gold production, we shall continue to support this bill and any extensions made to it. I repeat that we support it for those who are adhering to the fixed price. However, we have always advocated convertibility of goods rather than of gold or of currencies, but we shall support this bill.


Mr. H. W. Herridge (Kootenay West):: When the gold mining assistance bill was before the house last I spoke at some length. This afternoon I want to make just a few brief observations on this resolution, which states:
That it is expedient to introduce a measure to extend the application of the Emergency Gold Mining Assistance Act to the years 1952 and 1953 and to clarify the provisions of subsection five of section three so as to provide for the assistance intended when this subsection was enacted in 1951.
This group again accepts this resolution as a temporary expedient, as mentioned in the resolution, to meet a particular and we hope a temporary situation. We support the purpose expressed in the resolution because, since there are numbers of working people, communities and other services involved, we think the government is justified in doing something for them in those particularly difficult circumstances under which they are operating.
I might say that, before proceeding with my brief remarks, we in this group cannot agree with the suggestion made by the hon. member for York West (Mr. Adamson), if I heard him correctly, that it would be to the advantage of the Canadian people and the economy of Canada generally if we were to return to the gold standard.
While this resolution will provide for the introduction of a mining bill which will continue the payment of subsidies to the gold mining industry, we do again want to stress the fact that we in this group believe that the workers in that industry should receive wages equal to those received by individuals working in other sections of the mining industry, and should work under conditions equal to those enjoyed by other workmen in the mining industries.
In the passage of the Emergency Gold Mining Assistance Act the government has recognized the principle of subsidies, and it has in other respects- subsidized other industries where they felt they were justified in using public funds to support an industry under difficult circumstances and to keep it going. We in this group, and all hon. members, realize, as the hon. member for Spadina

(Mr. Croll) said the other day, there is a housing shortage in this country, a housing crisis. I do urge that the government show the same concern for the Canadian people who need housing when that question comes before the house. We support this bill because there is a need. There is a greater need for houses in Canada, and we do hope that the government will recognize the principle of subsidies when it comes to deal with that urgent and important question.


Mr. E. T. Applewhaite (Skeena):: Mr. Speaker, on my own behalf and on behalf of a large section of the area which I represent, I welcome the introduction of this resolution and the proposed extension of the Emergency Gold Mining Assistance Act. We welcome it not only for its own terms, but because we see in it the continued expression of the interest of the government of Canada in the problems of the mining industry, and particularly those of the gold mining industry.
A great deal has been said this afternoon which I do not intend to go over but which I think, particularly as it has originated on all sides of the house, indicates that the gold mining industry is a matter of major importance to the Dominion of Canada. The point that I wish to make to the minister and to the government this afternoon is that there is still truth in the old proverb that great oaks from little acorns grow, and great gold mines are developed always from little prospects.
Something has been said this afternoon about the danger of a major decline in the gold production of Canada. And, never mind what not too brilliant ideas the hon. member for Comox-Alberni (Mr. Gibson) may have expressed on this subject some time ago, the production of gold in Canada is, under our present system, a matter of some concern.
Under the terms of the act which is being extended, Mr. Speaker, it will not be possible for the minister to extend assistance to properties whose production runs below 50 ounces a year. The small producer of gold is found more often in placer mining than in lode mining, but at the same time there are also properties which make from small production of gold low profits during their initial period, particularly if they are fortunate enough to find a little vein on the property which lends itself to high-grade ore. I realize that there might be some grave difficulties in administering the act if there were not to be a limit on how small the property must be that might be assisted.
I am not going to go into the question of whether or not 50 ounces is a proper level, but I am going to use this opportunity to urge the minister and the government in some way, either under this act, or in other ways, to be
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of assistance to the prospector who, after all, is the backbone of the mining industry and always will be. Without him, there would never be any Hollinger, any Dome, any McIntyre, any Premier, any Bralorne, any major mining producer of any description.
Mines-this is of course a platitude-are in their very nature a wasting asset. To maintain the mining industry you have to keep on bringing in new properties. This can only be done through the prospectors, and so, both in the interest of the country itself and in fairness to the little man, the little prospector, the little operator, I would ask the minister and the government to give some thought to these suggestions.


Mr. J. A. Simmons (Yukon-Mackenzie River):: I should like to say just a few words in support of the resolution before us. As all hon. gentlemen are aware, the fixed price of gold and the mining costs of operations have placed the industry in a precarious position. The present fixed price is the big problem, and it is to be hoped that the government can set in motion some definite action which will result in a price commensurate with the cost of producing it, so that the operators can stabilize their position and look forward with some degree of confidence in planning future operations which are so necessary to the future of gold mining areas throughout the constituency I have the honour to represent.
It would be a great contribution to the national economy of Canada if something could be done to restore the gold mining industry to its former status and level. But the way it now stands the subject is bound up with international and economic intricacies. One concern, I believe, is that the Canadian government is not in a position to take independent action as a member of the international monetary fund.
We welcome the extension of the type of assistance given under the Emergency Gold Mining Assistance Act, but this can be considered only as a temporary expedient. Unless some permanent solution can be found, I am afraid the industry can only look forward to a steady decline. The operators throughout my constituency feel great concern and doubt the adequacy of the proposed measure to meet the needs of the industry.
Gold has been pegged at $35 an ounce in United States funds since 1934, and I believe it is the only commodity produced in Canada which still sells for the 1934 price. We would like to see it increased in price to the same extent as other commodities have increased since 1934.
The fixed price, coupled with rising costs, constitutes a threat to many producing gold

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mines, and to the employees and their dependents, as well as to the communities, especially in outlying areas where the mines provide sole support. This threat applies in practically every gold mining centre in Canada, and it is plain to see why the industry feels grave concern and doubts the adequacy of the assistance to be provided to meet the needs of the industry.
Mr. Speaker, I cannot stress too strongly the urgent need of stabilizing the position of the gold mines, so that operators can undertake with confidence the future planning which is so necessary to successful mining operations, and which will result in immediate contributions to the national economy of Canada.
Unless assurance of continuity of operation over a long-range period is forthcoming, I am afraid the industry will be confronted with an even more serious crisis threatening the continuation of these important operations which are so essential to the economy of Canada.
The situation is serious; and unless something is done to alleviate the uncertainty, so that the operators can look forward to the future with some degree of confidence and assurance-rather than gloom and despair- the gold mining industry will surely decline.
I feel confident that the Minister of Mines and Technical Surveys (Mr. Prudham) is sympathetic to the problem, and will do everything possible to remedy and assist the gold mining industry.


Mr, Donald M. Fleming (Eglinton):: Mr. Speaker, I think the house should welcome this opportunity of giving some consideration to the position of the gold mining industry. This is the first time this subject has been under discussion at the present session. Since it was last discussed a year ago two events of considerable importance have occurred: first, on September 28, 1951, when the international monetary fund took action in freeing members with respect to the marketing of so-called non-monetary gold, and then the decision taken by the Canadian government which issued on October 7, 1951, new regulations with respect to the marketing of that same commodity, the so-called non-monetary gold.
The position of the gold mining industry and what the gold mining industry has meant in the development of the economy of this country has, it seems to me-and I say this with respect-never been adequately recognized either by the government or by the House of Commons. Gold is still what it has been for a long time, the one universally accepted medium of international exchange. It is sought today by all nations

of the world, Russia included; and for Canada it has still a place of very great importance in our total economy.
The fundamental problem faced by the gold mining industry in this country is the problem of rising costs on the one hand and a fixed price for their product on the other- a price that has remained fixed for eighteen years, without change, while costs have risen at an alarming rate. Here we have one commodity singled out by governmental action not only on a national but on an international scale as one on which the price should be fixed, while it has been the policy of the government not to countenance price control in respect of any other commodities.
Let me say at once with respect to the decision taken by the government last October, which issued in the order in council and regulations which appeared on October 7, that I think it was a commendable decision. It was a step in the right direction. I cannot say that it was more than a step in the right direction; but so far as it went it was a constructive improvement.
This bill arises to some extent out of a conflict of government policy, it seems to me. The bill itself, like its predecessors, is only a stopgap measure. It is the application of an artificial expedient to a situation which calls for a long-term and constructive solution. We are still faced with a hand-to-mouth treatment of a problem which is very deep-seated, and which calls for the application of the utmost intelligence both in the house and on the part of the government.
Undoubtedly, in the three years during which it has been in operation, this Emergency Gold Mining Assistance Act has been the means of keeping alive certain producing mines on a hand-to-mouth basis. But the development work in the great Canadian northland has been virtually arrested. We saw a year ago when the amendments of 1951 were under discussion that the amount of aid provided by this measure had been reduced year by year, and that the number of mines which would qualify for assistance under the act was also being reduced.
The search for gold has been the forerunner of much of the development of the great northland of this country. The searchers for gold, in effect, in many great areas of this country, have been the pioneers. The search for gold has led in turn to the discovery and later to the production of base metals and to other economic developments.
The situation confronting the gold mining industry today is so serious that that trend has been reversed. Virtually no development work is going on in the search for gold. At the present time the development

work is directed rather to the search for base metals. Perhaps in a measure not experienced by any other industry in Canada, this industry has been faced during what are regarded as good times with the full effects of a depression. This has arrested the development of an industry which in times past has meant much to the development of the economy of this country.
There are many who do not like to think back to the days of the depression, but it would be well for us all to recall that in those days there was one industry which was assured a market for its product and which contributed effectively and on a large scale to keeping the wheels of industry going. That was the gold mining industry. Who can say that the day may not come when we may be glad to look to the gold mining industry with an assured market for its product to help to carry the load of the economy of this country?
How has this depression in the industry affected those who look to it for livelihood? The fact is that the production of gold in this country, even under the present measure, declined last year as compared with the previous year. Canada is not producing quite as much gold as she did prior to 1950. The minister has not yet indicated the results in 1952 of the order in council of October 7. It will be interesting to know what results in respect to production can be traced to the decision taken on October 7 as reflected in the order in council issued on that day.
What have been the results of the order in council of October 7? Putting it broadly, the effect was to provide a market for so-called non-monetary gold or gold of 22 carats of fineness or less at a price which yields approximately $3 per ounce more than the price paid for gold marketed for monetary purposes through the Bank of Canada. We have not been furnished with figures as to the proportion of the gold production of Canada which is marketed under the order in council as compared with that marketed for monetary purposes through the Bank of Canada, but I have seen figures which indicate that approximately one-third of the gold production has been marketed under the terms of the order in council of October 7.
At the same time the gold mining industry has had to contend with another problem arising out of the fact that the Canadian dollar has been appreciating in terms of the United States dollar. A price of $35 per ounce in United States funds actually yields something less than $35 per ounce in Canadian funds. This has had a damaging effect upon the prosperity of the mines and those who depend upon the mines for a livelihood, 55704-1401
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whether through direct employment or through living in communities which owe their economic livelihood, yes, their economic survival to the prosperity of the gold mines.
Certain it is that there has been as yet no revival of development work. In examining these regulations and the order in council of October 7 one might say that there are serious shortcomings to be found. The regulations introduce a great deal of rigidity. The assistance afforded by opening up a market for so-called non-monetary gold was on the basis of a choice by the producer as to whether he would market his output under the terms of the order in council of October 7 or under the terms of the Emergency Gold Mining Assistance Act. That choice carried him along a year at a time.
I submit that much of the benefit that might have flowed from the opening up of a market for this so-called non-monetary gold of 22 carat fineness or less was lost by reason of that rigidity. In the seven months during which the new system has been in operation several shortcomings have developed. I do not need to repeat what was said this afternoon by the hon. member for York West (Mr. Adamson) in his able speech, but I do suggest that within the general scope of the type of regulation now in effect there is much room for improvement. In the first place the producer should be allowed to make his choice as between the two methods of marketing, not on an annual basis but on a quarterly basis so that he might see where his advantage lies on a shorter term basis than is presently possible.
In a recent speech J. Y. Murdoch, president of Noranda Mines, who is entitled to have his observations in connection with this field treated with respect, referred to this new method of marketing as follows:
I do feel that for greater effectiveness and in order to encourage more mines to forgo "cost-aid", the present regulations could be improved. As it now stands, once a gold producer elects to sell in the free market it must continue to do so for the remainder of the calendar year. This provision makes it difficult for certain mines to properly appraise the situation and decide what is best for them to do. In all fairness, as it is solely a matter of administration I would strongly advocate that arrangements be made to permit the mines to "elect" each quarter.
If certain gold mines which have elected to sell their production in the present limited free world market are to continue and others encouraged to do so, some of the obstacles which they face will have to be smoothed out.
For one thing, it should not be necessary to add copper to refined gold in order to obtain an export permit. This is an unnecessary delay and expense. It is no secret that about 90 per cent of the gold so debased and exported is promptly refined again to remove the copper and hence it brings a lower

Gold Mining
price than would otherwise obtain. The cost of debasing and refining, with consequent delay, is, of course, borne by the producer.
Further, I would urge our government to allow the private ownership of gold in Canada, either by Canadians or by foreigners. I believe that nationals of other countries would welcome the opportunity of owning gold in safe-keeping in Canada as a hedge against inflation, as well as protection against devaluation or total collapse of their own paper money, which they have so often suffered from in the past, and the prospect of an ultimate increase in value. But first, it would be necessary to rescind the provisions of the Bank of Canada Act and the Currency Act whereby the government has the power to compel the surrender of gold at the now obsolete price of $20.67 per ounce. I doubt very much if our government would ever attempt to enforce this surrender but the power is there, however out of step with the times it may be. It would surely be wholly logical for a country such as ours, with its great potential gold production, to permit its citizens the right to buy and own gold. In all probability this would lead to the establishment of a healthy gold market in Canada.
I realize that such moves on the part of the Canadian government would not be enthusiastically received by the international monetary fund and the United States treasury, both of which evidently wish to keep gold out of private ownership and to hold the price near $35 for the time being at least. But Canada, with its rather unique position in world affairs and its great potential gold production, is in a position to take such action and I sincerely hope that Ottawa is already working on these matters.
One hears frequent reference to the imminence of a "higher price for gold"; or, as it should be expressed, a revaluation of gold in terms of depreciated currencies. As I stated last and this year, such a revaluation must come inevitably, and if it be accompanied by unhampered movement and ownership of gold, it will bring about a gradual and realistic revaluation of the world's currencies and so pave the way for the removal of restrictions and fixed rates of exchange. These latter measures were forced upon us by the upheaval of normal world trade during the war, but every effort should now be made to allow the natural interplay of supply and demand to take control once more. However, I am convinced that governments will not take these steps until forced to do so by public demand. Canada has led the world in the removal of wartime restrictions and now is the time for her to move in the direction of restoring gold to its proper and traditional role as the only universal medium of exchange and measure of value.
That extract from the speech of Mr. J. Y. Murdoch I think is an utterance that is entitled to respect in this house. I commend it to the government as containing recommendations of the type of policy that the government ought to follow and ought to proclaim in the house.
I pause only briefly to comment on one or two other matters in connection with this subject. When speaking on this subject in the house on June 18 last year I drew attention to the fact that the exchange reserves of the Canadian government were to a dangerous degree in the form of United States dollars and not to a sufficient extent in the form of gold. I suggested at that

time that Canadian gold was a much better hedge than United States dollars. It is gratifying to find that in 1951 the Canadian government moved in the direction then recommended. At December 31, 1950, the exchange fund account and the Bank of Canada held gold to the extent of $580 million and United States dollars to the extent of $1,144,900,000. At December 31, 1951, that situation had been corrected to the extent that the exchange fund account and the Bank of Canada held gold to the extent of $841,700,000 and United States dollars to the extent of $899,500,000. I think that is a move in the right direction.
What is required now with respect to gold is a serious attempt on the part of the house to address itself to finding a longterm and complete solution. The present measure while necessary is certainly no solution. At best it is only a stopgap, hand-to-mouth emergency measure. So far as the international monetary fund is concerned, I have said in the past that the fund and our hopes concerning it were built upon certain premises that were written into the preamble of the fund which certainly have not been realized in the experience of the world in the intervening six and a half years. I think we must recast our thinking with relation of the efficacy of the international monetary fund.
It has become largely an instrument of fiscal policy on the part of the United States government, and in this particular that fiscal policy has run counter to the interests of Canada as a leading world producer of gold. In that situation it seems to me that the duty of the government and of parliament is to put first the interests of Canada as a gold producer. We should call upon the government to seek to remedy the type of policy that has characterized the operations of the international monetary fund thus far or to make it quite clear that this country is not going to be able to continue to give support to the fund if its policies are going to run counter to the interests of Canada.
In addition, it seems to me that the government should be called upon now by the house to take energetic measures to bring about an increase in the effective world price for gold. I mentioned a moment ago that the price has been reduced lately by reason of the appreciation of the Canadian dollar in terms of the United States dollar. I am not unmindful of the difficulties in this respect. I have in my hand an Associated Press dispatch from Washington which anticipated by a matter of three weeks the change of policy announced on September 28 by the international monetary fund. On

September 7 the secretary of the treasury of the United States, Mr. John Snyder, said that the United States would oppose any effort to lift the price of gold above the $35 an ounce level that has prevailed since 1934. Therefore, Mr. Speaker, I am not underestimating the difficulties, but I do submit that the government must address the most strenuous efforts of which it is capable to seeking an increase in the world price for monetary gold. If that increase cannot be brought about by reason of intransigence on the part of the United States government, then other steps will have to be taken by this government to ensure for the Canadian gold producer an adequate price for his product, which is not available today.
The United States today holds $22 billion of gold of which $16 billion are needed for backing their currency. It seems to me that the Canadian government ought to take this problem to Washington without delay. It should state a policy designed to bring about by concerted action an increase in the price of gold. The alternative will be that Canada will have to seek more freedom to allow gold to reach its true value according to the law of supply and demand in the world. We ask the minister therefore, what is the government's policy in this respect? What representations has the Canadian government made to the international monetary fund in this respect? What efforts has the Canadian government made to enlist the support of the United States or other governments for an increase in the price of gold? What is the government's policy? A subsidy is made necessary in the present situation by reason of the failure to act in the direction of a long-term solution, but a subsidy cannot be regarded as a sound policy for anything more than a short period to meet an emergency.
This emergency does exist. Until effective measures of the kind I have been indicating have been taken, I suppose we will have to limp along with measures of this kind. At the best this type of measure supplies only an artificial expedient. It is an inadequate makeshift stopgap. It is discriminatory in its effects, and at the very best it is only partial in its remedial effects. I repeat what I submitted to the house last year, that the time has come when parliament must address itself seriously to a re-examination of the whole position of gold and of Canadian policy with respect to it.


Mr. J. M. Macdonnell (Greenwood):: Mr. Speaker, I wish to add only a few words to what has been said, principally to underline the point made by the hon. member for Eglinton (Mr. Fleming) that the measure
Gold Mining
before us does not really purport to deal in any way with the situation except as a palliative. Surely it is clear, as has been set out here this afternoon, that the gold industry has been through the decades-one might even put it longer than that-a very great asset to the country. In the 1930's it was one of the sheet anchors. It seems to me what is put before us is neither one thing nor the other. I was thinking of that well known remark by Churchill, which has been widely circulated. He was said to have asked the name of one of his backbench supporters. When he was told the name was Bossom he said, "Funny name; neither one thing nor the other." It seems to me that exactly describes this measure. It is not going to solve the problems of our gold mines. It is going to enable them to keep their heads comfortably below water, not above it. It does not really deal with the situation. Therefore I just wish to express the hope that when the minister comes to reply, these strong criticisms which have been made will be dealt with in an adequate manner, with some indication given of the real judgment and intention of the government on this point.


Mr. G. M. Murray (Cariboo):: Mr. Speaker, the province of British Columbia was created as the result of mining developments in the Cariboo country, where gold was produced in large quantities. So I would not be fair to perhaps 2,000 voters in my riding if I did not say a word this afternoon in support of the measure now before the house.
I do not want to wander into the international sphere of monetary reform, because I would be in the greatest danger of getting beyond my depth. But it is really encouraging to hear members of all parties saying a good word for this legislation. Some of our friends over on the left do not speak that way out on the hustings. Some of them say we can get along without gold at all, that it is a wasteful product totally unnecessary in our fiscal system; that you can make money by using a fountain pen judiciously. Another of our friends over there is a follower of the late Karl Marx, who of course despised gold and directed most of his campaign against those who controlled gold in the world's markets. But we are realists in Canada; we know this great industry. Gold mining is also concerned with the defence of the country. Certain nations opposed to us have vast quantities of gold and silver, and are daily adding to those hoards. We could not do anything more useful to the economy of this country than increase our production of gold.
This subsidy will assist to a certain extent; it is a step in the right direction. If we think we can pay our debts in world markets with

Gold Mining
mere scraps of paper, with the world in the shape it is today, we are making a great mistake. Our reserves of gold held by the Bank of Canada, and to our credit by other banks, make our position very strong.
To get back to my own district, those who have developed gold mines there have made a great contribution to the development of the province. I think of one young man, out of dozens who could be mentioned, who financed the Pioneer mine. He was Colonel Victor Spencer, a veteran of the first war, who during the dull days of the thirties brought into operation a mine in the Bridge river valley which has employed hundreds of men at very good wages. By bringing that mine into operation he created a whole string of new industries; he brought about new demands for goods; he gave employment to all kinds of people, and was largely responsible for the extension of highways. The Pacific Great Eastern railway, about which we hear so much in British Columbia, is flourishing today largely because of the development of the gold mines at Bridge river, at Barker-ville and at Wells, because these mines require great consignments of heavy hardware, heavy machinery, explosives, food supplies and so on. They are purchasers of trucks, automobiles, gas shovels, and all those machines required to carry on modern mining.
There was a time in the history of this country when people, reading of a new strike in the newspapers, turned over the paper feverishly to find out where the good news came from. Today, of course, the word "strike" has a more sinister meaning, and I regret that very much. But I will say this- and I am looking now at the hon. member for Kootenay West (Mr. Herridge)-that I do not think you will ever be able to pay a working miner too much. It is very easy for us to stand here and extol the merits of gold, to urge legislation along certain lines and so on. The men we should thank are those who
go down into the bowels of the earth and often risk their lives working under very dangerous conditions, despite all our modern safety devices. They bring to the surface the gold, silver, lead, copper and other mineral products which have made British Columbia the strong and prosperous province it is today.
There is one suggestion I would venture to put forward. I think we are neglecting an opportunity in this country if we do not coin more of our metal. On the Pacific coast when I first went there the $20 gold piece issued by the United States mint was in common circulation. I would like to see Canada mint certain gold coins, especially in the year ahead as an honour to our sovereign. Then Canadians with their pockets well lined with $20 gold pieces would be able to cross over there and share in the honour of crowning the sovereign. I think also as routine business we should coin more silver. I think our troops over in Korea-


Mr. Deputy Speaker:: Order. The coining of money does not come within this resolution; therefore I would ask the hon. member not to refer to that subject.


George Matheson Murray: Then I will move the adjournment of the debate. That will give me a chance to conform to your ruling more accurately.
Motion agreed to and debate adjourned.



BUSINESS OF THE HOUSE

Alphonse Fournier: Tomorrow we will take up Bill No. 93, to amend the Export and Import Permits Act. Then we will go into supply and consider estimates of trade and commerce and defence production.


Howard Charles Green: In that order?


Alphonse Fournier: Yes.


[Stage Direction]
At six o'clock the house adjourned, without question put, pursuant to standing order.
[Stage Direction]
Thursday, May 15, 1952