1953-12-16

STANDING COMMITTEES

[Stage Direction]
Mr. W.	G. Weir (Porlage-Neepawa)
presented the report of the special committee	
appointed to prepare and report lists of mem-	
bers to compose the standing committees of	
the house, as	follows:
PRIVILEGES AND ELECTIONS Messrs:	
Adamson	MacDougall
Benidickson	MacKenzie
Bourque	McWilliam
Bryson	Meunier
Cardin	Montgomery
Carter	Murphy (Lambton West)
Cavers	Nesbitt
Churchill	Nowlan
Dechene	Pouliot
Dickey	Richard (Ottawa East)
Ellis	Tucker
Fair	Viau
Hollingworth	Vincent
Leboe Lefrancois	Zaplitny-29. (Quorum-10.)
RAILWAYS, CANALS AND TELEGRAPH LINES Messrs:	
Barnett	Herridge
Batten	Hodgson
Bell	Holowach
Bonnier	Hosking
Boucher (Restigouche- Howe (Wellington-	
Madawaska)	Huron)
Buchanan	James
Byrne	Johnston (Bow River)
Campbell	Kickham
Carter	Lafontaine
Cauchon	Langlois (Gaspe)
Cavers	Legare
Chevrier	McCulloch (Pictou)
Clark	Mclvor
Conacher	Montgomery
Dupuis	Murphy (Westmorland)
Ellis	Murphy (Lambton West)
Eudes	Nicholson
Ferguson	Nickle
Foil well	Pouliot
Fulton	Purdy
Gagnon	Richard (St. Maurice-
Garland	Lafleche)
Goode	Ross
Gourd (Chapleau) Roy	
Green	Shaw
Habel	Small
Hahn	Stanton
Hamilton	Viau
Hanna	Villeneuve
Harrison Healy 83276-61	Wood-60. (Quorum-20.)
Messrs:
Balcom	Lefrancois
Batten	Lennard
Bennett, Miss (Halton)	Lusby
Blair	MacDougall
Brooks	Macnaughton
Bruneau	Mang
Cameron (High Park)	Matheson
Decore	McCullough (Moose
Demers	Mountain)
Dinsdale	McWilliam
Dupuis	Murphy (Westmorland)
Ellis	Perron
Enfield	Power (St. John's West)
Eyre	Proudfoot
Fairey	Regier
Ferguson	Reinke
Girard	Roberge
Hansell	Thomas
Hees	Valois
Hosking	Vincent
Houck	Weselak
Hunter	White (Hastings-
Knight	Frontenac)
Langlois (Berthier-	White (Mirdlesex East)
Maskinonge-	White (Waterloo South)
Delanaudiere)	Wood
Leduc	Wylie-50.
(Quorum-15.)

[Stage Direction]
Messrs:
Adamson	Henderson
Applewhaite	Huffman
Arsenault	Low
Ashbourne	Macdonnell
Balcom	MacEachen
Benidickson	Macnaughton
Bennett (Grey North)	Matheson
Blackmore	Mcllraith
Boucher (Restigouche-	Michener
Madawaska)	Mitchell (London)
Breton	Monteith
Cameron (Nanaimo)	Nickle
Cannon	Noseworthy
Cardin	Philpott
Crestohl	Picard
CroU	Pouliot
Dufresne	Quelch
Dumas	Robichaud
Fleming	Rouleau
Follwell	Smith
Fraser (Peterborough)	Stewart (Winnipeg
Fraser (St. John's East)	North)
Fulton	Thatcher
Gagnon	Tucker
Hanna	Weaver
Hellyer	Wood-50.
(Quorum-15.)	
PUBLIC	ACCOUNTS
Messrs:	
Anderson	Balcom
Applewhaite	Beaudry
Argue	Boisvert
Ashbourne	Boucher (Restigouche'
Balcer	Madawaska)
[Stage Direction]
Standing
Bruneau
Cameron (High Park)
Cannon
Cauchon
Cavers
Cloutier
Denis
Goode
Green
Hanna
Harkness
Hees
Henderson
Hollingworth
Holowach
Houck
Kickham
Kirk (Antigonish-Guysborough)
Leduc
Macdonnell
Committees Maltais Mcllraith McLeod McWilliam Mitchell (London) Mitchell (Sudbury) Monteith
Murphy (Lambton West)
Noseworthy
Nowlan
Pearkes
Picard
Pommer
Poulin
Power (St. John's West) Proudfoot Regier Thatcher Thomas Tucker Weaver-50. rum-15.)

[Stage Direction]
Messrs:
Anderson
Argue
Batten
Boucher (Chateauguay-Huntingdon-Laprairie) Breton Bruneau Byrne Cardiff Castleden Charlton Clark Coyle Decore Demers Deslieres Diefenbaker Dinsdale Fair
Fontaine
Forgie
Fulton
Gingras
Goode
Gour (Russell)
Harkness
Huffman
Johnson (Kindersley)
Jones
Jutras
Kickham
Kirk (Antigonish-Guysborough)
Legare
Lusby
MacKenzie
MacLean
Mang
Masse
Matheson
McCubbin
McLeod
Michaud
Montgomery
Murphy (Westmorland)
Perron
Pommer
Poulin
Purdy
Proudfoot
Roberge
Roy
Schneider
Stanton
Stick
Studer
Villeneuve
White (Middlesex East) White (Waterloo South) Wylie Yuill
Zaplitny-60.
(Quorum-20.)
Aitken, Miss
Buchanan
Carter
Denis
Fairey
Forgie
Green
Hanna
Hollingworth
Knowles
STANDING ORDERS Messrs:
Michaud
Monette
Nadon
Perron
Quelch
Robinson (Bruce)
Rochefort
Studer
Viau
Winch-20. (Quorum-8.)

[Stage Direction]
Messrs:
Anderson	Ashbourne
Applewhaite	Barnett
Arsenault	Bell

Bennett (Grey North) Brisson
Cameron (Nanaimo) Cannon Ferguson Goode Hahn Hardie Harrison Henderson Hodgson
Kirk (Antigonish-Guysborough)
Kirk (Shelburne-Y armouth-Clare) Langlois (Gaspe)
Maclnnis
MacLean
MacNaught
Maltais
Matheson
McDonald
Nowlan
Pearkes
Robichaud
Stick
Stuart (Charlotte) Thibault Thomas Trainor Weselak-35.
(Quorum-10.)

[Stage Direction]
Messrs:
Adamson
Benidickson
Boivin
Boucher (Restigouche-
Madawaska)
Brooks
Brisson
Buchanan
Byrne
Carter
Deschatelets
Dickey
Dumas
Eyre
Gauthier (Nickel Belt)
Gourd (Chapleau)
Hardie
Harkness
Harrison
Herridge
Hosking
LaCroix
Lafontaine
Leboe
MacLean
McCullough (Moose Mountain)
Mitchell (Sudbury)
Pearkes
Ratelle
Robichaud
Rowe
Shipley, Mrs. Trainor Weselak Winch Yuill-35.
(Quorum-10.)

[Stage Direction]
Messrs:
Brown (Brantford)
Brown (Essex West)
Byrne
Cauchon
Churchill
Cloutier
Cote (Verdun)
Croll
Deschatelets Dufresne Fairclough, Mrs.
Fraser (St. John's East) Gauthier (Nickel Belt) Gauthier (Lake St. John)
Gillis
Hahn
Hamilton
Hardie
Hees
Holowach
Knowles
Lusby
MacEachen
Maclnnis
Michener
Murphy (Westmorland)
Nixon
Pouliot
Ross
Rouleau
Simmons
Starr
Studer
Viau
Vincent-35.
(Quorum-10.)
Balcer
Enfield
Hees
Jutras
McLeod
Meunier
DEBATES Messrs:
Michaud
Nicholson
Power (St. John's West)
Purdy
Rowe
Simmons-12.
(Quorum-7.)

[Stage Direction]
Messrs:
Knowles Low Lusby MacDougall Maclnnis MacKenzie Macnaughton Mcllraith McMillan Nesbitt Patterson Picard Pinard
Richard (Ottawa East) Starr Stick
Stuart (Charlotte) Studer-35.
(Quorum-10.)
Mr. Weir moved: that the report be concurred in.


Mr. H. W. Herridge (Kootenay West):: Mr. Speaker, the names of the members of the committees have not been read. I understand that I am or will be a member of the committee on mines, forests and waters. I should just like to say at this point, before the motion is passed, that I hope this committee, which has had a corpse-like existence for so many years, will be called this session. It could do a great deal of useful work. It could have the estimates submitted to it. It could have the Emergency Gold Mining Assistance Act submitted to it, and it could make a study of the difficulties being experienced by the base metals industry.


[Stage Direction]
Motion agreed to.
Right Hon. L. S. St. Laurent (Prime Minister) moved:: That the standing committees of this house shall severally be empowered to examine and inquire into all such matters and things as may be referred to them by the house, and to report from time to time their observations and opinions thereon, with power to send for persons, papers and records.


[Stage Direction]
Motion agreed to.
William Gilbert Weir: That a message be sent to the Senate to acquaint Their Honours that this house will unite with them in the formation of a joint committee of both houses on the subject of the printing of parliament, and that the following members, namely:	Messrs.
Ashbourne, Bertrand, Blair, Boivin, Bonnier, Boucher (Chateauguay - Huntingdon - Laprairie), Boucher (Restigouche-Madawaska), Brown (Brantford) , Bryson, Campbell, Cardiff, Charlton, Dechene, Dickey, Fairclough, Mrs., Fairey, Fontaine, Gingras, Girard, Gour (Russell), Habel, Hansell, Healy, Hodgson, Houck, Howe (Wellington-Huron), 83276-611
Joint Committees
Huffman, James, Johnson (Kindersley), Kickham, Lefrangois, MacEachen, Maltais, Mang, McGregor, Mclvor, McWilliam, Patterson, Pommer, Regier, Robinson (Bruce), Rochefort, Schneider, Simmons, Small, Smith, Stanton, Stick, Thibault, Tustin, Valois, Weaver, Wylie, and Zaplitny will act as members on the part of this house on the said joint committee on the printing of parliament.


[Stage Direction]
Motion agreed to.
William Gilbert Weir: That a message be sent to the Senate to acquaint Their Honours that this house has appointed Mr. Speaker and Messrs. Applewhaite, Bertrand, Boivin, Bourque, Brown (Essex West), Castleden, Coldwell, Conacher, Coyle, Dechene, Dinsdale, Eudes, Fraser (Peterborough), Fraser (St. John's East), Gingues, Gourd (Chapleau), Hansell, Hellyer, Henderson, Howe (Wellington-Huron), Hunter, Jones, Kirk (Shelburne-Yarmouth-Clare), Knight, LaCroix, Leboe, McCulloch (Pictou), Mcllraith, McGregor, McWilliam, Nadon, Philpott, Ratelle, Reinke, Robinson (Bruce), Shaw, Small, Smith, Thibault, Tucker, Tustin, Weselak, White (Middlesex East), and Wood, a committee to assist His Honour the Speaker in the direction of the library of parliament so far as the interests of the House of Commons are concerned, and to act on behalf of the House of Commons as members of a joint committee of both houses on the library.


[Stage Direction]
Motion agreed to.
William Gilbert Weir: That a message be sent to the Senate to acquaint Their Honours that this house has appointed Mr. Speaker and Messrs. Bennett, Miss (Halton), Caron, Casselman, Gingues, Gour (Russell), Hardie, Hark-ness, Herridge, MacNaught, Mang, Masse, McCulloch (Pictou), McGregor, Michaud, Monette, Pommer, Richard (Ottawa East), Robertson, Shipley, Mrs., Simmons, Stewart (Winnipeg North), Stick, White (Hastings-Frontenac) and Yuill, to assist His Honour the Speaker in the direction of the restaurant so far as the interests of the House of Commons are concerned, and to act on behalf of the House of Commons as members of a joint committee of both houses on the restaurant.


[Stage Direction]
Motion agreed to.
[Stage Direction]
APPOINTMENT OF DEPUTY CHAIRMAN OF COMMITTEES OF THE WHOLE Right Hon. L. S. Si. Laurent (Prime Minister): Mr. Speaker, by leave of the house and in order to complete the organization of the personnel of the house before we adjourn for the Christmas recess, I should like to move:	,
That Edward T. Applewhaite, Esquire, member for the electoral district of Skeena, be appointed deputy chairman of committees of the whole house.
Hon. members are aware that under subsection 5 of standing order 56 this appointment is for only one session at a time.
Motion agreed to.	.
Aitken, Miss Balcer Boisvert Cannon Cardin Coldwell Crestohl Croll Decore Diefenbaker Fleming Garland Gauthier (Lake St. John)
Green
Henry
Jutras
Kirk (Shelburne-Y armouth-Clare)
[Stage Direction]
Trans-Canada Air Lines TRANS-CANADA AIR LINES
Hon. Lionel Chevrier (Minister of Transport):: Mr. Speaker, in view of the interest previously displayed by this house in the question of Trans-Canada Air Lines service to Mexico and the difficulties of starting the service, I wish to make the following statement which is also being issued in Washington today:
Representatives of the government of Canada and the United States met on December 14 and 15, 1953, in Washington to hold informal discussions on matters of current concern in the field of civil aviation. Mr. J. R. Baldwin, chairman of the Canadian air transport board, and Mr. Oswald Ryan, chairman of the United States civil aeronautics board, were the principal spokesmen for their respective governments.
The main subjects discussed were:
1.	A proposed operation by Trans-Canada Air Lines of an air service linking eastern Canada with Mexico City via Tampa, Florida, where a technical non-traffic stop would be made.
2.	Pan American World Airways service between Seattle, Whitehorse and Fairbanks as well as the Colonial Airlines operation Washington-Ottawa Montreal-New York.
3.	The desirability of consultation, within the next few months, for the purpose of considering amendment of the route annex of the United States-Canada air transport agreement.
It was agreed that the civil aeronautics board would issue to Trans-Canada Air Lines a six-months renewable permit for Montreal-Mexico City flights, making non-traffic stops at Tampa. In the special circumstances the civil aeronautics board also agreed that T.C.A. might, for reasons of economy, utilize the same aircraft and the same schedules for the Montreal-Tampa portion of such flights as are used for the Montreal-Tampa services operated by that carrier under the air transport agreement.
The Canadian representatives had indicated *their desire that Trans-Canada be permitted to combine its Montreal-Tampa operations under the air transport agreement and Mont-.real-Mexico City operations, with a technical stop at Tampa, under the international air services transit agreement for a temporary period until aircraft and facilities for nonstop operations between Canada and Mexico became available. The representatives of the United States made known their desire to co-operate with Canada in helping T.C.A. resolve its operational problem, stating that in the circumstances such co-operation did

not imply a departure from the established policy of the United States in the field of international aviation.
The spirit of co-operation was carried into the discussion regarding the operations of United States carriers which have been under review by the Canadian authorities, and it was agreed that Pan American World Airways and Colonial Airlines should be permitted to continue their respective combined services through Canadian points, and that the air transport board would vacate the outstanding show-cause orders.
With reference to the present network of air routes between the United States and Canada, it was understood that the Canadian government will, within the next few months, bring forward proposals looking toward a review of the route schedules of the bilateral air transport agreement. That is the end of the statement.
T.C.A. will now be able to proceed with its plans for initiation of service to Mexico City by way of Tampa and will, I expect, commence operations during January. During the same discussions in Washington problems attendant upon the use of the airport at Sault Ste. Marie, Michigan, in connection with a proposed new T.C.A. service from Montreal through Ottawa, North Bay, Sudbury and the lakehead to Winnipeg, were also considered. There had been no disagreement on this matter but certain legal and procedural questions had arisen. These were settled satisfactorily and in a spirit of ready co-operation on both sides so that T.C.A. on this service will be able, through use of the United States field at the Soo, to provide service to the residents of Sault Ste. Marie, Ontario.


Hon. George A. Drew (Leader of the Opposition):: Mr. Speaker, I feel sure that
there will be general satisfaction not only in the house but throughout Canada that this problem has been resolved for a period of six months, and we would hope for a longer term, as a result of the negotiations that have taken place. There may be reasons why it is not possible to achieve that complete freedom of movement in the case of aircraft that applies to ships whereby ships of all nations move comparatively' freely to the various ports of the world. However, at a time when we are seeking the extension of freedom of transport and communication, I think that every evidence of international cooperation such as this is extremely heartening. I believe that, entirely apart from the question involved in these particular problems that were under review, all Canadians will welcome this evidence of a spirit of Cooperation between these two nations.

Questions


Hon. W. E. Harris (Minister of Citizenship and Immigration):: Mr. Speaker, hon. members will have noticed that yesterday you informed the house that the Clerk had laid on the table the report of the civil service commission with respect to the compensation of the members of the staff. In order to make these recommendations effective, it is necessary to have a motion passed by the house. I therefore move:
That the report of the civil service commission recommending changes in the compensation and classification of the staff of the House of Commons, tabled December 15, 1953, be now approved.
In making the motion, Mr. Speaker, may I say on behalf, I think, of all the members of the house that the staff of the house attends to our needs and the needs of the many thousands of tourists in an efficient and dignified manner which reflects great credit to them and to the Canadian people.


Some hon. Members:: Hear, hear.


Mr. Knowles:: May I ask the Minister of Citizenship and Immigration whether that motion includes the temporary or sessional employees, or is there another motion coming to cover them?


Walter Edward Harris: On November 27 Mr. Speaker announced the arrangements with respect to the sessional employees which took effect on December 1. This motion only concerns the permanent staff.


[Stage Direction]
Motion agreed to.


Hon. Hugues Lapointe (Minister of Veterans Affairs) moved: for leave to introduce Bill No. 101, respecting benefits for members of the Canadian forces.
Motion agreed to and bill read the first time.



QUESTIONS


Mr. Gillis:: 1.	How many accidents have there been with CF-100's and how many of these can be classified as major and how many as minor?
2.	How many lives have been lost as a result of these accidents?
3.	In how many instances were inquiries held to determine the cause of the accidents?
4.	What was the finding of these inquiries in each instance?
5.	Have modifications been made as a result of these findings in either the Royal Canadian Air Force plans for use of the CF-100 or in the design of the aircraft to reduce the accident hazard?


Mr. Campney:: I should like to reply to this question orally. In all, 37 accidents have occurred to CF-lOO's of which 11 can be considered major and 26 minor. Six Royal Canadian Air Force personnel have lost their lives in accidents since the aircraft was brought into service in the Royal Canadian Air Force, and hon. members will recall that seven civilians were killed in a most regrettable accident which occurred on the outskirts of Montreal. All accidents to Royal Canadian Air Force aircraft are investigated by experienced investigators who belong to a directorate especially established to maintain flight safety.
Of the 37 accidents which have occurred, final findings have not yet been arrived at in 14 of them. I might remind hon. members that the patient reconstruction of aircraft accidents is a time-consuming process if all possible factors are to be considered. Of those accidents in which investigations have been completed, seven were due to human error, two to inexperienced maintenance, ten to some minor factor in the aircraft which required correction, and four to other causes. As a result of these accident investigations minor modifications, none of them involving substantial structural changes, have been or are being made from time to time, as in the case of any other aircraft. In addition, of course, a constant effort is being made to improve flying training methods, operational procedures and maintenance practices.
May I say that the Royal Canadian Air Force has complete confidence in the CF-100. It was designed in Canada to meet a special situation and it is doing so in full measure. There have been no modifications in Royal Canadian Air Force plans with respect to use of the CF-100.
I think hon. members will be glad to know also that the accident rate of the CF-100 compares very favourably with the other jet aircraft in this or any other country. Considering that the CF-100 is a new type of jet aircraft, the accident rate has been gratifyingly low. May I point out too that, much as we regret it, a number of accidents are bound to occur in an air force such as ours which is growing to a considerable size and a large element of which is engaged in a training operational job of a hazardous nature. I can assure hon. members however that every possible precaution is being taken to ensure that accidents are kept to a minimum.

Questions


DEFENCE PRODUCTION-EMPLOYEES
Mr. Thalcher:: 1.	How many were employed by the Department of Defence Production as at June 1, 1952?
2.	How many employees are working for the same department today?
3.	Since June 1,	1952, what divisions of the
department, if any, have been discontinued?
4.	If the materials division is still functioning, how many employees has it, and what are they doing since the abolition of all controls on materials?
5.	If a reduction in the work of the department has permitted a staff reduction, how many employees were transferred to other government branches, and how many were told to seek employment elsewhere?


Mr. Dickey:: 1.	1,760.
2.	1,644, as of December 15, 1953.
3.	July 1, 1952-Building maintenance section-transferred to Defence Construction Limited. Sept. 30, 1952-Pulp and paper division. Nov. 30, 1952-Chemicals and explosives division. Sept. 30, 1953-Petroleum division.
4.	The materials division is continuing to function until December 31, 1953. There are at present 16 employees in the division. This small group has been retained to deal with the expediting of materials and equipment from both United States and Canadian suppliers to meet defence requirements, and to deal with problems of production, consumption and distribution of basic defence materials. As certain controls are still in effect in the United States, continued Canadian participation in the United States priority and allocations system is handled through the division.
5.	Since June 1, 1952, 88 persons have been transferred to other government departments and 34 persons have been released.


GOVERNMENT COMMUNICATIONS, B. C.- REPEATER STATIONS
Mr. Fulion:: 1.	Are the repeater stations on the northern British Columbia and Yukon lines of the government telegraph and telephone system included in the sale of the said system to the British Columbia Telephone Company and Canadian National Telegraph Company?
2.	If so, to which company will they be sold?
3.	By whom will they be operated?
4.	How many such stations are there, where are they located, and when were they built, respectively?
5.	What was the total cost of construction?



GOVERNMENT COMMUNICATIONS, B. C.- EQUIPMENT AND COST

Mr. Fulion:: In connection with the government telegraph and telephone system in British Columbia and the Yukon:

1.	How many telephones are there in use on the whole system?
2.	How many exchanges, with how many switchboards respectively, and where is each located?
3.	How many poles?
4.	How many miles of wire?
5.	How many miles of copper wire?
6.	What is the net cost (installed) of the above totals of telephones, exchange switchboards, poles (with insulators and pole hardware) and wire respectively?



GOVERNMENT COMMUNICATIONS, B. C.   SERVICE, RATES, ETC.

Edmund Davie Fulton: In connection with the projected sale of the government telegraph and telephone service system in British Columbia and the Yukon to the British Columbia Telephone Company and Canadian National Telegraph Company respectively:
1.	What assurances have been given or are being required from the British Columbia Telephone Company regarding the continuation of telephone service on branch lines?
2.	What, if anything, is being written into the agreement of sale concerning the principles by which the purchasers will be bound with respect to, or the conditions under which they will be entitled to demand, an increase in rates?
3.	What arrangements have been made or are contemplated to ensure that the transfer is made with the minimum disadvantage to present employees of the government system relative to continuation in employment in their present positions or in positions of similar status with the new owners, and with respect to their superannuation rights?


Lionel Chevrier: May I say a word about these questions. With reference to the first two, I had indicated earlier that it was not possible within a reasonable time for the department to answer these questions fully. I have learned that the hon. member has had some conversations with the officers of the department, and to the extent that it is possible to answer those two questions they will proceed to do so. I hope that will meet with the satisfaction of the hon. member.
With reference to the third question, I still find myself in the position of not being able to answer it until after the agreement for sale has been completed. Because of that, I would hope the hon. member would see his way clear to dropping it.


Edmund Davie Fulton: I thank the minister for the information he has given me concerning the first two questions. With regard to the third question, as the result of a conversation with the minister I appreciate the position he takes, that he is unable to answer it now. I would just make this short observation, that the question does indicate the nature of my concern, and while agreeing to withdraw the question I hope I may be allowed to say that I trust the interest of those concerned in the matters referred to will be protected in the negotiations with the company. Under those circumstances, I would ask leave to withdraw

the question, without prejudice to my right to replace it on the order paper after the conclusion of negotiations.


Mr. Speaker:: The first two questions are answered, and the third is dropped.



DREDGE P.W.D. 117  SALVAGE

Mr. Coyle:: 1.	Has the Department of Public Works made any efforts to salvage dredge P.W.D. No. 117 at Port Stanley, Ontario, since April 1, 1953?
2.	If so, what was the cost?


Mr. Bourgel:: 1 and 2. Yes, at no cost to the department.



ST. JEAN MILITARY COLLEGE  PERSONNEL

Mr. Dufresne:: 1.	Have any members of the personnel of College Militaire Royal de Saint-Jean left since the beginning of the academic year, (a) among the teaching staff; (b) among the administrative staff; (c) among the auxiliary services staff, such as kitchen service, construction service, etc.?
2.	If so, what are the names of the said members, in each service?
3.	By whom have they been replaced?


Mr. Blanchette:: 1.	Yes.
2.	(a) Teaching staff, Georges Cadieux,
lecturer, part-time; (b) Administration staff, M. Bourgeois, Stenographer grade 3;	(c)
Auxiliary services staff, L. Bessette, messman; F. Laliberte, messman; A. Boucher, messman; F. Laplante, messman; A. Lachance, messman; J. Rameau, messman; M. Jolin, labourer.
3.	(a) Teaching staff, E. Lauzon, lecturer; full-time; (b) Administration staff, E. Leger, stenographer grade 3; (c) Auxiliary services staff, A. McDonald, messman; A. Tremblay, messman; F. Perrault, messman; A. Gagnon, messman; D. Gregoire, messman; M. Roux, messman; Still Vacant, labourer.



GOVERNMENT MAIL METERING

Mr. Fulton:: 1.	Does the Post Office Department meter all mail of all departments or agencies of government?
2.	If so, how much would be paid by each department or other government agency if ordinary postage rates were charged and paid for its mail in the last fiscal year?
3.	If this information is not available by departments or agencies, what would be the total paid for all such mail in the last fiscal year?


Mr. Kirk (Shelburne-Yarmoulh-Clare):: 1.	No. A number of departments or units of departments use combined sealing and metering machines, but many do not.
2.	Information respecting individual departments and agencies not available.
3.	Based on periodical checks made at the Ottawa post office, it is estimated that the postage involved on free mail posted by or
Questions
addressed to government departments and agencies during the fiscal year 1952-53 was $4,060,230.



NATIONAL HEALTH PROGRAM


Mr. Proudfoot:: How many persons were employed in the provincial health fields at the end of the first five years of the national health program, by categories?


Mr. Robertson:: With the assistance of grants made to the provinces under the national health program 4,723 persons were employed
in the provincial health fields, consisting of:
Full- Parttime time
Physicians	
657	385Psychologists	
128	14
Social workers (psychiatric,
medical, other)	
228	32Therapists (speech-physiooccupational)	
125	19Nurses	
734	57Hospital administrators ....	23	1Technicians	
455	90Rehabilitation officers	24	2Recreational directors	4	1Sanitary inspectors	
104	3Sanitary engineers	
23	2Veterinarians	
19	5Nutritionists	
24	4Dentists	
71	22Dental assistants	
40	3Other health personnel	
1,113	311



CANADIAN MERCHANT SEAMEN

Mr. Trainor:: 1.	What is the number, if any, of seamen previously employed in the Canadian merchant marine now serving under the flags of the United Kingdom, Panama and Liberia, respectively?
2.	What is the number of seamen previously employed by the Canadian merchant marine now engaged in other occupations?


Mr. Langlois (Gaspe):: 1 and 2. Information is not available in the Department of Transport with which to answer these questions.



QUESTIONS PASSED AS ORDERS FOR RETURNS


GAGETOWN TRAINING AREA


Mr. Brooks:: 1.	Have any properties been purchased in the city of Fredericton or elsewhere by any department of the federal government for the construction of houses in connection with the Gagetown military training area?
2.	If so, (a) from whom were they purchased; (b) what is the size of property; (c) the price paid in each case?

Orders for Returns
GRANTS TO CHURCH CONSTRUCTION Mr. Thatcher:
1.	Since January 1, 1952, have any grants been made by the atomic energy control board of Canada towards the building of churches?
2.	If so, how many, and to what churches?
3.	What was the amount of each such grant?
4.	For what reasons were such grants made?
5.	Since January 1, 1952, have any other civilian government agencies, corporations or departments, made grants of this nature?
OLD AGE SECURITY FUND Mr. Fulton:
1.	What amounts have been credited monthly to the old age security fund since its establishment, showing the amount derived from the personal income tax portion, the corporation income tax portion, and the sales tax portion respectively?
2.	What amounts have been credited from other sources, showing the source and respective dates of payment?
3.	What amounts have been paid out of the fund for old age security monthly since its establishment?
4.	What is the cumulative deficit of the fund to date, in terms of the excess of total payments from the fund for old age security over receipts from the tax sources mentioned in part 1?


Mr. Benidickson:: Return tabled.



OLD AGE ASSISTANCE


Mr. Knowles:: 1.	What is the estimated number of persons in Canada in the 65-69 age bracket (i.e., 65 years of age or over but not yet 70 years of age) ?
2.	What is the estimated number of persons in the above-noted age bracket who are not gainfully employed?
3.	What is the estimated number of persons in the above-noted age bracket who are not gainfully employed, but who are in receipt of unemployment insurance benefits?
4.	What is the estimated number of persons in the above-noted age bracket who are not covered by any pension or retirement plan other than old age assistance?
5.	How many persons in Canada are in receipt of old age assistance?



ARMY CAMP, COQUITLAM, B.C.

Mr. Regier:: 1.	What is the total expenditure to date on the proposed army camp in the district of Coquitlam, British Columbia?
2.	Has the corporation of the district of Coquitlam been paid an amount to compensate for the construction of a water main to this project? If not, for what reason?
3.	What are the plans regarding development or sale of this property?


Mr. Blancheiie:: Return tabled.



ROYAL CANADIAN MOUNTED POLICE


[Stage Direction]
On the orders of the day:
Mr. D. F. Brown (Essex West):: I should like to direct a question to the Minister of Justice. In my city, the city of Windsor,

Ontario, we are anxious to have the Royal Canadian Mounted Police musical ride for the centennial celebrations which are to continue throughout the year 1954 in celebration of the city's 100th birthday. I am informed that the musical ride is to be discontinued. Will the minister please let me know if that is the case, and if so why?


Hon. Stuart S. Garson (Minister of Justice):: I wish to thank the hon. member for having given me notice of his question. During the past two years we have produced not only two musical rides but the specially trained troop that went to the coronation, and also put on a ride in the United Kingdom, as well as two or three mounted escorts and a number of mounted displays.
The effect of these special functions and displays has been to curtail very severely our basic training in equitation and, instead of putting through approximately half the total number of our recruits, a much smaller percentage has received this type of training during this period. The result is that the pool from which we can draw for good riders has been depleted, and it is with the intention of building up this pool that we want to concentrate next year on basic equitation, curtailing, as much as possible, ceremonial functions and mounted displays.


George Alexander Drew: I would point out, Mr. Speaker, that the reason given by the minister does not relate to economy or to the expense involved in this matter, but rather to the problem of basic training in equitation. I suggest that careful reconsideration be given to this decision. Generally, in so far as any of the activities of any of the organizations within the supervision of the government are concerned, we will support any measures of economy. When it comes to a matter of this kind, I think we should recognize that there is perhaps no single thing of its kind which offers a more colourful expression of a Canadian tradition than the musical ride of the Royal Canadian Mounted Police.


Mr. Speaker:: Order. I should like to fell the hon. member that, having made an observation, it is most irregular to have the answer to a question debated. The hon. member may ask a supplementary question. Having made an observation, I would ask the hon. member to proceed by way of a supplementary question or to conclude his remarks.


George Alexander Drew: I would ask the minister if he will reconsider the decision which he has just announced.


Stuart Sinclair Garson: The minister, Mr. Speaker, is always prepared to accede to reasonable

requests to reconsider decisions, but I am afraid that the hon. Leader of the Opposition has missed the point of my answer. The point is that in order to continue these displays and musical rides, it is necessary to maintain a pool of trained men from which those who participate in these rides are chosen. It is with a view to maintaining that pool that the steps outlined in my reply were taken.


Edmund Davie Fulton: By way of a
supplementary question, may I ask if I would be correct in understanding that the ride is not being abandoned but is simply not going to be performed continuously until this pool of trained horsemen can be built up, and after that it will then be continued?


Stuart Sinclair Garson: Certainly the ride is not being abandoned. Perhaps I had better read again what I said and ask the hon. member to listen carefully to it.


Edmund Davie Fulton: I think you had, because you have said two contradictory things now.


Stuart Sinclair Garson: In my reply I indicated that, as a result of the activities in putting on these musical rides and other displays, the pool from which we can draw for good riders has been depleted, and it is with the intention of building up this pool so that we can continue the musical ride-


Edmund Davie Fulton: That is what I asked you.


Stuart Sinclair Garson: -that we want to concentrate the next year on basic equitation, curtailing ceremonial functions and mounted displays. In this way we can build up the pool so we can continue the policy the Leader of the Opposition recommends.


Some hon. Members:: Hear, hear.


Mr. McCann:: Whoa.


Mr. Rowe:: The minister yells "whoa", and I am glad that he knows something about horsemanship. I should like to ask the Minister of Justice, as one interested in-


Stuart Sinclair Garson: The minister to whom the hon. member is addressing his remarks did not yell "whoa".


William Earl Rowe: I was referring to the Minister of National Revenue (Mr. McCann). I presume the Minister of Justice knows something about horsemanship, but I might ask him if he knows any better way of developing horsemanship than by practising.


Stuart Sinclair Garson: That is precisely what this policy I have outlined is aimed at.


George Alexander Drew: Does the minister not think that the very existence of this trained unit is in itself the greatest possible attraction to that
Inquiries of the Ministry pool they would seek to train, and that its discontinuance would in itself discourage the creation of a pool of horsemen required for this purpose?


Stuart Sinclair Garson: The answer is no; I do not
think so.



LABOUR CONDITIONS


[Stage Direction]
On the orders of the day:
Mr. H. O. While (Middlesex East):: Mr. Speaker, just to get away from horses for a moment, I should like to ask a question about the railways. Would the Minister of Transport tell me if it is true that approximately 500 employees of the Canadian National Railways in the central Ontario region have been laid off, or are about to be laid off?


Lionel Chevrier: Mr. Speaker, I was asked some weeks ago by another hon. member a question having to do with lay-offs on the Canadian National Railways. While I am not able to tell the hon. member what the numbers are, I do know that there are some employees of the Canadian National Railways who have been laid off because of the decline in traffic. What the numbers are in central Ontario I am not able to say at the present time, but I shall be glad to find out.



NORTH ATLANTIC TREATY ORGANIZATION


[Stage Direction]
On the orders of the day:
Mr. Jean-Francjois Pouliol (Temiscouata):: Mr. Speaker, I have drawn the attention of my distinguished friend and very able colleague, the parliamentary assistant to the Secretary of State for External Affairs, to a distressing front-page news item in the Montreal Gazette on Monday morning. It reads as follows-


Mr. Speaker:: Order. The hon. member must put his question. It is not in order to read a telegram or extract from a newspaper upon asking a question before the orders of the day are called. Would the hon. member put his question, please.


Jean-François Pouliot: Yes, sir. This a distressing news item of urgent international importance, and I shall have to read the summary as set out in the headline of the article before asking my question. I took the trouble to mention the fact to my hon. friend, the parliamentary assistant to the Secretary of

Inquiries oj the Ministry State for External Affairs. It deals with the cohesion of NATO and the headline is as follows:
But official of organization-
That is, Lord Ismay.
-fears forces not strong enough to hurl back allout enemy attack.
What I wish to know is whether the members of NATO were consulted by Lord Ismay before such a statement was made and, if so, or if not, will Canada notify Lord Ismay to be more cautious in the future, and not to destroy the morale of the people who belong to the nations which are members of NATO.


Mr. Roch Pinard (Parliamentary Assistant to the Secretary of State for External Affairs):: Mr. Speaker, I do not think I should leave completely unanswered what has been said by the hon. member for Temiscouata. He is generally quite categorical in his observations, but I do not think on this occasion I can follow his example. I think he would expect me to decline to answer his observations. However, I shall discuss the matter with officials in the department and see whether an answer can be given later concerning the observations of Lord Ismay.


Jean-François Pouliot: Thank you.



INQUIRY AS TO INCREASED PLEDGE IN SUPPORT OF NATO

[Stage Direction]
On the orders of the day:
Mr. M. J. Cold well (Roseiown-Biggar): Mr. Speaker, I should like to ask a supplementary question which the Prime Minister (Mr. St. Laurent) may answer either now, or later when we resume after the Christmas recess. Has Canada pledged any increase in its NATO contribution for the coming year? If so, would he tell us the extent of the pledge.
Louis Stephen St-Laurent: Canada has not pledged any
increase in amount. There may be some change in the manner in which the amount is applied to the build-up of the NATO force; but there has been no increase in Canada's over-all commitment.



REQUEST FOR STATEMENT ON PARIS MEETING

[Stage Direction]
On the orders of the day:
George Alexander Drew: Mr. Speaker, may I ask a supplementary question, and preface it by saying that I realize the Prime Minister may not wish to answer it immediately. But having regard to the fact that these questions have been asked and that, in effect, they relate to a single topic of this over-all problem, does


the Prime Minister feel that he is in a position to place a report before the house as to the progress that has been achieved at Paris in the present meeting?


Louis Stephen St-Laurent: No, I am not. I have not had any report of the results of the deliberations which took place yesterday and the day before.



CANADA GRAIN ACT


[Stage Direction]
On the orders of the day:
Mr. H. R. Argue (Assiniboia):: Mr. Speaker, I should like to ask a question of the Minister of Trade and Commerce. Can the minister say whether the committee on agriculture and colonization will be called together early in the new year in order to review the Canada Grain Act, as recommended by that committee at the last session of the house? As the minister is aware, it would be called for the purpose of discussing the question of overages and box car distribution.


Right Hon. C. D. Howe (Minister of Trade and Commerce):: My hon. friend is aware that it is not the duty of any minister to call committees together. As a member of the committee in question, my hon. friend is in a position to do so. I have no amendments to the Canada Grain Act to recommend. There will be later in the session matters that I will wish to refer to the committee; but the subject matter of its business, I assume, will be determined by the committee.


Hazen Robert Argue: May I ask a supplementary question? Has the minister any objection to the government's carrying out the committee's recommendation, that the Canada Grain Act be referred to the committee on agriculture for study?


Clarence Decatur Howe: I have nothing to do with the matter. If the committee meets and desires to undertake that work, I shall endeavour to co-operate. But I have no wish either that it should be done or should not be done.


Hazen Robert Argue: Whisper a few words to the boys on your side.



RESEARCH INTO RELATION BETWEEN SMOKING AND LUNG CANCER

[Stage Direction]
On the orders of the day:
Stanley Howard Knowles: Mr. Speaker, I should like to ask a question of the Minister of National Health

and Welfare. In view of the reports and statements made in the United States in respect of the incidence between smoking and lung cancer, can the minister say whether the research being carried on in his department, which he referred to on May 8 of this year, has reached the point where any report or statement can be made?


Hon. Paul Martin (Minister of National Health and Welfare):: No such research is being carried on in the Department of National Health and Welfare, but various research bodies in Canada have been provided with funds out of the national health program to enable them to carry out research in various fields having to do with the health of the nation. That particular aspect of the matter is one subject that has been given consideration-not specifically, but along with others phases of cancer research.


Stanley Howard Knowles: May I ask a supplementary question? Have any reports on this question been received from any of the bodies doing this research? If so, will the minister make those reports public?


Paul Joseph James Martin: I should have said that we are aware of studies that have been made particularly in the state of New York with regard to the incidence of cancer in relation to cigarette smoking. But as to any conclusions drawn therefrom, I do not think I can say anything at this time.



CROP LOSSES IN NORTHWESTERN MANITOBA


[Stage Direction]
On the orders of the day:
Mr. F. S. Zaplitny (Dauphin):: Mr. Speaker, I should like to ask a question of the Minister of Agriculture (Mr. Gardiner) or, in his absence, the parliamentary assistant, or perhaps the acting minister. In reply to my question of December 7 with regard to emergency assistance to flooded-out farmers, the parliamentary assistant to the Minister of Agriculture stated that a decision would be reached on Saturday, December 12. Is the parliamentary assistant in a position to say what decision has been reached?


Mr. Robert McCubbin (Parliamentary Assistant to the Minister of Agriculture):: In
answer to the question of the hon. member for Dauphin, I do not think I said that a decision would be reached on December 12. I said only that the board of review would meet on December 12. I am very sorry to have to answer him by saying that a decision 83276-62i
Inquiries of the Ministry has not yet been reached, but that all the applications are in and that they are compiling the results.


Frederick Samuel Zaplitny: I should like to quote from what the parliamentary assistant said-


Mr. Speaker:: Order. Would we not be
losing time? If the quotation is not exact it has been modified, and the one that has been made today must be accepted.
[Later:!


Frederick Samuel Zaplitny: On a question of privilege, the parliamentary assistant to the Minister of Agriculture has contradicted the statement which I made in the course of asking him a question. May I refer him to page 644 of Hansard of December 7, the last line of his reply, which is as follows:
A survey is being made by officials of our department and the report of that survey will be handed to the board of review of the P.F.A.A. on Saturday next when a decision will be reached with regard to the matter.
I submit that my statement was quite correct.



EXTERNAL AFFAIRS


[Stage Direction]
On the orders of the day:
Stuart Sinclair Garson: On December 1, the hon. member for Winnipeg North Centre (Mr. Knowles) directed a question to the Secretary of State for External Affairs (Mr. Pearson). The question asked whether there had been any instances, other than in the case of Igor Gouzenko, of the F.B.I. or any other United States agency interviewing Canadian citizens in Canada with respect to loyalty investigations in the United States.
My colleague, the Secretary of State for External Affairs, replied at once that he did not know of any instances similar to the one which the hon. gentleman has in mind, but he promised that the matter would be looked into and that if there were anything to report the report would be made at a later date. He then discussed this matter with me as the minister in charge of the Royal Canadian Mounted Police and requested me to reply to the question of the hon. member for Winnipeg North Centre in due course. I have accordingly had the matter carefully examined and would reply as follows: If the hon. member for Winnipeg North Centre is referring to formal inquiries by congressional committees or agents representing congressional committees, I can assure him that we have no knowledge of any such occurrences, other

Inquiries of the Ministry than in the case of Igor Gouzenko, which occurred in 1949, and of which the house is already aware.
There are, of course, occasional criminal investigations which extend from the United States to Canada and from Canada to the United States. It is the feeling of the government that it would be unwise to undertake any discussion of individual cases of this sort publicly for reasons which I think are obvious. There is, however, a particular case which I might touch upon without identifying it-and I believe this may be the case that the hon. member may have in mind-where the F.B.I., with the approval of the R.C.M.P. and in the presence of an R.C.M.P. representative, questioned a Canadian to ascertain whether he would be able and willing to appear as a witness in the event of a criminal charge being brought in the United States against a certain American who was also the subject of a so-called loyalty investigation.
The foregoing case to which I refer was conducted in accordance with the well-established and recognized principle governing the relationship between the Royal Canadian Mounted Police and the F.B.I. officials in Canada and in the United States respectively, as to the conduct of police investigations which arise in one country and extend into the other. That principle is that the police investigator of one country will never conduct any investigation whatsoever in the other country unless it is with the full knowledge and approval of the appropriate agency in the other country. I am informed that our authorities have always found the F.B.I. meticulous in this regard.
Such investigations extending to Canadian territory have been very few in recent years, and they take place only when it is clearly best to take this course rather than to risk prejudicing the outcome of the case by having a part of it handled solely by a person who has not been connected with it.
I am informed that not only do the police and security officials consider this arrangement to be a practical and useful one, but that they would be the first to complain of any abuse of it by the authorities of the other country.
The arrangements which I have mentioned are, of course, fully reciprocal, and I am informed that they are quite as advantageous to our police authorities as to those of our neighbour.


Stanley Howard Knowles: By way of a supplementary question, may I say first of all that it does occur to me, after listening to the description of the case referred to by the Minister of Justice, that the case to which he refers is
rMr. Garson.]

one which I had in mind when I asked my question on December 1. I agree with him that we should not discuss these names in public. Obviously that would be following the very practice to which I take objection. My question is this. May we take it that the Canadian government would not look with approval on the F.B.I. coming into Canada to question Canadian citizens on behalf of congressional inquiries, apart from such cases as that of Igor Gouzenko, where special arrangements have been made?


Mr. Stick:: Why not?


Stuart Sinclair Garson: I think that I would not wish to add anything to the statement which I have just read because it covers the very point to which my hon. friend is now referring, and covers it very clearly. The statement was drafted with the intent that it would be fully complete, and if my hon. friend will examine it he will find that it is complete. If he wishes to ask any further questions after reading the statement he might address them to me tomorrow.


Some hon. Members:: Tomorrow?


Mr. Coldwell:: The minister spoke of
criminal charges. Did those criminal charges arise out of the congressional investigation into this man's activities? In other words, was this one of those perjury cases or not?


Stuart Sinclair Garson: I do not think I can pretend to give an accurate answer to that without checking back and getting the information from the police officials. My hon. friend will appreciate that everything I say here is hearsay. I have to get information from them before I can give it here.


Major James William Coldwell: Will the hon. gentleman get that information?


Stuart Sinclair Garson: Yes; I have no objection.


Major James William Coldwell: It bears on the question the hon. member asked.


CUSTOMS ACT
[Stage Direction]
The house resumed, from Tuesday, December 15, consideration in committee of Bill Mo. 29, to amend the Customs Act-Mr. McCann-Mr. Robinson (Simcoe East) in the chair.
On section 1-Value for duty where market price has declined.
Mr. Macdonnell:: I want to go back to the question I was asking the minister on December 11, Friday last, at page 859 of Hansard. I referred the minister to the practice which, as I understand it, was in existence before

Customs Act
1948, and I asked the minister why it had been changed. The minister said, at page 859:
I am informed by my officers that probably the reason for the change was to conform with our obligations to GATT.
I further asked the minister:
Can we have some further explanation? I do not understand to what provision of GATT the minister is referring. I would like information on that.
The minister again said:
The answer is that it was under article 7 of GATT, which requires us to apply actual values.
I refer the minister again to his own remarks in the house on March 12, 1952, as reported on page 359 of Hansard, when he referred to the opinion by the Department of Justice. I have it here if the minister would like to look at it. I should like to ask the minister some questions arising from that. First, does the minister agree with what I understand is a view quite widely held, that the situation before the change was working satisfactorily? That is my first question.


James Joseph McCann: Mr. Chairman, would you have the hon. member repeat his question. There was so much noise I could not get it.


James MacKerras Macdonnell: Mr. Chairman, perhaps those who are not interested in this would give some chance to those of us who are.


An hon. Member:: Louder.


Mr. Fleming:: Get rid of the Liberals behind the iron curtain.


James MacKerras Macdonnell: I was referring to the question that I asked the minister last Friday evening, as reported on page 859 of Hansard, and was referring to his remarks made in March, 1952, on the opinion of the Department of Justice. I then asked the minister this question:	My understanding is-I think
it has been presented to this committee before-that the situation which existed before 1948 placed the value on the cost of production plus administrative expense plus selling expense plus profit. If I am wrong in detail there it does not matter because I am asking whether the situation before 1948 was reasonably satisfactory. That is my first question and I have several more.


James Joseph McCann: It was not satisfactory having regard to our obligations under GATT.


James MacKerras Macdonnell: That is not my question. I will get to GATT later; I will not forget about GATT. What I want to know is whether it was satisfactory in the period before this opinion was obtained. I want to know if it proved satisfactory as a working arrangement. Incidentally, I will add to my question:	How long had it been proving
satisfactory, if it was satisfactory?


James Joseph McCann: My officers tell me that the opinion given by Justice had nothing to do with the changes made in 1948.


James MacKerras Macdonnell: We do not seem to be getting very far. I have asked what I think is a simple, direct question and the minister has answered something which I did not ask at all, though I may ask it later. I want to come back and ask whether the situation before the change, which I believe was in 1948, was working satisfactorily. Surely that is a simple question. If it is not clear, I will try to make it clear.


The Chairman:: I am trying to make up my mind to what extent I should allow this type of questioning to proceed. Hon. members will recall that for part of the afternoon yesterday we were discussing the amendment of the hon. member for Eglinton which broadened the discussion considerably. That amendment was negatived and we are now discussing the clause which is before us. Any discussion in committee stage must be entirely relevant to the clause. I am just asking myself whether a discussion of events which occurred in 1948 could be considered relevant to this present discussion.


James MacKerras Macdonnell: Mr. Chairman, I hope I can convince you that it is relevant. We are being asked to approve a measure, which incidentally we are not very enthusiastic about but we think it is at least an attempt to go in the right direction. As I understand it, the need for this measure has arisen largely because of a change which took place in or about 1948. The question naturally arises in one's mind: If it was satisfactory before 1948, why can we not get back to the time when it was satisfactory? I think it is relevant and, as a matter of fact, the minister considered it relevant because he made a statement at some length the other night in committee.


James Joseph McCann: The reason given is that we had to accept the GATT agreements and section 36, under which we had been working, had to be dropped because under the GATT arrangement we had to take the actual value.


James MacKerras Macdonnell: That does not seem to me to be getting us anywhere. The actual phrase from the Justice opinion which the minister referred to in his speech in March, 1952, was based on the words "fair market value" which had been in section 35 of the act. They were construing those words. As far as I am aware, the minister has not given us any wording, except that he did use the words "actual value" the other night.
What I want to know and what I still do not know is whether this opinion of justice was merely as to the meaning of the words

Customs Act
"fair market value" in the statute which they say may bear no necessary relationship to production costs. That is their opinion. In fact, that is the only thing we have. I have not any wording of GATT yet that suggests that the wording of GATT entered into this opinion. If that was the only obstacle which the department faced, and if in fact the situation before 1948 was satisfactory, if their only difficulty was this opinion from Justice, then what was to prevent a change being made in the legislation which could have restored the previous sense given to the words "fair market value"? What I want to be clear about is this:	Is it perfectly clear that our
obligations under GATT were responsible for this change in the law as outlined by the Department of Justice? If that is so, I want to know exactly why it is so, because it seems to me it is very important.


James Joseph McCann: Mr. Chairman, the opinion of Justice was given in 1952 and the GATT arrangements were made in 1948. Therefore the opinion of Justice had nothing to do with the changes made in 1948.


James MacKerras Macdonnell: The opinion of Justice was in 1952. Did we then carry on from 1948 to 1952 as we were carrying on before?


James Joseph McCann: No. A change was made in the law, in Bill 229, an act to amend the Customs Act, section 4, subsection 39:
The fair market value of goods shall be taken to include the amount of any subsidy or drawback of customs duty-
You can see the change was made by an amendment to the Customs Act in 1948.


Donald Methuen Fleming: I take it that the minister is now referring to the present section 37 of the Customs Act as it appears in the Revised Statutes of Canada, 1952, chapter 58. The words that he began to read a moment ago were taken from section 37 which was enacted in 1948. It was chapter 41 of the statutes of 1948, section 4.


James Joseph McCann: The statement I want to make is that, by the change in the statute of 1948, section 36 was dropped from the bill.


Donald Methuen Fleming: What was done in 1948 was this. The present section 35 was amended and section 37 was enacted. The minister started out a moment ago to read section 37 and then apparently stopped with a view to correction of his statement. We are talking about changes made in 1948. The minister, I take it, has asserted now that the change in 1948 that he is referring to was the amendment of section 35, the enactment of the present section 37 and the dropping of the old section 36. Is that what the minister is referring to as the change in 1948?


James Joseph McCann: Yes.


Donald Methuen Fleming: I should like to point out to the minister that section 35 as it stood after the 1348 amendments and indeed after the 1949 amendment and as it stands today in chapter 58 of the Revised Statutes of Canada, 1952, contains as subsection 3 of section 35 this provision:
When neither the fair market value nor the equivalent of such value can be ascertained, the value for duty shall be the actual cost of production of similar goods at date of shipment to Canada, plus a reasonable addition for administration, selling cost and profit.
It is a fhir question to ask, Mr. Chairman- and the question has not been answered- what difficulty, if any, did the department encounter in applying those provisions and in determining, in the light of that subsection, what was in any case the actual cost of production of similar goods at date of shipment to Canada, plus a reasonable addition for administration, selling cost and profit.


James Joseph McCann: Subsection 3 of section 35 is not an overriding provision. It is a residual section to be used only when the value cannot be determined under subsections 1 and 2.


Donald Methuen Fleming: Quite so. That is quite clear from the opening words which I read. The subsection states:
When neither the fair market value nor the equivalent of such value can be ascertained . . .
But the minister has not answered my question and he has not dealt with it. Let us make it perfectly clear. In the cases within the scope of subsection 3 which I have read, was any difficulty experienced by the department in the administration and interpretation of that provision and in the consequent ascertaining of the actual cost of production of similar goods at date of shipment to Canada, plus a reasonable addition for administration, selling cost and profit? Was there any difficulty in those words or in interpreting them and applying them?


James Joseph McCann: No. There was no difficulty, once you get into subsection 3, having dealt with 1 and 2 first, whether or not that met the conditions.


Donald Methuen Fleming: Then it is quite clear that there is no difficulty in any case in ascertaining what is the actual cost of production of similar goods at date of shipment to Canada, plus a reasonable addition for administration, selling cost and profit?


William Alfred Robinson: Order. Once more I must rise to question this type of debate on this clause. The hon. member whom I have been following as closely as possible has been discussing subsection 3 of section 35. I am

somewhat in doubt as to the relevancy of that discussion since we are considering the addition of the new clause to section 35.


George Alexander Drew: Mr. Chairman, may I point out that already there have been certain specific proposals put forward. In the discussions that have taken place it has been indicated that no matter how much agreement there may be in principle as to the need for doing something, there is great doubt as to the effectiveness of the proposal '.hat is made. I submit that nothing is more relevant to an understanding of what is now before us than to try to find out exactly why this kind of change is necessary and to have the basis upon which a reasonable discussion can take place and the appropriate change can be made.
The purpose of meeting in committee is to be able to examine a bill; and in fairness, I should say that on a number of occasions suggestions that have been made by the opposition with regard to amendment of various measures have been accepted and have represented a great improvement. In order that that may be done and in order that the usefulness of committee discussion may be a reality, it is essential that we know more than we now know as to why this particular form of amendment is before us.
I would point out that the hon. member for Greenwood a few days ago asked whether this amendment would apply to other industries than the textile industry to which the minister had referred. The minister in effect replied that he would not know until his officials had had an opportunity to report to him what the result of the application of this amendment would be. I rose later and asked if the minister had not considered what the impact on industry generally would be; and again in effect-because I am not attempting to quote the exact words used- he said he would not be able to tell until his officials were able to report to him how this was working and what the effect was. What is being attempted at this moment is to obtain that information which is essential for an understanding of why this amendment is now before us and of what amendment would be most effective to deal with the situation.


James Joseph McCann: I made a statement the other day on the question of the hon. member for Greenwood as to whether this amendment could be applied to any other commodity. The statement was in the affirmative, and that, as I have been quoted by the Leader of the Opposition, the effect of this amendment would not be known for some time.
Customs Act
That opinion is shared by the trade. The association of Canadian primary textile manufacturers said today:
While textiles are only one commodity affected by the new federal anti-dumping legislation, any steps taken to strengthen the Customs Act is a move in the right direction.
The house is in accord with that part.
It is too early to know the effect of the legislation mentioned in news reports until it is studied and its application over a period has been observed.


William Earl Rowe: That is exactly what he is saying. They do not know and you do not know.


James Joseph McCann: I reiterate my statement that it can be made applicable to other commodities. The hon. member for Greenwood yesterday challenged me to name anything else but textiles which might be end-of-the-line. What about shoes? What about ladies' purses? What about pharmaceuticals? There was a time when the pharmaceutical trade in this country made objection to the fact that antibiotic drugs were being sent in here at sacrifice prices. That was a time when there was bound to be a change in the manufacture of what were called the antibiotics of early days to the much later and more modern one of penicillin. Those are examples of types that may be affected as end-of-the-line goods and which produce something of distress selling.


William Earl Rowe: What about electrical equipment?


James Joseph McCann: It is not exactly in the same line.


James MacKerras Macdonnell: I am very interested in
the minister's exposition because I understood there were several of those who sit behind him who explained yesterday that they regarded this section as a purely emergency measure in aid of the textile industry.


James Joseph McCann: I have stated on different
occasions that it was not.


James MacKerras Macdonnell: Yes, the minister has
stated that. I want to come back to this section and to subsection 3 of section 35 which the hon. member for Eglinton read and which refers to cost of production plus administration, selling and profit. I understood the minister to say that the wording of that subsection was controlled to an extent by the wording of the preceding two subsections on one of which in particular we have the opinion of the justice department. I want to ask this question, and here again we come back to GATT. Will the minister also please remember that we have said we are going to vote for this. The only thing is, we wonder if it is as good as it can

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be. I want to ask whether it was considered and not thought possible to introduce apt legislation which would give effect to what I understand to be the wording of subsection 3 if it were uncontrolled by the previous subsections, and which procedure would come back to what I understand to have been the satisfactory practice before 1948.
I do not want to be too persistent. It may be that I have not fully understood what the minister said, but I have not yet been able to clear my mind on this subject. What is it in GATT which prevents us from taking that course, assuming that would be a sensible course to take in the circumstances?


Louis Stephen St-Laurent: Our interpretation of our obligation under GATT is that we cannot resort to the cost of production price if there is another way of determining what is the fair market value. It is only when we are prevented from using other ways of determining the fair market value that we feel that under GATT we can resort to investigation of the cost of production.


James MacKerras Macdonnell: I am grateful to the
Prime Minister, but could he not give us- after all, he is a lawyer-a brief, reasoned exposition of just what words there are in GATT which tie our hands?


Louis Stephen St-Laurent: We undertook to allow
the importation of goods at the tariff rates based upon fair market value, and this form of determining value was discussed in the negotiations and was discarded. It was urged that that was not fair market value and that the cost of production might have very little relation to the actual market value of the goods. We admitted that we were prepared to have our tariff rates apply to the fair market value in the country of export, but we do not admit that the fair market value is the selling price of end of season or end of line goods when that price is substantially below the price at which the major portion of that line of goods has been sold in the country of export.


James MacKerras Macdonnell: Could the Prime Minister carry his explanation one step further and explain why it is that we feel that this device of averaging over six months, which is contained in the measure now before us, comes within the four corners of GATT but the other related to cost of production does not? Did the words "cost of production" enter into the discussion and were they ruled out? I do not want to be too persistent.


Louis Stephen St-Laurent: They were not ruled out, but what was complained of was the fact that there were tariff authorities who, instead of applying their tariffs to the market value in the country of export, attempted to

determine what a fair cost and proper profit would be in the market of export. That was objected to and it was agreed we would take the fair market value when there is a method of ascertaining what it is. We have done that, but with respect to certain countries we had refused to accept their prices even before this change because they would not satisfy us that it was the fair market value in the country of export.
This matter has been under serious discussion. Canadian producers would prefer the rule that the hon. gentleman refers to, the one in paragraph 3. They say that if we could apply the rule in paragraph 3 they would not have to worry about dumping. But we say that we have had to forgo the application of that rule when there is another method of arriving at fair market value and we are going to attempt this procedure because the United States government, which is the one with which we are perhaps more frequently concerned than others, recommended this kind of rule for fixing fair market values to congress a year or two ago.


Donald Methuen Fleming: Which kind?


Louis Stephen St-Laurent: An average price over a period.


Donald Methuen Fleming: Such as we have in the bill?


Mr. Si. Laurent:: It did not go through congress. Congress did not accept it, but the United States government interpreted its obligation under GATT as being one that would be met by applying that kind of rule.


James MacKerras Macdonnell: What policy do the
Americans follow?


Louis Stephen St-Laurent: At the present time our trouble and the trouble of our exporters is that we can never be sure from day to day what is going to be applied by the customs officials, and that is why we have been urging with all possible force of our persuasiveness that they simplify their tariff practices. The hon. member will remember that that was the thing that I mentioned as being perhaps the most fruitful outcome of my visit to Washington last spring. The President stated that there was going to be a recommendation to congress to deal promptly with simplification of tariff procedures by a bill. It is difficult to say that they do comply with the spirit of GATT, but we felt that this kind of rule could not be disputed by the United States administration under present conditions because the administration itself had recommended its adoption to congress.


James MacKerras Macdonnell: I understood the Prime Minister to say in his remarks that there would be some qualification of our readiness to adopt this, that we had to have a plan

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which would be reasonably effective and could be worked, so perhaps we may rest in hope that before this discussion is through we may be able to satisfy the government that this plan is not going to work very well, and possibly we may bend our efforts to that for the moment. The Prime Minister has given us his opinion in the course of the discussion that the actual plan described in subsection 3 was in effect discussed by those concerned in GATT, and he feels that in the light of that we cannot go back to the pre-1948 practice. That seems to me to answer my question on that point unless we are able to satisfy the Prime Minister later on that this plan is so unworkable that we may get him to change his mind.


Louis Stephen St-Laurent: Mr. Chairman, it is not the government that the hon. member would have to satisfy that you can go back to the pre-1948 practice and still comply with GATT. It is the other members of GATT. They would regard a return to the 1948 situation as a clear violation of the undertakings of GATT. We hope that none will regard this procedure as a violation of the undertaking, and we feel that our American friends will not even venture to say that they think it is a violation because they themselves recommended it to congress some months ago as being something that would comply with their obligations under GATT.


James MacKerras Macdonnell: I would think the Prime Minister is fully justified in saying the United States would find great difficulty in criticizing us. I think he could go farther and say they could hardly criticize us, in the light of what has happened, even if we had gone back to 1948.


Mr. Cameron (Nanaimo):: In view of the Prime Minister's remarks, I should like to ask him just how one determines fair market value except in relation to the cost of production?


Louis Stephen St-Laurent: There are many traders who, over many years and decades, have gone into bankruptcy because there was not the relationship between fair market value and the cost of production. Their cost of production was out of line with the fair market value, and they were not able to continue in business.


Colin Cameron: I must say that seems to be arguing in a circle. However, I shall take that answer as it is. There is another matter that came up while the minister was speaking about which I was a bit puzzled. It bears on this question of the relationship of fair market value to the cost of production, and with all due deference to
the Prime Minister I insist there must be some relationship at some point between those two factors.
In the last part of his remarks the minister mentioned invoices which I gathered were the basis upon which decisions were made. I am rather puzzled as to the means by which these invoices came into the minister's hands. I am not suggesting there was anything improper, but were they part of the representations made by some industry who presented those invoices as evidence of dumping in Canada, or how did they come into the hands of the department?


James Joseph McCann: In the normal course of business every importer who is collecting his goods must present his bill of lading or his invoice, and it is upon that we calculate the duty. If the invoice indicates an abnormally low price for the type of goods, and our information indicates it could not be sold for that price, we immediately make inquiry and find out what the proper price should be for those goods.


Colin Cameron: That brings me to the next question I want to ask. Who makes the decisions concerning this dumping in the first instance? I suppose these invoices come into the hands of your officials at the points of entry?


James Joseph McCann: That is right.


Colin Cameron: Does the official at the point of entry decide, on the prima facie evidence of these invoices, that there is a necessity for investigation, or does he make the decision himself that these goods should be excluded? At what point does the minister intervene in the process?


James Joseph McCann: Is your question directed to the change in the law if it comes into effect, or what has been the custom?


Colin Cameron: Either one; if we are to judge the future result of this amendment then we should have some information as to what has happened in the past.


James Joseph McCann: In the natural course of events the customs officials at the point of entry, in the larger ports, call upon appraisers who are trained in the appraisal of certain lines of goods. For instance a man might be trained in hardware, and he would not be given the appraisal of textile materials or any other line of goods. He knows his business. If he has difficulty in making an appraisal, then he refers the matter to the head office in Ottawa.
Since this bill was introduced we issued certain instructions in this connection. Those

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instructions stated that the following amendment to section 35 of the Customs Act had been introduced in parliament, and then the amendment is quoted. The instructions then went on to say:
To give effect to the purpose of this amendment, collectors, appraisers and any officer acting as appraiser are instructed to closely scrutinize invoice values of all manufactured goods, comparing such values with home market values shown and certified on previous importations of the similar goods by the same or other importer. In any cases where invoice values indicate price decline such as is contemplated by the foregoing valuation provision, or the values appear abnormally low, the importer is to be advised that the entry may be subject to amendment in accordance therewith. The invoice is to be forwarded to the department with as full information as possible and the reasons for believing that the value shown is below the normal value, in order that the matter may be inquired into and the value for duty established as provided for by the new subsection of section 35.
There is a careful scrutiny made of all these invoices. If it cannot be determined at the point of entry what the invoices should be, then they are referred to the office in Ottawa, where our chief appraiser for the whole dominion and his staff operate.


Mr. Hees:: A few moments ago the Prime Minister said the United States administration recommended this definition of fair market value to congress, and congress rejected it. I think it is obvious that congress would reject it, because it is an unworkable measure.


Louis Stephen St-Laurent: Well, they are going to try.


George Harris Hees: I believe the minister and his department know it is unworkable. In many cases it will take months to determine the value of goods on a six-months weighted average basis. It is going to take an army of customs inspectors to do it, and that is going to effectively block the importation of most goods that we bring into this country. When goods are landed in Canada importers must know immediately what valuation they have so the goods can be put on the market, priced and sold. If the importers have to wait an indefinite period of time, then the selling season might easily be over by the time they received a price from the department. Then the goods would be of no value.
I feel that this measure is going to block a large volume of imports into this country, including goods brought in at a fair and reasonable market value. Another thing which this measure is going to do is that it will have a serious effect on our exports. If we impose a measure like this against people who want to ship goods into Canada, it gives them justification for imposing such a measure fMr. McCann.]
against the exporters in Canada who wish to sell goods in other countries. If our exporters are faced with a complicated measure like this, it is going to have a very serious effect on Canadian exports. I believe that is something which must be given serious consideration by the government, because this country relies on its export trade.
Now, Mr. Chairman, what we want in this measure is very simple. We want a measure that is going to protect the jobs of Canadian workmen against unfair importation practices. This could be done very simply if we were to go back to the pre-1948 definition of fair market value, which has been mentioned in this house several times today.
Before 1948 there was no dumping, and there was none of this trouble. If such a measure were adopted, it would do three things. First of all, it would stop dumping; secondly, it would not interfere with the importation of goods which come into this country at a fair market value; third, there would be no chance of jeopardizing our very important export trade.
Instead of introducing a measure which I feel confident the minister and his department know is not going to work, we should go to other members of GATT and point out the problem with which we are faced. We should ask them to go back to the simple, workable definition of fair market value which prevailed before 1948, and in that way clear up this serious trouble with which the industries throughout Canada-not just the textile industry-have been faced. I think we owe that to the exporters, the importers and our workers. I would urge the government to take this constructive step, instead of deliberately bringing in a measure which would not have a good effect. I believe the aim is correct, that of stopping dumping, and to protect the jobs of Canadian workmen. We agree with that. But we do not agree with a method which we know will not work, and which is simply going to make things very complicated for people engaged in business throughout Canada. That, in turn, will have a very serious effect on the employment of Canadian workmen.


Mr. Maltais:: Mr. Chairman, in connection with what has been said by the hon. member for Broadview, I should like to ask for some further information from the Minister of National Revenue. Listening to the remarks of the hon. member I was wondering if he was fearful of the position of importers into Canada, in the light of the way this new system of valuation would apply. The bill states that it will have application to goods which qualify under two headings.

I should like to know from the minister if this new method of valuation applies to goods which qualify in respect of those two conditions. If this is so I do not think the hon. member for Broadview need have any fear because all this legislation is attempting to do is to prevent unfair practices on the part of exporters in the United States who may try to send into this country goods which are what are known as either end of line or out of season products. This would have the effect of unfair competition for those concerns in Canada who are engaged in the same line of business.
How can the hon. member say that this method of valuation is impractical when it has never been tried in Canada? The fact is that, as applies in respect of all departmental statistics, the decision in this instance has been and is based on a weighted average. I do not see how the hon. member can quarrel with this method of valuing goods imported into Canada. We have the facilities to get the prices.
I would be interested to know however why the bill stipulates a period of six months, and would ask the minister if this provision has been made because of some international arrangement. Why has there not been a provision for, let us say, twelve months?
I have in mind the matter of Christmas toys, which I saw the other day in Quebec. Those toys were manufactured in Germany, and they are now being imported through New York. There is no doubt that during this season the market will be saturated in the United States, and that those toys will be dumped into Canada. At one time of the year they might sell for 25 cents, while at another time the price might be 15 cents, and the minister would have to arrive at a weighted average. Taking only a period of six months we would go back to the month of May.
I think the hon. member for Broadview should have no fear. However, it is clear that what he has been saying is directly in line with what was expressed yesterday afternoon when the two amendments were moved. The fact is that the hon. member and his colleagues want higher tariffs.


Some hon. Members:: No.


Mr. Maliais:: Yes, higher tariffs on the importation of goods.


George Harris Hees: No. I rise on a question of privilege.


Lauréat Maltais: You just take your seat.


William Alfred Robinson: Order.


Lauréat Maltais: Perhaps I am out of order in speaking about the amendments.
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William Earl Rowe: The hon. member for Broadview is rising on a point of order.


Lauréat Maltais: If he is doing that, all right.
I would point out to him however that if the provision for a valuation on a basis of weighted value were struck out, the bill if enacted without those words would give power to the minister to amend the tariff on all types of goods, if the amendment suggested by my hon. friend's colleague had been accepted yesterday. That is what would have happened.


George Harris Hees: Mr. Chairman, when I spoke about this matter last Friday I made it quite clear, as indeed every member in this party has done who has spoken in this debate, that the question of tariff is not under discussion. We are discussing a matter-


William Alfred Robinson: On that very point, may I ask the hon. member to keep in mind the fact that we are not discussing tariffs; we are discussing the first clause in Bill No. 29.


George Harris Hees: Yes; I am just clearing my stand in the matter. I have been accused by the hon. member who has just spoken of advocating higher tariffs. That I have never done, and never will do-and neither has any member in my party. We are not talking about higher tariffs; we are talking about a measure which the government should have presented to the house two years ago, when this matter was brought up and explained in great detail. The minister's reply was, "Dumping does not exist". Then, when he made his speech a week ago Monday outlining this provision, he suggested almost word for word what had been told him two years ago. In the meantime thousands upon thousands of Canadian workmen have been laid off because of his negligence at that time.


Some hon. Members:: No, no.


An hon. Member:: Stick to the facts.


George Harris Hees: I say we are not discussing higher tariffs. I say higher tariffs are not needed in this instance; it is just a matter of applying a proper anti-dumping regulation.


William Alfred Robinson: Order. Will the hon.
member please confine his remarks to clause 1.


Donald Methuen Fleming: What about the hon. member for Charlevoix? He was not called to order.


William Earl Rowe: Mr. Chairman, it seems as though everyone has been protesting as to being misunderstood in the remarks they have made. I can understand, Mr. Chairman, that you have a desire to keep the debate close to the subject matter in the section before the committee.

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I was impressed by what was said a few moments ago by the hon. member for Nanaimo, and I thought his point was reasonably well taken. In view of the way it had worked in the past, he wanted to know how it would work in the future. In other words, how is the minister going to arrive at a decision? How is he to arrive at a fair market value when action is taken?
The minister has given some slight indication as to how he may endeavour to approach the problem. However, as the hon. member for Broadview has pointed out, in the past it has not been a case of recognizing the fact that goods have come in at prices away below what they could be produced for in Canada. The practice evidently has been, after 300 men were let out of employment in one district, and several hundred more in Quebec and, I believe, three or four hundred more in Cornwall at this Christmas season-


James Joseph McCann: That has nothing to do with it at all.


William Alfred Robinson: Order. The hon. member has sympathized with me in my attempt to keep the discussion within bonds, and directed to clause 1 of the bill. I think he will also agree with me that he is a little far afield in what he is saying at the present time.


William Earl Rowe: Well, Mr. Chairman, it might appear that way because of my clumsy fashion of expressing myself. But I did think that I was pretty close to the issue before us.
When I made reference to the many people who were out of employment I heard an interjection from the minister which would seem to indicate that he agrees with you, Mr. Chairman, because he said that my remark had nothing to do with the matter at all. I submit, however, that it has. I wonder just how you are going to arrive at a fair market value without taking into account the cost of production. Despite arrangements that have been made with GATT, when the Prime Minister was asked today by the hon. member for Greenwood what policy was being followed by the United States, he said he did not know exactly what policy they were following. Despite his persuasiveness, or his effort to persuade, he has been unable to find out exactly what policy has been followed. Therefore, it seems to me, without any offence to the other members of GATT, we might give some consideration to slight changes in this clause.
Yesterday it was suggested that the word "manufactured" should be removed. The government seemed to agree at one time, but then they changed their minds. There seemed to be some confusion in government policy 
yesterday but it appears that it has been straightened out since. The Prime Minister said yesterday that the word "manufactured" could be dropped, and the Minister of National Revenue seemed to agree with him. Some hon. members from western Canada did not agree with that attitude, and I was not surprised. In fact, if I had been in the Prime Minister's place yesterday I do not believe I would have voted either.


James Joseph McCann: On a point of order, the amendment was settled yesterday. It is not relevant to the discussion today. The hon. member is out of order in again discussing an amendment which was settled yesterday.


William Earl Rowe: I am glad it is settled, Mr. Chairman, and so are you. So far as the settling of the fair market value is concerned, I am somewhat disturbed, as are the hon. member for Broadview, the hon. member for Greenwood, the hon. member for Nanaimo and others. This is not a matter of party differences. It is a matter in which we are all concerned. It is the employment of our people that is at stake. We are concerned about how this measure is going to work.
I know that we are all sincere in this. There is no one worthy of being in this House of Commons who is not sincere when he sees that these things affect so many homes in this country. I say that quite seriously. That concern is felt by hon. members regardless of whose riding is affected. All we are trying to do is to find some ways and means by which this legislation will be made more practical and more effective.
It has been long since appreciated by all parties that dumping of goods is an unfair trade practice. Without going into details, this legislation deals with "the average price, weighted as to quantity, at which the like or similar goods were sold for consumption in the country of export during a reasonable period, not exceeding six months". Therefore, the fair market value and what is a reasonable period are left to the discretion of the minister. The reasonableness of the period is to be left to the discretion of the minister. It might be ten days. I know he would say it would be longer than that; but it will not be longer than six months and will not be less than two or three days.
Yesterday we were told that we were going to add to the civil service personnel. It will take a large number of inspectors to do this job because the United States is a very large country. When you are trying to get a fair market value of a particular product you will find that in some districts they manufacture much more cheaply than in other districts. They sell for less in some districts. The fair

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market value over a period of time is less in some states than in others. You are to take the weighted average. I would take it that you would require at least 48 civil servants for the 48 states to get the weighted average.
I submit that some changes should be made in this clause. The word "manufactured" could well have been left out, and it should be reconsidered. The clause refers to the export price "as a result of the advance of the season for the marketing period, declined to levels that do not reflect in the opinion of the minister their normal price". The law of supply and demand has a lot to do with the fair market value of any commodity in any place in the world. Therefore it is going to be difficult to administer a principle that is not tied into anything. You say that at the end of the season or the marketing period, or as to the distribution of end of line goods or whatever you call it, a fair market value has to be put on the goods. You have to arrive at something. What is the basis for calculation? Unless it is based on the cost of production who is to say that it is a fair price unless they give some reason for that price?
I should like to refer to a point that has been mentioned by the other corner of the house, namely, that the consumer is involved as well. If your price is tied to no cost of production or a reasonable profit or is not placed on any basis at all you are going to get into extreme difficulties. We all know of manufactured goods that have not cost anywhere near what they are selling for. Indeed, the profit per unit is often enormous because of the law of supply and demand itself. In other words, the goods may be produced for only a fraction of what they are being sold for until competition gets stronger and until more people start producing those goods that are in short supply. We have all seen that, with respect to different articles. Therefore, either way you take it, the fixing of a fair market value, independent of cost of production, from a business sense, is absurd, inasmuch as it may be sold for far less than the cost of production and far less than our cost of production. On the other hand, it could be just as absurd the other way round. Goods that we produce very cheaply under certain conditions could be sold at an enormous profit and still be below the fair market price in this country.
I do not wish to detain the committee except to say that I do believe this legislation will be found to be unworkable and will not accomplish the purpose for which we are all struggling. Everyone is trying to avoid
any semblance of having any fiscal policy of their own. Even hon. members to the left are very careful; everyone in this party is very careful. Even the leader of the party to my left was ultra-cautious. In fact I think he was more cautious and more selective in his use of words than either the Minister of National Revenue or the Prime Minister, because yesterday the Minister of National Revenue said this was an effort to give reasonably good protection, and the Prime Minister called it a system of reasonable protection.
I remember back to the years when we used to talk about these things. Those were the terms I heard on this side of the house. Mr. Chairman, I know that this is perhaps not quite relevant and I still have sympathy for you. I am not going to embarrass you again except to say that you acknowledge the problem.
I do urge the government to reconsider the proposal that has been put forth by the hon. member for Eglinton, the hon. member for Greenwood, the hon. member for Broadview and other hon. members, independent of party. In many instances these people have wide experience in the business field. I think it is relevant to say that this clause has been hastily and clumsily drafted, evidently as a matter of expediency, brought about, as the old saying is, after the horse is stolen.
I come back to what the hon. member for Nanaimo said and I hope that in the future, even though it is clumsy and almost impossible of sound administration, an effort will be made to complete it before some plants go out of business and certainly before hundreds of people are thrown out of employment at Christmas time, which seems to be the only shocking evidence that can move the government which had not seen the problem for two or three years.


Major James William Coldwell: Mr. Chairman, it seems to me that confusion is becoming confounded in this committee. We are trying to get at the basis for the valuation of goods and in doing so there has been a great deal of discussion as to cost of production and so on. I would find it very difficult to administer the bill now before us if I followed the views expressed in the committee. I am not sure whether my hon. friends to my right, of the Progressive Conservative party, want this bill completely withdrawn or not. I think most of us are anxious indeed that we do not impose any additional burden on the Canadian people, that we do not increase the tariff, but at the same time legislate to stop unfair practices.

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It seems to me that so far as the valuation of goods is concerned the yardstick to be used is contained in an agreement known as the general agreement on tariffs and trade. Article VII of that agreement sets forth the method which countries may use when they are faced with conditions such as it is believed we are faced with at the present time. Clause 2 of that article reads:
2. (a) The value for customs purposes of imported merchandise should be based on the actual value of the imported merchandise on which duty is assessed, or of like merchandise, and should not be based on the value of merchandise of national origin or on arbitrary or fictitious values.
(b)	"Actual value" should be the price at which, at a time and place determined by the legislation of the country of importation, and in the ordinary course of trade, such or like merchandise is sold or offered for sale under fully competitive conditions. To the extent to which the price of such or like merchandise is governed by the quantity in a particular transaction, the price to be considered should uniformly be related to either (i) comparable quantities or (ii) quantities not less favourable to importers than those in which the greater volume of the merchandise is sold in the trade between the countries of exportation and importation.
(c)	When the actual value is not ascertainable in accordance with subparagraph (b) of this paragraph, the value for customs purposes should be based on the nearest ascertainable equivalent of such value.
If we are going to conform to the general agreement on tariffs and trade, it is not a question of our cost of production, it is a question of the fair market value, of what comparable goods in comparable quantities are sold for in the country from which the goods are imported. It seems to me that even in the suggestion as to prices made by the minister regarding the period of the previous six months we are going to run into some difficulty.
Supposing an industry in the United States has overproduced and they are offering 12, 15, 20 or 150 purchasers in the United States goods at a certain price which would seem to be below what we consider to be the cost of production in this country. Under this agreement we would have no right to impose any barrier against those goods coming in here provided they are offered to a Canadian importer at the same price at which they are being offered to purchasers in the United States.
It seems to me that we are getting into difficulty in trying to get around an agreement which we have made already. I think if it is taken up with the United States the suggestion contained in the bill is a reasonable one. As they are obligated to do under the general agreement on tariffs and trade, if we proposed to do something of this sort and a contracting party or parties raised
IMr. Coldwell.]
objection we could negotiate on the basis laid down in the bill before us but to put anything else in this bill regarding comparable costs of production and all the rest of it would be violating this general agreement on tariffs and trade.
I do not think it is any use talking along the lines along which my hon. friends have been talking; there is no use trying to put another value on these goods; the basis is laid down in an agreement to which the government has placed its signature. That agreement has been gone over and modified and extended at Havana and Annecy and the provisions of that agreement have been in effect since 1947.
If v/e are going to facilitate the business of the house I think my hon. friends should keep this agreement in mind. What we should try to do is to pass legislation which has this agreement in mind. There may be objection by a foreign government to some of the duties proposed or some of the barriers suggested by our department in carrying out the particular bill now before us, should it become an act of parliament, and we should always keep in mind that we would have to negotiate on the basis of the governing agreement which we have signed.
A discussion of other things that have been mentioned this afternoon seems to me to be quite irrelevant. We should try to find something workable. To me the bill is objectionable in many ways and yet I want to see something done that will protect our people's jobs which may be threatened because of dumping. Let us not in our discussion be led into the belief that we can set aside a firm agreement which the government has signed.


Mr. Adamson:: Mr. Chairman, I want to make one observation. At line 10 this section reads, "of the advance of the season or the marketing period." I should like to see inserted words such as these, "or change of model".
I am thinking particularly of electrical equipment the manufacturing of which is also in some considerable difficulty because of dumping. One must remember that over half of the household electrical equipment such as refrigerators sold in Canada was imported last year. I am not going into the difficulties created by extra cost of manufacturing in Canada as compared with the comparable cost in the United States. I should like to mention one instance of a machine which cost $77,000 and the put-through in the United States was 3,000 per day as compared with a maximum daily put-through in the Canadian factory of 60. This

shows just how extra capital costs in Canada have to be taken into account in the unit cost of manufacture.
There is a device adopted which almost constitutes dumping, and this is particularly applicable to United States electrical equipment. In the case of much United States household equipment there is an annual change of model. Sometimes the change is considerable, but sometimes the change is merely another paint job, a differently shaped handle, a different arrangement of shelving, a different name or a different advertising campaign.
However, this does allow the American producer to write down the price of the previous model and sell it at bargain rates. That is becoming a regular marketing practice. As to refrigerators, washing machines and other things, there are model changes. Last year's model is tremendously reduced in the United States as a marketing technique. The Canadian concern probably has not the capital to make these small changes and is manufacturing the same article it was manufacturing before. The previous model of United States equipment is then imported into Canada at a price which is a fair price but it is the price of the previous year's marked-down United States equipment, which may be 40 per cent or sometimes even 50 per cent below the price of the current year's model.
That is recognized merchandising practice in the United States. What happens in that period in which the model is being changed is that there is a surplus of equipment-and I have instanced it-which is dumped on the Canadian market. I feel that should be included in this act in order to prevent the results of this rather episodical fluctuation in the markets in the United States. I feel that the impact of the Canadian tax structure on the price differential is something which also should be considered.


William Alfred Robinson: Shall the clause carry?


Donald Methuen Fleming: I should like to clarify one
or two things with the Minister of National Revenue before raising a matter which I should like to put to the Prime Minister. I take it that the dumping which exists today is dumping entirely from the United States. Is that correct?


James Joseph McCann: No, that is not correct. The major portion of it is from the United States.


Donald Methuen Fleming: I did not catch the minister's reply.


James Joseph McCann: The major portion of it
would be from the United States but there are other countries from which goods are- if you want to use the term-dumped. There
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are other countries from which they come. For instance, they come from Japan, Czechoslovakia and Britain.


Donald Methuen Fleming: Of course, this provision
will apply to dumping from whatever country is concerned.


James Joseph McCann: From any country.


Donald Methuen Fleming: Are there any other countries than the four now mentioned from which goods are being dumped into Canada?


James Joseph McCann: They could come from any
trading country. Those four were the ones I had in mind. An examination would show whether or not there are any more.
Just while we are on that question, I should like to correct the impression given by the statement made by the hon. member for Broadview with reference to dumping. I am sorry that he is not in the chamber. He said there was practically no dumping before 1948. The hon. member for Greenwood asked me the other day with reference to the figures. We had given him the figures from 1947 to 1952. We can go away back to the year 1931, when approximately $1,400,000 was collected in dumping duties. The figures are as follows:
Dumping Duty Collected
Fiscal Year ending March 31
1931	.$1,339,695.
1932		 1,976,625.
1933		 4,101,257.
1934	. 1,764,761.
1935		 1,264,660.
1936	. 1,200,890.
1937		 1,335,925.
1938	. 1,073,112.
Calendar Year
1939		 1,445,315.
1940		 2,747,581.
1941		 1,547,427.
By order in council of 19 December, 1941, under authority of the War Measures Act, the imposition of special duty was suspended for the time being except in respect to fresh fruits and vegetables. This suspension expired with the expiry of the War Measures Act on April 1, 1947.


William Earl Rowe: Have you the figures for 1950 or 1951?


James Joseph McCann: I put them on the record the other day but I can put them on again. For 1950,	$1,735,543;	1951,	$1,547,247;	1952,


Donald Methuen Fleming: From the study made by the department in framing the bill now before the committee, what commodities will this measure apply to as to which the department is satisfied that goods are now being dumped into Canada?

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James Joseph McCann: I can only make a general answer to that question. It would be hard to say in advance what it would apply to. The general answer is that it could be applied to any commodity.


Donald Methuen Fleming: That is not quite right, of course, because the bill speaks only of manufactured goods; but surely the government has some cases in mind.


James Joseph McCann: Any commodity that is
included in that category of manufactured goods.


Donald Methuen Fleming: Yes. I know to what the bill can be applied, but that is not my question. After all the government, in introducing a measure of this kind, must have had some specific cases of dumping in mind which it is anxious to prevent. Will the minister tell us what that study indicates, as to what manufactured goods are being dumped into Canada today?


James Joseph McCann: I think the illustration I gave previously is the one that is giving us the most bother; that is textiles.


Donald Methuen Fleming: Are there others?


James Joseph McCann: There could be others.


Donald Methuen Fleming: It is not a question of "could be". Are there others? Are there other known cases of dumping to date?


William Earl Rowe: Electrical appliances.


James MacKerras Macdonnell: Shoes.


William Earl Rowe: Frigidaires.


James Joseph McCann: I am told that it could apply to any commodity, but we have no segregation of particular lines of goods.


Donald Methuen Fleming: I understood the minister to say earlier this afternoon-and if I misapprehended him I wish he would correct me- that shoes were within that category.


James Joseph McCann: When I said that it was in answer to a statement made yesterday by the hon. member for Greenwood, wherein he challenged the minister to state any other line of goods that it could affect and that were end of the line. Let me say to the hon. member who has just spoken that when there is a change in model, the goods that are left over come under the category of end of the line. I think he will agree with that statement.


Agar Rodney Adamson: I am glad to know that.


Mr. Trainor:: I am concerned with the question of administrative delays under this proposed amendment. In this connection I should like to direct a question to the minister. Will the minister assure the house that

the delays incident to the administration of the bill before the house will not in effect constitute an embargo against imports; and if not, will he undertake to explain why not?


James Joseph McCann: I can assure the hon. member that it will not constitute an embargo against the importation of any goods. There are few instances in which goods come into this country-and for which they present an invoice and they want to have the customs duty paid-where they take and ship them back to the country of origin. It is all done subject to reappraisal. Where it might interfere with the importation of goods is where an importer would come along and make an inquiry from the officials at a port as to what the duty is going to be on a particular line of goods. It will take some time perhaps before we are able to make an investigation to find whether the goods he has mentioned constitute end of the line or end of the season goods.


Owen C. Trainor: Suppose a particular article appears at a point of entry and under this bill the appraiser has to make a decision right at once. What happens?


James Joseph McCann: I have read the regulations, and he will not make a snap decision if he is in any doubt. He will refer it to head office. But except for individuals the general principle is that the business of an importing firm is done through a customs broker, and the customs broker makes a deposit with the Department of National Revenue to cover the indebtedness of his clients so far as duty is concerned. If he wants to take his chances on what the duty may be and wants to have the goods released so he can sell them to retailers, all well and good. He is taking that risk. On the other hand, if he wishes to do so he can wait until a proper appraisal is made and then have his goods released.


Owen C. Trainor: Do I understand the minister to say that there will be no greater delay under this new method of ascertaining the value of the goods than there has been in the past?


James Joseph McCann: I do not think I said there would be no greater delay. I did say it may take some time.


Mr. McCullough (Moose Mountain):: Mr. Chairman, I should like to say that it is with a good deal of hesitation that I support this bill to amend the Customs Act. I do so for the very good reasons that were given by the hon. member for Rosetown-Biggar.


William Alfred Robinson: Order. This type of discussion should more properly take place on second reading. Will the hon. member please confine himself to the clause under discussion.

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Edward George McCullough: In dealing with the clause under discussion I want to say that I support it in so far as it will give some measure of protection to those industries which are finding themselves in difficulty, and particularly to the workers in industries that are confronted with the dumping of goods into this country. But I want to make it very clear that as far as I am concerned I support the measure on the ground that the good which will flow from the ministerial authority given by this legislation will go to the workers and the consumers of the country. I think there is a great possibility that under this measure the minister may not have proper information, and that there may be what might be termed an iron curtain prohibiting the minister from getting information as to profits from certain industries to which we are giving protection under the legislation, and it may be that certain industries will be protected which should not be.
In the first instance some of these industries may be uneconomical, and in the second place certain industries may be involved which have been investigated before and have been found to have made huge profits at the same time that their workers were being paid low wages. Therefore I hope the minister will use the power that is being given to him to protect first of all the workers and the consumers of the country.
In this connection I should like to say that when the hon. member for Dufferin-Simcoe spoke he said that some of the prices which are in effect in Canada are due to the law of supply and demand. That may be true in certain cases, but under the capitalist system and as the result of the investigations that have taken place, such as the price spreads inquiry and other royal commissions, we have found that artificial prices are established which the consumers of Canada are forced to pay, and the law of supply and demand does not enter into the picture at all. I think I just need to mention the rubber industry which was under investigation-


William Alfred Robinson: Order. I wonder if the hon. member would co-operate by confining his remarks to a discussion of the clause under consideration.


Edward George McCullough: I should like to conform with the rules of the house, but in making some observations may I say that so far the committee has not been given the information necessary to come to a reasonable and logical conclusion with respect to the matter under discussion. We have not been given information as to the amount of goods being imported into Canada under what might be termed dumping procedure. I should like to read to the house
a statement contained in the newspaper Style of Wednesday, December 9. It bears the heading "Imports Only 3-2 Per Cent" and reads as follows:
The facts do not substantiate claims that the Canadian clothing industry has suffered from the competition of imports, Morgan Reid, of Simpsons-Sears, told the national associated women's wear bureau in an address last week. In 1951, he said, imports of clothing into Canada represented "only 3-2 per cent'' of the total domestic disappearance. The figure remained the same in 1952, "and there is no reason to suspect that it will be significantly higher in 1953".
Therefore I want to submit that the bill under discussion is not going to do the thing which the government hopes it will, namely protect those industries which are finding themselves in difficulty today and, more important, the workers in those industries. As I see it, what is going to happen is simply what the hon. member for Rosetown-Biggar indicated previously to the committee, namely that it will be found that these goods are being sold in the United States at a price which is normal there. I need only mention a few examples such as farm machinery, cars, trucks, electrical and photographic goods. Any member of this chamber can go to the United States and buy photographic equipment for 40 to 50 per cent less than when purchased in Canada. The same thing is true of electrical equipment, and as the hon. member for Rosetown-Biggar indicated the other day.


William Alfred Robinson: Order. I hope I do not have to rise again, but this is really a speech that should have been made on second reading. The hon. member must confine himself to the terms of this clause.


Edward George McCullough: Thank you very much, Mr. Chairman. With respect to my decision to support the measure, as I said at the outset I do so simply because under the Canadian capitalist system we have to be practical and we have to go along with the government in giving to the workers and the people generally the best kind of legislation we can to protect them under a system which in my opinion is very bad in any case. I want to submit that trade is a two-way street, and from the discussion that has taken place I believe all hon. members will agree that whether we like it or not this bill is going to lead to certain measures by which the government will undertake to protect these industries that are having difficulties, with the result that trade barriers will be built up and will to a large extent prevent international trade. Canada is mainly dependent on international trade for exporting a large volume of her goods, and I say that in that regard we are very vulnerable.

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Mr. Hahn:: In speaking on the amendment yesterday the minister mentioned section 43 of the Customs Act as providing protection for fresh fruits and vegetables, and he said-*


William Alfred Robinson: Order. May I remind the hon. member that the clause we are discussing deals with manufactured goods, and I cannot permit a discussion of fresh fruits and vegetables.


Frederick George Hahn: Mr. Chairman, I was coming to that. I was going to ask the minister if he would be so kind as to give us a definition of manufactured goods, so we could at least be assured that there was more protection under this section than there is under section 43 for the fruit and vegetable growers.


James Joseph McCann: There is no definition in the act of "manufactured goods", but there is a definition of goods. I have no doubt the hon. member is familiar with it. It reads:
"goods" means goods, wares and merchandise or movable effects of any kind, including vehicles, horses, cattle and other animals;


Frederick George Hahn: That is a definition of goods. I quite agree that is what I wanted yesterday, but I should like to have the minister explain what manufactured goods are. Are the goods contained within a can considered as manufactured goods? It would be worth something to know that. I should like a definition of "manufactured goods".


James Joseph McCann: At the moment I cannot give an answer to that, except to say that the word speaks for itself. An interpretation of the word "manufactured" can be obtained by looking in any standard dictionary.


Frederick George Hahn: I should like to ask the minister, then, whether or not the goods within the can would be considered manufactured goods?


James Joseph McCann: I should think they would. They are canned goods. They have gone through a process of manufacture which changes them from the original.


Frederick George Hahn: Let us take butter. If it is in a package, is it also manufactured goods?


James Joseph McCann: It would be regarded as a manufactured product.


Frederick George Hahn: What about canned cherries?


James Joseph McCann: I gave an answer to that yesterday, and stated that canned cherries would be manufactured goods.


Frederick George Hahn: But the cherries themselves would not? The reason I raise the question, sir, is that on a perusal of section 43 we find it has to do with erroneously classified or priced goods for entry. It does not mention the end of the season goods in which we

were so interested and which the Prime Minister was quite willing to accept in the act. That was my purpose in suggesting it.


Donald Methuen Fleming: It has been indicated already that the matter of delay in determining the value for import purposes under the amendment has given a number of hon. members concern. I presume that will depend, to some extent, on the number of inspectors available to the department for checking on the average price weighted as to quantity, at which the goods in question are sold in the country of origin prior to the date of export to Canada. What provision has been made by the department in that respect? The minister made reference the other day to the fact that there are inspectors in the United States. At page 693 of Hansard for December 8, 1953, the minister answered a question asked by the member for Rosetown-Biggar. The question and answer are as follows:
May I ask a supplementary question? What steps will the government take to Investigate an industry to see if there is actual injury to that industry from competition abroad?


James Joseph McCann: The answer to that question is that we have special investigators who are trained in particular lines of industry, and who make these investigations in the country of export.
Will the minister tell the house what steps his department is taking to provide sufficient inspectors to discharge the considerably augmented duties that will now fall upon them under the new bill?


James Joseph McCann: I think I told the house the other night that we had taken on 18 additional appraisers who will confine their efforts, for the time being at least, to this particular work.


Donald Methuen Fleming: That is, 18 in addition to
the present number?


James Joseph McCann: Right here in the city of
Ottawa there are about 100 appraisers, and it will depend upon the size of the port. There are more appraisers in places like Toronto and Montreal than there would be in an inland port like Sudbury. It depends a good deal upon the position of the port.


Donald Methuen Fleming: I thought we were not discussing the matter of appraisers at Canadian ports of entry. I thought we were discussing the number of investigators in the country of export; that is what the minister referred to in the passage I read from Hansard. Are we to understand that the figure of 18 which he has just mentioned is the augmentation of the staff of investigators operating in the United States?


James Joseph McCann: That is right.


Donald Methuen Fleming: They are all in the United
States?


James Joseph McCann: No, I would not say they
are all in the United States. They operate from Ottawa, but some of them will be sent to the United States or wherever there is necessity for them.


Donald Methuen Fleming: How many investigators are similarly engaged today, that is engaged not with full-time duties as appraisers in Ottawa or other Canadian customs ports of entry, but how many investigators are engaged today as we are told these new 18 new investigators will be engaged, namely in making investigations in the country of export?


James Joseph McCann: I am told there are only two at the present time in the United States, but their headquarters are in Ottawa. They come and go. If the hon. member wants to know, at the moment there are two, and they may be back home for Christmas; then there will be none. They will go back to Boston or New York afterward.


Donald Methuen Fleming: 1 think they will deserve to get home for Christmas, because from this point on they will be busy men. I take it that, in addition to the present two, we will have 18 more, making a total of 20 available for investigations in the country of export. Is it expected they will work almost entirely in the United States?


James Joseph McCann: Yes, it is. I suggest to you, Mr. Chairman, that these are all administrative details that have to be worked out. In my experience in this house I have never heard questioning with reference to every minor detail of what the departmental officials are going to do after a bill is in effect. These are questions on administrative details. These are for the purpose of delay.


Donald Methuen Fleming: I ask you, Mr. Chairman,
to enforce the rules of the house. The minister has imputed motives by suggesting these questions are for the purpose of delay.


Lionel Chevrier: It is very evident that you
are delaying.


Donald Methuen Fleming: There is another. I ask
that they be withdrawn.


William Alfred Robinson: I do not think the hon.
member for Eglinton should feel aggrieved. The minister certainly said there was delay, but there was no imputation of motive that I could hear. The minister was not imputing to the hon. member for Eglinton a desire to delay.


Donald Methuen Fleming: Mr. Chairman, that was the
whole purpose of the minister's statement. It was echoed by the Minister of Transport just now. You might not have heard him, but he followed up with a similar jibe.


Lionel Chevrier: Let us get on with the
discussion.
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Donald Methuen Fleming: Let us get on with the discussion with the minister refraining from deliberate breaches of the rules.


Lionel Chevrier: It was not a deliberate
breach of the rules of the house, as Mr. Chairman just said.


Donald Methuen Fleming: The chairman did not hear what was said. If the government were amenable to suggestion, it would not be necessary to go into this question.


Louis Stephen St-Laurent: Defeat this one, if you are not satisfied with it.


Donald Methuen Fleming: We are trying to improve it, if the Prime Minister were only open to suggestions. We are trying to make workable a bill which I think the Prime Minister must realize is unworkable. And when we try to discuss the question of delays, something that is of concern to the house, delays in working out this complicated formula, we would think it would be very directly relevant to know how many persons are going to be available to carry on the very considerable work of investigation that will have to be carried on in the United States, if this bill carries.


William Alfred Robinson: Order. I presume that information as to investigators who might be used under this clause, if it is passed, would be relevant, in that it affects an expenditure of public money. But surely we have dealt with that matter at some length, and could proceed to another subject.


Donald Methuen Fleming: I have no wish to prolong the matter. We could have had it disposed of a long time ago if the minister had stuck to the point. It is a relevant matter. We have indicated our concern about the complicated formula and about delayed rulings and the difficulty of applying the formula, as well as the number of investigators who will carry on these investigations. That is something which will have a very direct effect upon the speed with which rulings can be made under this complicated formula, if it is capable of application at all.


William Alfred Robinson: Shall the section carry?


James MacKerras Macdonnell: I am going to cause more delay, and I do so with great regret, and only with a strong sense of duty. I wish to ask a further question of the minister, although at the moment he does not seem very responsive. However, as the hon. member for Eglinton said, we are not taking time on this bill because we think it is perfect. If we had thought it was perfect we would have voted for it long ago. We think it is far from perfect, and we want to be sure that we understand it.

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I wish to ask this. Let us suppose that I am an importer, importing something that is highly necessary and that is coming in to meet the needs of consumers. It comes in under this section, and inquiry has to be made. Will the minister tell us exactly what happens to me as an importer? There has been a good deal of talk as to the effect of the bill, that it may have no effect except to slow things up. There has been reference to protection in the United States, which we have constantly criticized; and it has been suggested-and I do not know with what warrant-that this may be perhaps unintentionally a renewal of some of their practices.
I wish to know, play by play-no, this thing is serious; I will say step by step- exactly what happens. I am an importer, and I want to import goods. Will the minister tell me exactly what inquiries are made, how long they are likely to take, and just where I am left during that period, as an importer.
We cannot have it both ways. If it is going to be a delay-action measure, then it will bother me as an importer and also bother all the people whom I am serving in a useful manner. I wish the minister would tell us what happens step by step, and what inquiries he is going to make. Let us take any article; he can select it, if he wishes. How does he find out? It is not an easy matter to find out the average price weighted as to quantity at which like or similar goods were sold for consumption in the country of export during a reasonable period.
That is not a very easy thing to find out. I should like to know how it is going to be done, and the inquiries involved, and what delay there might be. I submit that is all relevant material.


James Joseph McCann: I am glad to answer that question. The importer gets a bill of goods. He goes to the customs office or he sends his customs broker there to clear that bill. In the meantime that bill of goods has been opened and examined by our appraisers. If they are textiles-and we have been talking about textiles-the work will be done by an appraiser who has been trained in the valuation of goods of that particular industry.
I just wish to interject at this point that we appear to lose sight of the fact that this whole section has to do with valuation for duty. The question must be asked whether it comes under subsection 1 or subsection 2 or subsection 3. Subsection 2 deals with goods when the market value is unascertainable, and subsection 3 with goods where the value or the equivalent is not ascertainable. Then the other two subsections, 4 and 5, have

to do with the amount of tax not included, and the statement that the governor in council may order that import duties be disregarded. Then in order to strengthen this whole thing we are adding this subsection 6, which has to do with valuations.
Let me go on to what I was attempting to say with regard to procedure. We will take, for example, the textile appraisers who are trained in the valuation of textiles, and who would make the appraisal of that bill of goods. If they find that-


James MacKerras Macdonnell: Would the minister permit a question?


James Joseph McCann: Yes.


James MacKerras Macdonnell: Would I be correct in thinking that the first thing they have to do is determine whether these goods come within the meaning of the words "as the result of the advance of the season or the marketing period"?


James Joseph McCann: That would be one of the things, but perhaps not the first. They will follow the routine, which is as plain and simple as it can be, in the act. The routine in respect of valuation for duty is here determined. First of all-
Whenever any duty ad valorem is imposed on any goods imported into Canada, the value for duty shall be the fair market value of such or the like goods-
Then the next subsection:
(2)	When the fair market value of any goods is not ascertainable under subsection (1) the value for duty of such goods shall be the nearest ascertainable equivalent of such value.
Then the next:
(3)	When neither the fair market value nor the equivalent of such value can be ascertained, the value for duty shall be the actual cost of production of similar goods at date of shipment to Canada, plus a reasonable addition for administration, selling cost and profit.
In connection with the appraisal of these goods, we have exhausted those three subsections. The remaining two subsections, as I pointed out earlier, are not directed to value. They are in the nature of additions.
Then we come to the addition of subsection 6 where we say:
(6) Notwithstanding anything in this act, where the market price of any manufactured goods in the country of export has, as the result of-
Two things:
-the advance of the season or the marketing period, declined to levels that do not reflect in the opinion of the minister their normal price, the value for duty shall be the amount determined and declared by the minister to be the average price, weighted as to quantity, at which the like or similar goods were sold for consumption-
And so on. So the appraiser goes through that, and if the fair market value is the

value that is reflected in the invoice he will proceed to tell the broker or the importer what his duty is to be. The sales tax is levied on the value of the goods, plus duty.
Now, in the event that he feels the invoice price on that bill of goods is not the value of similar goods sold in the country of origin he will say, "As a result of our investigation we find that these goods were sold in the city of Boston-" or in the New England states, or some other place, at such and such a price. He will say, "That price is the value you have on your invoice, plus X dollars" and on that invoice price plus X dollars the duty is levied and collected and the goods are cleared to the importer.
But there is a second condition. Supposing we do not know the value of the goods. Supposing we have not yet determined the comparable price at which these goods have been offered in the country of origin under comparable conditions. We will say to that importer or his customs broker, who has already made a deposit with us so the crown will not lose money, that we release these goods subject to reappraisal. Then of course he is taking a chance. He is probably going to come to us prior to the importation of goods and attempt to determine the value of a certain line of goods he is going to import into this country.
I submit to you that this subsection, as an addition to the five subsections of section 35, puts the government and the department of customs and excise in a far better position to collect the duties and taxes that are owing than have the previous sections.
Is there any other part of the hon. member's question that I have not answered?


James MacKerras Macdonnell: The minister has made a very good beginning. Having regard to the fact that this inquiry must cover the time immediately prior, how is the minister going to get the figures to show how the average is weighted. Will that not involve knowing the amounts exported from month to month? How can you work that out?


James Joseph McCann: That information will be collected at the point of export by our investigators.


James MacKerras Macdonnell: These men are going to be pretty busy, are they not? Will the minister explain? 'Someone says it is being done all the time. I want to know exactly what the (practice is. The minister says it will be obtained at the point of entry. How far afield will they have to go? You cannot just determine it by one or two casual inquiries.


James Joseph McCann: We deal with the particular exporter. Usually they are co-operative with the officials to the extent that they give us
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their -costs of manufacture and the selling prices of their goods. We actually make inquiry of the manufacturer or his agents. Throughout the New England states, although many of the textile mills are in the smaller places, these people operate for the most part from a large city like Boston or New York. We make an inquiry through their offices and they have co-operated in giving us information, and they will show us a list of home market sales.


James MacKerras Macdonnell: The minister means that his officials, at the point -of entry, will merely communicate with the various manufacturers in the United States and ask for their selling costs over these months?


James Joseph McCann: The hon. member is getting two things mixed up. The communication is not made by the officials at the point of entry; the communication is direct with the manufacturer or his agent and is made at his place of business, personally in a great many instances.


James MacKerras Macdonnell: This is an important matter. I am sick to death of people whose sole contribution to the debate here is a groan and an expression as a sign of pain when one is at least trying to do what he can to contribute to the debate. If they are in pain let them get out. Will the minister tell me again what is the situation? Will his officials-I will not call them by name; I am not familiar with the details-go in person and inquire from the manufacturers as to the various prices at which they have sold their goods?


James Joseph McCann: Yes, that is right.


Stanley Howard Knowles: I listened with considerable interest to the attempt of the minister to describe how this new clause is going to work. There are one or two questions about that procedure that are not -clear to me. I should like to know as specifically as we can be told where the operation of this phrase "in the opinion of the minister" comes in. I have read several times the various paragraphs of section 35 as they are already in the act, and I see no discretionary margin in paragraphs 1, 2 and 3 comparable to that which is proposed in clause 6. I realize that so far as the operation of subsections 1, 2 and 3 are concerned, certain information has to be obtained by the officials, but at least it is specific and definite information on the basis of which these values are determined.
When we get to this new clause 6, while there is something of a yardstick spelled out in it, the key to the whole clause is the phrase "in the opinion of the minister". I would judge from the fact that the phrase is in there that whereas any action taken-the

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minister may correct me if I am wrong- under section 35, subsections 1, 2 and 3, could be appealed to the tariff board, there is no basis for appeal in the new clause because the matter is left entirely to the minister and to his opinion.
As I say, I want really two things. First I would like to know specifically how the minister's opinion is brought to bear on this operation. Second I would like to know what assurance or what knowledge parliament has as to how that minister's opinion is going to work. Is it going to be an opinion that is restrictive or one that is wide open? Is it going to be one thing one day and another the next? Is the minister, in exercising that opinion, going to be subject to pressures that are put on him by importers or by others, by members of parliament, by Liberals or what have you? It does seem to me that parliament has a right, when passing a piece of legislation of this kind that leaves so much to the minister, to know just exactly how it is going to work.


James Joseph McCann: In matters of this kind there has to be somebody who makes the final decision. That decision, according to this amendment, will be made by the minister, along with the deputy minister. I can assure the hon. member that as far as I am concerned no amount of pressure one way or another is going to cause me to deviate from good honest views with reference to the administration.


Stanley Howard Knowles: The minister, with considerable pride, makes the statement that no pressure is going to have any effect on him, and I noticed that Liberals applauded that statement. But hon. members should consider what is being done here. We are passing a bill in which parliament puts this final power in the hands of the minister, yet there is not put into the act any yardstick for the minister to use in expressing that opinion, and he does not tell us what his opinion is. He just says, "I will make the decision and nobody is going to cause me to deviate".
I personally do not think it is good enough for a piece of legislation to be passed by parliament in that form. I imagine that no members around here are unhappier about it than the hon. members who sit on the same side of parliament as the minister. We have had experience in other cases where these administrative decisions can be made in respect of duties of one kind or another which have the effect of varying one way or another what was the intent and expectation of parliament. Parliament I think has a right to a more definite statement as to how the minister is going to operate this act.


[Stage Direction]
Section agreed to.
On section 2-Coming into force.
Mr. Decore:: I should like to make one or two brief remarks in connection with clause 2. It seems to me that this bill gives very wide powers to the minister. First of all may I say to the minister that since I come from the prairie provinces the minister can readily understand our concern with regard to unrestricted free trade. We in the west are concerned with regard to any restrictions on free trade.


James Joseph McCann: May I ask the hon. gentleman to speak a little louder, as I cannot hear him.


John Decore: I say that we in western Canada are strong believers in free trade and in the minimum of protection to be given to industry. I am not going to go into the reasons for that except to point out that western Canada, especially the three prairie provinces, are agricultural in nature, with agriculture being the basic industry. It is mainly for that reason that we are strong believers in free trade.


William Alfred Robinson: I do not like to interrupt the hon. gentleman, but he will notice that clause 2 which we are now discussing merely provides for the coming into force of the act, and the hon. member should direct his remarks to that clause.


John Decore: I am just coming to that if you will bear with me for a few seconds. I say we are very much concerned that there should not be any tendency to restrict trade because of our dependence on export markets. In dealing with section 2 I notice that it places no limitation upon how long the act shall remain in force, and the minister is given very wide powers. I should like to see this measure made temporary, not something that would be regarded as a permanent fixture on our statute books.
There are a lot of us in western Canada who would like to be given the assurance that there would be a time limitation under this section during which the minister might exercise his wide powers. We should be given the assurance that the minister will endeavour to prevent a recurrence of certain practices in the way of dumping which have taken place in connection with particular industries, such as the textile industry, and that this legislation will not be used for the purpose of protecting industry generally. At the same time we would like to have the assurance of the minister that we will be given an opportunity to review this matter and have another look at it at the earliest, opportunity.


Colin Cameron: I move:
That clause 2 be amended by adding at the end thereof the following words:
"and this act shall cease to have effect on and after the 8th day of December, 1954".
The purpose of this amendment is selfevident. Grave misgivings have been expressed in various quarters of the house as to the possible result of this legislation, and doubts have been expressed as to the way in which it will be used and as to the competence of the advisers to the minister with regard to its application. Doubt has also been expressed in relation to the extent of the powers conferred on the minister by this bill.
Therefore I think it is only reasonable to suggest, as I am doing in this amendment, that this legislation should come up for annual review. It is obvious that when the government is faced with the date mentioned in the amendment it will prepare an amending bill to extend the life of the legislation if that appears advisable at that time.


Louis Stephen St-Laurent: Mr. Chairman, I do not
think it would be proper to have a limitation of this sort in a bill of this nature. This is a bill to provide a method whereby the dumping alleged to be taking place as a result of selling goods in Canada, at the end of the season or at the end of a run, at lower prices than those that have prevailed in the country of export while the main portion of the run was being sold. I do not think it should automatically come to an end on December 8, 1954.
First of all there is the obvious reason that if it were found to be a desirable bill to continue in existence it might not be possible to have the replacing bill enacted before December 8, 1954. It so happens that this year parliament met in November, but that is something unusual, that is something that does not happen every year. We would not like to feel committed to something that would make it not possible to select the date for the meeting of parliament which might appear under the then existing circumstances to be the most proper.
I do not think the manufacturers who are having considerable difficulty at this time keeping their industries going would feel that it was fair to them to say, "We are going to do this, but we are going to do it only for the period from now to December 8, 1954." I would hope that even under the difficulties facing the textile industry-that is the one in connection with which we received the most pressing representations- they would endeavour to keep operating by improving their methods and thus tiding over a period when there is world-wide overproduction of textiles, a production in greater quantity than the consuming public
Customs Act
is using. I do not think it would be proper to say to them, "This legislation will come to an end on December 8, 1954".
Hon. members may feel that this matter should receive reconsideration, but that is possible when the estimates of the department are under consideration. The fact that it would be discussed on the estimates would not mean that the legislation would have to be modified. I think it has always been the attempt of those responsible for government policies, whatever government may have been in power, to meet the wishes of the people as represented by the majority of members in this house. There certainly will be an opportunity every time the estimates of the Department of National Revenue are before the committee to give consideration to the manner in which the powers given to the minister by this bill are being exercised and to express opinions as to whether or not those powers should continue to be available.
I do not think it would be a proper response to the conditions that exist at the present time to pass legislation that would automatically cease to be operative on December 8, 1954, unless there was a reenactment prior to that date.


George Alexander Drew: Mr. Chairman, there has been very considerable evidence of the fact that we are not impressed with the effectiveness of the amendment to carry out the desired purpose. On the other hand we have made it clear that we are prepared to support anything which is attempting in some measure to meet a situation which the government has clearly shown to be one calling for some legislative action. As has already been indicated, the question before us is not one of tariffs or anything of that kind. It is a question as to whether or not a provision which will deal with devices that permit unfair practices in relation to workers of this country is to be dealt with under a law that was originally introduced in 1904.
I say that because I would not wish anything I now say to appear to express satisfaction with the form of the amendment, although we do support the intention expressed. I agree with the Prime Minister that it would be an unsatisfactory thing to have this act terminate at the date suggested by this motion. We have no assurance that the house will be in session at that time. Without now reviewing the arguments that took place earlier on that point, I would point out that we have been informed by the minister that it will be necessary to wait for the actual operation of the act before its impact upon this problem may be known.

Customs Act
As the Prime Minister has indicated in his remarks, the subject can be brought under review again at the time the estimates are discussed and arguments can be put forward then with regard to further amendment, if necessary, even within the course of the present session. If a time limit were to be considered, I think it should be a time limit such as is ordinarily imposed, which would bring us within the certain period that this could be dealt with while the house was in session. For those reasons and without in any way indicating our approval of the wording of the government amendment, I would hope that this proposed motion will not be adopted.


Mr. Castleden:: In supporting the motion, with all respect to the Prime Minister I should like to point out that when this measure was first introduced, it was as something of a temporary nature. I think the situation in Canada with respect to our export trade requires constant review by every member of the house. It is quite evident today that things are changing rapidly and that our present policies with regard to export trade might be quite different one year from today. This amendment is intended to give the House of Commons the opportunity of reviewing this measure or reviewing this bill so that one year from this date, if the situation requires changing, a change can be made.
Canada is moving off a war economy. We are moving rapidly into a peacetime economy when export markets may be the thing upon which Canada will depend for any measure of prosperity. Our industries from coast to coast are going to find themselves in competition with mighty keen operators in every other country in the world, particularly the United States to the south of us, whose exports are to a large extent very similar to our own. Therefore anything which affects the trade of our country with the United States, or anything which affects our export trade with any other country, must receive serious consideration; and that trade will be affected by any steps we take with regard to their goods coming into this country. From what has happened within the last three months it is quite evident that the first guns of a major tariff war have already been fired, and that Canada had better be watching herself closely.
The Prime Minister also spoke of the responsibility of the government and of the Liberal party to the people of this country who put them there. I should like to point out that every member of the House of Commons is to some extent responsible for what

happens here. I think he has the responsibility of stating whether or not he is supporting this measure or supports giving to the minister these powers without any opportunity of review other than discussion when the estimates come up for consideration. In view of the powers that are given here, in view of the members' own responsibility, and in view of the fact that we are facing a situation wherein all Canadian industries are going to have to depend on exports to maintain their operations, I would earnestly suggest to hon. members that this act should come up for constant review, and I would support it on those grounds.


William Alfred Robinson: Is the committee ready for the question?


Some hon. Members:: Question.


Major James William Coldwell: May I just say one word, Mr. Chairman. The Prime Minister says there is some difficulty about the date in the amendment. Would the Prime Minister be prepared to accept a suggestion of this description, namely that the measure should be reviewed, shall we say, within fifteen days of the meeting of parliament in 1954; that is, the first meeting of parliament in 1954?


An hon. Member:: In 1955, the hon. member means.


Major James William Coldwell: That would probably be January or February, 1955.


Louis Stephen St-Laurent: No, Mr. Chairman. I do not think this legislation should have the guillotine put on it in that way. When the estimates are under discussion, there will be opportunity for discussing it, the way in which it is administered and the effect which it will have produced. Someone has said, "Oh, you might delay those estimates until the end of the session". I am quite prepared to say that no attempt will be made to delay consideration of the estimates and to say that, if it were desired, they could be among the first things to be considered.
The operators of these textile mills who are feeling the brunt of this competition at the present time should, I think, be given whatever this will produce as a stabilizing influence upon their decisions without there being a cut-off date automatically fixed.


Major James William Coldwell: Of course I meant 1955,
although I said 1954.


Louis Stephen St-Laurent: I understood that what the hon. gentleman meant was the session that would follow this session.


Major James William Coldwell: Yes.


Louis Stephen St-Laurent: That is the normal session that would follow this session.


Major James William Coldwell: Yes.


Louis Stephen St-Laurent: Whether it commences at the end of 1954 or at the beginning of 1955.


Mr. Low:: May I just say a word relative to the amendment. I listened to the arguments on both sides, and I am persuaded that there will be an opportunity to review the operation of this legislation when we come to the estimates of the Department of National Revenue, at any time. For that reason I do not think that the amendment would be of any value at all. Under the circumstances I feel that I must vote against it. But because I feel the government must have something with which to deal with this end of season dumping, I believe the bill should pass.
I want to say to the minister, by way of a word of warning, that in using his discretion he must be extremely careful not to place upon any of these goods a value that would represent an unjustified increase in price to the Canadian consumer. We must remember this. As has already been pointed out, the people in western Canada especially are obliged to depend almost entirely upon export markets for their income. As a consequence they are anxious about the prices they have to pay for imported goods. They want to know that they are not being unfairly dealt with in the matter of any valuation that is placed upon these goods coming into the country, no matter whether they are end of season goods or not.


Stanley Howard Knowles: The hon. member for Peace River and the Prime Minister have both suggested that on the estimates there is ample opportunity to review the operations under a statute like this, and to review the policy involved in it.
May I remind both these hon. gentlemen that, although we can review the operations carried on under legislation when the estimates are before us, that does not give us an opportunity to press effectively for repeal of legislation on the statute books. Hon. members know that it is difficult to get laws on the statute books, but once they get there they can tend to stay for a long time. I would remind the Prime Minister and others who are interested in this matter of the very real concern expressed on this point by the hon. member for Rosthern, the hon. member for Vegreville and the hon. member for Charlotte. They expressed the view that there should be real assurance that this is not going to be permanent legislation, and that the possibility of it being discontinued after a set period of time should be very real.
The Prime Minister doubts whether the legislation should have a cut-off date in it, 83276-63
Customs Act
but may I remind him that when other pieces of legislation have been brought in that have been described as emergency in character they have contained cut-off dates. I refer to the transitional powers act, the Emergency Powers Act and others on the statute books now, as well as to other pieces of legislation. Other items of policy have been put into effect on a year to year basis. It seems to me that because of the admitted and alleged emergency character of this legislation we should not put it on the statute books in such a way that for all practical purposes it will be there for a long time to come.
Perhaps I might be permitted to illustrate my point by referring to a delightful and very interesting little anecdote that is recorded in Grace Maclnnis' book on the life of her father, J. S. Woodsworth, which I think hon. members of various parties in the house have been interested in reading since it came off the press recently.


Mr. Johnston (Bow River):: What is the price of it?


Stanley Howard Knowles: It would make an excellent Christmas gift. Mrs. Maclnnis tells how her father was concerned, as friends of his will recall, about some of the things that were being done by the mounted police. Though he had a personal friendship for these gentlemen, he had certain views of his own about police activities. It appears that one day he asked a question in the house of Mr. Lapointe, who was then minister of justice, about a certain mounted policeman who was patrolling outside of the parliamentary library. It seems that the minister of justice told Mr. Woodsworth that he would answer the question later. But as I recall the story, Mr. Lapointe met Mr. Woodsworth outside of the house a few days later and asked him not to press the question in the house.
The reason Mr. Lapointe asked Mr. Woodsworth not to press the question in the house was that Mr. Lapointe had found out -and this was in 1926-that following the fire in 1916 which destroyed the parliament buildings a policeman was posted outside the library to protect it from looters.. Mr. Lapointe had found out that no one had ever cancelled the order, and so ten years later a policeman was still patrolling outside the library.
I suggest that laws on the statute books are something like that. They have a permanence that is very real, and bearing in mind the arguments and the words of caution that have been expressed by the hon. member for Charlotte, the hon. member for Vegreville and the hon. member for Rosthern, I suggest that this amendment should be given consideration.

Customs Act
If the Prime Minister feels that the date is an unwise choice, and that is his main objection, he can of course suggest a date six months later because, as he knows, by virtue of a provision in the British North America Act, if parliament is not in session next December it would certainly have to be in session within six months after that. Therefore I urge that the amendment be given favourable consideration.
Amendment (Mr. Cameron, Nanaimo) negatived: Yeas, 14; nays, 126.


William Alfred Robinson: I declare the amendment lost.


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


Donald Methuen Fleming: There is one matter I should like to mention.


Mr. Speaker:: Order. I am asking if the bill is to be read a third time now. If consent is not given then this bill will be ordered to be read at the "next sitting of the house".


Stanley Howard Knowles: On a point of order, I am usually the one who seeks to delay third readings until the next day, but second reading was not given today-


Mr. Speaker:: If second reading was given on a different day-


Stanley Howard Knowles: -so I suggest it is in order to proceed with third reading today.


Mr. Speaker:: I am sorry; 1 thought second reading had been given today. It is my mistake. Therefore the bill is before the house for third reading now.


James Joseph McCann: the third reading of the bill.


Donald Methuen Fleming: I have a matter to raise on third reading. Yesterday afternoon in committee of the whole I introduced an amendment which had two parts to it. The amendment can be found at page 916 of Hansard and reads as follows:
That clause 1 of Bill 29 be amended by striking out of the proposed new section 35 (6) of the Customs Act, the following words: the word "manufactured", in line 8, and the words "as the result of the advance of the season or the marketing period", in lines 9 and 10.
When I introduced that amendment the Prime Minister (Mr. St. Laurent) rose to his feet and said:
Would the hon. member permit an interruption? Would he not prefer to move the amendment in

two parts? X believe the government would be quite prepared to accept the first part, but might have some reservations about the second.
He then proceeded a little further. You will note, Mr. Speaker, that the words that the Prime Minister used were, "I believe the government would be quite prepared to accept the first part." In view of that assurance given by the Prime Minister I said at once, with a view to expediting the business of the house:
I readily accept the Prime Minister's suggestion. In view of what he has said I am quite prepared to move it in two parts. In view of what the Prime Minister has said about the first part I shall not labour what will now become the first amendment.
I was not a little surprised therefore, Mr. Speaker, to find on page 916 of Hansard of December 15 that the Prime Minister (Mr. St. Laurent) is recorded as having said:
Would the hon. member permit an interruption? Would he not prefer to move the amendment in two parts? I believe the government might be quite prepared to accept the first part, but might have some reservations about the second.
The fact, Mr. Speaker, is that the word "would" was used by the Prime Minister, and now the word "might" appears in Hansard. The Prime Minister said he believed the government would be quite prepared to accept the first part. The Prime Minister used the word "would", and said he believed "the government would be quite prepared to accept the first part." That is attested to not only by recollection, but by the fact that the record taken in this house shows the Prime Minister used the word "would" and that the record was changed by someone by eliminating the word "would" and substituting the word "might".
Now, Mr. Speaker, in view of the importance of this question, not only because of the fact that the course of action which I followed immediately after this statement was prompted by the Prime Minister's assertion that he believed the government would be prepared to accept the first part of my amendment, but also because of the fact that the statement of the government given at that moment became a matter of very clear importance as the debate proceeded, it seems to me that whoever revised the original text of the Prime Minister's speech in the house, whoever made this change, has made a very improper change. It has completely altered the sense of the Prime Minister's actual statement in this house upon which we relied in following the course that was followed during the balance of the debate.
Right Hon. L. S. St. Laurent (Prime
Minister): I must confess that I made the change. I did not realize I made any change in the meaning of the sentence. Possibly I

may have said that I believed the government would be prepared to accept or might have no objection-the two words seemed to me to be synonymous when I read them. I put in both places the same word to express the same idea. I do not think there is any difference in meaning that can be ascribed to either of them.


Donald Methuen Fleming: I have only this to say, that if the Prime Minister-this is just what the difference in the words is, because there is a clear difference-had said only "I believe the government might be prepared to accept the first part," I certainly would not have followed the course I did in view of so weak an assurance. The Prime Minister's assurance was very much stronger because the word "would" is infinitely stronger than the word "might". In spite of the explanation the Prime Minister has just made, and with great respect, I think there is a world of difference between them. There is all the difference as between day and night between the word "might" and the word "would".


Mr. Abbott:: Don't take yourself too seriously.


Donald Methuen Fleming: Nor you.


Colin Cameron: I should
like to move, seconded by the hon. member for Yorkton (Mr. Castleden):
That this bill be not now read a third time, but that it be referred back to the committee of the whole for the purpose of amending it so as to provide for the proposed act to cease to have effect on and after the 8th day of March, 1955.


Mr. Speaker:: The hon. member is moving that this bill be referred back to the committee of the whole in order to accomplish there what was tried when the bill was before the committee of the whole. The house has already expressed judgment on that question. The hon. member for Winnipeg North Centre (Mr. Knowles) is probably ready to tell me that the bill was to be limited by the date of December 8, 1954, whereas this amendment expresses a change in that it imposes a limitation on the life of the bill of March 8, 1955. There is that difference. Does the hon. member wish to say something about this amendment?


Stanley Howard Knowles: Mr. Speaker, I might at
this point speak to the point of order, and might I include in what I say now something that might seem to be with respect to substance, but I am sure you will see it is relevant to the point of order.
I think it should be made clear to Your Honour that the change of date from December 8, 1954, to March 8, 1955, has been made by my colleague the hon. member for 83276-03J
Customs Act
Nanaimo (Mr. Cameron) without any thought that doing so made the amendment in order where the other would not have been in order. The reason for the change was to meet the objection raised by the Prime Minister (Mr. St. Laurent) that December 8, 1954, could be at a time when parliament might not be in session.
With respect to the question Your Honour has raised as to whether it is in order for the house to be presented1 with an amendment the same in character-and I suggest it is the same as has been dealt with in the committee of the whole-may I point out that this is a practice which has been provided for in the books on procedure. It is a practice which has been followed on a number of occasions. I have notes before me of four or five instances in which this was done. I have before me as well the Hansard record of one particular case where the Minister of Finance himself pointed out that the amendment proposed on third reading of the Customs Tariff back in 1948 was precisely the amendment that had been proposed by a member in committee of the whole house.
It is recognized that the purpose of an amendment such as this on third reading is to get a recorded vote on a matter which was dealt with in committee of the whole only by what is known as a standing vote. The instances I refer to can be found in Hansard of June 8, 1948, at page 4890, also in Hansard of February 24, 1948, at page 1560. On that occasion it was a motion to refer back made by the then leader of the opposition, Mr. Bracken. Your Honour will find similar instances on March 5, 1952, and several others to which I could refer. The citations in Beauchesne's third edition that make provision for reference back from third reading to committee of the whole are 708, 709 and 710.	.


Mr. Speaker:: The hon. member has
established that this kind of amendment to third reading of a bill is normal and quite in order. I agree with him. I have before me citations 708, 709 and 710. The point I am trying to raise is this. This bill was considered in committee of the whole where an amendment was moved to the second section to the effect that this act should expire on December 8, 1954. The amendment which is now moved on third reading might have been moved in committee of the whole just a moment ago, so is it not superfluous? That is the point. I know the hon. member will cite the fact that an amendment moved in committee was moved again, that is that the amendment moved to third reading was that the bill be not now read a third time

Customs Act
but be referred back, and that the particulars to be amended were the same as those considered in committee of the whole.
I am merely submitting to the hon. member that in my opinion this is violating the spirit of our rules which tend to expedite the procedure of the house. I am not going to rule it out of order, but I want to have these remarks put on the record for guidance in the future in similar cases.
I think the hon. member will agree with me that the amendment could have been made in committee. After the first amendment was defeated, the hon. member could have tried in committee to amend it further, by putting in the date March 8, 1955, but he waited until the committee reported, and has now moved that third reading should not be had now, but that it should be referred back for the purpose of doing precisely what could have been done in committee. However, at this moment I accept the amendment.
The hon. member for Nanaimo (Mr. Cameron) has moved, seconded by the hon. member for Yorkton (Mr. Castleden), that this bill be not now read a third time, but that it be referred back to the committee of the whole for the purpose of amending it so as to make provision whereby the proposed measure will cease to have effect on and after March 8, 1955.
Is the house ready for the question?


Mr. Harliness:: It is five minutes after six.


Hazen Robert Argue: Mr. Speaker, my contribution will be brief, and I am prepared to make it now. However, if someone wishes to call it six o'clock-


Douglas Scott Harkness: Six o'clock.


Mr. Speaker:: Unless we have unanimous consent we cannot proceed. Therefore, it being six o'clock I do leave the chair. However, it has been suggested that I put the question. Are hon. members ready to proceed with the question now?


Hazen Robert Argue: Before the question is put I have some observations to make. It makes no difference to me whether I make them now or at eight o'clock.


Mr. Speaker:: Then I shall call it six o'clock; because if the hon. member wishes to make observations he may make them when I put the motion for the passing of the title, or at some other point.
Therefore, it being six o'clock I do leave the chair.
At six o'clock the house took recess.


[Stage Direction]
AFTER RECESS

The house resumed at eight o'clock.
Hazen Robert Argue: Mr. Speaker, the remarks I wish to make at this time, and which I was prepared to make at six o'clock, will take only a very few minutes. The amendment moved by the hon. member for Nanaimo (Mr. Cameron) asks that this legislation be placed on a temporary basis, and that within the next fifteen months, if the government felt that such legislation were needed beyond that length of time, it would be required to come back to parliament and ask for an extension.
I believe that any kind of legislation that increases the area of protection is legislation that should be embarked upon only after the most careful consideration. We in this group have been prepared to support this bill as we believed that it dealt with an emergency, and that when that emergency ceased to exist it would be dropped and abandoned. We believe that having a time limit in the bill would be a good move.
In that respect we have the support expressed on the floor of this house by such members of the government party as the hon. member for Rosthern (Mr. Tucker), the hon. member for Qu'Appelle (Mr. Mang), the hon. member for Charlotte (Mr. Stuart), who prides himself as a free trader and who has expressed grave misgivings, and the hon. member for Vegreville (Mr. Decore), who asked this afternoon, and the Prime Minister (Mr. St. Laurent) would not agree, that the legislation be kept in effect for only one year and a second look taken twelve months hence. I was sorry when I looked around the chamber this afternoon, as the standing vote was taken, to notice that not one of the four hon. members whom I have mentioned was in the house to vote. My hope is that when the division bells ring they will be here to stand up in their places and vote for this amendment.
Certainly the life of the government is not at stake in this motion. I do not think it is a want of confidence motion. Even if it were, a handful of members, half a dozen or even a dozen Liberal members, voting against the government, if you want to put it that way, and for the amendment would probably have no effect on the government's standing in the house. It would constitute a notice to the Prime Minister, to the Minister of National Revenue (Mr. McCann) and to others-


Mr, Speaker:: Order. Does the hon.
member think that discussing the attitude

which hon. members may take on a vote is relevant to the amendment which is now before the house?


Hazen Robert Argue: Mr. Speaker, I was hoping that I was discussing how essential it was that hon. members should support the motion, and I was attempting to advance reasons why the amendment of the hon. member for Nanaimo should be supported. I believe that if even a few members on the government side of the house would support this amendment it would be in the interests of the people of Canada, because it would serve notice on the cabinet that certain members of the Liberal party were really concerned about this legislation, and by voting for the amendment they were asking that the government take a second look, a real second look, at this legislation within the period of fifteen months. My hope is that these members will support the amendment.


Mr. Speaker:: Is the house ready for the question?


Some hon. Members:: Question.


NATIONAL HOUSING ACT
Hon. Robert H. Winters (Minister of Public Works) moved: that the house go into committee to consider the following resolution:
That it is expedient to introduce a measure to be substituted for the present National Housing Act for the further improvement of housing and living conditions and for that purpose-(a) to authorize Central Mortgage and Housing Corporation to insure approved lenders, including banks, in respect of loans made by them to assist in the financing of new residential construction in urban and rural areas; also to insure, under certain conditions, loans for the repair, alteration and extension of existing homes; and (b) to continue and redefine the actual powers of the corporation as to the making of loans, the furnishing of guarantees, and the undertaking of federal provincial projects; also
998	HOUSE OF
National Housing Act
to continue the powers of the minister to make grants in aid of housing redevelopment and for other matters necessary for the proper administration of the act.
Motion agreed to and the house went into committee, Mr. Robinson (Simcoe East) in the chair.


Robert Henry Winters: Mr. Chairman, it is a very
pleasant privilege to sponsor such a popular resolution as this one appears to be, judging from the applause.
This resolution precedes a bill which, if and when enacted by parliament, will effect substantial changes in the financing of residential construction under the National Housing Act. It is important not only that the proposed measure be given careful and detailed attention, but also that it receive royal assent as soon as possible. It is during the winter months that prospective home owners and builders plan their programs to start at the beginning of the next construction season. Moreover, any arrangement new to lending institutions, home owners and builders will take some time to get into full operation. For these reasons I am anxious for hon. members to have the opportunity of studying the bill during the Christmas recess. On second reading, I propose to move that the bill be referred to the standing committee on banking and commerce.
I hope we may have the debate on second reading immediately after we reconvene, and that the bill can be referred to the standing committee on banking and commerce as soon as possible. Because the second reading debate will be deferred until after the recess,
I will for the benefit of hon. members make a few remarks now upon the more important features of the bill, notwithstanding the fact that it is usual at this stage to limit remarks to the resolution which confines itself to those features of the bill which require the expenditure of public funds.
There are two main provisions in the proposed1 legislation. First, it is proposed to widen the group of lending institutions to include the chartered banks and the Quebec savings banks which will be empowered to make loans on the security of insured first mortgages on residential property. Second, it is proposed to abandon the present form of joint loans under the National Housing Act and to substitute a system of insured mortgage loans. Although our supply of new houses in 1953 is greater than ever before, our population and number of families keep growing.
This growth requires continued expansion of housing.
For reasons which I will discuss in more detail at the time of second reading, we feel that the present sources of mortgage money


Donald Methuen Fleming: Mr. Chairman, I am sure all members of the house recognize the high importance which the problem of housing still occupies in all our considerations. The bill that is to follow the adoption of the resolution, as indicated by the minister in his statement, is one, I think, that will command special interest in the house. It is evident that the bill is going to go beyond a mere matter of a few amendments, and will involve a review and recasting of the present act as well as certain important departures from the whole scheme upon which part I of the National Housing Act has been based throughout its now nearly ten years of life.
It is not my intention tonight to make extended comment upon the resolution. I think anything I might have to say will be better said after there has been an opportunity of reading and reviewing the bill. I will make this comment, however, that I think it is altogether desirable, as the minister

National Housing Act has indicated, that in the short space of time remaining to us before the Christmas recess the bill should be given first reading in order that it may be distributed to members for study and discussion prior to our reassembling next month.
I do like the idea the minister has put forward that, after the bill has received second reading, it should be referred to the banking and commerce committee for detailed study. It will be recalled that two years ago the banking and commerce committee made a quite extensive review of the operations of Central Mortgage and Housing Corporation. I feel that was a useful and constructive piece of work, and I think probably it has been the experience in that respect which has led the minister to make the suggestion he has tonight, that this bill should be referred to that committee. Personally I should like to commend the proposal the minister has made.
We are all glad indeed that the number of housing starts in 1953, so far as the figures are available, indicates that there has been a fairly substantial increase over the number of starts in 1952. The house will remember that after the year 1950 the number of housing starts in Canada dipped, beginning in the spring of 1951, and that dip continued for the space of nearly two years. Beginning in the late fall of 1952 there was some recovery and now, as we approach the end of 1953, it is evident that the number of starts in 1953 will have exceeded those of 1952 and perhaps even the best previous year, namely 1950. It may be that when the figures are complete it will appear that the number of houses completed in 1953 will compare very favourably with the number completed in any previous year.
But lest any of us become satisfied in the face of this improvement in the number of houses constructed in 1953, let us remember that the proper way to test performance in this respect is in comparison with the housebuilding capacity of this country. It has been estimated by those in the Canadian construction industry that the house-building capacity in Canada is 130,000 houses per annum. Mr. Mansur, president of Central Mortgage and Housing Corporation, has indicated that in his view a figure of 125,000 houses is within the capacity of the construction industry, although there is the problem of mortgage financing to be met. It will be remembered also that in the seven years beginning with 1946 and ending with 1952, this country did not keep pace with current housing needs, and the backlog that existed on December 31, 1945, was actually swelled by the first of January, 1953, according to the figures submitted by Central Mortgage and


Housing Corporation, by about 17,000 housing units. We have not yet the final figures for 1953, but having regard to the rate of family formation in Canada and the extent of immigration into Canada, it is not unlikely that we will find ourselves at the end of 1953 with as large a backlog of needed houses in Canada as we had at December 31, 1945.
No hon. member of this house can be content in the face of that situation. There may be differences in estimates concerning the extent of the housing backlog in Canada at the conclusion of the war, but that figure has been estimated by authority acceptable, I am sure, to most hon. members of this house at close to 500,000 units. I hope that when the banking and commerce committee sits to consider this bill we shall have an opportunity of coming to closer grips with a calculation of the extent of the housing deficit in Canada today.
I have only this further observation to make. There will be, I may say, certain questions put to the minister following these opening statements on matters on which I trust he will be able and willing to furnish the house with information tonight, in the hope in that way to have a more informed discussion on second reading of the bill. It is hoped also that time may be saved in that way.
Whatever may be the outcome of the proposals for revamping Canada's housing legislation, its administration will still remain a matter of cardinal importance in the approach of the government and parliament to our national housing problem. We can have the best legislation in the world, but we will still have to have drive, vigour and vision behind the administration of the housing legislation. There must, moreover, be even-handed justice in the way in which the housing legislation is administered by the government and its agent, Central Mortgage and Housing Corporation. There must be fair play for all parts of Canada.
There has been a feeling that, through no particular fault of the government or the corporation, the larger centres have received better treatment under the provisions of part I of the housing act than smaller communities. There were reasons for that. But we hope, Mr. Chairman, that plans will become possible under the new legislation to carry the benefits of the new legislation to all parts of Canada where a housing need exists.
In the administration of that legislation, let us see to it that there are no favourites played. On November 18 in this house I drew attention to what appeared then and still appears to be a case of bold discrimination in favour of one part of Canada, simply

because that part of the country is represented by a leading member of the cabinet.
I mentioned the fact that at his nominating convention at Port Arthur last June, the Minister of Trade and Commerce (Mr. Howe), in commenting upon the shortage of mortgage money available in his constituency, said:
I instructed our treasury to make money available.
Sir, how many other members in this house, how many others who were candidates last June and July, were in a position to give instructions to the treasury to make mortgage money available in their particular constituencies? I have wondered what hon. members sitting to your right, Mr. Chairman, have had to say about favouritism and discrimination of this kind. If there was a need of mortgage money there, then to the extent to which mortgage money was available it should have been made available there, but on terms open to every other part of this country. Let us have an end to this kind of discrimination. Let us have an end to this high-handed behaviour, by which a senior minister finds himself in a position to give instructions to the treasury to make mortgage money available in his constituency, when apparently it was not available in any other constituency in Canada.
Therefore I say, Mr. Speaker, where the need exists let that need be met according to the limit of the resources made available by parliament for that purpose, according to the limits of the Canadian construction industry and the funds available. And let that need be met on the basis of fairness and justice for all parts of Canada. Let us have no favourites played.
So, Mr. Speaker, I say that we shall look forward with keen interest to this measure when introduced, and then we shall apply to it the closest study of which we are capable.
Mr. Nose worthy: Mr. Speaker, I wish to speak at some length on this resolution. I had hoped there would be some opportunity for the opinions expressed by members of the house at the resolution stage to be brought to the attention of the minister and possibly incorporated in his bill before the bill was actually introduced in the house. However, I have learned, as have many other members on this side of the house and some on the other side, that it is not the privilege of private members to get the ear of the government or to have the slightest attention paid to anything they say. Members of this government do not come to parliament or consult with members of parliament to obtain ideas on subjects such as housing.
On many occasions in the house I have charged that Central Mortgage and Housing 83270-64
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Corporation exists for the benefit of the lending institutions, first and foremost, and that the government's housing policy through the years has been directed to the security of those lending institutions rather than toward the provision of homes for those people in this country who really need homes.
I have here a press release bearing the dateline March 20, 1953, coming from the office of the director of public relations of the National House Builders Association, Incorporated. I gather from this press release, which was made public last March, that the government no longer relies upon the support of the lending institutions. Actually of course the National House Builders Association has been critical of some of the government's policies and of the way in which it has played up to the lending institutions. It becomes evident now that the government is attempting to enlist the support of the house builders' association as well as that of the lending institutions. This is what the president of that association had to say back in March of 1953. This release states that he said:
Canada's house production could be boosted to 125,000-
I call the attention of the house to that figure, and ask hon. members to compare it with the objective set by the minister.
Canada's house production could be boosted to 125,000 units a year instead of 75,000 as in 1952, if new sources of mortgage money could be tapped to finance home building.
According to the opinion of the president of this association:
Canada's present mortgage credit structure was not big enough to support an annual production program of 125,000 homes. It was necessary in his opinion to enlarge the supply of money for investment in mortgages.
The president went on to say:
This could be done by permitting such institutions as savings banks to enter the mortgage business. The federal government, he suggested, might be willing to extend the guarantee system by which it protects loans made under the National Housing Act, and revise the Bank Act, to permit banks to make N.H.A. mortgage loans.
Then he went on to say:
Once more mortgage money was available it would be possible for the federal government to reduce the size of down payments from 20 per cent to 10 per cent, to widen the band of possible home purchasers whose incomes are sufficient to qualify for N.H.A. mortgages, but lack the money to make a large down payment. For those who have saved enough to make a 10 per cent down payment but do not earn enough to qualify under the N.H.A. requirement that no more than 23 per cent of a home owner's income go to pay mortgage interest, principal and property taxes, he urged lending institutions to extend the mortgage repayment period from 20 to 25 or 30 years.
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A comparison of that press release of last March with the statement of purpose as given to the house this evening by the minister would indicate that the minister has adopted holus-bolus the policy of the National House Builders Association. The provisions which are to be contained in the new housing act are the provisions the president of that institution asked back in March of 1953 to be incorporated in the housing act.
In other words the government is simply following in the measure to be introduced the same line of policy it has been following since the inauguration of Central Mortgage and Housing Corporation, and that is to make house building profitable for private enterprise. The government's concern has been first, foremost, and all the time with the security and profits of the lending institutions and the private builders, and not with the needs of the Canadian people.
The proposed legislation is probably as good as anything we can expect from the present Liberal government or, for that matter, from any other government so completely wedded to private enterprise in the matter of housing. What I have said, and what other members of this group have said time and again in the house, is that today housing in Canada is a social problem. Today it is no longer a field in which private enterprise should be left free to make profit. The provision of homes for those in the lower income brackets is just as much a social responsibility of a government as is the provision of schools and hospitals, or the provision of pure water on a community basis.
The sooner the government realizes that houses can be provided for those in the lower income brackets only with government assistance and government subsidy, the better. Only when that is done are we going to be able to provide those in the lower income brackets, who are by far the greatest number of people who need them, with houses.
All this bill does is enable associations such as the National House Builders Association and others interested in exploiting the needs of the Canadian people for homes to make more profit. Their interest is certainly to build houses for profit, and this new legislation will be used to induce more and more people to buy those houses, to move into them and to undertake larger mortgages over a longer period of time. There will be some just below that $3,500 income level who will be induced to buy some of the houses that will be built and sold under the terms of this new legislation. They will be induced to accept higher mortgages, higher interest rates and longer periods for repayment. In other
fMr. Noseworthy.]

words they will burden themselves for a longer period; they will undertake to pay for these things at a time of prosperity and probably find that when a recession comes they will lose everything they have put into those buildings.
The point is that the whole object of this legislation is to enable lending institutions, including the banks, to put money into housing with greater security and less risk, to try to induce a larger number of people to buy these houses which will be sold at a profit by private builders. It does not touch the problem that faces the great mass of people who come within the $3,000 income brackets, and even less. It provides security for the banker. It insures him against loss. There is no insurance for the workingman who buys one of these houses, who undertakes a mortgage greater than he will be able to carry over the years, and who in all probability stands to lose what savings he puts into them. All this legislation does is indicate that the government is selling out what little interest it had in housing to the lending institutions.
The government's main concern here is the security of the lending institutions and not the provision of homes for those who need them. We made a suggestion back on April 21. I put on the record six points which will be found) at page 4161 of Hansard. In our opinion these six points would meet the needs of the Canadian people for a housing program. First among these was a lower interest rate. I said:
In our opinion a policy that is to meet the needs of the Canadian people regarding housing must, first of all, provide a reduction in interest rates to 2 per cent by having Central Mortgage and Housing Corporation solely responsible for the issuing of these loans.
This legislation, instead of decreasing interest rates, will increase them for the home owner. I pointed out then, and I want to reiterate it now, that expert opinion has shown that a reduction by 50 per cent in the interest rate on a mortgage will do more to reduce the carrying charges on a home than a 50 per cent reduction in wages and material used in that house. If we want to make houses cheaper, if we want to bring houses within the reach of the mass of Canadian people, we must first of all tackle that interest rate and do as other countries are doing which are seriously attacking this problem, and that is advance government money at the actual cost to the government of about 2 per cent interest. If you do that, then you will automatically reduce the cost of the house and the carrying charges on

the house, and help to bring houses within reach of the ordinary working people of this country.
It is true that we also advocated a reduction in the down payment from 20 per cent to 10 per cent. According to the minister's statement this new legislation will, in so far as the Toronto area is concerned, reduce the down payment from 20 per cent to 14 per cent. There just are no $8,000 houses available today in the Toronto area. The lowest price house available is around $10,000 or more. The down payment, the minister tells us, on a $10,000 house is to be $1,400 instead of $2,000. In other words there is to be a reduction from 20 per cent to 14 per cent in the down payment. In so far as there is a reduction in the down payment it is all to the good. It will enable people to get into some of those houses; it will enable more people to buy those houses, even though they may be undertaking to carry a bigger mortgage over a longer period of time and to pay a higher interest rate on that mortgage.
We also recommended in our six-point program that the amortization period should be extended, but we coupled both those recommendations, the lower down payment and the extention of the amortization period, with a reduction in the interest rate. Unless we can find some way of reducing that interest rate home owners are not going to get much benefit from this legislation, which reduces the down payment and extends the amortization period.
To meet the needs of those people I have been talking about, the people in the $3,000 income bracket or less, the people who today just cannot rent and cannot buy, the returned soldiers with large families who just cannot find houses in our modern communities, we suggested that a rental subsidy fund should be inaugurated. As we said, it can be done if it is provided that only a municipality or a public housing authority would receive the subsidy. Subsidies should be granted on condition that the municipality or the recipient comply with the requirements of a comprehensive housing program.
A subsidy would permit a sharp reduction in the present high rents so that those in the low income brackets could build or rent homes under even more favourable conditions.
I want to reiterate our fifth point, that one of the difficulties we are having in securing housing accommodation today is due to the cost of land improvement and providing schools and other facilities. For instance, the municipalities adjoining Toronto are hesitant about entering into agreements with 83270-644
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the provincial and federal governments for the building of low rental houses because of the cost they would have to bear to provide schools and other facilities. As a fifth point we suggest that the federal government should make grants to the provinces to be turned over to the municipalities for the construction of schools and other public facilities, which at present are a heavy charge upon the municipalities when a new housing subdivision comes into being.
As I said before, all this new legislation does is modify to some extent the down payment, and extend the amortization period. But that is offset by the higher interest rates to be paid by the home owner. The premium on an insurance policy will be incorporated into the cost of the house, and will be an added interest rate which the purchaser must pay. Any benefit that may be derived from a reduction in the down payment and a lengthening of the amortization period will be more than offset by the over-all longterm increased cost to the purchasers of homes.
As I said before, this bill is simply further evidence of the fact that this government can see the housing needs of the people of Canada only through the eyes of the lending institutions. This government just cannot see the needs of the people of Canada in regard to housing except in terms of security for the lending institutions. Until the government is prepared to provide funds at the interest rate I have indicated, until the government is prepared to subsidize low rental housing for people in the lower income brackets, we are not going to be able to provide homes for the hundreds of thousands of people in this country who need them.
Until we provide these houses we will pay far more for the evils which result from overcrowding and slum conditions than it would cost to subsidize a good low rental housing scheme. I have not the slightest hope in the world that the minister can be induced to see the housing needs of the people of this country except through the eyes of the lending institutions, but I appeal to him now to take a careful look at this legislation. If he does I am confident he will see that while a few more people may be induced to buy some of these houses which are built, while a few more people will be able to move into some of these houses, this measure will not meet the basic need of the Canadian people for houses which can be purchased or rented at prices those in the $3,000 income bracket can afford.


Frederick George Hahn: Mr. Chairman, I do not wish to labour the question at this time, and I do not intend to keep the committee in session

National Housing Act any longer than is necessary. I want to express to the minister my gratitude for recognizing a problem that is so prevalent in Canada today. He is trying to do something under the present lending institution set-up to make it possible for the little man to get the type of housing that is so necessary to him. This is true particularly in my own part of the world, and I am sure it applies generally across Canada.
My first reflection upon the implications of the resolution is that possibly now we are going to have homes in Canada instead of houses. I was particularly pleased to hear the minister say that the amortization period is to be extended, but I must admit that I was a little unhappy, as was the hon. member for York South, when he said that in all likelihood the down payment would be 10 per cent on houses costing $8,000 or less and 14 per cent on those costing above $10,000. I think that will make it a little difficult, and we should examine the bill very closely to see whether the lending institutions cannot arrange for a down payment of only 10 per cent on all houses.
I agree with the minister and disagree with the champion from York South as far as the insurance premium is concerned. Insurance should be a necessary factor in all housing units. It is necessary that the man who has assumed a loan should be insured in case he is not able to pay in future years because of some catastrophe. While the 2 per cent interest rate is low, I would hope that it might be reduced. However, I will be quite ready to settle at 2 per cent.
I approve of sending the bill to the banking and commerce committee, as one who is particularly interested in that type of legislation. I feel it is absolutely necessary that a matter of this magnitude should go before that committee. I could say much more at this time, but I shall reserve most of my comments until second reading. By that time I hope some of these points will be clarified.


Mr. Cresiohl:: Mr. Chairman, I should like to make but one observation on this measure. No doubt the resolution will receive a good reception throughout the country, notwithstanding the apprehensions expressed by the hon. member for York South. I think this is quite apparent from the enthusiastic reception the minister received from all sides of the house when he rose to present his resolution.
As for my principal observation, Mr. Chairman, I believe it can perhaps be made most pointedly by a question I should like to put to the minister. Can the minister tell the house whether, in the administration of the housing act, he has received any complaints


that some builders who finance their construction through government loans discriminate in the sale or rental of that housing accommodation by refusing to sell or rent to Canadians because of their race or religion? I would appreciate it if the minister could favour the committee with a reply to that question.


Robert Henry Winters: Mr. Chairman, perhaps I should answer that question at once. There was one instance of discrimination brought to my attention some time ago and I was quite surprised to learn of it. Government policies are opposed to discrimination of this kind. I asked Central Mortgage if there were any other instances and the corporation assured me that since it was set up in January of 1946 there is no record of any other instance in which any complaint on the ground of discrimination has been brought to their attention; and there is no other instance of discrimination that has been brought to my attention.


Mr. Small:: I should like to ask the minister a question. When the minister introduced the resolution he quoted figures showing that on a $10,000 home the down payment would be $1,420, or that there would be practically a 14 per cent down payment. I listened attentively and I do not know whether I understood him aright, but I did not hear him tell what the monthly payment was going to be, having regard to the carrying charges for a house of that nature. I should like to ask the minister if he has worked out what would be the carrying charges on a $10,000 house with a $1,420 down payment.


William Alfred Robinson: Order. I think that question might more properly be asked when the bill is before the house and we are in committee.


Robert Hardy Small: I asked the question because the minister led up to the idea that there was going to be a down payment of so much, and he did not carry through with it. I thought that over the Christmas recess we might have a chance to digest the matter and work out what could be done along that line. It is not a matter of trying to put the minister on the spot. It is just a question of having the information which should be available as to what it is going to cost with respect to carrying charges, having regard to the figures he gave us.


Robert Henry Winters: As you say, Mr. Chairman, this is the type of question that cannot be answered until after the bill has been enacted. But since I understand this is the first time the hon. member for Danforth has participated in the discussions in the House

of Commons, perhaps I should say to him that I cannot answer that question now. I made that point in my statement, the reason being that the interest rate must be determined by the governor in council. The interest rate on mortgage loans will be related to the interest rate obtaining at the particular time on long-term government bonds. That is something that will have to be determined at the time the act comes into effect and be fixed then by the governor in council.


Robert Hardy Small: My only reason for posing the question at the present time, Mr. Chairman, is that it has a great bearing on this matter, and probably it would remove the necessity for a great deal of discussion if we could have these figures beforehand. After you get through with the down payment, the cost is amortized over a 30-year period. The lending companies, or those who are going to supply the money for the building of homes, set a rate and you must have an assured income of so much per year. Having regard to the rates that have been set, whether it is on a 20-year or 30-year amortization plan, there is no workingman who can comply with the demands of the lending companies.
I should therefore like to have the information during the interval in order that we might study it further. We might then be able to see whether the recommendation made by the minister comes within the ambit of what the man who is earning an ordinary salary can afford to pay for a home.


Mr. Ellis:: Mr. Chairman, there are one or two observations I should like to make. We welcome the announcement that amendments are to be made to the National Housing Act, but there are a number of matters which I believe should be included in any changes in the national housing legislation.
I think there are two aspects of housing that should be given consideration by the government. Something has already been said about providing homes for those who wish to own their own homes through a lower down payment, and so on. I feel, however, that this is only part of the problem. There are many of our citizens who are not in a position to make the down payment needed to purchase a home. I am thinking, for instance, of those who move into a locality and do not know how long they are going to be living in that area. I feel that the government should not overlook the important question of low-rental housing. In other words, I believe oun emphasis on housing has been in one direction. I think it is a worth-while objective to see that as many Canadians as
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possible own their own homes. But I feel that in the circumstances there are many people who are not in a position to purchase homes.
I say there are two reasons for this. In the first instance, as I have already pointed out, there are many-particularly among our younger people-who are not settled in employment and who move into a locality when they accept employment, not knowing how long they are going to be there, and who find that it is virtually impossible for them to undertake the big step of buying a home. Then on the other hand we have many of our citizens whose incomes are so low that, irrespective of what changes we might make in the housing legislation, they would not be in a position to buy homes at the present time.
I feel that those people with very low incomes ought to be in a position to obtain decent low-rental housing.
I want to say that I believe the objective should be to have every Canadian family own its own home. But in the meantime I say we have a serious problem because of the fact that many thousands of Canadians are not in a position to buy homes at the present time. We cannot ignore them altogether. I believe the government has a responsibility to provide for low-rental housing, always bearing in mind, of course, the fact that the most adequate method is to make it possible for them to own their own homes.
As to home building, we know there have been two major obstacles, apart from low incomes, of course. One has been the down payment required, and the second has been the high rate of interest. Central Mortgage and Housing Corporation made certain figures available just recently. We know that in 1951 the average house built in Canada cost in excess of $10,000. During the same time the average down payment was in excess of $3,000.
Through experience we have found that there are many Canadian citizens who are not in a position at this time to purchase a $10,000 home. There are many of our citizens who are not in a position to make a $3,000 down payment. I therefore feel that the changes in the act will be welcomed by that group. I believe, however, the key to the whole problem has been suggested by the hon. member for York South, namely the interest rate. We know only too well the difference that 1 per cent in the interest rate is going to make in the finance charges on a house.
We in this group have maintained that the interest rate ought to be set so as to make money available to home builders, not from the standpoint of the interest rate providing

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profits to those lending institutions which make a business of lending money at a profit, but rather from the standpoint of providing houses for people in Canada, leaving aside altogether the profit motive. In other words we maintain that the government should accept housing as a social responsibility.
We have suggested a 2 per cent interest rate. I will grant that there are those people who will say that is going to be a subsidized rate. I say this. If the government is going to subsidize industry as it does in this country-and I suggest the tariff structure itself is a form of subsidy-if it is going to subsidize the gold mining industry, if it is going to make subsidies of any kind, I cannot think of any field the government could better subsidize than the field of housing. We have a problem that will have to be faced, and it is no use simply saying that a 2 per cent interest payment is too low.
The fact is that if interest rates have gone up they have done so because the government has allowed them to go up, because it has been a conscious part of government policy. There is no reason why an interest rate of 2 per cent cannot be made available to prospective home builders in this country. The other night an hon. member mentioned something about the 2 per cent figure being too low. I suggest that if the government accepts housing as a social responsibility it will provide money at 2 per cent. There is no reason why it cannot be done if the government wills it.
We do not know just what the bill will contain when it is brought before the house, but press reports have been quite liberal in their hints as to what the housing legislation is going to involve. From what we have been able to gather we surmise that a system is going to be set up of insuring the holders of new residential mortgages against loss in return for an appropriate insurance premium. We know that. From press reports we have been led to believe that is in the legislation. It has been suggested that when the legislation is brought before the house it may have a provision empowering the chartered banks to make loans on insured mortgages. It has been suggested that the down payment will be reduced from 20 per cent to 10 per cent, and I am quite sure all hon. members will welcome that provision. It has further been suggested that there will be an increase in the amortization period from 20 to perhaps 25 years.
If these provisions are included in the bill, then I suggest there are certain aspects that must be given very careful consideration. It seems, as the hon. member for York South has

pointed out, that if this is true the government is surrendering its last interest in housing directly to private enterprise. In other words it seems to be washing its hands of the entire business of housing, the little interest that it has had. Then we must surmise that in withdrawing from the lending field in favour of private enterprise the government is departing from a basic policy of our Canadian banking system.
In checking over Hansard we find that at the time of the revision of the Bank Act in 1944 Mr. Ilsley, at that time minister of finance, made this very significant statement, as found on page 2557 of Hansard for May 2 of that year:
This has been a fundamental principle of Canadian banking since confederation and experience has, I think, proved its soundness for depositors, borrowers and shareholders alike.
That of course is a reference to keeping the banks out of the mortgage field. Apparently this legislation would seem to envisage a radical departure from this long-accepted principle of Canadian banking. We know, too, that if press reports give any fair indication of the legislation to be brought down, the legislation will have the effect of making mortgage investment more attractive to private institutions. As the hon. member for York South has said, it is legislation designed to meet the requirements of the lending institutions primarily rather than to meet the interests of those who want to buy or build their own homes.
We know that private enterprise will be the chief beneficiary of this legislation, and we know moreover that in the long run the prospective home owner will have to pay more for his home. With the amortization period being extended and the interest payment being increased, we know that in the long run it is going to mean increased cost to those who wish to build their own homes. Until such time as the details of the bill are brought down we do not know exactly what the legislation will contain, but enough has been indicated through the press about the main points of the proposed legislation that I think members of the house and of the government should give serious consideration to modifying the legislation so that when the bill is brought down provision will be made for an easier rate for those who wish to build or own their own homes, through a lower down payment, an increased amortization period and an interest rate of not more than 2 per cent. Second, I feel that the government must not overlook the many thousands of our citizens who for one reason or another are not at this time in a

position to go into the market and buy their own homes. I believe the legislation when brought down by the government should include provision for low rental housing.


Douglas Scott Harkness: Mr. Chairman, I had no intention in the world of taking part in this debate at this stage of the proceedings, but in the last few minutes there has been considerable talk with respect to interest rates. I should like to make one or two remarks on that subject and ask the minister one or two questions. In the first place, I think any introduction of what would amount to a subsidized interest rate of 2 per cent, or any similar rate, would be one of the biggest steps we could possibly take in this country toward a completely socialized state. As a result I think it is the sort of proposition that would not commend itself to the vast majority of our people.
However, I think there is a middle ground between what one might call a subsidized interest rate of 2 per cent, as suggested by the last speaker, and a reasonable rate consonant with what money will ordinarily earn under the general economic conditions prevailing in the country. I think a number of insurance companies operating in the housing field at the present time are demanding excessive, in fact I would say usurious, rates of interest.
I should like to ask the minister first of all whether he is aware of the fact that some of the insurance companies operating in the housing field are asking 6J per cent on housing loans. Second, does the government agree that that is a reasonable rate of interest; and if not, what measures are they taking or proposing to take to see that such a rate is not extorted from the unfortunate person who wants to build or buy a house and is possibly desperate enough to pay almost any rate of interest asked rather than find himself without a home?


Robert Henry Winters: The types of loans to which the hon. member for Calgary North has referred are those made by lending institutions directly, what are known as conventional loans. Loans made by lending institutions through the joint lending facilities of the National Housing Act are of course made at 5J per cent on their share of the money, which is more in keeping with what I am sure my hon. friend had in mind by reasonable rates of interest.


Douglas Scott Harkness: Mr. Chairman, may I say that the minister has not answered the questions. He has answered the first question more or less by inference, namely whether
National Housing Act
he was aware that loans were being made at a rate of 6i per cent by some insurance companies. I am aware of that, but he has not answered the second part of the question as to whether the government agrees that this is a reasonable interest rate for these insurance companies to be asking, and what steps the government proposes to take in connection with it.


Robert Henry Winters: It is pretty difficult to define what everybody thinks is reasonable. The fact that lending institutions can place money at 6 or 62 per cent only means that there are people who are willing to pay that much for it.


Douglas Scott Harkness: There are a lot of desperate people in this country.


Robert Henry Winters: Many people, under the
National Housing Act, obtained money for 5J per cent. I believe the new legislation, with the insurance guarantees and the other measures taken to encourage the flow of mortgage money, will result in an interest rate somewhat lower than the high interest rate mentioned by the hon. member.


Stanley Howard Knowles: I may say to the minister that I was disappointed and disturbed to learn that it is the intention of the government to refrain from putting an actual interest rate in the act itself. As I understand it, the minister has told us that there will be a provision in the act leaving the interest rate to be set by the governor in council.


Robert Henry Winters: That is the way it is now, Mr. Chairman.


Stanley Howard Knowles: It is that way now in the National Housing Act?


Robert Henry Winters: It is that way now in the
National Housing Act.


Stanley Howard Knowles: If that is the way it is now, then this would be a good opportunity to change it. The minister has not liked it on previous occasions when we have talked about lending institutions going on strike or putting pressure on the government to permit an increase in interest rates. But I submit that is exactly what has happened, and so long as this sort of thing can be set by order in council pressure will continue to be exerted on the government.
I listened carefully to the reply the minister made to the hon. member for Danforth. It seemed to me his question was a proper one, but the minister was not only unwilling to give figures concerning what it would cost in that example to carry a loan, but he said it would not be possible to make the interest
1008	HOUSE OF
National Housing Act
rate known until after royal assent had been given to the bill. This means that we will go through all the stages of this housing legislation and not be told what the interest rate is going to be. In other words we will not be told what it is going to cost an individual home owner. I hope the minister will correct what he has said.


Robert Henry Winters: I am going to restate what I said to make it a little clearer to the hon. member. What I said was that the interest rate in the legislation will be related to the interest rate obtaining on long-term government bonds. The legislation will make clear what the relationship will be between the interest rate paid by the prospective borrower and the interest rate on long-term government bonds. The variable in the equation is the interest rate on long-term government bonds. I assume that the hon. member will not be in a position, nor will I, to say what the interest rate will be on those bonds in the future; that is the variable.


Stanley Howard Knowles: I wonder if the minister can remember what it was he said to the hon. member for Danforth he would not be able to tell us until after the bill had been given royal assent? As I understood it he said it would be that stage before we would know the interest rate or, in other words, before we would know what it is actually going to cost the purchasers of homes in terms of monthly payments.
It seems to me if that is the case it is a grave weakness in the legislation and a great handicap to the house to ask it to deal with this legislation, either at the resolution stage or the bill stage, without knowing at that time what the actual effect of this legislation is going to be.
I have one other question. Will the cost of insuring a mortgage under this proposed legislation be in addition to the interest rate that is set on the mortgage, and what will be the cost of that insurance to the home purchaser?


Robert Henry Winters: The cost to the home purchaser will be 2 per cent of the amount of the loan. It will be amortized over the period of the loan and be in addition to the interest rate otherwise obtaining under the legislation.


Stanley Howard Knowles: So, whatever interest rate is set on the loan itself, if it should be 5f per cent as is now the case or a higher figure, the home purchaser will have added to that an additional amount to cover the insurance on the mortgage. Will the minister say whether that mortgage insurance will include


in it any protection for the home purchaser himself, or is it just a protection for the money lenders?


Robert Henry Winters: It is just an insurance of the mortgage loan, Mr. Chairman.


Stanley Howard Knowles: Insurance against what kind of eventuality?


Robert Henry Winters: Insurance against loss on the mortgage.


Stanley Howard Knowles: In other words it insures the money lender in case the home purchaser is not able to pay. Is there any protection in that insurance for the equity the home purchaser would have in his home?


Robert Henry Winters: Not in this insurance element, Mr. Chairman, no.


Mr. Blackmore:: I should like to ask the minister if any modification is going to be made in mortgage loans which have already been advanced to people who have built houses, to give them as good an opportunity as those who borrow under this scheme? Is there provision for that sort of thing?


Robert Henry Winters: No; those people who have commitments for mortgages under the present arrangement will continue on the basis under which the commitment was made.


John Horne Blackmore: I believe that is entirely unfair to the people who have already borrowed.


Robert Henry Winters: I do not think the hon. member will say that once he sees the legislation. There will be no unfairness to people who have commitments under the present legislation.


John Horne Blackmore: I should like to draw the attention of members of the committee to this important fact, that we are proceeding on the basis that all the moneys which we may use for building houses have to be borrowed from somebody. Now, that is an absolutely unsound assumption. There are plenty of people who, in my judgment, almost stupidly assume that is true.
Let me draw the attention of the committee, Mr. Chairman, to the fact that under the dominion notes act of 1869 it was specified that the minister of finance could create money, and he did create money. Surely we must not neglect the importance of that fact to our day and generation. Why should we assume that all the money we use must be borrowed?


Mrs. Shipley:: Do you want to steal it?


John Horne Blackmore: Why not learn a little? How can you disregard established historical

facts of the financial history of this nation? Take the report of the royal commission on banking and currency in Canada, published in 1933, and read the first 25 pages. You will find there is no answer to what I am saying.


William Alfred Robinson: Order. May I remind the hon. member that we are discussing a resolution on housing.


John Horne Blackmore: I think this is pertinent to the resolution on housing. Surely finance is one of the important aspects of any resolution on housing. Is it not time we began to learn something-


Robert Henry Winters: On a point of order, the Bank Act will be before the house later on, and the hon. member will then have ample opportunity to discuss all such policies. I am sure that at that time the Minister of Finance will be more than delighted to answer him.


John Horne Blackmore: If the Minister of Finance is as courageous before Social Crediters as he has been in the last few years in committee, we, and Canadians generally, have not much to hope for. But let us not forget that Canadian financial history, right up to 1934-


William Alfred Robinson: I am sorry, but I shall have to interrupt the hon. member once again. We are approaching the Christmas recess and are discussing a resolution on housing, and I would ask the hon. member kindly to limit his remarks so they will be directly related to housing.


John Horne Blackmore: Mr. Chairman, I shall be delighted to do so. I have said all I wanted to say, and all that is necessary to say at this time. But I would urge hon. members to look back to the history of Canada's financial structure right up to 1934 when the Bank of Canada was established, and-


William Alfred Robinson: Order. I hope I shall not have to rise again, because the hon. member is entirely out of order in his remarks.


Donald Methuen Fleming: I have two or three questions to ask the minister, and I shall do it swiftly and ask them together. Will the minister tell us what is the expected extent of participation on the part of banks under the new scheme? Also will he tell us what is the anticipated augmentation from that source of mortgage funds, and how it may be expected that that augmentation will be made available for distribution in smaller communities.


Robert Henry Winters: Mr. Chairman, it is difficult to answer those questions in detail. We do not know, for instance, to what extent the lending institutions will divert money they formerly put into conventional loans into the
National Housing Act
lending operations under the insured mortgage technique. We would hope, however, that this would result in a great increase in the flow of mortgage money under the National Housing Act.
With respect to the last part of the question, perhaps it can be answered more specifically than the other parts. I understand there are about 4,000 branches of the chartered banks in Canada. Each branch will now become a lending institution. That in itself will increase the number of lending agencies under the National Housing Act from some 150 odd, as there are at the present time- that is, branches of authorized lending institutions-to over 4,000.


Donald Methuen Fleming: I take it there will be no change in the operation of the present section 35 of the act?


Robert Henry Winters: That is right.


Donald Methuen Fleming: Has there been any change in the basis of valuation for lending purposes?


Robert Henry Winters: No, Mr. Chairman, there is to be no change in that basis.


James MacKerras Macdonnell: I have one question. In view of the fact that, as I understand it, this bill will have the effect of making very important alterations in our banking practice, will the committee be able to have available for its deliberations-I am referring to the banking and commerce committee-experts on banking?


Robert Henry Winters: So far as I am concerned the committee will be the master of its own destiny.


Stanley Howard Knowles: Do I understand from the terms of the resolution, and from what the minister has said, that when the bill is introduced it will constitute a new housing act in its entirety?


Robert Henry Winters: Yes.


Stanley Howard Knowles: And that it will replace the old one?


Robert Henry Winters: That is right. All the sections of the housing act will be embodied in this new bill.


John Horne Blackmore: In the light of what I have already said I wish to register a most emphatic protest against the interest being charged in connection with the building of houses, and against the burden of debt being placed against all those who are endeavouring to build houses in Canada. And that protest stands.
Resolution reported, read the second time and concurred in.
1010	HOUSE OF
United Kingdom Financing, 1953
Mr. Winters thereupon moved for leave to introduce Bill No. 102, to promote the construction of new houses, the repair and modernization of existing houses, and the improvement of housing and living conditions.
Motion agreed to and bill read the first time.


THE ROYAL ASSENT
Mr. Speaker:: I have the honour to inform the house that I have received the following communication:
Government House, Ottawa, December 16, 1953.
Sir:
I have the honour to inform you that the Right Honourable Thibaudeau Rinfret, Chief Justice of Canada, acting as Deputy of His Excellency the Governor General, will proceed to the Senate chamber tonight at 10.15 p.m., for the purpose of giving the royal assent to certain bills.
I have the honour to be, sir,
Your obedient servant,
J. F. Delaute
Secretary to the Governor General (Administrative)


UNITED KINGDOM FINANCING, 1953 APPROVAL OF AGREEMENT RESPECTING PAYMENT OF OUTSTANDING BALANCE OF LOANS
Douglas Charles Abbott: the second reading of Bill No. 78, to approve the financial agreement between the government of Canada and the government of the United Kingdom.


James MacKerras Macdonnell: Mr. Speaker, first of all, I would point out that it is ten o'clock and, second, I wish to know if the minister is going to make a statement.


Douglas Charles Abbott: Perhaps we might not look at the clock for a few moments. I have very little to add to what I said at the resolution stage, at the time the bill was introduced. The purpose of the bill is to approve an agreement entered into between the government of the United Kingdom and the government of Canada, subject to ratification by parliament, which in essence provides that $150 million, the amount remaining of the $700 million interest-free loan made in 1942, after the payment of $38 million last August, should be extended for a five-year period, and be payable in quarterly instalments.
That, in essence, is the purpose of the bill. When we were in the resolution stage the hon. member for Greenwood asked me certain questions, and I shall be able to give him the information when we are in committee on the bill.


Mr. Speaker:: Is the motion agreed to?


James MacKerras Macdonnell: Mr. Speaker, I would ask to be allowed to adjourn the debate, because I have some remarks I should like to make. I understand that in a very few moments we have to go to the Senate chamber. It is now ten o'clock and, unless there is some matter of convenience against it-and I am always a very obliging person, as the leader of the house knows- I should like to move that the debate be adjourned.


Walter Edward Harris: I am sure we all agree that the hon. member for Greenwood is a most obliging member, and I have no doubt he will be on this occasion. However, as the house knows, it happens that the Minister of Finance will be absent throughout the whole of the next month. I had thought it desirable that this bill be dealt with before he left, particularly as we have some time available. It seems to me that there was fairly complete discussion at an earlier stage of this bill. Therefore I think the hon. member for Greenwood, who is very well informed on this subject, can probably discuss it learnedly and wisely on behalf of his party in the next 14 minutes, and we might be able to dispose of it before we go to the other place.


Douglas Scott Harkness: On a point of order, before we proceed with this may I ask the leader of the house to tell us how many other bills, resolutions, motions or anything else the government propose to bring up tonight before we adjourn for the Christmas recess?


Walter Edward Harris: As soon as we have returned from the other place, Mr. Speaker, I shall place before the house a motion which will permit the filing of petitions during the recess and then a motion to adjourn.


James MacKerras Macdonnell: Mr. Speaker, I do not know exactly where my motion stands now.


Douglas Scott Harkness: In jeopardy.


James MacKerras Macdonnell: You have not given a ruling yet, and the leader of the house has said that I am always ready to accommodate. Therefore I move that the debate be adjourned until we come back from the Senate.


Douglas Charles Abbott: May I appeal to my hon. friend. It is true that I am taking it for granted that most hon. members, if not all, are in agreement that we should confirm this arrangement for the payment of this loan. I have no doubt that my hon. friend may wish to discuss matters which could be quite relevant in connection with this bill. I have an idea as to what some of those matters are. I am sure he will agree with me that there will be ample opportunities in the course of this session to discuss them.

I would personally like to see this bill pass while I am still here. I did indicate to my friend the Chancellor of the Exchequer that I had very little doubt that parliament would ratify it. I would like to meet him in Australia in a couple of weeks from now and be able to say that parliament had approved this bill. If my hon. friend feels that that is unreasonable I am quite willing to let it stand over, but I am hoping we might put it through tonight.


James MacKerras Macdonnell: I think my chief reluctance was my unwillingness to inflict a 15 minute or possibly a 20 minute speech on the house at this time of night. You will at least agree, Mr. Speaker, that I did my best to save my fellow members that pain.
This measure of course is simplicity itself. I do not think any of us will question the propriety of its being done. After all it is merely to prescribe the terms of repayment of the amounts still owing.
This is a matter of international finance. The remarks which I wish to make are directed to the question of international trade. International trade and international finance are, as you might say, Siamese twins. They are two sides of the same shield, and I want, as I say, to make some remarks on trade.
The minister told us, in answer to my question, that this had been dealt with on a purely debtor and creditor basis, of which there is no criticism to be made; but I want to go back and recall to hon. members that when these loans were made there was a vastly different situation. At that time these loans were considered not merely as aids to Britain, but as aids to ourselves. They were considered most important as stimulating our own trade. We must carry our minds back to the fact that in 1946 we were very fearful as to the developments after the war. The government at that time had prepared, quite properly, a shelf of projects to take care of unemployment if it should arise. It is interesting to quote from Mr. Ilsley, the minister of finance at that time, to show how much in his mind was the question of trade with Britain when these loans were made. I quote from Mr. Ilsley, speaking on March 18, 1942, at page 1420 of Hansard:
The enormous purchases and expenditures made in Canada by Britain and the rest of the sterling area have, of course, been an important factor in the expansion of production, employment and national income in this country.
And again on the question of loans away back in 1946, at page 1282 of Hansard he said:
The whole purpose of this loan is to help Great Britain which is in such a strategic position at the present time if only she is strong enough to assert that position to build up her economy. I am satisfied that in the future it will help us in this country also to attain a higher standard of living.
United Kingdom Financing, 1953
Thus we can say that at the time these loans were made, Mr. Speaker, we were fearful as to our own position. We thought it was a matter of self-interest to make these loans. I mention this chiefly for the purpose of reminding ourselves of the seven very different years that we have gone through, seven years when we have not been, with one or two minor intervals, so concerned with trade, years when the goose has been hanging high.
You will remember, Mr. Speaker, the various things which came to our assistance; the Marshall plan in 1947-48; the war in Korea which, while it was a very terrible thing, nevertheless economically bailed us out of what was at that time a minor recession, or looked like one.
In that connection I should like to read a statement made by the Minister of Trade and Commerce (Mr. Howe) on March 31, 1950, as reported at page 1430 of Hansard:
One very striking fact is in evidence; the seller's market is over. Today all markets are buyer's markets, and in every market the Canadian exporter meets tough competition.
There was more to the same effect. I want to ask, Mr. Speaker-and I shall refer in a moment to the minister's speech of a few days ago-are we now in a situation similar to the one the minister thought we were in back in 1950? It was popular at that time, it has been popular since then, rather, to pooh-pooh some of our foreign markets. The Minister of Agriculture (Mr. Gardiner) when he spoke in this house earlier this year rather pooh-poohed the British market. Speaking of sales at home he said, as reported at page 3224 of Hansard:
You will be thinking that as long as you can get the prices you are now getting in the United States and Canada you had better stick to the market you have.
In other words, he was pooh-poohing the idea of the necessity of the British market. I want to read briefly from the statement made the other day at the annual meeting of Barclays Bank by the president of the bank, who surveyed the situation today in these words:
There is reason for concern that Canadians have arrived at the historic peak for their industrial and agricultural output, capital investment, personal incomes and domestic spending during a time of falling world prices, with an attendant slackening off in external demand for their goods.
Later in the same speech he said:
Our country's urgent need is the early disposal abroad of these very large stocks of commodities of different kinds that are superfluous to our domestic requirements, thus easing our topheavy position and helping to slow down the far from healthy and far too rapid rate of increase in our adverse balance of international payments.

United, Kingdom, Financing, 1953
I want to refer to one or two things that have happened recently. I want to refer to a speech made in this house on November 30 by the Minister of Trade and Commerce, in which he drew attention to various problems affecting us at this time. He referred to the difficulties encountered by various industries, and wound up by expressing on the whole, in his usual way, calm confidence as to the future. I understand, however, that when the minister was asked about the position of the textile workers when they were before a committee of the cabinet about the middle of November, he spoke to them in very plain words. He said, "I don't know how peacetime demand can be expected to take up the productive capacity needed in war". I think it is relevant to ask the minister whether that same answer would have to be given in the case of other industries as well.
The minister spoke with emphasis, and of course was quite right in referring to the fact that our capital expenditures were preserving employment and the whole economy, but we must always remind ourselves how much of those capital expenditures are government expenditures which are taken out of taxes.
I want to say just a word about the export market, and in this connection I want to refer to what the minister said, as reported at page 450 of Hansard, when he was speaking about the improved situation in the United Kingdom where restrictions were being removed, and also in South Africa. I have made inquiries about the South African situation, and so far as I can discover the restrictions that are left are so thoroughly adequate that our entry into the South African market is not going to be of any great practical importance to us for some considerable time.
There is one thing the minister overlooked entirely, and which I think should not be overlooked when we consider our position in foreign markets. I refer to the effect on our prices of inflation and high taxes. Certain other countries in the world have had more serious inflation, while others have had not nearly as much, and these countries may come into competition with us. We know that inflation and taxes have driven costs up very high. We have been given figures here which cause us to think. We know that the young housewife cooks on a stove, the cost of which has been greatly swollen because of our inflated money and high taxes. We know that the taxpayer who is driven to death by the tax collector is carried to his grave in a taxed coffin built with debased money which has been swollen also by inflation.


The minister prides himself on being an optimist, and he has suggested that other people are pessimists. He once called me a Cassandra. I deny that entirely, but I would point out to him that Cassandra was always right.


Mr. Speaker:: Order.


James MacKerras Macdonnell: It would seem that there must be a necessary interlude in my speech.


Mr. Speaker:: Order. I understand the
Gentleman Usher of the Black Rod is at the door.


Jean-François Pouliot: Mr. Speaker, I rise on a question of privilege. I do not see why someone should knock at the door when the hon. member is speaking. I think it is most discourteous to the hon. member for Greenwood (Mr. Macdonnell) to be forced to interrupt his speech, to prevent him from concluding in order to listen to someone who is banging at the door.


THE ROYAL ASSENT
[Stage Direction]
A message was delivered by Major C. R. Lamoureux, Gentleman Usher of the Black Rod, as follows:	[DOT]
Mr. Speaker, the Right Honourable the Deputy Governor General desires the immediate attendance of this honourable house in the chamber of the honourable the Senate.
Accordingly, Mr. Speaker with the house went up to the Senate chamber.
And being returned:
Mr. Speaker informed the house that the Deputy Governor General had been pleased to give, in Her Majesty's name, the royal assent to the following bills:
An act respecting the use of election material for by-elections and Northwest Territories elections.
An act respecting the appointment of auditors for national railways.
An act to amend the Pipe Lines Act.
An act to amend the Children of War Dead (Education Assistance) Act.
An act respecting the Department of Northern Affairs and National Resources.
An act to amend the National Parks Act.
An act to amend the Customs Act.

[Stage Direction]
The house resumed consideration of the motion of Mr. Abbott for the second reading of Bill No. 78, to approve the financial agreement between the government of Canada and the government of the United Kingdom.
James MacKerras Macdonnell: Mr. Speaker, I feel that
the first part of this speech, which I think was only 13 minutes long, has been such a success that I should now propose to avail

myself of the balance of the 40 minutes, and I have no doubt that I would get unanimous consent to go on still further. After all, there is no one else, so far as I know, who has had his speech interrupted by the Governor General. But, Mr. Speaker, much as I know you would like to hear the rest of my speech, I think the spirit in the house on the whole is against it. I shall therefore merely content myself with giving a little bit of advice to the Minister of Finance to take with him on his journey to Australia, which I am sure will be of great value to him.
One of the last ministers who was in the east was the Secretary of State for External Affairs (Mr. Pearson), who some years ago went to a meeting at Colombo where he got rid of a certain amount of our money, and where I believe the Colombo plan which we all approve was founded. At that time he came back and I well remember his saying that he had been a gadfly. I understand that a gadfly is an insect which stings cattle. He explained that allusion by saying that as the only non-member of the sterling area who was in attendance, he felt that he just had a kind of watching brief.
I am going to suggest to the Minister of Finance that he do not go as a gadfly. I do not think that is his quality. I think he has, shall I say, more human qualities than that. I hope he is going there with the feeling that he is just one of the boys and that he is going to have a good time. I will not say, "Bring back the bacon" but I will say "Bring back bacon for everybody"; in other words, let him make as much progress as he can.
I feel, Mr. Speaker, that if I was a man of courage I would go on for 35 minutes more; but not being such a man, I shall resume my seat.


Mr. Speaker:: Perhaps I might say something with regard to the point raised by the hon. member for Temiscouata in reference to the interruption of the speech of the hon. member for Greenwood. When the messenger of His Excellency is announced to be at the door, business is interrupted. It is not a matter of discourtesy. I do not think anyone should take that view here in this house. Hon. members know that the notice of that visit of the messenger of His Excellency is always announced previous to his coming to this chamber. At approximately ten minutes to ten I read the announcement that His Excellency would be in the Senate to give the royal assent at 10.15. At 10.15, with royal punctuality, the messenger of His Excellency was here knocking at the door. His
United, Kingdom Financing, 1953 procedure was in accordance with tradition, and I am sure we want to preserve it exactly as it is.


[Stage Direction]
Motion agreed to, bill read the second time and the house went into committee thereon, Mr. Brown (Essex West) in the chair.
On section 1-Short title.
Douglas Charles Abbott: Mr. Chairman, I know the house is in the Christmas spirit, but the hon. member for Greenwood did ask for some information when we were at the resolution stage and perhaps I might give him that now.
The total amount payable to Canada by the United Kingdom when the new arrangements for the repayment of the outstanding balance of the $700 million interest-free loan go into effect will be $67-7 million a year. This amount will be made up of $30 million a year on the 1942 loan and $37-7 million a year representing amortization and interest at 2 per cent on the outstanding balance of the loan of $1,185 million made to the United Kingdom in 1946. The $700 million loan will be completely repaid by December 1,1958, but the annual repayment of $37-7 million

that is on the $1,185 million loan

will continue until the year 2001, at which time the 1946 loan will be fully and finally redeemed.
The hon. member also asked what payments were being made by the United Kingdom to the United States; and while I have not complete information, of course, concerning annual payments on all the loans made to the United Kingdom by the United States under ECA, the mutual security act, and other arrangements, I think I am answering the sense of the hon. member's question when 1 say that the United States loan of $4,350 million made to the United Kingdom in 1946 at the same time that our loan was made calls for substantially the same terms of repayment as does the Canadian post-war loan; that is, 50 equal annual payments until the year 2001. The annual payment on the United States loan including 2 per cent interest on outstanding principal is $138-5 million.
The committee will recall that in the year 1942, when we made an interest-free loan of $700 million, we also made a free gift of $1 billion to the United Kingdom at the same time. The hon. member also asked some questions concerning loans made to other countries, and perhaps he will accept this as an answer if I tell him that the report which is filed each year-I have not the date we did it this year-under the Export Credits Insurance Act gives full particulars with respect to those loans.


Stanley Howard Knowles: I am sure hon. members will be pleased when I say that I do not intend to keep speaking until the year 2001.

United Kingdom Financing, 1953


Douglas Charles Abbott: It is reassuring to hear you say that.


Donald Methuen Fleming: Or 1954.


Stanley Howard Knowles: As a matter of fact, in view of the compliments that were paid to the hon. member for Greenwood when he offered to cut his remarks short, I am tempted to say that I do not intend to speak very long at all. All I wish to do is ask the minister whether he is in a position to answer the question that my leader, the hon. member for Rosetown-Biggar, asked him when we were in committee on the resolution. The question had to do with what has happened with respect to the Canadian Pacific shares formerly held in the United Kingdom.


Douglas Charles Abbott: I thought I answered that at the time. The answer I gave the hon. member for Rosetown-Biggar was that since the 1942 loan the United Kingdom has been completely free to do as it pleased with securities owned by its residents. It could keep them, sell them, give them away or do as it liked. We have not attempted to interfere in any way with the holdings of securities by United Kingdom residents, whether of Canadian Pacific shares or anything else.
The only condition was that if these shares were sold or if, in the case of fixed obligations, they matured, the proceeds of those sales or maturities were to be paid to us in reduction of the interest-free loan, and we relied upon a certificate from the Bank of England as to what sales had taken place or what securities had matured. But we had no control and no direction of and no interest in how residents of the United Kingdom who own Canadian securities dealt with them.


Stanley Howard Knowles: Has the minister any information with respect to where the shares are now held as among the people in the United Kingdom, the United States and Canada?


Douglas Charles Abbott: No, I have not.


[Stage Direction]
Section agreed to.
Section 2 agreed to.
Title agreed to.
Bill reported.
Mr. Speaker:: When shall this bill be read the third time?


Douglas Charles Abbott: Now, by leave.


Stanley Howard Knowles: By leave.


Douglas Charles Abbott: I beat you to it, Stanley.


Douglas Charles Abbott: the third reading of the bill.
Motion agreed to and bill read the third time and passed.



BUSINESS OF THE HOUSE


Walter Edward Harris: Mr. Speaker, as I indicated earlier, because of the recess that we are about to enter upon, persons who wish to file petitions will find themselves barred by the rules of the house unless we extend the time for filing these petitions. Therefore I move:
That, in view of the forthcoming adjournment of the house, the time for receiving petitions for private bills under the terms of standing order 92 be extended from Wednesday, December 23, 1953, to Monday, January 18, 1954, notwithstanding the provisions of any standing order in relation thereto.


[Stage Direction]
Motion agreed to.

Walter Edward Harris: 
Robert Hardy Small: Mr. Speaker, with relation to what took place earlier and your explanation with respect to the representative of Her Majesty the Queen in the person of His Excellency the Governor General, may I say that I accept your explanation with respect to the Gentleman Usher of the Black Rod presenting himself to this house.
As far as I am concerned that is all right, but having regard to the supremacy of this house, which has been contested most strenuously in days gone by, I want to place myself on record as agreeing with the hon. member for Temiscouata (Mr. Pouliot) that hereafter when such person presents himself to this house he should have the consent of the Speaker before entering.
A member on this side of the house was interrupted. We should preserve the ancient rights of this assembly and remember that when an individual presented himself to the English house long ago and asked for Mr. Pym, he did not receive the recognition of the Speaker. I think in future that should be our guide, and that before anyone enters you must give your consent.


Douglas Charles Abbott: Merry Christmas.


Mr. Speaker:: The hon. member must not be under a misapprehension. It is precisely

because our rights are respected that a message is received about the gentleman usher coming at a certain time. That is announced in the house, and furthermore it is provided in our standing orders that when the Sergeant-at-Arms announces that the Gentleman Usher of the Black Rod is at the door Mr. Speaker shall take the chair, whether there be a quorum present or not.
That is what the members of the house decided themselves long ago. As a matter of fact, it has been the practice ever since 1867. Those were the rules of the parliaments of Upper and Lower Canada before 1867, and I would say ever since 1793. Of course in those days it was a different proposition; they had not reached the constitutional level we have now reached. However, we shall not need to discuss this point any further.
I wish to thank the acting leader of the house for his kind words, and also all hon. members for their co-operation and kindness
Christmas Adjournment toward me. I should like to wish each and every one a very happy Christmas and a happy new year.


Walter Edward Harris: As the house will have noticed, January 12 is a Tuesday, and that is government day. We will proceed on that date with the motion by the Minister of Justice for a joint committee of both houses with respect to certain aspects of the Criminal Code; then the resolution in the name of the Minister of Resources and Development with respect to the national battlefields at Quebec; then the resolution in the name of the Postmaster General with respect to the Post Office Act; and then second reading of the housing bill. We shall continue with that until second reading has been completed, later in the week or in the following week, if necessary.
Motion agreed to and the house adjourned at 10.45 p.m. until Monday, January 12, 1954, at 2.30 p.m.



END OF VOLUME I