1953-03-09

Mr. Pearkes:: 1.	Has H.M.C.S. Algonquin been converted recently?
2.	If so, where was the work carried out?
3.	What was the total cost of the conversion?
4.	Has H.M.C.S. Crescent been converted to a new role?
5.	If so, where is this work being done?
6.	What is the estimated cost?


Mr. Blanchette:: 1.	H.M.C.S. Algonquin has been converted and is at present undergoing acceptance trials.
2.	Yarrows Ltd., Esquimalt.
3.	The total estimated cost is $5,275,700 (including production and prototype plans and development work).
4.	The H.M.C.S. Crescent is now undergoing conversion.
5.	H.M.C. dockyard, Esquimalt.
6.	Preliminary estimated cost is $3,500,000.


COSTS OF CANADIAN PARTICIPATION
Mr. Robichaud:: 1.	What has been the total cost to date of Canada's participation in the war in Korea?
2.	What have been the annual outlays of money by Canada, in each and every year, for the cost of our participation in the war in Korea, since its inception to the 31st of December, 1952?
3.	What has been the respective cost, to Canada, of each of our armed services participating in the said Korean war, in each and every year, since its inception to date?


Mr. Blanchette:: 1.	$129,416,038. This figure does not include the cost of recruitment, training or initial outfitting of personnel. Nor does it include the cost of the organizations which serve and direct our forces in the Korean theatre. It would be impossible to isolate such elements relating only to Korea.
2	and 3. See table below.



KOREAN COSTS-INCEPTION TO 31 DEC. 1952

[Stage Direction]
Cost by Year and Service	1950-51	1951-52	1952-53	TotalNavy	$ 3,734,891	'$ 4,784,576	* 3,553,022	$ 12,072,489Army	36,933,614	42,103,734	22,076,905	101,114,253Air	4,361,165	7,819,410	4,048,721	16,229,29645,029,670	54,707,720	29,678,648	129,416,038
bleachers was begun in October, 1951, and completed in June, 1952. Construction of the field, loaming and seeding, etc., was started in May, 1952. Construction of a cinder perimeter track and perimeter fence was started in October, 1952, and is nearing completion.
2.	Greater facilities for recreation are necessary due to the fact that cadet enrolment at the Royal Military College is about double the pre-war enrolment. During the summer months the field will be used by the approximately 600 officers who take courses conducted at the college. The field will alsc be used by the Kingston garrison for sports activities.


Mr. Harkness:: 1.	When was work started on a new playing field opposite Royal Military College, Kingston?
2.	What is the purpose of this playing field?
3.	When were bleachers erected for this field?
4.	After this field was loamed and grass had been sown and come up, was approximately half of it bulldozed up and a cinder track put in? If so, was this due to a change in plans?
5.	Has this playing field yet been used?
6.	What has been the total cost to date of this playing field (a) for land; (b) for construction?


Mr. Blanchette:: 1. Construction of the playing field was planned in three stages. Erection of the

Questions
3.	Answered by No. 1.
4.	No. A very small portion of the seeded field was disturbed to permit the rounding of the corners to conform with the standard design of a cinder perimeter track.
5.	No. The playing field has not yet been accepted and taken over from Defence Construction Limited. It is expected that the Department of National Defence will take over the field in the spring of 1953.
6.	The total cost to date of the playing field is:
(a) land: nil, as the property is owned by the Department of National Defence.
(b) construction:
Bleachers	 $ 8,677.73
Playing field	 11,900.00
Cinder track and perimeter fence...	19,555.00



$40,132.73 COMMONWEALTH AIR TRAINING PLAN

Mr. Knowles:: 1.	How many persons from countries other than Canada received training in Canada, during world war II under the British commonwealth air training plan?
2.	From what countries did they come, and how many in each case?
3.	What was the total cost to Canada for the training of those referred to in question (1), including transportation, maintenance or any other expenses paid by Canada?


Mr. Blancheite:: 1.	68,174.
2.	(a) United Kingdom, 50,248; (b) Australia, 10,350; (c) New Zealand, 7,576.
3.	In reply to part 2 of a question asked by Mr. Power, the total contributions, in money and equipment, to the BCATP were given on 28 March, 1946, at page 357 of Hansard.



SARDIS ARMY CAMP-EXPENDITURES

Mr. Cruickshank:: What is the total amount expended on the Sardis army camp including any contracts now awarded?


Mr. Blanchette:: During the period 1 April, 1948, to 31 January, 1953, $5,217,395 has been expended on the Sardis army camp.



WALLIS HOUSE, OTTAWA  FLOORS

Mr. Fraser:: 1.	Was any of the flooring in Wallis house, Ottawa, (a) sanded; (b) sealed; (c) varnished; (d) finished?
2.	If so, how many square feet of each were done?
3.	In each case, what was the price per square foot?
4.	Were tenders called for this work?
5.	If not, on what basis was the contract?
6.	What was the complete contract price?


Mr. Blanchette:: 1.	(a) Yes; (b) No; (c) and (d) Yes, varnished only.
2.	(a) 44,000 sq. ft.; (b) not applicable; (c) and (d) 22,300 sq. ft.
3.	(a) 3 cents per sq. ft.; (b) not applicable; (c) and (d) 3 cents per sq. ft.
4.	No.
5.	No contract was let. The work was done by the army works service employing day labour at a cost of $1,989.
6.	Not applicable.



MILITARY SEVERANCE BENEFITS

Mr. Starr:: 1.	How many claims for military severance benefits were outstanding as of March 1, 1953?
2.	What is the longest outstanding date of unsettled claims?


Mr. Blanchette:: 1.	Outstanding claims as at 1 March, 1953 for released personnel
Benefits payable under the Defence Services Pension Act to personnel
released from the regular force

 3,038
Benefits payable to personnel
released from the special force		164
2.	22 February, 1952. In this case, the man involved does not answer correspondence.



DIRECTOR OF INTERNATIONAL SERVICE, C.B.C.   OFFICE FURNISHINGS

Mr. Fulton:: 1.	What, in detail, is the list of the furnishings of the office of the director of the international services of the Canadian Broadcasting Corporation, Montreal, as at March 1, 1953?
2.	What was the initial cost of each item on the list?


Mr. McCann:: 1 and 2.
Item	Price
1 Chair, sectional	$ 43.00
1 Bookcase	 97.90
1 Bookcase	 153.75
1 Chesterfield	 161.87
1 Table	 17.50
1 Chair,	arm	
101.501 Chair,	arm	
101.501 Chair,	arm	
73.501 Chair,	arm	
73.501 Chair,	arm	
48.501 Chair,	arm	
71.751 Basket, waste	
3.601 Desk, flat top	
178.201 Tray, desk	
6.301 Stand,	telephone	
28.851 Table,	with	shelf	
69.301 Cushion	
9.95Drapes, linen	
89.00



TRANS-CANADA HIGHWAY, NEWFOUNDLAND

Mr. Browne (Si. John's Wesl):: 1.	Has any variation been made in the specifications for the trans-Canada highway in Newfoundland because of the difficult terrain?
2.	How much of the trans-Canada highway in Newfoundland (a) has been completed; (b) is passable by motor car?


Mr. Winters:: 1.	Yes. There have been some variations, as permitted by the terms of the trans-Canada highway agreement.
2.	(a) No mileage has been accepted as fully completed. The equivalent mileage of grading completed amounts to 122-0 miles.
(b) Although gaps exist between the sections of the route mentioned below, the trans-Canada highway is passable by motor car over 462 of the 610 miles to be constructed in Newfoundland between:
St. John's and Clarenville, 135 miles.
Gander and St. Georges, 292 miles.
South Branch and Port aux Basques, 35 miles.



BITUMOUNT, ALTA., POST OFFICE

Mr. Dechene:: 1.	On what date was a post office called Bitu-mount established down the Athabasca river from Fort McMurray?
2.	Who was appointed postmaster?
3.	According to the post office records, how many people were patrons of that office, and what were their occupations?
4.	When was the said post office closed?


Mr. Langlois (Gaspe):: 1.	9th December, 1937.
2.	R. C. Fitzsimmons.
3	(a) At date of establishment, 3 families in summer; 4 families in winter.
34 single men in summer; 15 single men in winter.
(b) Mainly employees of International Bitumen Company.
4.	20th February, 1940.
This post office has since been reopened and closed twice, as follows:
(a)	Reopened, 16th July, 1945; closed, 24th October, 1946.
(b)	Reopened, 28th May, 1948; closed, 15th March, 1950.



IMMIGRATION, QUEBEC

Mr. Balcer:: 1.	How many immigrants settled in the province of Quebec in the year 1952?
2.	How many of each nationality?


Mr. Harris:: 1.	35,318 gave Quebec as their destination.
2.	See statement giving distribution by racial origin.
Questions
Immigration to Canada showing racial origin, from overseas and total from the United States, destined to the province of Quebec, calendar year, 1952
English	 3,601
Irish	 880
Scottish	 1,290
Welsh	 109
Total 5,880
Arabian	 22
Armenian	 26
Belgian	 583
Bulgarian	 36
Chinese	 233
Czechoslovakian	 313
Danish	 232
Dutch	 1,209
East Indian	 15
Esthonian	 143
Finnish	 232
French	 3,480
German	  5,718
Greek	 791
Hebrew	 2,882
Icelandic	 8
Iranian	 4
Italian	 6,175
Japanese	 1
Jugoslavian	 637
Lettish	 274
Lithuanian	 166
Magyar	 480
Maltese	 17
Mexican	 2
Negro	 52
Norwegian	 153
Polish	 1,778
Portuguese	 92
Roumanian	 152
Russian	 338
Spanish	 192
Swedish	 92
Swiss	 658
Syrian	 69
Turkish	 13
Ukrainian	 636
Others	 26
Total 27,930
From United States	 1,508
Grand Total 35,318
WINNIPEG POST OFFICE . Mr. Knowles:
1.	Do the plans for the new Winnipeg post office include provision for (a) adequate off-street loading facilities; (b) adequate off-street parking, so

Orders for Returns
as to avoid any increase in the traffic burden in the vicinity of the said new post office?
2.	If so, what are the details of such plans, and what is the capacity of (a) such off-street loading facilities; (b) such off-street parking provisions?


Mr. Fournier (Hull):: 1.	(a) Yes.
(b) Yes, off-street parking is being provided for post office vehicles.
2.	(a) Off-street loading facilities will be provided for approximately 115 vehicles on teamways on the first and second floors of the building.
(b) Off-street parking provisions will be made for post office vehicles.



SHIPPING SUBSIDIES

Mr. Brooks:: 1.	What subsidy is now being paid yearly by the federal government to shipping companies using Atlantic ports (a) sailing to West Indian ports; (b) South American ports?
2.	What is the number of ships in each case?
3.	What subsidy was paid in the following years: 1939, 1946, 1948, 1950 and 1952?
4.	Have any ships been taken off the above routes in the past two years?


Mr. Benidickson:: 1.	Nil.
2.	Answered by No. 1.
3.	1939 nil; 1946 nil; 1948 nil; 1950 nil; 1952 nil.
4.	(a) Passenger vessels S.S. Lady Rodney and S.S. Lady Nelson withdrawn from West Indies service November, 1952.
(b) Nil.



DOMINION STEEL AND COAL


Mr. Gillis:: 1.	Did the Dominion Steel and Coal Corporation, or any subsidiary of it, import American coal in, the years 1951-52?
2.	If so, what was the tonnage (a) anthracite; (b) bituminous?
3.	What was the dollar value of the coal imported at the border?


James Joseph McCann: 1, 2 and 3. It is contrary to the practice of this department to furnish information which would disclose the private transactions of importers or exporters at customs.



QUESTIONS PASSED AS ORDERS FOR RETURNS


Mr. Shaw:: 1.	Were any motor vehicles purchased by the federal government or any department thereof, in Alberta, between January 1, 1949 and January 1, 1953?
2.	If so, what was the total number purchased?
3.	How many motor vehicles of each trade name were purchased?

4.	What were the names and addresses of all dealers from whom purchases were made and how many units were purchased from each?
5.	Were all purchases made by tender? If not, what method is employed in determining from whom purchases are to be made?


RECREATIONAL BUILDING, H.M.C.S. &quot;NADEN&quot;
Mr. Maclnnis:: 1.	Did the defence department since January 1, 1951, construct a recreational building at H.M.C.S. Naden, Vancouver island?
2.	If so, what was the cost of the project?
3.	Was the work performed by (a) cost plus contract; (b) contract by tender?
4.	If cost plus contract, what is the name of the firm which did the work?
5.	If tenders were called what are the names of the firms tendering and the amount of each tender?
6.	What was the name of the successful tenderer?
7.	What is the floor area of this building?



DEFENCE PRODUCTION


Mr. Hodgson:: 1.	Was a contract let for a building in February, 1953, by defence production department, to Bennett and White Limited, of Edmonton?
2.	If so, what was the amount of such contract?
3.	What will the building be used for?
4.	What is the estimated time for construction?
5.	What are the terms of payment?
6.	How was this contract let, by tender or on a cost plus basis?
7.	Where is the building to be located?




Mr. Hodgson:: 1.	Was a contract for a building awarded in February 1953 to Leitch Construction Company Limited, Winnipeg, by the defence production department?
2.	If so, for what amount?
3.	To what use will the building be put?
4.	What is the estimated time required for the completion of the building?
5.	Was the contract let by tender or on a cost plus basis?
6.	What are the terms of payment?
7.	Where will the building be located?


Mr. Dickey:: Mr. Speaker, questions Nos.
75 and 76 relate to construction contracts and the wording of the question is:
Was a contract let for a building in February, 1953, by defence production department to-
And the company is named. If the question were worded "By Defence Construction (1951) Limited", an answer could be given. Subject to that amendment in wording, I move that questions Nos. 75 and 76 be orders for returns.


Mr. Speaker:: Orders for returns.



RAILWAY MAIL CLERKS, QUEBEC AND NEW BRUNSWICK

Mr. Riley:: 1.	How many railway mail clerks operate out of post offices in the province of Quebec to points in New Brunswick on all railways?
2.	How many railway mail clerks operate out of post offices in New Brunswick to points in the province of Quebec on all railways?



MAIL SERVICE, MONTREAL-NEW BRUNSWICK

Mr. Riley:: 1.	Is mail destined for New Brunswick out of Montreal, or from New Brunswick for Montreal presently being transported by motor vehicle to and from Sherbrooke, Quebec?
2.	If so, what are the reasons for this change?
3.	What was the amount of money paid to the Canadian Pacific Railway for transporting this mail between these two points during the last twelve months when it was transported by rail?
4.	What personnel changes in the railway post offices have been effected as a result?
5.	Does the Post Office Department contemplate eliminating any railway post offices presently operating in the province of New Brunswick in favour of transportation of mails by motor vehicle?
6.	If so, what is the rate presently paid to the railways for transporting such mails?
7.	Will there be any reduction in the number of postal clerks presently employed in New Brunswick?
8.	If so, upon whose suggestions or recommendations are such changes being contemplated?



MEDICAL EQUIPMENT AND SUPPLIES

Mr. Fraser:: 1.	What was the total cost of all medical equipment bought by the government, during each of the fiscal years, 1949-50, 1950-51, 1951-52, and from April 1 to December 31, 1952?
2.	What was the total cost of medical supplies bought by the government, during each of the fiscal years, 1949-50, 1950-51, 1951-52, and from April 1 to December 31, 1952?
3.	What is the total cost of medical supplies stored by the government at the present time, (a) in Canada; (b) outside of Canada?



MOTIONS FOR PAPERS


Mr. Diefenbaker:: For a copy of all correspondence and telegrams since the first day of January, 1951, between any department of government and the Lunam Construction Company Limited of Regina, Saskatchewan, having to do with the failure of the said company to complete its several contracts, and in particular referring to the work progress reports submitted by it on the various construction projects under consideration by the said company, together with any statements on file containing the liabilities of the said company.


Mr. Fournier (Hull):: Mr. Speaker, may I ask the hon. gentleman to allow this motion to stand. I wish to discuss the terms of it with my officials.


Mr. Speaker:: Stand.
Motions for Papers



FORT GARRY HOTEL, WINNIPEG

John George Diefenbaker: For a copy of all letters, telegrams and other communications between senior officers and officials of the Canadian National Railways and Robert Pitt, M.B.E., then manager of the Fort Garry hotel, Winnipeg, concerning complaints as to allotment of rooms to federal ministers of the crown in the said hotel, and of all replies to such letters, telegrams and communications in any way referring to alleged complaints since the 1st day of September 1952 and to date.


Mr. Chevrier:: This matter is one which concerns the internal management of the Canadian National Railways; and as the house knows, it has not been the policy either of the various departments or of the Canadian National Railways to table correspondence having to do with officers within the department. This policy is one of long standing which has been followed in this house not only by Liberal governments but by Conservative governments as well. My colleague, the Minister of Resources and Development (Mr. Winters), some days ago quoted from a statement made in this house by the Right Hon. Arthur Meighen. It was a statement made in 1920, dealing with a matter having some relation to that which is now before the house. I should like to quote from another statement made by Mr. Meighen in 1921, during which time the then minister of the interior, as I believe he was, gave cogent reasons for the policy which, I submit with deference, should be followed on this occasion. His remarks can be found at pages 1182-3 of Hansard of that year and are as follows:
I think it will be obvious that if the Canadian National directorate are to be compelled to answer to resolutions, which by the dozen may be put upon the order paper of this house every day, calling for copies of correspondence, for the disclosure of every fact and of every deed connected with the operation of the road, they will be put under a disability that their great competitor is not under at all. Should we do that they might well say: You shackle us in the management of the road: you refuse to give us that latitude and freedom of management that every successful business must have; you therefore will have to take the responsibility of failure-we do not. That would be the position they would logically assume. I venture to say that no board of directors, no president and general manager who would be big enough for the tremendous task of operating that system today, would undertake to assume such responsibility under conditions that would be brought about were this amendment to be adopted.
As the minister responsible for the Department of Transport I have always taken the position that it is not in the interests of the Canadian National Railways to give information which relates to the internal operation of the system, and which other competitors or other business organizations would not be required to produce. In fact, the hon. member who has made this motion

Proposed Legislation
seems-at least to my way of thinking-to have adopted and to have accepted that position when the debate took place on the motion that I referred to in connection with the Minister of Resources and Development because-and I am sorry the hon. member is not in his seat now-after the position was set out by my colleague he had this to say, as reported at page 2292 of Hansard:


John George Diefenbaker: I would point out, Mr. Speaker, that Mr. Meighen was dealing with the Canadian National Railways and he stated that it would be impossible to furnish parliament with the information, particularly in view of the size of the C.N.R. and the number of employees of that body.
He seemed in that case to be arguing away against Central Mortgage and Housing Corporation but in favour of the C.N.R.; and in my opinion at least he seemed to be taking the position that Mr. Meighen was correct in the attitude he then took.
For the reasons I have stated I would hope that the hon. member for Lake Centre (Mr. Diefenbaker) or the hon. member who speaks for him today would consent to the withdrawal of this motion.


Mr. Green:: Mr. Speaker, in view of the
fact that this motion appears to be controversial and that the hon. member for Lake Centre is not able to be here this afternoon, I would suggest that the motion stand over until his return.


Mr. Speaker:: Stand.



NATIONAL DEFENCE ADMINISTRATION- INVESTIGATIONS

Mr. Fullon:: For a copy of all reports made since January 1, 1948, as a result of investigations into or surveys of the army works services, the Royal Canadian Ordnance Corps, and/or the administration of the Department of National Defence by any person or agency outside that department and excluding the Royal Canadian Mounted Police, on which said investigations or surveys public money was spent.


Mr. Campney:: I would ask the hon. member if he would be good enough to allow this motion to stand.
.Mr. Speaker:	Stand.



PUBLIC SERVICE SUPERANNUATION ACT


Hon. Douglas Abbott (Minister of Finance) moved: that the house go into committee at the next sitting to consider the following resolution:
That it is expedient to introduce a measure to revise the Civil Service Superannuation Act and to provide, amongst other things, for payment out of the consolidated revenue fund, as a matter of right, of annuities and other benefits to persons and to widows and children of persons who, having

paid contributions into the consolidated revenue fund while employed in the public service of Canada, cease to be so employed, and to continue payment out of the consolidated revenue fund, as a matter of right, of allowances granted under the Civil Service Superannuation Act.
He said:	His Excellency the Governor
General, having been made acquainted with the subject matter of this resolution, recommends it to the consideration of the house.


[Stage Direction]
Motion agreed to.


Alphonse Fournier: that the house go into committee at the next sitting to consider the following resolution:
That it is expedient to bring in a measure to amend the Fisheries Research Board Act to increase the membership of the board from fifteen to nineteen including the chairman; to provide for the appointment by the governor in council of a permanent chairman at such salary as may be fixed by the governor in council, and for the appointment by the minister of an acting chairman who may, if he is not a member of the public service, be paid such remuneration as may be fixed by the governor in council; and also to abolish the position of executive director.
He said:	His Excellency the Governor
General, having been made acquainted with the subject matter of this resolution, recommends it to the consideration of the house.


[Stage Direction]
Motion agreed to.


[Stage Direction]
On the orders of the day:
Mr. A. F. Macdonald (Edmonton East):: should like to direct a question to the Minister of Labour. Has the Minister of Labour anything further to report respecting the grain handlers' strike in Vancouver?


Hon. Milton F. Gregg (Minister of Labour):: Mr. Speaker, in addition to the hon. member for Edmonton East, the hon. member for Vancouver South (Mr. Laing), the hon. member for Vancouver-Quadra (Mr. Green), as well as others, indicated that they would like to have further information on this matter. I mentioned last Thursday that my department was watching the situation closely and would intervene again at the first sign that it might be useful to do so. Later in the week it appeared that further conciliation services might usefully be employed; therefore our chief conciliation officer from Ottawa

was assigned and proceeded at once to Vancouver. He is now in discussion with the parties.



FREIGHT RATES


[Stage Direction]
On the orders of the day:
Mr. M. J. Coldwell (Roseiown-Biggar):: May I direct a question to the Minister of Transport? In view of the announcement made this morning of an increase of 7 per cent in freight rates, will the government consider using its power under the Railway Act to rescind-I think that is the word in the act-or at least suspend the coming into effect of those rates until further consideration has been given to them?


Lionel Chevrier: Mr. Speaker, I have not seen the
judgment which was handed down by the board of transport commissioners. I am sure my hon. friend realizes that it is a judgment which has to do with the application by the railways for increases in freight rates brought about by the increase in wages of certain classes of employees of the Canadian National Railways. That being so,
I am not too clear as to why the government should indicate that such a judgment should be rescinded. My recollection of prior judgments of the board is that if it can be established that the railways have been put to increased costs, because of increased wages, then I think the board must of necessity grant an increase in rates, provided that it meets with the facts. While I shall be very glad to consider the request made by my hon. friend, I doubt very much whether the decision would be in favour of a rescission.


Major James William Coldwell: May I just say a supplementary word? I had in mind the recommendation of the Turgeon commission that no further increase in rates should be granted until some steps toward equalization had been taken. I think there have been several increases, and this is one which affects the country to a very great extent.


Lionel Chevrier: I do not think the Turgeon
commission had reference at all to a situation such as this.


Major James William Coldwell: Well, every situation. INQUIRY FOR RETURN



WOODFALLE SCHOOL, ROCKCLIFFE

[Stage Direction]
On the orders of the day:
Mr. A. M. Robichaud (Gloucester):: May I
ask the Minister of National Defence or the
Inquiries of the Ministry Secretary of State when the return to an order for papers appearing under my name, and passed by this house on January 28, asking for a copy of all correspondence concerning the teaching of religion and French at the Woodfalle school, Royal Canadian Air Force, at Rockcliffe, Ontario, will be brought down? This order may be found at page 193 of Votes and Proceedings of January 28.


Hon. F. G. Bradley (Secretary of State):: I will make inquiries and have the necessary order brought down as soon as it can conveniently be done.



HOUSING


[Stage Direction]
On the orders of the day:
Mr. J. W. Noseworthy (York South):: May
I direct a question to the Minister of Resources and Development? Will the minister comment on the Toronto Daily Star's recent report of a new understanding reached between Central Mortgage and Housing Corporation and the lending institutions, a copy of which report was sent to the minister?


Hon. Robert H. Winiers (Minister of Resources and Development):: May I thank the hon. member for sending me a copy of the newspaper clipping. At the present time activity in the housebuilding field is very buoyant. The government, as always, is anxious that within the limits of availability of materials, labour and mortgage financing the demand for houses be met. To that end there was a meeting of the Central Mortgage and Housing Corporation and the larger lending institutions on Wednesday, February 25. This meeting was one of a series of regular meetings between the corporation and the lending institutions, at which general mortgage conditions are discussed.
During 'recent weeks there have been representations that mortgage commitments in sufficient quantity are not available from the lending institutions. These representations, together with the routine meeting, have led to rumours that some new arrangement has been made. This is not the case. But the lending institutions and Central Mortgage are aware that at the moment the demand for mortgage funds seems greater than the supply.
As in the past, Central Mortgage and the lending institutions are co-operating towards finding ways and means of ensuring that there will be sufficient joint loans under the National Housing Act to stimulate a satisfactory volume of housing.
2736	HOUSE OF
Inquiries of the Ministry Some newspaper reports have indicated that there are likely to be fewer loans made by the lending institutions in 1953 than there were in 1952. There is no reason to believe this will be so. One important difference this year is that, with the mildness of the winter, the demand for mortgage funds has arisen very much earlier than in years of more normal climatic conditions.
Furthermore, there are instances of inability to secure mortgage commitments because of unsatisfactory location and doubt whether the builder can finance a large development, rather than the lack of mortgage funds.
I can assure the hon. member that this situation is being kept under active review, in order to assure a large volume of housing in 1953.



INQUIRY AS TO SHORTAGE OF AMMUNITION

[Stage Direction]
On the orders of the day:
Mr. Gordon Churchill (Winnipeg South Centre):: I should like to direct a question
to the Associate Minister of National Defence. Is the government aware of the shortage of ammunition for the United Nations forces in Korea? What steps are being taken by Canada to assist in correcting this shortage?


Ralph Osborne Campney: So far as information has come to us in regard to our Canadian troops in Korea, there is no shortage of ammunition in respect of actual operations. I think it was said by the Minister of National Defence, on another occasion, that with respect to holding operations and retaliatory fire it is always customary to have a certain amount of rationing of ammunition. That is normal practice. But as far as actual operations are concerned, we have never been informed of any shortage of ammunition so far as the 25th brigade is concerned.


Gordon Minto Churchill: My question did not pertain only to the Canadian brigade. I was speaking generally about United Nations forces. Is the minister aware of the declaration of General Van Fleet concerning the ammunition shortage?


Ralph Osborne Campney: Mr. Speaker, I have no intention of commenting on any dispatches or any statements with reference to the ammunition supply of other nations.



NATIONAL DEFENCE

[Stage Direction]
headquarters' site for gagetown brigade

[Stage Direction]
On the orders of the day:
Mr. A. J. Brooks (Royal):: May I direct a question to the Associate Minister of National Defence? Has the Department of National Defence decided on the location of the headquarters site for the Gagetown army brigade training area in New Brunswick? If so, where is the headquarters to be located, and is it the intention of the department to start work and construction on headquarters this spring?
If no decision has been made yet as to the location of such headquarters, when may we expect one?


Mr. Speaker:: Perhaps that question could appear on the order paper.


Alfred Johnson Brooks: Mr. Speaker, in connection with that I might say that owing to the great unemployment in New Brunswick many men have registered their names in the employment office, and they are waiting to see when this will be started. It is an urgent matter so far as our province is concerned.


Mr. Speaker:: No doubt there is some urgency to it, but in view of the fact it is the type of question that should appear on the order paper it might be more in keeping with our procedure if that were done. It would be called on Wednesday if notice were given today and there would be only two days' delay.


Mr. Lennard:: That is what you think.


Alfred Johnson Brooks: I have waited for a month for an answer on the order paper. These men do not want to wait a month or more to find this out.


Alphonse Fournier: that the house go into committee of supply.



REQUEST FOR INQUIRY TO PROMOTE GREATER EFFICIENCY IN GOVERNMENT

Mr. George A. Drew (Leader of fhe Opposition):: Mr. Speaker, on Friday the hon. member for Hull (Mr. Fournier) spoke to me about this motion, and I indicated to him that, in the event of its being called, I did not expect there would be any extended debate. That is my expectation.
However, motions such as the one before us present the only opportunity we have to place before the house motions in positive form, in a way that we can be sure will

call for a decision on the part of members of the house. It is therefore my intention to avail myself of this opportunity to present the motion I shall make at the conclusion of my remarks, calling for an examination of the organization of government, departments of government and agencies of government for which the government is responsible.
We have asked before for an inquiry of this nature. This is something quite different from the type of inquiry we have had under discussion at other times during this session. This proposal calls for a businesslike examination of the organization of government, of the relationship between the different departments of government, and the relationship of government decisions to those agencies the government creates, either by orders in council or by legislation presented to the house for approval.
On earlier occasions a number of reasons have been given for opposing such motions. In the past it has been suggested that one answer to such a proposal is that definite examples of extravagance, waste and inefficiency have not been put forward. It has also on other occasions in the past been suggested that the motion called for some specific type of inquiry which the government did not feel was appropriate, even though they might conceivably have considered some other type, if that suggestion had been made.
For that reason I propose to place before the house in the simplest possible form a motion which will give the government an opportunity to decide what it wants to do in regard to this matter, without being bound in any way as to the procedure, or detail of that procedure, so long as it accepts the proposition. And because the motion is put in that form I seek the support of hon. members on both sides of the house who have reason to be concerned about the cost of government.
In presenting my argument today I am not placing before the house any suggestion of wrongdoing or of any specific example which might be put forward, and which doubtless will be put forward on other occasions by different members in other debates. I am dealing with this as an ordinary business proposition, and on a basis which I hope will commend itself to members on both sides of the house as being an approach which is not open to challenge, if one once accepts the basic proposition that the largest business in the country, the business of Canada, should be conducted on as efficient a basis as can be made possible by every step taken in the house.
Government Organization-Proposed Inquiry
Other governments have tackled this problem. Other governments have been ready to admit their set-up was not perfect. Other governments have been ready to admit that there is an important similarity between the business of government and ordinary business, and have taken steps accordingly. The most recent example of that is to be found in the United States.
We are often told that there is a great difference between the system of government in the United States and that in Canada. This is true. We have emphasized that difference; we have emphasized over and over again the importance of remembering that we have a parliamentary system under which parliament, and not the executive, is the supreme authority. It is to that supreme authority of parliament that I am presenting my argument on this occasion in the hope that members will find themselves free to support a proposition which I hope will commend itself as appealing to their ideas of good business. I should like to refer to what was said by the President of the United States in his "state of the union" speech on February 3, only to indicate the nature of this problem, and the way in which others are seeking to tackle it.
While they have a different system from ours, while we have a parliamentary system and they have a constitutional system, nevertheless from the point of view of business administration there are many marked similarities between our own system and theirs. That is particularly true because of the impact upon government of the federal system in the two countries. Because of the fact that central government must not deal only with the problems entrusted to its exclusive responsibility, but must deal also with many problems in regard to which there is a joint responsibility, we find the similarities very striking in many respects.
Therefore I should like to read these words from the "state of the union" speech of President Eisenhower:
I have already established a committee on government organization. The committee is using as its point of departure the reports of the Hoover commission and subsequent studies by several independent agencies.
To achieve the greater efficiency and economy which the committee analyses show to be possible, I ask the Congress to extend the present government reorganization act for a period of eighteen months or two years beyond its expiration date of April 1, 1953.
There is more involved here than realigning the wheels and smoothing the gears of administrative machinery. The Congress rightfully expects the executive to take the initiative in discovering and removing outmoded functions and eliminating duplication.

2738	HOUSE OF
Government Organization-Proposed Inquiry
Then in dealing with certain specific questions which he had in mind the President closed his remarks on this subject with these words:
In all departments, dedication to these basic precepts of security and economy can and will produce an administration deserving of the trust the people have placed in it.
Our people have demanded nothing less than good, efficient government. They shall get nothing less.
Pursuant to his statement that he would undertake such an inquiry, the President of the United States created what he described as a task force of one hundred experts, including men specially qualified to deal with problems of government, widely experienced accountants and businessmen whose training had given them the type of experience that would be valuable in an inquiry of this nature.
That task force has already been proceeding with its very important activities. As the President of the United States pointed out, it is proceeding to conduct its inquiry with the information already available which was obtained by the Hoover commission and which was brought up to date by subsequent inquiries by those associated with that commission. Since the Congress of the United States was dealing only with the organization of government as a structural problem, they have recently had before them the report of the Sarnoff commission on the utilization of manpower in both the armed forces and civilian occupations. They also have the report of the committee of Congress on overseas construction which recently made very important findings in regard to the huge expenditures on activities of that nature. These are only examples of the way in which an attempt is being made in the United States to tackle a similar problem.
A few days ago the hon. member for Hamilton West (Mrs. Fairclough) pointed out that we have no reason to be complacent about the level of taxes in this country. The hon. member gave to the house figures which disclosed that the per capita taxes in this country are substantially higher than those of the United States, the United Kingdom, Australia and France which have comparable economies and comparable types of industrial and other production, although there are immense differences as well.
At the time these figures were put forward there was an interjection by a member of the government pointing out that the figures were not related to the individual earning power of those who lived in the countries which the hon. member mentioned. An examination of the comparative earnings produces some interesting results which I shall

leave for discussion on another occasion. Since the government has raised this point, perhaps we cannot be blamed for accepting that as the basis upon which we should make a comparison. Therefore, I propose to make a comparison between the taxes levied by the central government of the United States and by the central government of this country on the basis of percentage of gross national product which is the most appropriate figure to use for that purpose.
The gross national product of the United States for 1952 was $346,300 million; the gross national product of Canada in the same year, 1952, was $22,984 million. The budget now before the Congress of the United States calls for expenditures of $68,700 million; the budget now before this house calls for expenditures of $4,817 million. It will be found by anyone who cares to examine these figures that the budget now before the Congress of the United States represents 19-84 per cent of the gross national product of that country, while the budget now before this house represents 20-96 per cent of the gross national product last year of this country.
On the basis of percentage of gross national product our government is charging our people a greater percentage in taxes than the people of the United States are being charged by their federal government. Surely this removes any suggestion that we have the right to be complacent, and disposes of any argument in favour of attacking this problem of high taxes simply by saying, "Look at our taxes as compared with those of other countries." In the case of actual taxes per capita we are substantially above those being paid in the United States, the United Kingdom, France and Australia. On the basis of percentage of gross national product, we are being called upon by our federal government to pay a higher percentage than is the case in the United States.
The important thing for us to remember is that, although they are more than one per cent below us in percentage, they are doing something about it. I have read the statement by the President and we see that immediately upon taking office he took the appropriate steps to conduct an inquiry, as any business would take if it had a similar proportionate expansion and expected to remain in business.
I want to make this abundantly clear. I am not placing before this house a suggestion that the government should agree to the setting up of a commission created for the purpose of conducting fishing expeditions into all departments of government. We

recognize that this or any other government must accept certain responsibilities in regard to matters of that kind and that being human they would wish to have some sound basis for an inquiry of this nature. I am suggesting that they recognize the need of doing it in exactly the same way that any business would do it if it had developed even a small part of that proportionate expansion that this government has had in its activities during the last fifteen years.
This is a straight business proposition and in the motion which I shall introduce I leave the form of that inquiry open. We recognize that the government must accept responsibility for the form of the inquiry and for the terms of reference and instructions that will be given to the body that will conduct the inquiry. That is left open in the motion I will put before the house. I simply repeat that any business which had multiplied its departments, expanded its activities and created new agencies in the way the government has in the past fifteen years, and had failed to appoint independent experts-I repeat, independent experts-to inquire into the general organization of the business, would almost certainly be bankrupt. The difference is that government in the very nature of its activities does not need to meet the competitive tests of ordinary business. That is not a reason why the government should apply less exacting standards. It is the reason why the government should apply the most exacting standards of all. The ordinary competition of business will take care of those who fail to observe business practices where there are inefficient methods. It is because the government is not open to these standards of competitive business that the most exacting examination should be made, by competent independent experts, of the whole expanded structure, and changes recommended for the purpose of producing greater efficiency in government itself.
In the past we have been told that there was no need for this because, in spite of the apparent cogency of the arguments, nothing had been put before the government or the people to show any reasons why such a thing should be done. We have been told that before we put forward any such arguments we should give examples of waste, extravagance and inefficiency. I hope, Mr. Speaker, that no one will rise in the house and say that there are no examples of waste, extravagance and inefficiency before us. It is not necessary now to refer to the long list of incredible examples of waste, extravagance and inefficiency that have been presented to the house wherever it has been possible to find out what the facts were.
9, 1953	2739
Government Organization-Proposed Inquiry Remember, we have only had the curtain lifted in one very small room of the large house of government. If one takes as an example the inquiry conducted into one branch of government which produced some unique examples of inefficiency and waste, we should remember that the inquiry in that case only covered an area of less than one per cent of the expenditure of the people's money by this government in one year. It was just as though we had seen before us a building with 100 rooms with the blinds down in every room, and inadvertently someone let one blind go up. We saw into that room. We saw how untidy it was. We saw how disgraceful the condition in that one room was. We ask for something which will permit some independent body to examine the other ninety-nine rooms and find out what can be done to effect a real housecleaning and to reorganize the government for the advantage of the people of Canada.
True, the government must accept the responsibility. I concede that immediately and anticipate any suggestion of that nature.
I hope that no one will rise and say:	That
is our responsibility; we have been chosen by the people to do it and no one else is going to assume our responsibility. What I am suggesting is that the members of the government party should express themselves in these critical days as being in favour of a thorough examination of government, of the departments of government and their relation to each other and, extremely important, the activities of those agencies of government which are kept under a veil of secrecy such as we saw placed around one agency of government in the house this afternoon. It does not make any difference who has argued that in the past. The fact remains that a veil of secrecy surrounds these great and important agencies of government.
Again may I repeat what I said before. That is all the more reason why the most exacting tests should be imposed with respect to the efficiency of those agencies of government which conduct affairs in many different fields of activity of great importance to the people of Canada. Our people have reason to ask for efficient government today as never before in the history of the country. The elimination of waste and extravagance and government inefficiency is part and parcel of the great struggle in which we are engaged. Those men of immense power who now meet in the Kremlin under a new leader want nothing more than carelessness and inefficiency within the democratic world, because in the long run that is the most powerful weapon on the side of that power which seeks to enslave the world.
2740	HOUSE OF COMMONS
Government Organization-Proposed Inquiry
Again may I repeat that I am not placing before the house any of the many specific examples that could be brought forward of the most remarkable extravagance and waste. I am hoping that it will not be said that these do not exist. I am hoping it will be remembered that those that have been exposed have only been exposed within the limited areas that we have been permitted to see, through the examinations which have already been conducted by independent experts. Therefore it is my intention to leave the arguments there. On other occasions we have put forward many extended arguments. In this case I am speaking on behalf of the party that 1 have the honour to lead. I believe that it will not be an extended debate today and I hope that it does not need to be. I would hope that on this occasion, with the urgency of the issues now before us, when we have been reminded within the past few days by the brilliant head of NATO that the economic problems go hand in hand with the military problems and the social problems hand in hand with them, we will recognize the importance of everything being done to streamline the government and make it more efficient. Therefore I move:
That all the words after "that" to the end of the question be deleted and the following substituted therefor:
"in the opinion of this house an immediate inquiry should be instituted for the purpose of bringing about a more efficient and economic organization of government and the departments and agencies thereof."


Right Hon. C. D. Howe (Minister of Trade and Commerce):: Mr. Speaker, I do not intend to speak at great length on this subject. This is not the first time it has been discussed in the house. The suggestion is that we be asked to accept as a fact that there is waste and inefficiency in government. I would point out that since the beginning of our defence expenditure program there has been a committee sitting more or less continuously, a committee that also sat throughout the last war. We are still waiting for it to report to the house that it has discovered waste and inefficiency. It has not done so to date.


George Alexander Drew: They have not discovered efficiency.


Clarence Decatur Howe: I say they have not reported to the house that they have discovered either waste or inefficiency. My hon. friend says that the United States government does it another way; that they appointed the Hoover commission and that the Hoover commission reported waste and inefficiency in the United States government. I have not heard of any great changes being made as a result of that report. The United States government may IMr. Drew.]
have believed that the report was a correct statement of the facts. If that government did believe the findings it seems to me that they have been very slow in making the changes recommended by Mr. Hoover.
I have never heard of the government at Westminster, within the last several hundred years, ever having appointed a royal commission to investigate procedure in that government. I know the hon. member thinks that the parliament at Westminster has a monopoly on all the virtues of parliamentary government, and that perhaps such an investigation is not necessary because there is no waste or inefficiency within the British government. I do not suggest that there is. I think Britain has always been a well governed country. I believe that today it is a model of efficient government for the world. I believe, however, that anyone who would make a suggestion in the parliament at Westminster of the type that has just been made would have very short shrift from the members of that parliament.
As the Leader of the Opposition has said, there is a difference between the United States government and the government of Canada. In Washington the president is responsible for the executive functions of the government, and for seeing that all phases of government are efficiently administered. He appoints a group of men to assist him in that function. He chooses the men he likes from any walk of life, or any part of the United States, to serve in his cabinet. The heads of the various departments of government are not men who have been elected to office but are men chosen by the president and appointed to. administer the various departments of the government of the United States. Here we have a totally different system. We have a government elected by the people, and from the elected representatives of the people are chosen the men who are made responsible for the administration of certain departments of the government. These men take an oath of office that they will carry out the specific work that has been assigned to them, and of course as members of the government are responsible to this parliament.
We are asked now to accept the view that these men are mediocre people, and very bad administrators. That is not the opinion that people outside this country have of those administering the affairs of government at Ottawa. I think that it is the opinion of most that the government at Ottawa is a government that administers the affairs of this country in a businesslike and efficient way. We are asked to get a group of independent people, as though there were no

Government Organization-Proposed Inquiry
independence in those administering the affairs of government. Well, I do not know whom you would get that would be considered independent. You could pick men who would be efficient in industry but without experience in government. Who would be responsible for this group of independent men who would be asked to remodel our government? Who would elect them? Who would choose them? I presume it would be the government of the day that would choose them. I presume that the government would choose the very best men they could find, but the fact that it would be an independent body without responsibility to anyone would be, in my opinion, no guarantee that they would be better judges of how this parliamentary government should be organized and administered than are the elected representatives of the people who have sworn to carry out that particular task.
We talk about independent people. Who is more independent than a member of the government of Canada? I gave up all the business affairs 1 had eighteen years ago, and I have devoted my attention solely to the work of administering the departments for which I have been responsible. Every other member of the government is in the same position. You will say we are mediocre people. Perhaps if we were better people the government might be better administered. We will admit that at once. Nevertheless, the people of Canada have returned us from period to period to carry on our work. All I can say is that we are being as efficient as we can.
It is suggested by the Leader of the Opposition (Mr. Drew) that if any member stands up in this house and says something is wrong, something is inefficient, that makes his statement a fact. I suggest that when we have a parliamentary committee investigating defence expenditures, sitting continuously and with access to all the records, someone ought to be able to prove his statement before the parliamentary committee. The hon. member for Moose Jaw (Mr. Thatcher), who seems to be anxious to get into this debate, spoke the other day about landscaping around military establishments. Yes, we put down grass to keep down the dust where military people are established. He asks if that is what we consider efficiency. The answer is, yes, that is what we consider necessary for the kind of people that are training in these camps.
He spoke about a swimming pool. He asked whether that was the sort of thing for which the people of Canada were being taxed. The answer is, yes. We are asking young men to volunteer to serve in that camp for long periods of time. If the hon.
member wants a swim he can go to the Y.M.C.A. in Moose Jaw, but these young men have to take the facilities that they find in the camp to which they are assigned and in . which they must stay. The hon. member cited other things and asked if those were the things for which we were taxing the people of Canada. He is very good at picking out the picayune things and asking whether they are going to save this country from destruction. He asks whether those projects are desirable. These projects are submitted to the minister of the department and, after taking all the factors into consideration, the minister undertakes to say whether those are desirable projects to be carried out.
The hon. member for Nanaimo (Mr. Pearkes) says we have been in too much of a hurry. He spoke particularly about the radar stations. These radar stations were started at a time when I think the hon. member was in as great a hurry as any man in this house. Certainly, our ally with whom we undertook to carry out that joint project was in a hurry. Military authorities in that country set a time of completion that we did not think was physically possible of attainment, but we did our best to meet it. Our partners, who are paying the larger part of the bill, were satisfied with what we were able to accomplish in connection with these radar stations. This is a difficult subject to discuss because it is surrounded with secrecy. We had no plans that we could make public at the start. We had to let the contract on a cost-plus basis. However, we picked the best contractors in the country. If there has been graft and inefficiency in carrying out those contracts, then there is graft and inefficiency throughout the contracting business in this country, for we chose contractors who we knew took their obligations seriously. I can say that they have carried out their obligations in a manner which is a credit to the industry.
We have had complaints, and where they were sufficiently specific to associate them with a project we have examined those complaints. In every case we found there was no foundation whatever. If men were diverted from the work, they were also diverted from the payroll. If materials were diverted from the -work, they were also diverted from the cost items submitted to the government for that project. Let us not be too ready to admit that every statement made in this house is a true statement, that every accusation of waste and inefficiency is a true accusation.
I know of only one occasion when a Canadian government undertook to get an independent body to examine the work of government and to overhaul government machinery. This was in the time of the
2742	HOUSE OF
Government Organization-Proposed Inquiry late Sir Robert Borden. He brought in a firm of efficiency experts from Chicago, with instructions parallel with those that the Leader of the Opposition would ask this government to give to a new body of independent experts. I was not a member of the government of that day-I came in later- but I can say this. I think the consensus of opinion of those who were associated with government at that time is that the report of that committee, which was made effective in part, did more to cause confusion in the government and produced evil results which took longer to eradicate than anything that has ever happened in government circles before or since.
I do not know that it is necessary, Mr. Speaker, to prolong this debate. I say that there is no foundation for the suggestion that this government is inefficient or that there is waste and extravagance in this government, and that there is no purpose in the independent examination that my hon. friend has asked for in his motion now before the house.


Mr. W. Ross Thatcher (Moose Jaw):: Mr. Speaker, I should like to take only a few minutes in this debate. I think the Minister of Trade and Commerce (Mr. Howe) was a bit touchy a moment ago. After all, one of the main duties of opposition members, as I understand it, is to try to scrutinize various expenditures. If we point out things that we think are wasteful, I do not think the minister should take exception to our activities, He knows better than does any other member of this house that private business, when they get into difficulties, quite frequently bring in outside companies to go over the departments, to point out weaknesses or inefficiencies. They are called efficiency experts. That is a common procedure in the business world. I do not see why the motion of the Leader of the Opposition has not a good deal of merit in it, because certainly this parliament is not doing an efficient job of examining our estimates and expenditures. We have been sitting here now for three months, and I do not believe one item has actually been brought down before parliament. It is physically impossible-


Clarence Decatur Howe: What my hon. friend is really suggesting is that we bring in efficiency experts to examine the work of the parliamentary opposition.


Wilbert Ross Thatcher: Oh, Mr. Speaker, the Minister of Trade and Commerce is talking nonsense and he knows it. I say again that expenditures today are not being properly scrutinized. Why is the minister so touchy about the matter? It is small wonder that


this arrogant attitude which the government has is causing so much resentment out in the country.
In the past, opposition members have suggested methods whereby the government could save money, and the government attitude seems to be that they are not even interested. They rather resent such suggestions, as the minister has done this afternoon. For instance, cost-plus contracts were mentioned in the house last week. I do not think that the government has yet given a satisfactory answer with respect to these cost-plus contracts. We know that the cost of each man in our defence forces is from $18,000 to $20,000 whereas the equivalent cost in Britain is $5,000 and in the United States $13,000. What the answer is I do not know. I have my suspicions. However, I do not see why a committee of this kind could not do something to find out.


John Horace Dickey: The answer is that my hon. friend's figures are not correct.


Wilbert Ross Thatcher: The figures certainly are correct. The government this year is spending $4-8 billion and it is the average Canadian-the workingman, the farmer and the labourer-who is paying the major part of that $4 [DOT] 8 billion. Those people are getting fed up. Taxes are too high. Taxes in Canada are discouraging initiative and promoting inefficiency. No one knows that better than does the minister. The easiest way in which to bring taxes down surely is to find inefficiencies in the government; and if the government is not going to give us a chance to examine expenditures, how are we going to do that? I strongly support the suggestion which the Leader of the Opposition has made this afternoon, as do the members of this group; and when the motion comes before us, we are going to vote for it.


Mr. Solon E. Low (Peace River):: Mr. Speaker, I do not think it is necessary to prolong the debate beyond a few words. I think that sufficient facts are before the house to make it possible for hon. members to render a judgment without going into a prolonged discussion of the amendment. I think there is a good deal of room for inquiry into the efficiency of the government and into the charges of waste and extravagance. The best way of doing that, I am not prepared to say nor, I suppose, is any member of my group. But certainly I stand for and will support the amendment as it is worded.
Before I sit down, Mr. Speaker, I want to emphasize that there is nothing in the wording of the amendment to suggest that a specific type of committee or commission

Government Organization-Proposed Inquiry
should be established. I draw your attention to the fact that the motion simply says:
In the opinion of this house an immediate inquiry should be instituted for the purpose of bringing about a more efficient and economic organization of government and the departments and agencies thereof.
I can think of half a dozen ways in which that could be done.


Mr. Ferrie:: Tell us.


An hon. Member:: Make your case.


Solon Earl Low: I imagine, Mr. Speaker, that it should be quite clear to all the members that it could be done. Now that I have had some interruptions from the other side, may I say that, if they want me to keep on talking, all they have to do is just to keep on interrupting.
Let me just say that one of the best evidences that an inquiry should be instituted into all phases of government activities is this. When members of the opposition have brought forward in this house specific allegations as to waste and extravagance, immediately the government has taken fast action to see that the causes were removed. I will just refer to something that was said here not long ago by the Minister of Resources and Development (Mr. Winters) in reply to a request for an inquiry into the Penhold construction situation. After my colleague the hon. member for Red Deer (Mr. Shaw) had spoken about the Penhold matter, the minister admitted at once that he had sent somebody in or had made an inquiry, and in his talk he indicated that certain causes were found for dissatisfaction.
That being the case, Mr. Speaker, I want to point out that the members of the opposition have not just been talking through their hats. They have had definite grounds on which to base a number of their charges. I suggest that it is high time that a complete inquiry was instituted into all the departments of government. I am prepared to support the amendment moved by the Leader of the Opposition.


Mr. H. W. Herridge (Kootenay West):: Mr. Speaker, I should like to say a few words on this resolution because on first reading it seems to be quite innocent and something that all of us in this house could support; but I am under the impression that there is more in it than meets the eye.
I have on my desk a copy of "Policy Declarations and Resolutions" of the Canadian Chamber of Commerce. In this booklet, at page 40 I find a paragraph entitled "Efficiency in Government" which reads as follows:
Recognizing the need for solving the problems of government organization and administrative management, the chamber recommends that at an opportune time there be instituted a thorough analysis of government departments and agencies by a royal commission (similar to the Hoover commission in the United States) with a view to making recommendations in the interests of economy and efficiency, and improved service in the transaction of public business.
I am rather in a dilemma, when I hear the Leader of the Opposition refer to the Hoover commission, when I read that that Hoover commission is suggested in this policy statement and when I also see, at the same time, a suggestion that this investigation, so far as efficiency, economy and waste is concerned, would or should result in lower taxation. The whole tenor of the policy statement of the Canadian Chamber of Commerce -and I do not blame the chamber of commerce one bit; the chamber of commerce defends business interests in this country- is that lower taxation will result in lower corporation taxes, and that welfare services have exceeded the limit.
I want to emphasize that we in this group certainly want to see waste and extravagance eliminated from government administration. We have said that repeatedly, and we are all behind the actual wording of this resolution, but we want to be quite certain that this examination into waste and extravagance that may bring some savings does not result in savings to the corporations of Canada but to the lower income groups. I am of the opinion, from what I have heard in this house, that possibly there could be considerable savings-as I have said before, perhaps 10 per cent without any loss in security in the Department of National Defence. But I would prefer to this motion that the government permit Mr. Currie to make a thorough investigation into the whole Department of National Defence. While there must be the usual minor inefficiency here and there, the only other department that I can think of that is outstandingly inefficient, and where we may make some savings, is the restaurant.
I want to make it quite clear that we in this group want inefficiency in government and waste and extravagance eliminated, but while we stand for a lessening of the income tax load on the lower income groups, we believe in higher corporation taxes. I want to make that quite clear to the house. We believe in an excess profits tax.


Mr. Gibson:: Is that unanimous over there?


Herbert Wilfred Herridge: That is the policy of this party.


Mr. Sinnotl:: What about Moose Jaw?


Herbert Wilfred Herridge: We believe in an excess profits tax, particularly on the large profits
2744	HOUSE OF
Government Organization-Proposed Inquiry of big corporations and a capital gains tax where indicated. Let us be frank about this. We from this side of the house urge the elimination of the means test for the blind. Day after day we have appeals asking for increases in payments for old age security. All of us support increases in war veterans' allowances, and are advocating those increases almost daily. There are a good many men and women in this country who badly require those increases at this time.


Mr. Speaker:: I am afraid the debate is getting a little too general.


Herbert Wilfred Herridge: I am giving illustrations of the necessity, from our point of view, of higher corporation taxes.


Mr. Speaker:: I have allowed considerable latitude, but I think the debate is getting a little too general at the moment.


Herbert Wilfred Herridge: Very well; I bow to your ruling. I should like to have brought out a few more things, but we all know what they are. There are all the things that we are advocating which would cause increased government expenditure. We voted for the Saskatchewan dam, which will cost $200 . million. How can you pay for that dam without taxes? Excuse me, Mr. Speaker; I will stop there. I want to emphasize this: the fact is that we cannot continue to advocate these things that are required for the benefit of the Canadian people and to improve our welfare services and do all these things generally to assist various groups, without admitting that we must have taxation to pay for them. And any savings that may be developed through the result of government economies in my opinion should not mean the lowering of corporation taxes, but should be applied to do the things that we continually suggest, and lower taxation for the lower income groups.
In concluding my few remarks, Mr. Speaker, I want to emphasize we believe that the savings that would result from economies in the Department of National Defence, and possibly in other departments, should be applied to do some of the things that this group advocates from day to day, and that we emphasize are necessary. We believe in increased corporation taxes to increase the return to the workers and farmers of this country of a greater amount of their production.


Mr. Speaker:: Is it the pleasure of the house to adopt the motion?


Douglas Charles Abbott: No.


Mr. Speaker:: Those in favour of the motion will please say yea.


Some hon. Members:: Yea.


Mr. Speaker:: Those opposed to this motion will please say nay.


Some hon. Members:: Nay.


Mr. Speaker:: In my opinion the nays
have it.


Mr. McCubbin:: I was paired with the hon. member for Middlesex East (Mr. White). Had I voted I would have voted against the amendment.


Mr. Ross (Souris):: I was paired with the hon. member for Melville (Mr. Gardiner). Had I voted I would have voted for the amendment.


Mr. Johnston:: I was paired with the hon. member for Halton (Mr. Cleaver). Had I voted I would have voted in favour of the amendment.


Mr. Cardiff:: I was paired. I would have voted in favour of the amendment.


Mr. Goode:: I was paired with the hon. member for Medicine Hat (Mr. Wylie).



FREIGHT RATES

Major James William Coldwell: Mr. Speaker, I do not want to delay the business of the house, but had there been an opportunity I would have moved an amendment this afternoon with regard to the announcement made today concerning freight rates. I want to say something on behalf of my constituents particularly who are affected, as are other people who live in the more remote parts of Canada, by this recent announcement of a flat increase in rates to the extent of 7 per cent.
There have been a number of increases in freight rates in recent days. When I raised the matter on the orders of the day today the minister objected or said that this increase was due largely to the recent increases in the wages of the employees of the railway companies. I do not believe that any member of this house desires that the railways should be operated at the expense of any single group in the country, whether they be the people who operate the railways or those who produce the heavy commodities that have to be carried from one end of this' country to the other. The cost of living has gone up and wages have been increased in all fields. The application for increased wages arose out of the economic circumstances in which many of our railway workers found themselves.
Freight Rates
Moreover, the increase in wages was decided after conciliation and negotiations between the employers and the employees. I want to state emphatically that I do not believe that any group of individuals, whether they are workers in industry or users of a service which is essential to the well-being of the country, should be called upon to bear an undue share of the cost of operating that service.
Our railway system in Canada was designed originally to bind this country together. We are bound together by bands of steel. The probability is that but for these railways there would have been no Canada as we know it today. When the fathers of confederation agreed to the building of the first transcontinental railway and the making of large land grants and the guaranteeing of bonds for a number of years they had in mind the binding together of this country that is now Canada.
Consequently I believe that what we require is not a railway policy such as we have had, but a transportation policy. I believe that the recommendations a few years ago of the Turgeon commission were in most respects quite sound. The report of that Turgeon commission recommended a transportation policy. This would apply to our major transportation facilities. I am not talking about small groups of people who run trucks here or there; I refer to the major transportation systems whether they be air or truck or bus or railway. They should all be integrated so that we might get the maximum service for our people at the minimum cost, particularly in connection with the movement of heavy commodities.
After all we in this country are largely dependent upon the movement of bulky and heavy commodities. Lumber is moved across the country from the Pacific coast or from the interior to points within our own country. Coal is moved over great distances. Oil is moved largely by pipe line, but none the less we are dependent upon the transporting of fuel from one end of this country to the other. Since this is a problem that affects the well-being of the whole of Canada, no particular area or group of people should be placed under a disability.
That was the reason for the subsidy to the maritime provinces in connection with coal and so on. That was the reason why this house accepted the recommendation in the Turgeon report that a subsidy of some $7 million be paid for the maintenance of the lines over that great unproductive area of northern Ontario, between Sudbury and Fort William on the Canadian Pacific, a distance of -I am speaking from memory-about 552

Freight Rates
miles, and a comparable distance on the Canadian National. That carried out only in small part the recommendations of the Turgeon commission which recommended that there should be some attempt at the equalization of freight rates. We have not achieved that equalization. These constant increases in freight rates are not imposed equally on the whole of Canada.
We all know that rates in central Canada are generally lower than they are on the prairies, in British Columbia or indeed in the maritime provinces. That is due of course to the competition from water, from truck and otherwise. That part of Canada reaps the benefit of that competition. Either the whole of Canada should benefit from competition, if it were possible to give that kind of competition in all parts, and it is not, or we should have a national transportation policy that would tend to equalize the burden of transportation over all parts of Canada.
These horizontal increases in rates-you understand that they need not be put into effect in areas where there is competition- tend to make the burden heavier on the prairie provinces, British Columbia and the maritime region. Those of us who come from these areas have brought this matter before the house on a number of occasions. This afternoon I asked the minister to use the power under the Railway Act which permits the government to rescind or suspend the order until organizations or governments in the regions affected have had a further opportunity of making representations to the federal government.
After all, the government has power by statute to rescind or to suspend and also to hear representations from those who feel aggrieved. We have noted that farm prices have been falling in the last few months. During the last week what a strange picture we saw in the transportation of steers from Chicago. It was noted in the papers on Saturday that 30 carloads had been bought by Canadian packers for transportation to Toronto and Montreal for sale as Canadian beef. That indicates that the price of that particular commodity has fallen in the United States. I do not blame the packers because under our system of business, as Mr. McLean once said, they buy in the cheapest market, and at the moment Chicago is the cheapest market. But our cattle raisers and our wheat and grain growers, our farmers, generally, have to transport their commodities hundreds of miles to get them to the markets. Hence anything which tends to increase the rates on bulk commodities is bound to impinge more on people who live in the distant areas than on those who live in the more competitive area of central Canada. I
IMr. Coldwell.l
urge the minister this afternoon to consider representations of this sort. I am not doing so, may I say, on behalf of any particular group in the house but because many of us come from regions where the impact of freight rates is felt very seriously indeed by those who sent us to this parliament. In my opinion the excuse that wages have gone up is not an excuse at all because if the government allows the economy to become more and more inflated then no group, as I have said, should be called upon to bear the burden of that inflation.
We should see to it that we go back to the original point of view when the railway system of Canada was first visualized by the fathers of confederation, that it should be a means of building up the country in unity, of building up a country which will enjoy in all parts as great a measure of equality as it is possible to give our people. The Turgeon report had equalization in mind. While I say to the minister that we are very grateful for the subsidy of $7 million that was granted for the 552 miles of line on the C.P.R. and a comparable distance on the C.N.R. over the bridge of northern Ontario, yet that has not equalized the situation.
Every time there has been a flat increase in freight rates of a horizontal nature it has borne more heavily on the people who live in the non-competitive areas or, as I prefer to say, the more remote areas of Canada than upon those who live in the more favoured regions of our country.
May I raise one more point. I have followed very carefully the statements of the representatives of the railway companies before the board of transport commissioners and the Turgeon commission. I have not had time to refresh my memory today, and I am drawing upon it without having had that opportunity; but my recollection is that any examination, for example, of the railway that is looked upon as the yardstick, the Canadian Pacific, reveals that the bulk of its profits arise from movements of commodities in and out of the prairie provinces, in and out of the remote areas of Canada. Before this additional increase is granted I think that the government should hear further representations and bring before the house a transportation policy that will be just to all of Canada and that will not mean again, as happened this afternoon, an attempt to place the responsibility of higher freight rates on one group within our country.
I do not think that any one group, whether they be farmers, workers or whatever they are, should be called upon to bear the results of inflated costs of transportation or of any

other service rendered to the people of Canada. As I said at the outset, I do not intend to prolong my contribution to this discussion, but I wanted to rise at the earliest opportunity and once again express the point of view, at least on behalf of the people who sent me here, that the government owes it to our people to recommend to parliament a transportation policy that will equalize the burden of transportation costs and will maintain Canada as a country bound together by these bands of steel without placing a burden upon any particular group in our society.


James Arthur Ross: Mr. Speaker, I wish to say a word in support of the request made by the hon. member for Rosetown-Biggar (Mr. Coldwell) with respect to the granting of increased freight rates. I do not intend to repeat all the very excellent arguments that he has made on behalf of those provinces which are remote from the central part of Canada, but the most unfortunate pyramiding of increases in freight rates that has taken place in the past few years bears very heavily on one section of the country. As was pointed out, in the central provinces transportation is more competitive because of water haul and highway competition which we do not have in the western provinces. I do not think that the fact that the railways may be losing money on passenger traffic is a legitimate excuse for passing along, as the Minister of Transport (Mr. Chevrier) has said, the full increase in wages by increasing freight rates which are continually pyramiding.
He has referred to the maritimes, British Columbia and the prairie provinces. I believe we in the prairie provinces suffer greater discrimination than any other part of Canada through the repeated increases in freight rates. They are most unfair, and especially at this time when agricultural producers are very fearful about their immediate future. That is not to say that they have not had good times, but the increase in costs of production is still continuing while a decrease is taking place in the value of most of their products. Everything which they must purchase from the manufacturers of central Canada to enable them to produce is always plus freight rates. Everything which they sell, whether it be wheat or other agricultural products, is always sold less freight rates. The producer pays the freight on everything he buys and everything he sells. Without repeating the very excellent arguments put forward by the hon. member for Rosetown-Biggar, I want to make a request to the minister that he rescind this order increasing freight rates until such time as briefs can be received from the various provinces which will suffer to the
Freight Rates
greatest extent by reason of the most unfair situation with which they are now faced.


Mr. E. G. Hansell (Macleod):: Mr. Speaker,
I do not suppose that I can add very much to what has already been said, but I wish to rise to support the request made by the hon. member for Rosetown-Biggar (Mr. Coldwell).
I do so because some of us have recognized for a good many years that western Canada always gets the raw end of the freight rate deal no matter what happens. It seems as though we in the prairie provinces get it coming and going. I agree with the hon. members who have preceded me that there does not seem to be any very definite policy with respect to freight rates as related to the entire cost of living problem that exists in Canada today.
What I rose particularly to call attention to was a return tabled in the house the other day to certain questions asked by the hon. member for Battle River (Mr. Fair). The answers are very significant. I want to read the questions for the record and give the answers as they were submitted by the Minister of Transport and approved by Mr. Hugh Wardrope, assistant chief commissioner of the board of transport commissioners. The first question is as follows:
Since January 1, 1945, how many increases in freight rates have been granted to the Canadian railroads?
The answer to that question is four. I want you to notice, Mr. Speaker, that that is four increases in six or seven years.
Question No. 2 reads as follows:
What percentage in each case, based upon the January, 1945 rates?
This answer reveals a picture. The first increase was one of 21 per cent; the second increase was 20 per cent; the third increase, 17 per cent; and the fourth increase was 9 per cent. The cumulative increase over the six years rolls up to no less than 85-2 per cent. Now, that is quite an increase in that number of years.
The third question was:
What amount, in dollars, did each such increase amount to?
These answers are revealing. The 21 per cent increase gave the railroads an additional $282 million. The second increase of 20 per cent gave the railroads $197,400,000; and the third increase of 17 per cent gave the railroads $86,700,000. The amount is not given for the last increase of 9 per cent, but I expect we could easily work it out. In any event, the first three increases totalled about $566,100,000. That is over half a billion dollars, and that is a lot of money. This was

Freight Rates
not simply income, but was the result of the increases in freight rates.
The fourth question is:
What provinces have borne the heaviest burden as a result of the increases allowed?
This question was not answered; at least it was answered, with the reply that there was no information available. I believe we are all well aware of the fact that railroads cannot be run on a five and ten-cent basis. Railroading in Canada is big business. The railroads have to watch their finances very carefully. They can go broke just as easily as they can make a profit. Sometimes increases or decreases, either in freight rates or business, can mean the difference between showing a balance or going into the red. Nevertheless, I believe that because it is big business, and because it affects generally the cost of living of our Canadian people, the government should have some policy on that matter. In spite of the fact that we may talk of these as good times, they are not good times when it comes to making your dollar stretch far enough to enable you to live.
As I say, railroading is big business. Because it is big business, I believe the government should have some very definite policy which relates freight rates to the cost of living. These freight rate increases over the past few years amounting to over half a billion dollars must be written into the cost of living of the people of Canada. We in this corner, Mr. Speaker, join with previous' speakers in their request, and we do wish the house would give some consideration to the matter.


Mr. J. H. Ferguson (Simcoe North):: certainly join with the representatives from the various western provinces in saying that for years there has been discrimination against the western provinces with regard to freight rates. We must remember, however, that the Liberal cat has been chasing its tail for the last 17 years in this country. We must remember that we must pay the railroad men adequate compensation for the services they render. These men are receiving less money than their cousins to the south for doing identically the same work year in and year out. When we raise wages we must increase revenues. Freight is the greatest source of revenue which the railroads have, so freight rates must be increased whenever salaries are increased.
This is not the only item in the last 17 years upon which this government has fallen down. They have fallen down on everything they should have done during that time. They know that a shortage of population, through lack of planning, is the cause for the high cost of living to a great extent. They know [Mr. Hansell.l
our people are educated on United States literature turned out by the finest advertising mediums the world can find, depicting life in Florida and California, Cadillac cars and other luxuries that are beyond the reach of Canadians.
Why is this? It is because of the small population. If this government had been on its toes during the last 17 years, it would not have sat back and taken all the credit for the natural prosperity which has come to Canada through the energy of private enterprise and the good Lord's kindness to the Dominion of Canada in placing oil, iron and many other natural resources here. Our immigration policy has been a fallacy. This government has always treated the immigration department as a baby that belongs to the family, but they have put people in charge of that baby who have caused it to almost die from malnutrition year in and year out. They never worked in conjunction with the needs of Canada; there has been no definite planning.
It is plain from one year to the other that the government hopes prosperity will continue so they may go back into power. Today the people of Canada are sick and tired of the bureaucratic control and lack of planning which we have in every single department. Through planning this country should have a terrific growth and a much greater development of natural resources-


Mr. Speaker:: Order. The subject before the house is the recent increase in freight rates. If I allow the hon. member to discuss another subject, then the discussion on freight rates could not be resumed.


Julian Harcourt Ferguson: Mr. Speaker, I was only trying to emphasize the fact that these freight rate increases are due to a lack of planning.
I hope that something will be done to see that the burden is not increased, and that there may be some redress for these people to alleviate the burden of the present method of increasing freight rates across Canada.


Lionel Chevrier: The debate which has taken place, and is continuing, is not a new one in this house. We have had many discussions on the subject of freight rates, certainly since I have been in the house and more particularly since I have been in change of the Department of Transport.
This debate has arisen today, and as a general rule arises, because of a judgment of the board of transport commissioners increasing freight rates. When the board declines to hear an application for an increase or when the board dismisses an application, there is rarely a debate in the house. This

was the case when the board recently decided to dismiss an application by the railways to increase rates by a certain percentage. We heard nothing of it, though I must admit that at the time the house was not in session, but it did sit a short time thereafter.
The judgment that was handed down this morning increases the freight rates in Canada by 7 per cent and makes the effective date for the increase March 16, 1953, on a five-day notice. The reason given in the judgment- which unfortunately I have not had time to read in full, but which I shall read in due course-is this, and the house knows what it is. Two major wage increases which raised the operating expenses of the Canadian Pacific Railway and the Canadian National Railways by approximately $104 million during 1952 and, as projected for 1953, bring about this 7 per cent increase.
There is in the minds of certain hon. members some doubt that the government should allow this increase to go into effect; and I think that doubt was raised by the hon. member for Rosetown-Biggar (Mr. Coldwell) who felt that it should be rescinded or should not be allowed to stand. I shall deal with that point a little later on, but I want to remind the hon. gentlemen and the house that a similar situation arose some two or three years ago when the then chief commissioner of the board of transport commissioners decided that, while an application had been made on account of increases in wages of railway employees, he should not at that time grant a proportionate increase in freight rates. The matter was immediately taken by the railways to the Supreme Court of Canada in appeal, and the Supreme Court of Canada directed the board of transport commissioners to give consideration immediately to the application of the railways because of the increase in wages that brought about the application.


Major James William Coldwell: That would not stop the government from exercising its power under the act.


Lionel Chevrier: No. I said I would deal with that point later on. I am dealing now with the position in which the Board of Transport Commissioners for Canada would find itself if it refused to grant this application because of an increase in wages. Immediately the railways again would launch an appeal to the supreme court, and there is a precedent in this respect which the board of transport commissioners would have to follow. The point I am therefore making to the house now is that under the law, as I understand it, the board of transport commissioners would have no alternative but to grant this application
Freight Rates
if it was established that the rate of increase sought is necessary because of the increase in the wages of the employees.
It has been stated in the house that this is not a railway policy matter but that it is a transportation policy matter, and that we should have a transportation policy in this country. In reply, Mr. Speaker, I say that we have a transportation policy in this country, and that we have a good one. Furthermore, we established a royal commission on transportation to consider some of the defects and some of the matters having to do with freight rates and other transportation facilities. These matters were referred to that body several years ago. The house knows that most of the recommendations made by the royal commission were put into effect by the government.
I should like to remind the house what some of those recommendations were because there seems to be a lapse of memory on the part of certain members as to what was done. It is true that the hon. member for Rosetown-Biggar referred to one of these matters, but there were several other matters recommended by the royal commission on transportation and put into effect by the government.
Some of the many adjustments which were made in rates were as follows. First of all, there was the removal of the mountain differential on traffic within, from and to British Columbia. There had been a demand over a long period of years for the removal of that differential so that products from the prairie provinces could move into British Columbia and vice versa. The board of transport commissioners, after having listened to the evidence, decided to remove that differential; and effective July 1, 1949 the prairie level of rates was made applicable throughout western territory. The reductions then made were of benefit chiefly to British Columbia and to the prairie territory immediately east of the Rocky mountains.
The next adjustment in rates was with regard to competitive rates between eastern Canada and the Pacific coast. This came about in 1949 upon resumption of the water service through the Panama canal. On that occasion the rates on many specific commodities were reduced-that was in 1949-and have since then been subjected to numerous adjustments; there have been both reductions and some slight increases.
Then agreed charges on petroleum products in western Canada were brought about because the railways decided to reduce their charges on the movement of those products following applications made to the board of

Freight Rates
transport commissioners, and because of the highway competition which they received from the trucks.
Then we enacted in this house, following the recommendations of the royal commission, section 332B of the Railway Act which brought into effect the one and one-third rule. I think that had a great deal of effect with regard to certain commodities moving into the central parts of western Canada. Then there is section 18 of the 1951 amendment to the Railway Act; that is the subsidy of .?7 million which was voted by this house and which is paid to the railways because of the nature of the territory which traffic moving from east to west must traverse. This was a recommendation of the royal commission on transportation, and I think that statute has been well received.
This 7 per cent increase has many exceptions in its application. There are a large number of commodities to which it does not apply at all. For instance, the increases do not apply to grain and grain products governed by the Crowsnest statute, nor to such commodities from prairie points to the Pacific coast ports for export. A large proportion of the traffic which moves in western Canada is covered by that exception. Similarly I doubt if any increase was authorized in general cases in respect of grain and grain products moving locally within western Canada and not subject to the Crowsnest rates. Competitive rates and agreed charges are exceptions. International rates, import and export rates, again are excepted from the operation of this judgment. There are also other minor exceptions which are made to its application.
Just as do the hon. member for Rosetown-Biggar and other members of this house, I realize that an increase of this kind is bound to have an inflationary effect on the cost of living. Unquestionably that is so; and I agree with his apprehension in that respect. But what other alternative is there? Parliament has established the board of -transport commissioners to deal with this question. The board of transport commissioners is the only body authorized by parliament to consider the question of freight rates. It deals with it after exhaustive investigation, assisted by counsel from all of the provinces except Ontario and Quebec, and by experts from the board, accountants, traffic men and the like.
Neither my hon. friend nor any other hon. member has submitted an alternative. One hon. member suggested that the government should have some definite policy which relates freight rates to the cost of living. But 
the Railway Act governs the manner in which this shall be done, and the Railway Act has made clear in certain of its sections that upon application by the railway association of Canada, or by other railways of Canada, the board of transport commissioners shall hear and determine what the rates for certain commodities shall be.
That is the procedure which we ourselves have authorized. That is the transportation policy, and only recently we submitted this whole policy to a royal commission on transportation. That royal commission agreed that the method which was being followed was the right one, but suggested certain amendments that might be made, and we have put those amendments into effect for the most part.
One of the amendments recommended that there should be an equalization of freight rates across Canada. Unfortunately it has not been possible to put that recommendation into effect. What the board of transport commissioners is doing now, as the house knows, is conducting an investigation under P.C. 1487. They have begun that investigation, or at least are about to begin it in western Canada, dealing with a formula which is to become effective on January 1, 1954, I believe. They are inviting representations from all the provinces. I understand that they will sit in the capital of each province to hear representations in so far as this new plan or new formula is -concerned.
It is unfortunate that that plan and formula were not completed before this increase in freight rates went into effect, but I cannot see how the board would have any other alternative -but to grant the request of the railways, in view of the position in which the railways find themselves. The only other method would be to vote hundreds of millions of dollars in this house, and I do not think that would be the proper procedure.
I said that before I resumed my seat I would deal with the suggestion made by my hon. friend as to the rescinding of this order.
I do not think the government should rescind this order. Certainly I, as the minister, have no power so to do. The procedure is quite clear under the Railway Act. By virtue of section 52 of the Railway Act the provinces -and I am not too sure whether the section does not refer to other groups who feel that they are aggrieved-but certainly the provinces or other parties to the judgment that has been handed down have the right to appeal to the governor in council. There is a form of appeal which is made to the governor in council, setting out the reasons why the judgment should be set aside. If that appeal is made under the formula established

by virtue of section 52 of the Railway Act the government will of course hear it.
Therefore my answer to my hon. friend is that I have no authority as minister to rescind, do away with or set aside the order which the board has made today. But if the provinces, as they have a perfect right to do, proceed under section 52, I can give my hon. friend and the house the assurance that their application, as have other applications in the past, will receive the attention of the government. I do not know that I can add any more than what I have said at this moment.
Some mention has been made of the number of increases and their effect. Compared with other countries Canada is doing pretty well, I would say, in so far as increases in freight rates are concerned. The hon. member for Macleod (Mr. Hansell) stated that there had been an 85 per cent increase in freight rates since 1947 or 1948. Well, the increase in the United Kingdom is higher than that, and the 85 per cent figure compares favourably with that of the United States. As a rule, freight rates in Canada have been slightly lower than freight rates in the United States and slightly higher than rates in the United Kingdom. As it is now, I believe our position is that our rates are slightly lower than those in the United Kingdom and compare favourably with those in the United States. Therefore, on the whole, if we compare our rates with other countries that have conditions similar to ours I do not think we will find that the comparison is at all out of line.
Consequently I find myself in the position of not being able to accept the suggestion of my hon. friend; but I repeat that if an application is made in the usual way it will receive the attention of the government.


Solon Earl Low: I want to assure you, Mr. Speaker, that I will not detain the house long, but I do want to say a word and join in the protest against the 7 per cent freight rate increase that was granted by the board's decision today.
I listened very attentively to what the minister had to say, and as usual I found that he took a pretty sound position. But there is one thing the minister did not consider, and it is because he did not consider it that I thought it might be wise for me to enter the debate just briefly.
The minister said there is some doubt that the government should allow the board's ruling to go into effect. I believe that is quite correct. Under the circumstances the government-and I shall show later on what circumstances I mean-should not have allowed the board's ruling to go into effect,
<18108-175
Freight Rates
and that is in spite of the exceptions which the minister cited in the board's judgment that was handed down today. He mentioned grain. Of course we know that the board's ruling could not apply to grain because that comes under the Crowsnest agreements which are not subject to the board's rulings.
He mentioned a few other things; but in spite of these exceptions I still say that the minister should not allow the board's ruling to go into effect. I shall tell you why. In the hearing that was completed a short while ago, the yardstick company, the Canadian Pacific Railway, represented the views of both railways; but they took as the yardstick their own requirements. The Canadian Pacific Railway asked the board for a new formula. They asked for the income formula rather than the old requirements formula, according to which rates would be struck in the future. If the board had been foolish enough to grant a new formula, based on a guaranteed income to the railways, then I say that there would be a lot more room for playing around with rates than there has been in the past. I am very glad that, thus far, that old requirements formula has not been changed. It simply means that the rates are struck or allowed by the board according to the requirements of the railways.
About the biggest item connected with the request for the increase in rates at this time was that of increased wages. But wages are not the only things that enter into railway expenses. The expenditures of railways are partly controllable and partly non-controllable. I would say that, to a degree, wages are pretty nearly uncontrollable at the present time, with employment in Canada remaining almost at the full employment level.
That is quite correct. But I would point out to the minister that there are many railway expenditures which are controllable. It is well known that when we have a good year and I have noticed this particularly in my own experience in the west-the railways invariably put a new coat of paint on the railway stations, even though there may be half an inch of paint on them already.
I have noticed that in those good years they also put a new coat of whitewash on the stockyards and, particularly in these days, they shop around for the latest type of diesel locomotive. There is plenty of opportunity to curtail expenditures in connection with controllable items; and there are plenty that are controllable.
If the board had said to the Canadian Pacific Railway, the yardstick company, "Now, go back and do some homework. Then

Freight Rates
come back here in, six months and show us where you have trimmed some of your expenditures in the controllable division", the situation would be somewhat different. The board could have said, "You can call it deferred maintenance, if you like; but you should cut back on some of your controllable expenditures. After doing that, show us your requirements, and we might be inclined to be a little more lenient with you."
But unless the Canadian Pacific was prepared to do that sort of thing, unless the railway was prepared to do some paring of its controllable expenditures, then I think the board was very wrong in allowing the 7 per cent increase. It would seem that the board has been too easy. Either that, or I must conclude that it has not the machinery with which to investigate thoroughly what railway requirements are. It is perfectly clear that the board did not say to the railways, "Go back and see where you can trim expenditures." No, not at all; it gave the railways a blank cheque: "Seven per cent you have asked for; seven per cent it is."
No one can tell me that the Canadian Pacific Railway, the yardstick company, with its expenses in maintaining right of way and equipment running to about $400 million a year, could not have found some places to have trimmed those expenses. And it did not have to be off wages, either. It is because the board did not require the railways to attempt to trim their controllable expenditures that I think it was wrong in allowing the increase. I say the alternative the minister asks for is right there, in asking the railway companies to take back their statement of requirements and to do some paring.
I am satisfied they could have made a good showing. The railway companies might reply to the board, "If we do that we may be impairing safety on our railways, and we do not want to jeopardize life and property". I certainly agree with that point of view; I would not want to see railway expenditures cut to the point where life and property were jeopardized. I would want to see safety measures maintained at as high a level as possible. But when the board grants virtually a blank cheque and does not ask the railway company in question to see wherein it can trim its controllable expenditures, then I for one cannot help feeling that the board has been too easy.


Lionel Chevrier: I do not wish to interrupt the hon. member, but may I make one observation?


Solon Earl Low: Yes.


Lionel Chevrier: As the hon. member knows, the board dismissed an application for an
TMr. Low.]
8 per cent increase made by the railways. So when he says the board is not scrutinizing railway expenditures carefully, or is granting a blank cheque, I think he is not being quite fair to the board.


Solon Earl Low: The minister of course is closer to the board than any of us, and I am making my statement only on the information I have. However, I have tried to keep in close touch with what has been going on, and I know the statement of expenses presented to the board by the Canadian Pacific Railway was in the neighbourhood of $400 million a year. They based their application for the 7 per cent that has been granted upon the anticipation that their wages bill is going to be increased and that the 7 per cent will be required to take care of that increase. My complaint is that the board did not ask the railway to take that bill of $400 million for expenses and trim back the controllable section of it.
As I have already said, there are many items upon which the railways do not have to spend in a particular year, necessarily. With the rest of us, they must look forward to a time when it may be possible to bring down the cost of living. Surely if they are interested in keeping the cost of living from going higher, particularly at a time when farm income is declining seriously, they would not object to taking back their request, trimming it, and then coming to the board at a later time with a revised figure.
I know the railways say, "Well, this business of trying to trim down our expenditures simply means that we defer maintenance", and they add that deferred maintenance may endanger life and property. But I do not think it needs to endanger life and property, because there are certain fields where they can cut down measurably without impairing efficiency in any way whatever.
I feel that those who have taken strong exception to the granting of this 7 per cent increase are standing on sound ground because last year, according to the dominion bureau of statistics, our farmers had to suffer a 19 per cent decrease in their wholesale price index. This simply means that farmers' incomes declined seriously last year. Yet they are asked to meet increased costs of equipment and freight rates, thus narrowing their margin of profit to a point where they will not be able to stay in business.
I would like to see something done to enable the farmer to stay in business, because he is the backbone, the strength of this country, and it is on his behalf mainly that I rose in my place today to protest.


Mr. Clarence Gillis (Cape Breton South):: Mr. Speaker, I rise only to pose a question to the minister, so that he may answer it later. I am going to state my question to the minister because I see he wants to leave. Is there a possibility of having a stay of execution of this decision until the committee provided for on the order paper is set up and has examined the accounts of the Canadian National Railways and formed an opinion as to whether the increase now asked for is justified? When the minister returns he can answer that question, as I am going to say a few words.


Lionel Chevrier: I can answer it now if my hon. friend will allow me to do so. The answer is no. The application for reconsideration should be made under section 52 of the Railway Act, as I stated earlier. The procedure is set out therein, and the matter is dealt with by the governor in council.


Clarence Gillis: I am not going to go into the ramifications of freight rates because that would entail a long story. I think the railroads are smart when they base their application on the need to meet their wage bills which have risen because of demands on the part of the railway workers for increases in wages. There is a certain psychological effect in that. Members of the house will say if it is to pay wages, we are in agreement with it.
In my opinion that is a false argument. I do not think the real reason for asking for increased freight rates is the increases in wages asked for by the railway workers. When he was speaking the minister stated that it would be necessary for the Canadian National Railways to raise $104 million for wages. I do not think the wage increases constitute a reason why the Canadian National wants increased freight rates. When the committee is able to sit down with Mr. Gordon and his officials and take a look at their operations over the past year I think they are going to find that the real reason is the modernization that has been carried out, particularly the dieselization of the Canadian National almost from coast to coast. I think the Canadian National were shortsighted and in too much of a hurry in putting diesels into operation on the section from Montreal to Mulgrave in Nova Scotia.
I say that advisedly because, as the minister knows, there is a coal-burning turbine engine almost completed. It is expected that when it gets into operation it will make the diesel obsolete, because it will cut the cost of operation to about one-fifth of the present cost. When we were examining the accounts of the Canadian National last year 68108-1751
Freight Rates
I asked Mr. Gordon if it would not be feasible to delay the dieselization on that end of the line until such time as the experiments with the coal-burning turbine engine were completed. I did not get a definite answer one way or another, but the dieselization is completed right through to Mulgrave, Nova Scotia. The chances are that this turbine will revolutionize transportation over the whole system from coast to coast.
I think if we have a chance to sit down to examine the accounts of the Canadian National, and those of the Canadian Pacific if necessary, we will find that the argument that the wage increases justify these freight rate increases does not hold up. I agree with the hon. member for Peace River (Mr. Low) that in an operation like the Canadian National or the Canadian Pacific the economic experts could sit down and trim their sails in many directions and find the necessary money to meet their wage bills without asking for a flat increase right across the board.


Solon Earl Low: Within $400 million.


Clarence Gillis: They have $400 million to play with. The figures put on the record this afternoon by the hon. member for Macleod (Mr. Hansell) were rather revealing. This 7 per cent increase will bring the total increases in the last few years up to 92 per cent.


Lionel Chevrier: Eighty-five per cent.


Clarence Gillis: Plus this 7 per cent they are asking for now. The hon. member for Macleod indicated four increases which totalled 85 per cent, and this 7 per cent will bring it to 92 per cent. I think there has to be an end to this passing on to the consumer of all the costs of industry and railroads and so forth, expecting him to just take it lying down.


Lionel Chevrier: If there is to be an end, can the hon. member suggest how that end is going to be reached?


Clarence Gillis: I say the minister has a motion on the order paper to set up a committee to examine the accounts of the Canadian National. The officials of the railroads could be brought before that committee. The committee could examine the accounts and find out whether this increase is justified, and we could ask for a stay of execution of this judgment until the committee had a chance to make that examination.


Lionel Chevrier: The committee has certain rights and powers as set out in the motion now on the order paper, that is to deal with the accounts and the budget of the Canadian National Railways, T.C.A. and so forth. It has no right to deal with freight

Freight Rates
rates. A tribunal has been established to deal with freight rates, the board of transport commissioners. Parliament has determined that. Back in the time of confederation freight rates were dealt with by a committee, but that right was taken away and given to the board of transport commissioners.


Clarence Gillis: I am not suggesting that we should deal with freight rates at all. The basis of the application of the railways is that this increase in freight rates is required to meet their wage bills. I am not suggesting that we should deal with freight rates in the committee. I am suggesting that the minister ask the board of transport commissioners not to put this increase into effect until the committee has had a chance to examine the accounts of the Canadian National Railways; to do its ordinary job.
After that examination has been made we may find out that the Canadian National Railways and the Canadian Pacific do not require this increase in order to meet their wage bills and other commitments. The committee will be merely doing its job in getting evidence as to whether or not this increase is necessary, without interfering with freight rates at all. I think that is a reasonable request. The committee could be set up tomorrow if the minister so desired, and we could have Mr. Gordon come here.
This is an election year. If the Conservatives were planning the strategy of the election I do not think they could do any better than some of these bodies that are working behind you. In the last few months a number of bad issues have been raised by creatures of the government. I think what I am asking the minister to do is quite reasonable. This committee has a function to perform, to find out whether the money is being spent wisely.
I do not believe that the wage bill is a problem at all. As far as the Canadian National is concerned, I believe they have wasted a lot of money in the dieselization of the line east of Montreal without waiting to see whether the coal-burning turbine engine would be better. According to the information I have received from men who have looked at that engine, in a few months time it is going to make the diesel obsolete. I think we were reasonable last year when we asked Mr. Gordon to delay the installations on the eastern end of the line. That should have been done, but it was not.
I am not asking the minister to give the committee the right to handle freight rates, but I think it is reasonable to ask that the committee be set up as soon as possible and that there should be an extension of the date when this increase becomes applicable so the
[Mr. Chevrier.'J
committee may determine whether this increase is justified at this time.


Alfred Johnson Brooks: Mr. Speaker, I am not going to make any extensive remarks on freight rates. I have spoken on the subject before; but I felt that I should say a few words today for fear the house might think that my own province was not protesting this increase.
As the hon. member who has just taken his seat has said, to go into the history of freight rates in Canada would take a very long time. I think all members know the great problem that freight rates have been for the maritime provinces since the very first day they entered confederation. As a matter of fact freight rates were one of the problems which were supposed to be solved after we entered confederation, and the inducement held out to us to enter confederation was that the problem would be solved. Needless to say, it has not yet been solved.
I feel that the burden of increases in freight rates will bear more heavily on the maritime provinces than any other part of Canada, and I say that on the basis of facts that we know. So far as Ontario and Quebec are concerned, when railway freight rates are increased then freight can be and is carried by trucks. Short hauls are involved, and trucks can carry the freight if the people believe that railway freight rates have been increased too much. The minister has just told us that in western Canada, for instance, there has been no increase as far as grain is concerned. We all know that grain for export constitutes 75 or 80 per cent of the freight carried in western Canada; but I did not hear the minister say that potatoes or any of the other products of the maritime provinces would be treated in the same manner. It is for this reason that I claim that the increase in freight rates is going to bear more unjustly on the freight shippers of the maritime provinces than on shippers of freight in any other part of Canada.
As I said at the outset, one could discuss this problem at great length, but it is not my intention to make a prolonged speech this afternoon. Nevertheless I feel the time is coming when the problem will have to be solved in some other way than the almost annual increases in freight rates that have been put into effect in recent years under one excuse or another. If freight rates continue to increase, it is going to mean that certain sections of Canada are not going to be able to trade in any way at all in the central markets of the country. As my desk-mate, the hon. member for Cumberland (Mr. MARCH 9, 1953
Black) says, the increases are pyramided. As was brought out this afternoon, freight rates have been increased 92 per cent in the last few years, and if they are increased again it will not be an increase of 7 per cent on 100 per cent but 7 per cent on 185 per cent. So far as the trade of this country is concerned, this is a state of affairs which I do not think can go on very much longer.


Mr. H. R. Argue (Assiniboia):: Mr. Speaker, I should like to associate myself with others who have protested the 7 per cent increase in freight rates that has been allowed by the board of transport commissioners.
The Minister of Transport (Mr. Chevrier) has made the statement that Canadian freight rates compare favourably with those in the United States. He has said that freight rates have gone up 85 per cent, but I want to point out that, with the 7 per cent increase granted today, Canadian freight rates are now 98 per cent higher than they were five years ago, in 1948. One of the reasons why I think members are protesting the 7 per cent increase is the fact that it is not likely to be the last one. If the railway should get the 9 per cent increase in freight rates for which they are now asking it will mean a cumulative increase of 116 per cent in freight rates since April, 1948.
Certainly freight rate increases of that magnitude are going to have most serious effects on the prairies and the maritime provinces. The minister has said there is nothing else that the board of transport commissioners could have done. He said they were faced with an increase in wage rates, and that the board had no alternative under the law in dealing with this case because otherwise its decision would have been referred to the supreme court. I think the minister's statement is not entirely correct.


Lionel Chevrier: It is.


Hazen Robert Argue: Let me point out to the
minister that, so far as the appeal to the supreme court in the 20 per cent case is concerned, the board of transport commissioners had allowed the railways an interim 8 per cent. Then they said that before they finally settled the 20 per cent application they had certain other things they wanted to do, and they wanted to make a certain study. The supreme court ruled that in dealing with any given application the board of transport commissioners had to deal with the whole of it and that they could not deal with it piecemeal and a step at a time. Therefore I say it follows that under the law the board of transport commissioners did not need to grant the 7 per cent. All that the ruling of the supreme court requires the
Freight Rates
board to do is deal with the application for a 7 per cent increase either by granting it in whole or in part or, as the minister has said with reference to some previous application, throwing it out altogether.


Lionel Chevrier: May I interrupt my hon.
friend to say to him that the effect of the supreme court judgment in the case to which I referred earlier and to which he refers is that when there is an increase in wages it follows that there must be a consequent increase in freight rates. That was the effect of the judgment of the Supreme Court of Canada in that earlier case. That is why I stated that if the board had not granted the increase this time an appeal could have been launched, and I am sure that precedent would have been used against the board.


Hazen Robert Argue: I do not think the minister has refuted what I have said. The board of transport commissioners is required to deal with the application in the light of the increase in wage rates and may consider any other factors that have arisen in the meantime. Certainly the board of transport commissioners was not obliged to grant the whole 7 per cent. They could have granted a part of it. If the board of transport commissioners is required to increase freight rates automatically by the amount of the wage increase, then why have the board of transport commissioners dealt with the matter? You might just as well have a formula and have the increase come into effect automatically.


Lionel Chevrier: It is required, provided it is established by the evidence that there is a necessity for the increase.


Hazen Robert Argue: That is it, if there is a
necessity for the increase. The board of transport commissioners must take into account the increase in wage rates, the price of materials, the cost of railway operations, changes in the debt position of the railways and any and all other factors that may enter into the making of a decision on the basis of a fair and reasonable rate adjustment. I say that the board did have an alternative, and that they did not give sufficient weight to certain other factors.
I noticed that it was pointed out in evidence given before the board that the Canadian Pacific Railway increased its maintenance expenditure from $48 million to $197 million. Its maintenance costs have increased by four times. Just by mentioning these figures indicating the terrific increase in maintenance costs of the Canadian Pacific in the last few years, I think it is clear that there is something else that enters into the

Freight Rates
$197 million, other than the increase in maintenance costs. Out of that figure which they say is the increase in maintenance costs the railways can do a lot of things that in the final analysis are capital improvements.
Another thing which I feel the board has not dealt with adequately is the fact that the Canadian Pacific has many subsidiary companies in other fields of endeavour that are very profitable indeed. The Canadian Pacific takes this position. It comes before the board of transport commissioners and says, "We want a certain return on our railway operations." Then from time to time the Canadian Pacific wants to take money out of its profits and invest in such things as air lines, trucking organizations, pipe lines and so forth. The Canadian Pacific says to the board of transport commissioners and the freight users in Canada, "You must not consider these other competitive things in which we engage; you must give us a reasonable profit on our railway operations alone." Immediately that is done, then the Canadian Pacific starts competing with itself and reduces the railway profits. As soon as these air lines have been successful in competing with the railroad, or when the trucking business has been successful in taking freight away from the railroad and the Canadian Pacific profits are down, then back they go before the board of transport commissioners requesting another increase in freight rates.
If the Canadian Pacific were successful in hauling all its passengers by plane instead of on the railroad, and in handling half of its freight by trucks, then the company would be in that much better position because it would be back to get higher freight rates on the traffic that still goes by rail. I say, therefore, that it is not right for the board of transport commissioners to refuse to consider the Canadian Pacific as a corporate entity but instead to divide it into two entities, one the railway operation and the other these subsidiary businesses of the Canadian Pacific.
Of course the public of Canada have a real stake in the Canadian Pacific Railway. Early in the history of this nation 25 million acres of land and $25 million in straight subsidies were granted to the C.P.R. Through government subsidies and railway profits the Canadian Pacific has been able to undertake many other businesses. But when the Canadian Pacific makes a profit on its mining business, its trucking business or its pipe-line business, it goes before the board of transport commissioners and say, "You must not consider in any way these other profits we are making; you have to provide us with

freight rates that will give an adequate return on our rail operations."
I say that until this problem is dealt with we are going to have further increases in freight rates. The thing I am most afraid of is that the board of transport commissioners may give the Canadian Pacific a rate-base formula. If it does that, of course no real control over freight rates will be possible. If the Canadian Pacific should ever be granted the rate base it is now requesting, the result will be disastrous for the prairies and the maritimes.
I say, Mr. Speaker, that the board of transport commissioners has an alternative. The government should not be afraid of subsidizing the railroads if that should be necessary in order to give equitable freight rates to people in all parts of Canada. The government is prepared to build the St. Lawrence seaway which is going to provide lower freight rates for the people in eastern Canada. I do not think the government can fold its arms and allow the board of transport commissioners to go on granting one increase in freight rates after another, without taking into account the very serious economic consequences to the people in the prairie provinces and the maritimes.


Mr. W. J. Browne (St. John's West):: I know, Mr. Speaker, that this is probably the only opportunity we shall have in the house to mention freight rates, since the committee that is being appointed will deal with the accounts of the Canadian National Railways. I think today we are under a handicap because even the minister has not read the judgment, so we are more or less talking on the principle of freight rates.
According to the minister, there does not appear to be much we can do about the judgment rendered by the board. I feel that I should, however, on behalf of the people of Newfoundland, make a protest against the freight rates which, even before this judgment, were the subject of complaint.
Before confederation with Canada we were told that the cost of living was going to be brought down. People were not aware that many articles were subsidized, and even railway rates were very low. Now the railway rates are up by 98 per cent, according to the previous speaker, and that is going to have quite an effect upon the cost of living in Newfoundland, which is so far away from its chief source of supply. We have a new industrial program started by the provincial government which necessitates the importation of goods upon which high freight rates are charged. If the manufacturers want to market the goods up here, they have to pay the same high rates going back.

I have in my hand an article dated February 6, 1953, which appeared in the St. John's Daily News, in which examples are given of the effects of these increased rates on the cost of living. For instance onions, an item in general use, cost $2.30 a 50-pound sack in Toronto. In 1949 the freight charge was 48 cents, and today that has gone up to 82 cents. The freight now amounts to 38 per cent of the cost of the onions, and that is an increase in the cost of living. The same thing applies to an article like pork and beans. It must be remembered that these things come from Ontario, which is the chief centre for the manufacture of these canned goods. The freight to St. John's on a case of pork and beans weighing 40 pounds is now 19 per cent instead of 11 i per cent.
There is one other feature about which I think something might be done, and that is in connection with the comparison between water rates and railway rates. The complaint amongst importers in Newfoundland is that when railway rates go up the steamship companies put up their rates as well. This practice has been carried on to such an extent that at the present time it costs only about half as much to bring an article from Liverpool to St. John's, a distance of over 1,800 miles, as it does to bring an article from Montreal to St. John's, a much shorter distance. I believe the minister might make some investigation into these exorbitant charges which the steamship companies seem to be putting on freight coming from Montreal to St. John's. From personal experience I know that the rates from Halifax are up to a similar extent. They charge almost as much to bring certain goods from Halifax to St. John's as they do from Montreal to St. John's.
I can, therefore, only join with members from the maritime provinces in making this protest against the high freight rates which are affecting the cost of living in Newfoundland, just as in the other maritime provinces. This increase will affect us more because the 7 per cent will be on rates which are much higher from the central provinces to Newfoundland than they are to the maritime provinces.


Charles Edward Johnston: Mr. Speaker, I do not want to detain the house too long on this matter, but I think it is of sufficient importance that I should say a word or two about it, particularly in view of the fact that it affects those of us who live in western Canada. I am not unmindful of the fact that these increased rates are going to have a serious effect on other parts of Canada as well. The parts of Canada that seem to get off most lightly are Ontario and
Freight Rates
Quebec. That is one of the reasons they were not concerned about presenting their case to the royal commission when it was sitting.
It would not be so bad, Mr. Speaker, if this 7 per cent increase was the only increase. As has been pointed out by other speakers, there have been continuous increases, until we have reached the point where those of us who live in western Canada are feeling the pinch.
Then when this 7 per cent has been settled, as it has been now, there is another 9 per cent pending. As soon as that other 9 per cent is out of the way-and no doubt the railways will have an increase again granted to them-then there will come the question of the increase in freight rates because the St. Lawrence seaway project will have been completed. As the minister pointed out the other day in the railway committee room when the labour advisory council was sitting and discussing the question of railway rates, the competitive area would then be increased and would take in the maritimes. That is going to be all right for the maritimes, Mr. Speaker-and I hope they get some relief from this continual increase in freight rates-but it is again going to put us in western Canada in an extremely bad position because we are going to be included in that area of noncompetitive rates. Hence we are greatly concerned about this matter.
The minister says the proper procedure would be for the provinces to make their presentations when the board of transport commissioners is having its sittings in the various capitals of those provinces. But, Mr. Speaker, that procedure seems to be somewhat useless, because the provinces have continually protested these constant increases in freight rates, and where have we got? On the one occasion the minister pointed out when the board had refused to increase the increase, that was not exactly a refusal. It was merely a postponement until a little later on, and then the increase was granted. So we in the western part of Canada are continually being called upon to pay this additional increase.


Lionel Chevrier: I do not want to interrupt
my hon. friend, but may I say that there was a definite application on July 15 for a 7 per cent increase which was dismissed by the board. That was not a suspension or a postponement; it was an actual dismissal.


Charles Edward Johnston: I accept what the minister says, Mr. Speaker. But while that application was dismissed, this other application for a 7 per cent increase comes up and they are granted it; and now there is another 9

Freight Rates
per cent increase pending, I think. What is going to be the result? History has proven that eventually the railways will get what they are asking for.
I think the minister is missing the big point in this question which the hon. member for Peace River (Mr. Low) pointed out a moment ago. If the railways need an increase, they need an increase. But surely there are other ways by which they could pare their expenditures. One of the things I am complaining about at this time is this. When the railways are given an increase, why should certain sections of the country bear the main portion of that increase?


Solon Earl Low: That is the point.


Charles Edward Johnston: Not so long ago a return
asked for by the hon. member for Battle River (Mr. Fair) was brought down in the house, and it is not the one that was put on the record a moment ago. It is a statement showing freight rates on various commodities from Toronto, Ontario to Winnipeg, Manitoba; Regina, Saskatchewan; Edmonton, Alberta; and Vancouver, British Columbia, in effect on the 1st of February, 1945, 1950 and 1953.
This statement shows that from Toronto, Ontario to Edmonton, Alberta, on boots and shoes, in less than carload lots, the rate was $4.53 in 1945, $5.92 in 1950 and $8.12 in 1953. It is no wonder that out in western Canada we have to pay so much higher prices than are paid down in central Canada. Then in carload lots, minimum weight 20,000 pounds, the rate to Edmonton was $3.03 in 1945; it was $3.98 in 1950, and on February 1, 1953 it is $5.41. It is getting to the point where we cannot afford to ride, we have to walk; and now we are being soaked for the shoes to walk in.
The rates are shown for blankets, but I will not give those. Let me take the rates for nails, iron or steel, they being things which are highly necessary out in the western part of this country. For less than carload lots, the rate to Edmonton was $2.33 in 1945; it was $3.05 in 1950 and is now $4.14. In carload lots, minimum weight
36,000	pounds, to Edmonton the rate in 1945 was $1.98; in 1950 it was $2.59 and in 1953 it is $3.52. On canned goods, less than carload lots, to Edmonton the rate in 1945 was $3.03; in 1950 it was $3.96 and in 1953 it is $5.41. In carloads, minimum weight 24,000 pounds, the rate to Edmonton in 1945 was $1.98; in 1950 it was $2.59 and in 1953, $3.52. Let us take the rate on barbed wire, which is extensively used out in the west. For less than carload lots, the rate in 1945 was $2.33; in 1950 it was $3.05 and in 1953 it is $4.14. On carloads, minimum weight

36,000	pounds, to Edmonton the rate in 1945 was $1.98; in 1950 it was $2.59 and in 1953 it is $3.52.


An hon. Member:: More than double.


Charles Edward Johnston: It is almost double. Then let us take the rate on farm implements -I am skipping a great many-such as binders, harvesters, mowers and so on. For less than carload lots, to Edmonton the rate was $3.76 in 1945; in 1950 it was $4.91 and in 1953 it is $6.74. In carload lots, minimum weight 24,000 pounds, to Edmonton the rate in 1945 was $1,634; in 1950 it was $2.14 and in 1953 it is $3.17. Then let us look at the rate on passenger automobiles. For less than carload lots actual weight subject to a minimum of 5,000 pounds each, to Edmonton the rate in 1945 was $4.53; in 1950 it was $5.92 and in 1953 it is $8.12. For carload lots, minimum weight 10,000 pounds, to Edmonton the rate in 1945 was $4.53; in 1950 it was $5.92 and in 1953 it is $6.17.
This clearly shows that these rates are going up in such proportions that we in western Canada, and those in the maritimes as well, are greatly concerned over this continual increase in freight rates.
The minister, when he was speaking a moment ago, said that some of these rates were not affected, that there had been some endeavour to alleviate this condition in western Canada, and he spoke of agreed charges. But, Mr. Speaker, the railways, under their agreed charges on petroleum products, are now hauling that stuff at what is generally considered to be away below cost. What for? To gain revenue? Not at all. They are doing that under the agreed charges in order to eliminate competition from the trucking industry. I do not profess to be a lawyer, Mr. Speaker, but if I am not mistaken that procedure is illegal. I think it is against the law for the railways to haul any commodity at a loss. Yet they are hauling petroleum at ridiculously low rates in order to eliminate the only effective competition that we have out in western Canada.
As the hon. member for Assiniboia (Mr. Argue) said a moment ago, possibly the alternative is subsidization. I do not know; but I would say that if something has to be done, it should be subsidization rather than discrimination. The way the government's policy is working now is this. It is making those of us in the outlying areas, those any distance from central Ontario and Quebec, pay the shot. I think the government should halt this increase. I do not know what the legal procedure would be, or whether it could be done at the moment; but certainly the government should take some steps to

see to it that there is greater equality for the people of Canada in bearing this tremendous burden of increased freight rates.
Motion agreed to and the house went into committee, Mr. Robinson in the chair.



DEPARTMENT OF CITIZENSHIP AND IMMIGRATION

[Stage Direction]
57. Departmental administration, $280,729.
Item stands.
DEPARTMENT OF FISHERIES General services-
131. Departmental administration, $298,800.
Alphonse Fournier: Stand.
Item stands.
DEPARTMENT OF TRADE AND COMMERCE General administration-
426. Departmental administration, $588,333.


Alphonse Fournier: Stand.
Item stands.
Progress reported.



THE BUDGET


[Stage Direction]
The house resumed, from Friday, March 6, consideration of the motion of Hon. Douglas Abbott (Minister of Finance) that Mr. Speaker do now leave the chair for the house to go into committee of ways and means, and the amendment thereto of Mr. Macdonneil (Greenwood), and the amendment to the amendment of Mr. Coldwell.
Mr. R. J. Wood (Norquay):: Mr. Speaker, on Friday night at ten o'clock I was giving a summary of the conclusions and recommendations of a special committee that was set up in this house in 1936 to investigate farm implement prices. On January 1, 1936, the tariffs on imports of all agricultural machinery were reduced to 12J per cent; on May 1 of the same year, under the United States trade agreement, they were reduced to 7) per cent, and on June 26, 1944, all tariff rates, including the general rate, were cancelled on agricultural implements. I consider that the reduction and the wiping out of these tariffs were entirely the result
The Budget-Mr. Wood of the conclusions and recommendations of the committee that was set up in this house in 1936.
There are people who say that the tariff and trade policies of the Liberal party and the Conservative party are the same. I consider there is no element of truth in this statement. I have before me a statement which I received on March 4 from the commissioner of tariffs in the Department of Finance, showing the Canadian tariff structure on farm implements from various countries during the years 1921, 1924, 1930, 1931 and 1933. The tariff rates on all classes of implements were increased in the budgets of 1930, 1931 and 1933, but the British preferential remained free on all articles.
Probably hon. members do not care to have me read this statement in detail, and it would save the time of the house if I were permitted to have it placed in Hansard.


The Acting Speaker (Mr. Robinson):: Has the hon. member leave to have this document printed in Hansard?


Some hon. Members:: Agreed.


William Joseph Browne: The other night we had a discussion along similar lines and the hon. member for Assiniboia (Mr. Argue) was not permitted to have his statement included. We do not know what this statement contains. The hon. member might give us some idea of what is in it.


Robert James Wood: If I am permitted to place it in Hansard you will see what it contains. It contains the rate structure on farm implements. I will give you a list of them. They are: plows and complete parts; seed drills and complete parts; horse rakes and complete parts; harvesters, self-binding or not, and complete parts; reapers and complete parts. I can give you the list of farm implements. It shows the tariff rates since 1921.


Some hon. Members:: Agreed.


The Acting Speaker (Mr. Robinson):: Agreed.


Robert James Wood: The table follows:



CANADIAN TARIFF CHANGES ON AGRICULTURAL MACHINERY

[Stage Direction]
July 28, 1930
RATES December 29, 1921	Changes April 11, 1924	RATES August 7, 1930	Changes September 17, 1930	Changes June 2, 1931	RATES September 8, 1933	B.P.	Int.	Gen.	B.P.	Int.	Gen.	B.P.	Int.	Gen.	B.P.	Int.	Gen.	B.P.	Int.	Gen.	B.P.	Int.	Gen.12!%	17!%	17!%	5%*	10%	10%	Free	10%	10%	Free	15%	25%	Free	15%	25%Free	10%	10%	Free	10%	10%10%	15%	15%	Free	7!%	7i%	Free	7!%	7i%	Free	15%	25%	Free	15%	25%Free	71%	71%	Free	71%	71%10%	15%	15%	Free	7!%	7!%	Free	71%	7!%	Free	15%	25%	Free	15%	25%Free	71%	71%	Free	71%	71%Harvesters, self binding or not, and complete	12!% 12!%	12!% 12!%	12!% 12!%	Free	6%	6%	Free	6%	6%	Free	15%	25%	Free	15%	25%Free	6%	6%	Free	6%	6%12!% 12!%	12!% 12!%	12!% 12!%	Free	6%	6%	Free	6%	0%	Free	15%	25%	Free	15%	25%Free	6%	6%	Free	6%	6%12!% 12!%	12!% 12!%	12!% 12!%	Free	6%	6%	Free	6%	6%	Free	15%	25%	Free	15%	25%Free	0%	6%	Free	6%	6%10%	15%	15%	Free	7!%	7!%	Free	71%	71%	Free	15%	25%	Free	15%	25%Free	71%	71%	Free	71%	71%10%	15%	15%	Free	7!%	7!%	Free	7!%	7!%	Free	15%	25%	Free	15%	25%Free	71%	71%	Free	71%	71%10%	15%	15%	Free	7!%	7!%	Free	7!%	7!%	Free	15%	25%	Free	15%	25%Complete parts for repairs	Free	71%	71%	Free	71%	71%2760	HOUSE OF COMMONS
The Budget-Mr. Wood
f9il-80189
Farm wagons and complete parts	15%	20%	20%	March 25, 1925 5%| 10%| 10%	5%	10%	10%	Free	15%	25%	Free Free	15% 10%	25% 10%Complete parts for repairs	10%	10%	April 16,	926	Hay loaders and complete parts	12J%	20%	20%	5%	10%	10%	5%	10%	10%	15%	25%	15%	25%Complete parts for repairs	10%	10%	10%	10%Potato diggers and complete parts	121%	20%	20%	5%	10%	10%	5%	10%	10%	15%	25%	15%	25%Complete parts for repairs	Free	10%	10%	Free	10%	10%
* Reduced to free May 2. 1930.
B.P. means British Preferential Tariff. Int. means Intermediate Tariff.
Gen. means General Tariff.
The Budget-Mr. Wood
[Stage Direction]
The Budget

Mr. Wood
I might say that the general tariff rate is the highest in this list of goods and the rates charged against the United States goods were under the general tariff. They remained in effect against the United States until January 1, 1936, at which time the mostfavoured-nation treatment was extended to the United States.
I should like to give a summary of the tariff structure on farm tractors that is not included in the list. On February 7, 1919 an order in council was passed granting authority for remission and refund on gas and gasoline traction engines for farm purposes valued at more than $1,400 each, and repairs for same. On April 11, 1924 the tariff was amended to give permanent status to the order in council referred to above.
This situation remained unchanged until the special session on September 17, 1930. You will remember that the Bennett government was elected on July 28, 1930. At this special session a proviso was added to the free item on tractors authorizing the governor in council to impose a duty of 10 per cent on the British preferential, 15 per cent on the most-favoured-nation and 25 per cent on the general tariff. Not until the Liberal budget of May 1, 1936, was duty-free entry for internal combustion traction engines from other countries allowed. The situation is the same today, and we still have a Liberal government.
I might also mention that during that period the duty-free rate was still continued on British empire products. I just draw your attention to these tariff changes to show how ridiculous it is to say that the tariff policies of the two old parties are the same.
There are approximately 850 articles that enjoy our customs tariff, and in nearly every case the price charged here in Canada is a price that provides a reasonable profit plus an amount very close to the amount of the tariff. Industry shows no sense of gratitude for the protected, sheltered market in which they sell their goods. I wish to give you an example of one of the articles that are so protected. I will take the Canadian automobile.
In the Winnipeg Free Press of February 14 there appears a list of 21 automobiles of various makes, showing the selling price in the United States and in Canada. These prices cover a four-door sedan with no extra equipment. It shows the price of a Chevrolet car in the United States at $1,670; in Canada, $2,179. That is a difference1 of $509. It shows the price of the Ford V-8 in the United States at $1,751; in Canada, $2,257. That is a spread of $506. It shows the Plymouth car with the
[Stage Direction]

price in the United States at $1,821; in Canada, $2,333. That is a difference of $512. In the case of the Chevrolet car it shows a spread of $509. The Canadian sales tax of 10 per cent and the excise tax of 15 per cent on the small Chevrolet car amount to $368, but there is a United States federal tax of $129 on the same car. This makes a difference of $239 in tax charged in Canada more than in the United States. Deducting this $239 from the spread in price between the Canadian and the United States price of the same car of $509 and we have a balance of $270. I maintain that this difference is brought about by our' automobile industry to a very large extent taking advantage of the customs tariff.
An hon. Member:: Six o'clock.
At six o'clock the house took recess.


[Stage Direction]
AFTER RECESS

The house resumed at eight o'clock.
Robert James Wood: Mr. Speaker, when we adjourned for dinner I was giving an example of one of the items that enjoy protection under the customs tariff, and I shall proceed with my observations from that point.
Recently at a dinner here in Ottawa some 60 members of the House of Commons had as their guests three heads of the Canadian automobile chamber of commerce who are, incidentally, the heads of the three principal automobile industries in Canada. We were asked to submit some questions to these gentlemen, with the understanding that they would discuss and answer the questions after dinner. One question I submitted was as follows: Why is it that the automobile manufacturers of Canada are still charging the consumers of Canada a price for their product, apart from taxes in the United States or Canada, which is equal to the United States retail price plus the tariff charges for entering from the United States?
These gentlemen spoke for 30 or 40 minutes after dinner, and the president spoke for close to 15 minutes in an effort to answer the question regarding the difference in retail prices between Canada and the United States. But I am confident that he made very little impression upon those present at that dinner. As I said previously, there are approximately 850 items in our customs tariff, and the same can be said in regard to the price of practically every one of them.
Drawing to a conclusion, I wish to refer briefly to some of the policies of the two small groups in the opposition sitting to my left. I feel that the policies of either group

would bring our trade movements almost to a standstill. On February 11 the hon. member for Macleod (Mr. Hansell) who, I understand, speaks with some authority for the Social Credit group, had this to say at page 1833 of Hansard, in speaking of the Cuban sugar controversy:
I say that free trade is an absolute impossibility.
And at page 1834 in the same debate he said:
Let us remember that the more that nations become self-sufficient, the less they become dependent on foreign trade.
Then the hon. member for Lethbridge (Mr. Blackmore) is reported in this way at page 1847 of Hansard:
I maintain that the sooner we shut out Cuban refined sugar entirely, by a device similar to the one used in 1932-
And so on. I maintain that this theory of self-sufficiency coincides 100 per cent with the policies of the R. B. Bennett government between 1930 and 1935.
As for the C.C.F. socialists, with their controls and their theories of nationalized industries, and their promises of trade boards which would be followed by coupons and all that go with them, I am sure that such schemes would put trade in a strait-jacket. I feel confident that the level of political intelligence in Canada is high enough that the people will not risk our prosperity with either view.
In conclusion I wish again to urge the government to set up a committee of the house to investigate any possible abuses by Canadian industry, and to report such abuses to the house. If no discriminatory practices exist, it will ease the minds of consumers across Canada; but if discriminatory practices do exist, then the government can take corrective measures. *


Mr. D. S. Harkness (Calgary East):: Mr. Speaker, this year's budget has been described in various ways in speeches made by hon. members in the house, and in newspaper articles across the country. It has been described as an election budget, a shell-out budget, a rich man's budget, a sunset budget, and so on. The minister himself has called it a social dividend budget. That, of course, got more laughs than any other name applied to it, and for obvious reasons. I think it would be more apt to call this year's budget the mirage budget, because it has had the effect of a mirage-that is, something you think you see, but which really does not exist. And, so far as this budget is concerned, that description applies in more ways than one.
Its first effect of that kind was noted in respect of the Liberal members on the night
The Budget

Mr. Harkness it was presented. They thought they could see in it an instrument of election victory, something that would appeal to everyone in the country and would pull the Liberal party out of the public disfavour into which their policies and their taxation, coupled with inefficiency and waste, had very rightly put them in the minds of the public.
A few days later, however, hon. members supporting the government began to realize that they were still far from being out of the desert, far from the flowing wells they thought they saw on budget night-wells which they realized did not really exist. The mirage effect was felt, too, by the general public. They thought at first that the long days in the desert under the guidance of this government were at an end. But then they got their pencils out and began to figure how much better off they would be after the budget came into effect. The mirage rapidly thinned out and disappeared; there was not a great deal for most of the pencils to do. For that considerable segment of our population which pays no income tax, a pencil was scarcely necessary to make it clear that this budget hardly helps them at all. In fact, those who do not smoke cigarettes or who do not operate radios got absolutely nothing. Those who do buy a few packages of cigarettes each year would save possibly a dollar, or something like that, and there was a saving of another $2.50 for those who operate radios and who had previously paid the radio tax.
Then, coming to the income taxpayers, we find that the married man with two children, and receiving a wage of $2,500 a year, makes the magnificent saving of $2 a year, as a result of this budget.


Mr. Lesage:: What is the age of the two
children?


Douglas Scott Harkness: I do not care what the age of the two children might be.


Jean Lesage: Well, he cares.


Douglas Scott Harkness: If the two children are dependents, the man is still better off to the extent of $2 a year, and that is all. Then if the wage earner receives $3,000 a year, his relief is $7.


Jean Lesage: Again, what is the age of the children?


Douglas Scott Harkness: In spite of what my young friend from Montmagny-L'Islet (Mr. Lesage) says, so long as they are dependents the age of the children makes no difference. I would point out that the vast majority of Canadians do receive a salary or wage less than $3,000 a year. About 75 per cent of all wage and salary earners in Canada come
2764	HOUSE OF
The Budget-Mr. Harkness within that class. The most that any of those people will save, on the basis of a married man with two children, is $7 per year. If that is all, then when that fact sinks into the consciousness of the Canadian people the mirage which they enjoyed for a short time, of a tax reduction that would amount to something, will rapidly evaporate.
What the minister did in effect was to spread what he had to offer so thinly that whilst he could say that all taxpayers received some benefit, that all cigarette smokers and owners of radios received benefit, no one received sufficient benefit to do him any real good except those who are very wealthy and those who are the owners of considerable amounts of corporation stocks. I think in this budget the minister made the mistake of spreading it so thinly that the effect cannot be seen.
I was very interested in listening to the Minister of Finance (Mr. Abbott) trying to defend his budget on "Citizens' Forum" which was broadcast on February 26 of this year. At that time he was asked questions by members of the press and I should like to read a few of the questions he was asked and the answers he gave, and make some comments on them. I will start off with a question which was asked by Anne Francis:
Well, Mr. Abbott, still the fact remains that three out of every four Canadians have an income of less than $3,000 a year and these people are not very much benefited by your budget?


Douglas Charles Abbott: Well, they are benefited, Miss
Francis, to the extent that they smoke cigarettes, they are benefited to the extent that they use radios. They are benefited to the extent that as a result of the general tax cuts, production may be encouraged and increased and they get their goods cheaper.
Can you conceive of a weaker defence of his budget than a statement of that kind by the minister going out over the air to the people of Canada?


Jean Lesage: Keep on reading what he said.


Douglas Scott Harkness: I will if you will just hold your horses. I am going to read on. A weaker defence, a greater indication of lack of defence, could hardly be imagined. As a matter of fact what the minister has done in. that statement is admit that the majority of the people in Canada are no better off as a result of the budget than they were before. The parliamentary assistant apparently wants me to continue reading it, so I will oblige him. Next was a question by Harvey Hickey who asked:
Well, what about Mr. Coldwell's argument that 70 per cent of the tax cuts go to the wealthier classes?


Douglas Charles Abbott: Well, it is just not correct.


In other words, what we have there is a flat statement. There is no proof whatever produced at this time. The minister simply says that the statement of the hon. member for Rosetown-Biggar (Mr. Coldwell) is not correct. There is just a flat contradiction with no proof to support it. There is good reason for that, because I do not think he could produce any proof to support that statement that it was not correct. I think it was correct, as far as I can read these budget figures. Of course when a man is speaking over the radio and he knows what he says is going out across the country it is to his advantage just to make a flat statement and let it go at that. There is nobody to contradict him or bring him to task. Does the parliamentary assistant want me to continue with this?


Jean Lesage: By all means. Read the whole thing without skipping anything.


Douglas Scott Harkness: The next is a question by Mr. McKeown.


Jean Lesage: You did not read the whole of the answer.


Douglas Scott Harkness: I have the whole thing here. Mr. McKeown asked:
Mr. Abbott, you said a lot of this goes to the payers of income tax but doesn't it go to the people who pay high income taxes? I think 7 per cent of the taxpayers pay about 53 per cent of income tax, so they are the people who benefit. Those 7 per cent get about 50 per cent then of the benefit of the income tax changes.


Douglas Charles Abbott: Well, Mr. McKeown, it is very easy to deal casually with percentages, but in fact the income tax structure, which was devised in 1949, and which increased the exemptions to pre-war, and which lowered rates, is the structure which now prevails.
Is that any answer to a question?


An hon. Member:: A perfect answer.


Douglas Scott Harkness: Those are just words
designed to lull the questioner and the general public into a false sense of security as to what actually happened.


An hon. Member:: Let us have it all.


Douglas Scott Harkness: I am not going to use up my full 40 minutes in reading all the nonsense the Minister of Finance produced on this particular occasion.


An hon. Member:: Table it.


Douglas Scott Harkness: If the parliamentary assistant or some of the gentlemen to my immediate right are interested in having this, I will let them have it.


An hon. Member:: We have heard it.


Douglas Scott Harkness: I will let them have this document which contains a record of the

questions asked of the minister and the answers he gave. All right; we will go on a little further. For quite a long time the minister wobbled along talking about this tax structure, and then Robert McKeown asked another question, as follows:
Well, even though this results in a fair tax rate, as you say, it is so that the man who pays no income tax and the man who pays little income tax in the low income group does get very little out of this beyond cigarettes.


Douglas Charles Abbott: I think that is true, Bob, because he got it before. You can't give a fellow something when he's got it already.
I would like to know when did he get it. That is the question the minister did not answer. He never said when this poor fellow got it. In actual fact the poor chap never did get it and he still has not got it.


An hon. Member:: He does not pay any taxes.


Douglas Scott Harkness: The only time he ever got anything was away back following the war when the rates under the income war tax act were reduced and there was an increased deduction allowed up to $1,000. That is the only time these people about whom the minister was talking ever got anything. He says this man got it before, but he got it so long ago that I do not think you can relate that to the minister's budget. You might just as well relate the minister's present budget to the time before world war I when nobody paid any income tax, when it was looked upon as a completely impossible thing that people would be required to pay income tax, as to relate it back to the period of 1946-47.
In other words, once more the minister did not have an answer so he said, "He got it before". But he does not say when he got it or what he got. Unfortunately whatever he did get was so long ago that it is past history and not related to the present circumstances. In most cases he got nothing.
I come now to another of these excerpts which is really good. I think everybody will appreciate this. Once more it is Robert McKeown asking a question, as follows:
Well, how is it, Mr. Abbott, that these tax cuts always seem to coincide with an election year. Is this a matter of fortuitous circumstances?


Douglas Charles Abbott: Well I can only say that I think it must be.
That was the only answer the minister gave. I wonder when the Minister of Finance became so naive that he would make an answer of that kind. He must have been completely stumped, that is all there is to it. Particularly, when did the Minister of Finance-


Jean Lesage: Go on with your reading.
The Budget-Mr. Harkness


Douglas Scott Harkness: -become so naive that he would think the general public of Canada were so naive that they would do anything except laugh uproariously at that explanation? There is no question about it that these tax reduction budgets come only when there is an election in the offing, and there is no doubt they have been produced for that reason.


Mr. McCusker:: But you were saying there was no reduction..


Jean Lesage: Keep on reading.


Douglas Scott Harkness: I did not hear what the hon. member for Regina City (Mr. McCusker) said, and I would be interested in hearing it.


Emmett Andrew McCusker: You just said there were no reductions, and now you are saying that reductions come in election years.


Douglas Scott Harkness: Mr. Speaker, either the hon. member for Regina City was not in the house or he was not listening. Possibly he should go to his eye, ear, nose and throat clinic and get his ears fixed.


Gladstone Mansfield Ferrie: You get in a hole and you get sarcastic.


Douglas Scott Harkness: What I said was that the Minister of Finance (Mr. Abbott) spread his tax benefits so thinly that they really do no good to the great majority of people in the country. I did not say there were none. I said they were spread so thinly they were practically valueless. I think perhaps that is enough time to spend-


An hon. Member:: Read some more.


Jean Lesage: Keep your promise. Send the text to me. Send it over here. You promised.


Douglas Scott Harkness: Now-


John Sylvester Aloysius Sinnott: Send it over here.


Mr. Speaker:: Order.


Douglas Scott Harkness: The great basic weakness of the budget is that the tax cuts proposed are based on hopes for an increased national product instead of on the sound ground of economy and reduced expenditures. The budget actually proposes increased expenditures in nearly every department, and the minister relies on an increase in the gross national product to cover those increases and at the same time enable him to cut taxes.	.
Personally I do not believe this is sound financing, because the gross national product may be seriously reduced below the minister's expectations by events which are completely beyond his control. To mention just one, a poor grain crop in western Canada this coming year would knock the minister's calculations for a loop, and instead of getting

The Budget-Mr. Harkness the income he expects he would get considerably less. Of course a poor grain crop in western Canada this coming year could very easily develop, particularly in view of the extremely dry fall and the very small snowfall this winter, resulting in a much below normal moisture content in the soil.
It is on incalculable factors of that sort that the Minister of Finance has based his calculations and has decided that he can cut taxes and at the same time increase his collections. Apparently he refuses absolutely to face what I would call the realities of the situation and go after tax reductions by the means he should make them, by a drive for economy and the reduction of inefficiency and waste. As a matter of fact the budget demonstrates once more what has been the outstanding characteristic of the government since the war, its unwillingness or inability to curb extravagance and waste in public spending. I am not going to put on the record once again the numerous examples which have already been cited by speaker after speaker in this debate which show the enormous increases that have taken place in expenditures in the past ten to fifteen years, expenditures which in many cases cannot possibly be argued to be essential.
I refer particularly to such things as the terrifically increased expenditures for travelling, telephones, postage, printing, advertising and things of that kind. The extravagance, waste and inefficiency which have been displayed in our rearmament program are of course the outstanding examples of all. So much has that been the case that it has now become something in the nature of a national scandal. Nearly every day brings to light new instances of terrific extravagances and waste in our defence effort. We are getting many of them in the committee that is considering this matter-


Mr. Speaker:: Order.


Douglas Scott Harkness: -and as the result of answers to questions. They are found generally throughout the country. I will not go into detail on that. I just stopped in time, Mr. Speaker.
I should like to turn now to the Minister of Agriculture (Mr. Gardiner). Speaking in this debate he attempted to show that there was no justification for the amendment moved on behalf of this party which condemns the government for its failure in the budget to-
-offer any encouragement to Canadian farmers in meeting the serious consequences of lost markets and lower prices resulting from the government's agricultural and marketing policies.
That was part of our amendment. The Minister of Agriculture attempted to show


that there were practically no surpluses of farm products for which we were searching for markets, and thus of course by inference was attempting to show that we had not lost markets. As a matter of fact his own figures which he placed on the record confound him.
I	should like to deal with those figures which are found at page 2663 of Hansard for March
5.	First of all I shall read the short statement he made preparatory to introducing them. It is as follows:
I give those figures in order to emphasize the position I took a few moments ago, namely that there is not a decrease in the quantity of farm products being produced in this country, either in the last years as compared with the last three years of the war or in the six years since the war as compared with the last six years before the war.
Note this, Mr. Speaker:
Our production is going up, and going up continuously: and while it is going up prices are increasing and therefore the returns to the farmer are increasing from year to year.
The rest of it does not matter. After having made that statement, the minister put the table on Hansard and I should like to comment on it. Quite contrary to what the minister said, the chart which he himself placed on Hansard shows that in the period from 1949 to 1951 production was considerably less than it had been in the period from 1943 to 1945, the two periods he deals with in the chart. That is true of all the major commodities he lists except wheat, and I shall mention something about that later.
If we refer to the chart we see that from 1943 to 1945 20 million hundredweight of cheese were produced and from 1949 to 1951
II	million hundredweight, just a little more than half as much cheese. That is a big reduction. Taking butterfat, from 1943 to 1945 production amounted to 437 million pounds and from 1949 to 1951 to 386 million pounds, another considerable reduction. From 1943 to 1945 13 million hundredweight of hogs were produced and from 1949 to 1951 10 million hundredweight, another considerable reduction. Turning to cattle, from 1943 to 1945 19 million hundredweight were produced and from 1949 to 1951 17 million hundredweight.
I come now to apples, and this is one of the few cases in which there was an increase. From 1943 to 1945 there were 12 million bushels and from 1949 to 1951, 15 million bushels. There were 350 million dozen eggs produced from 1943 to 1945, and 305 million dozen from 1949 to 1951. Coming to potatoes, once more there is an increase from 71 million bushels to 78 million bushels.
Wheat increased from 339 million bushels to 461 million bushels, but I might point out that the amount of wheat produced had

nothing to do with the Minister of Agriculture. It depends entirely on the weather, and it happens that the weather was considerably more favourable in the years 1949 to 1951 than in the years 1943 to 1945. Therefore we produced a great deal more wheat. In addition, during the period 1943-45 the Minister of Agriculture was paying people not to produce wheat. Now he is trying to use those figures of low production to bolster his argument that production is greater now. Surely that is a most ridiculous argument and situation.
We come to oats, and there are 454 million bushels as against 408 million bushels; barley, 189 million bushels as against 179 million bushels. In other words, Mr. Speaker, in connection with all the important items except wheat which the minister lists and says form part of the economy of this country, we produced less on a volume basis in 1949-51 than we did in 1943-45. When the minister put this table on the record just after saying we had produced more and we find the table proves decisively that we produced less, I think it must indicate that he is losing his grip.
I should like to point out, Mr. Speaker, that during those years for which we have had these statistics for the main agricultural products, our population increased from 12 million in 1945-I am taking the end year in each period

to 14-5 million people today. This is an increase of 18 per cent. We had 2-5 million more people to feed this year than we had in 1945, so naturally we needed a great deal more food. The necessity for that amount of food, plus the decline in production which is shown in. the minister's table, of course1 reveals only one thing. It shows quite definitely the large loss in overseas markets. One does not need to prove in this way the loss of overseas markets. One does not need to use the minister's own figures to prove it, because everybody in the country knows we have had an extremely large loss in overseas markets.
Let us take one example. In 1944 we exported 695,750,000 pounds of bacon and pork products. By 1947, only three years later, this had dropped to 235,750,000 pounds, which is approximately one-third. At that time I well remember standing up in this house, as did many other members of the opposition, and warning the Minister of Agriculture and the government that they were losing our overseas markets at an alarming rate. They pooh-poohed the idea. The minister gave all kinds of reasons why we would not have as much pork. He said we had not had as big coarse grain crops as we had in 1943-44, and would not admit that we
The Budget-Mr. Harkness were losing the overseas markets. What is the situation we find at the present time? We have no overseas markets for bacon or pork; they have just disappeared. Of course the minister has to admit that we have lost that market.
The same story is told by the statistics for other products, if anyone wants to take them in the bald form in which they are found in the Canada Year Book. This is a handy little reference book, of which every member has been supplied with a copy. Take the Canada Year Book and look over the statistics given there. You will see that they show the same story. These statistics show that so far as cheese, butter and nearly every other agricultural product is concerned, we were exporting large quantities. You will see that the figures taper down year after year until you get to the present time, when you find that we have lost these markets almost entirely.
The minister attempts by a long detailed speech and the quoting of a lot of statistics, which are not applicable at all, to prove that we have not lost the overseas markets, that farmers are much better off, and that they are producing more and getting bigger prices for their production. If the minister thinks he can fool Canadian farmers and Canadian citizens generally on this matter of having lost markets and the general prosperity of farmers, he is deluding himself miserably. When he goes about the country or stands up in the house and says the members of the opposition should not think the farmers are not supporting this government because most of the farmers are still supporting it, he is deluding himself even more miserably. He is engaged in a form of self-hypnosis in order to keep up his own courage.


An hon. Member:: You should have a cowbell.


Douglas Scott Harkness: If I had a cow-bell I would know what to do with it. I would not have to hang it around my neck the way some of you people do. I do not think even the Minister of Agriculture will argue that we could not have kept our agricultural production at the high level it was at in 1943-45. I do not think even he will argue that. As a matter of fact we could have greatly increased it during that period. The reason we did not increase production in the period 1949-51 was to a large extent because we lost our markets for our production. The farmers realized we had lost our markets, and of course they cut down production accordingly. They knew they would not be able to sell a lot of the stuff they had been producing, so they deliberately cut down their production.
2768	HOUSE OF
The Budget-Mr. Harkness
My own case is a good example of that. For several years my farm was producing a large number of pigs, and we had litters between two and three times a year from some 40 to 70 sows. A year ago last November I still had 67 sows producing pigs, but today I have not one. That is a fairly typical example of what a large number of farmers in this country have done. They could see that there were going to be no markets for these products, and in order to avoid taking great losses they cut down production.
In addition to the loss of our markets, another reason for the reduced production- a reason which the minister glossed over very quickly in his speech-is the fact that farm costs have been rising faster than prices for farm products. The minister admitted that implement costs had increased from being 3 per cent to 6 per cent of the cost of operation in 1936 to 8 to 9 per cent of the cost today. What he did not mention was that all other costs had increased. The cost of labour, the cost of fuel, taxes, fuel oil, gasoline, everything the farmer uses, has skyrocketed to great heights. The general picture we get is that a large number of production costs have risen so much more than the prices of farm products that it has become unprofitable to produce these products.
The minister, as he has done every year since I have been here, and generally several times a year, tried to draw a comparison of conditions now with those in the period 1930-35, and to place the responsibility for the low prices of that period and the hard times which prevailed upon the Conservative government of R. B. Bennett. What he did not say, what he never says and what I am sure he never will say is that Mr. Bennett succeeded to a mess which had been created by the Liberal party in the five years preceding.


Gladstone Mansfield Ferrie: What a way out.


Douglas Scott Harkness: Having inherited that mess at the start of the worst depression the world has ever seen, he struggled through the midst of that depression and took very definite steps to improve the position of the farmers as well as the lot of other people in this country. The steps which he took bore fruit, and from 1932 onward conditions gradually improved. They did not improve very much from the time he left office in 1935 until the war broke out. They improved very little; but what improvement did take place was due to policies which had been introduced by Mr. Bennett in that period from 1930 to 1935. The Minister of Agriculture and all the other members of the Liberal government have ever since been taking credit for the improvement in conditions. 

As I say, that improvement was not due to anything they did. It was due to what Mr. R. B. Bennett did.


Some hon. Members:: Oh, oh.


Douglas Scott Harkness: What the Liberal government which came into power in 1935 did was merely carry on the new trade and agricultural marketing structure which the Bennett government had created.
In his speech the Minister of Agriculture (Mr. Gardiner) made much of the increased prices which the farmers are now receiving as compared with what they received before the war; but he did not mention that this increase in money return is in 50-cent dollars. He did not point out that the farmer who is now getting $1.50 a bushel for his wheat- which the minister himself said is the average price on the farm-is exactly the same position as was the farmer in the thirties who was getting 75 cents a bushel.


John Sylvester Aloysius Sinnott: Rot.


Douglas Scott Harkness: He is no better off at all as far as real wages are concerned. If he is getting $1.50 now, he is getting exactly the same as in the thirties when he was getting 75 cents. As a matter of fact, during a certain part of the thirties the farmer was getting more money in real wages for his wheat and other farm products than he is getting now; considerably more.


John Sylvester Aloysius Sinnott: He was getting less.


Douglas Scott Harkness: In certain periods he was getting less. Nobody disputes that fact.
The new Canadian consumer price index chart shows the position quite clearly. I should like to refer to this chart briefly, and then to relate the figures in this chart back to the figures in the chart which the Minister of Agriculture put on the record.
This particular copy was put out by the Bank of Montreal and it comes along with their weekly or monthly supplement. This is the new Canadian consumer price index. It shows an index price in 1913, of nearly 50- 49 point something-and in 1932 to 1939 it shows the index varying between from just above 60 to below 60. During that period it went along almost on a straight line. Then when we come up to the present time, in 1951, we find that this index is up to almost 120. In other words, during the period from 1932 to 1940 the index was at approximately 60 and in 1951 it was approximately 120, or twice as much.
If we look at the index for 1945, which is the one I want to relate particularly, we find that it was at 75; that is, the consumer price index was at 75. If we go back to the minister's chart and relate that figure with an

index of 75 to the index of 120 in 1951, and if we correct the figures the minister gave by making reference to that figure, we get a totally different picture from the one that he presented.
In other words, the money price which the minister has given as the average annual farm value, in terms of the 1945 dollar, is approximately two-thirds of the amount he has listed. We correct this and we take, for example, cheese. In 1943-45 the farmers received an average of $38 million a year. In the same kind of dollars, in 1949-51 they received $19 million a year, not the $28 million the minister mentioned; they received $28 million worth of 1951 dollars, but in 1943-45 dollars-and surely if you are going to compare one figure with another you have to compare its spending value-they received only $19 million.
For butterfat they got $187 million in 1943-45. In these last three years they got $158 million; for hogs, $225 million in the former period as against $200 million. In cattle there was an increase, $187 million in the former period as against $256 million. That and wheat are the only two cases in which there are increases.
For apples they received $18 million as against $13 million; eggs, $107 million against $91 million; potatoes, $78 million as against $56 million; wheat, $441 million as against $522 million. The only reason they got more for their wheat in these last three years was that they produced about 30 per cent more than they did in the previous period. If they had produced the same amount they would have obtained less for it. For oats they received $249 million as against $211 million, and for barley $131 million as against $156 million. That is another increase, and the only other one.
What all that shows, Mr. Speaker, is that during that period the minister's chart demon-strates^ quite clearly that first of all production is down in the period 1949-51 as compared with 1943-45. In the second place it shows that the return to the farmers in dollars-[DOT] real dollars, as far as value is concerned- is down also, and down considerably. Their real purchasing power is reduced.
As I said before, I really do not know why the minister put this chart on the record, because it shows these things so clearly. I think I should take this opportunity of thanking him for putting such a convenient chart on the record in order to show the real situation. Certainly I would be greatly surprised if the minister himself ever used it again.
The Budget-Mr. Arsenault
The hon. member who preceded me in this debate and a considerable number of other members have had something to say about free trade, and we have had mention of free trade by various people. It was spoken of as a desirable thing.


Mr. Speaker:: Order.


Douglas Scott Harkness: Is my time exhausted, Mr. Speaker?


Mr. Speaker:: I am afraid the hon. member's time has expired.


Douglas Scott Harkness: Thank you.
(Translation):


Mr. Bona Arsenault (Bonaventure):: Mr. Speaker, I would like to take part of the time allotted to me to recall to hon. members of this house an important event in Canadian history, which will be celebrated two years hence, that is in 1955, and to suggest to the government steps that could be taken in those circumstances. It is not too soon in fact to draw the attention of the Canadian government to certain measures that could and should be taken upon the celebration of the second centenary of the deportation of the Acadians. There is no question of reviving whatever ill-feeling may have resulted from an unfortunate period in our history, for which no Canadian of our generation holds any responsibility. It is rather a matter of showing in an official way, in a solemn way, the gratitude of the Canadian people towards the astonishing survival of an important group of our citizens, of the Acadians, that is of Canadians of Acadian origin. It would also be fitting for those in high places to underline the example-an example which is probably unique in the history of our country -offered by the reconciliation of the Acadian people with the various other ethnical elements which now make up this Canadian nation.
During the wars which led to the conquest of Canada, no other part of the then population of our country suffered more through the loss of their possessions, in their very flesh, in their hearts and their souls, than the Acadian people. Nevertheless, today, no other element of the Canadian people contributes more sincerely, more loyally and more actively to this sacred union which must exist between all Canadians from the Atlantic to the Pacific, whatever may be their origin, in spite of past rivalries and mistakes.
In 1755, more than 2,000 families, 15,000 people approximately, who were living in the territory represented today by the provinces of New Brunswick, Nova Scotia and Prince Edward Island, were cruelly affected

The Budget-Mr. Arsenault by a drastic measure which has come to be known as "le grand derangement"-the great disturbance.
More than half of these peaceful and Godfearing people, who had maintained themselves on Acadian soil for 150 years, that is from 1604 to 1755, were deported and dispersed during the fall and winter of 1755. Another group were hounded, seized or made prisoners between 1755 and 1758, while what was left of these unfortunate creatures spent the next ten years in constant wanderings, from forest to forest, from shore to shore.
There was not one of these families that was spared the death or disappearance of one or more of its members.
Nearly 5,000 of them were dispersed in small groups in the various British colonies of America. A large number took refuge in Canada-that is in that part of Canada which has become the province of Quebec-or in Louisiana. Others, numbering about 1,500, were taken into captivity in England, where they had to wait for seven years until the signature of the treaty of Paris, after which they were able to cross over to France, to settle there, especially in the southwestern part, more particularly in Poitou.
Hundreds of others had been shot down by their pursuers or had died of hardship. More than a thousand were engulfed by -the sea along with the old hulks which brought them into exile.
Without for a moment wishing to establish the responsibility for the tragedy, but for my purposes in this debate, I should like to put on record a few brief excerpts from certain official documents, practically unknown to the general public, the translation of which I found in L'Acadie by Edouard Richard, annotated by Henri d'Arles in its second edition.
First of all, a few excerpts from the deportation edict which was read by Winslow to the 418 men and children over 10 years of age, in the church of Grand Pre, on September 5, 1755:
The duty, said Winslow, which I must now perform, although imperative, is quite repugnant to my nature and my character, as it will be to you, who are somewhat like me. But I cannot oppose what I was ordered to do; I must obey orders. Therefore, I shall let you know immediately the orders and instructions of His Majesty, which are:
That your farms and your homes and your cattle and your herds of all kinds be confiscated to the crown, with all your other belongings, except your money and your household effects, and that you be taken, outside this province.

And here are a few excerpts from the account given by Governor Lawrence of Halifax himself to the right honourable Lords Commissioners for Trade and Plantations of England, under date of October 18, 1755, again according to Richard's translation, at page 28:
Since the last letter I had the honour of writing
to Your Lordships on July 18,-said Lawrence,____
the French representatives of various districts, have appeared before the council in order to formulate a final answer to the proposal which was submitted to them to take an oath of allegiance to His Majesty; they persisted in opposing to the said proposal a positive refusal. In spite of the fact that all possible means were tried in order to persuade to them that their real interests were at stake and that a sufficient delay would be granted to them so that they would be able to give due consideration to their decision, nothing could win their assent to any of the measures required by with regard to the honour due to His Majesty and to the security of the province.
Confronted with such an attitude, the council decided to force the representatives to leave the colony and considered immediately what might be the quickest, cheapest and easiest way to carry out this resolution.
We could easily foresee that to exile them by armed force and drive them to Canada or to Louisburg could not be done without great trouble; if such a move had met with success, it would have greatly strengthened the said establishments in- bringing to them men who had always been without exception the most inveterate enemies of our religion and government and who are now desperate owing to the loss of their possessions. The only way to prevent a counter-attack on their part or their reunion in a large body was to disperse them in the colonies', from Georgia to New England.
In conclusion, here is an excerpt from -the letter dated March 25, 1756, which was sent to Governor Lawrence by the Lords of Trade, that is after the dispersion and deportation of the Acadians; it completes this historical correspondence concerning the deportation of the Acadians, which I wanted to bring to the attention of the house. I quote:
We have placed before the Secretary of State of His Majesty that part of your letter dealing with the deportation of the French people and the methods you have used to bring this about; as you present this deportation as having been absolutely necessary to the security and protection of the province, in the present critical circumstances, we do not doubt that your conduct in the matter will meet with the approval of His Majesty.
There you are. Then followed, as we all know, the Seven Years' war, the battle of the plains of Abraham, the fall of Montreal and the treaty of Paris, surrendering Canada to England.
And during that decisive period in our history, the unfortunate Acadians, who had been expatriated, knew much more bitter hours than that of their arrest and deportation. Scattered in small groups along the shores of New England as far south as

Georgia, as may be seen from the texts I have just quoted, among a hostile people, whose racial origins, religion and language differed from theirs, poorly fed, already sick and weakened by their trip on the sail boats that carried them, death worked havoc in their ranks.
But their most sorrowful affliction, the one that was their greatest cause of despair, was the dispersal of families. For those exiled people, the loss of their property and of then-country was not the worst of their sufferings. Wives, left alone on foreign soil, separated from their husbands and children, husbands, thrown on distant shores without any hope of ever seeing their loved ones again, often died broken-hearted. They were killed by moral suffering. As Father Casgrain said, they were like uprooted plants; they could not take a new lease on life. They were dying of homesickness as much as of want and like the exile of bygone days, they died their eyes turned towards their homeland.
Philip H. Smith, an English author, said in his book, Acadia, A lost chapter of American History:
In the annals of the past, we find examples of countries devastated in time of war, and where inhabitants were found in possession of arms; but history mentions no case similar to that one; peaceful and defenceless people were never subjected to treatment such as was meted out to the neutral French population of Acadia.
John Clark Ridpath, a well-known American historian, makes the following comment:
Governor Lawrence and Admiral Boscawen, together with the Chief Justice of the province, Belcher, came to a horrible decision: the whole of these people must be banished. Their first move was to require of them an oath of allegiance so contrived as to make its acceptance impossible. Then the English accused the Acadians of treason and forced them to give up their firearms and their boats. These broken-hearted people also submitted to this order. They even went so far as to offer to take the oath, but Lawrence answered that they having once refused, they must needs suffer the consequences. The annals of civilized nations contain nothing that can be compared to this wanton and sacrilegious destruction of an inoffensive colony.
In any event it is much to the credit of English-speaking historians, among whom Longfellow ranks highly, as well as comforting for those who are of Acadian extraction, to note that most historians have had enough intellectual honesty and courage to stigmatize such barbarous conduct. In spite of these terrible hardships which have no precedent in the history of civilization, the Acadian nation is today stronger and more alive than ever.
The sons of the deported and dispersed of 1755, who managed to survive their misery, number today more than a million.
The Budget-Mr. Arsenault
There are today more than 80,000 people of Acadian descent in Nova Scotia, nearly 200,000, if not more in New Brunswick and in Prince Edward Island, more than 100,000 in New England, more than half a million in Louisiana and nearly 300,000 in the province of Quebec alone.
Bonaventure county, where my ancestor took refuge at the time of the dispersion, numbers alone more than 35,000 persons of Acadian origin. With faith in God, with confidence in Providence, these people have maintained the customs and traditions of old Acadia and the gentle tongue of the Acadian ancestors, of which you probably now hear a few accents.
They live in close harmony with some ten thousand descendants of Wolfe's or perhaps Lawrence's soldiers and of American loyalists to whom their ancestors' land in Acadia has been distributed.
From that point of view, Bonaventure county, and for that matter the entire Gaspe peninsula, sets for the rest of the country an unequalled example: the descendants of two races of different origin leading together a peaceful and fraternal life. Such an example could very well be followed in some other parts of the country, at Maillardville especially where, in the very middle of our twentieth century, the prejudices, the bigotry and the arrogance of the eighteenth century are still rampant and even inspire a form of persecution which, though subtle, is none the less disturbing.
Apart from the county of Bonaventure, there are numerous districts in the province of Quebec where a large section of the population is of Acadian origin: the Magdalen islands, the Saguenay and the Chicoutimi districts, the eastern townships, the districts of Beauce, St. Hyacinthe, Joliette, Nicolet, Three Rivers, Quebec, Montreal, and others.
It is that miraculous survival that will be celebrated, no doubt very brilliantly, in the various parts of the province of Quebec, in New Brunswick, in Nova Scotia, in Prince Edward Island, in the Magdalen islands, and in the New England states, as well as in Louisiana, upon the second centenary of the deportation of 1755.
As a descendant of that race that would not die and as representative in this house of Bonaventure county, where the great majority of the people are of Acadian ancestry, I suggest to the government of my country four ways in which it could solemnly and officially take part in the celebration of that second centenary:
2272	HOUSE OF
The Budget-Mr. Thomas First, by issuing a memorial stamp, similar to the one that was issued in 1928, at the time of the erection of Evangeline's monument at Grand Pre and of the opening of the memorial church, which has since become one of the most popular monuments in eastern Canada.
Second, the appointment, among the personnel of our public archives, of a Canadian of Acadian origin, whose exclusive responsibility would be to resume the work which the eminent Acadian genealogist, Placide Gaudet, interrupted in 1924 at the archives, regarding research and classification of historical documents pertaining to the Acadian history and genealogies. For more than 25 years, the great gap created by the departure from the archives of Placide Gaudet and his subsequent death unfortunately was never filled.
Third, the recovery, restoration and repatriation as far as possible of Acadian original registers and historical documents, a large number of which are scattered in France and England as well as in Louisiana and Nova Scotia. These are historical treasures of immense value and they should be entrusted to the custody of public archives for future generations.
And fourthly, Mr. Speaker, and last, the setting up of special scholarships, paid by the Canadian government, with the concurrence of the governments of Quebec, New Brunswick and Nova Scotia, and the representatives of the Societe nationale 1'Assomption for university students of Acadian origin whose ancestors lived in Acadia at the time of the dispersion. A permanent committee could be set up in order to determine the means of administering and distributing such scholarships, which would constitute a rather belated but at least symbolic gesture of reparation in compensation for the incalculable amount of material harm endured by their Acadian ancestors whose property was arbitrarily confiscated.
This is the form which the Canadian government's participation could take in 1955, on the occasion of the commemoration of the two hundredth anniversary of the deportation of the Acadians.
In all justice, it should be done, to my mind. It would redound to the honour of the government which would take the initiative in the matter.
(Text):


Mr. Ray Thomas (Weiaskiwin):: Mr. Speaker, when speaking in this debate on February 

24 my leader had some very interesting things to say with regard to corporations. I should like to enlarge on his remarks in this connection, because I feel that the Canadian people will be quite anxious to have as much of the truth as possible so they may be able to render a proper judgment on the action of this government in this respect.
The hon. member for Peace River (Mr. Low) said his calculations showed that Canadian corporations in the ten-year period from 1940 to 1950 accumulated undistributed profits of $4,952 million in round figures, and that was after paying all their costs, all their taxes, setting aside depreciation allowances of $6,338 million and paying shareholder dividends of $4,276 million. Doubtless the total of undistributed profits accumulated by the end of 1952 by Canadian corporations reached the $6,000 million mark. As my leader said, the figures are not yet available, but I believe that the $6,000 million estimate will be found to be very close to the actual figure.
Let us remember that the tax relief granted to corporations by the budget now before us dates from January 1 last, while the reductions provided for individual Canadians are not effective until July 1. No one can possibly say that the corporations have not been given preferential treatment over the ordinary citizens. No one can claim, either, that this government has not been aware of the high level of corporation profits for quite a number of years. Those profits have been taken out of the pockets of the consumer in the form of prices.
Against this background of fact we in the opposition feel that we are perfectly justified in making the claim that this is indeed a rich man's budget, and that it offers nothing to the Canadian people in the lower income brackets. Most certainly the people of Canada will now know who the government favours, and they will know perfectly well that it is not the ordinary man.
My leader mentioned in his speech on February 24 that there was no good reason why the sales tax should not have been abolished several years ago. Let us take a look at the figures for a moment to see whether or not that claim is justified. Suppose the government made a levy of only one-eleventh part of the undistributed profits of corporations; what would be the result? Remember that at the end of 1950 these corporations had paid their way, had distributed handsome dividends of $4,276 million, had set aside total depreciation allowances of over $6,000 million, and had left undistributed profits amounting to $4,952 million.

Those undistributed profits represent $353.48 for every man, woman and child in Canada. An eleventh part of those undistributed profits would be $450,181,818, which is more than the total revenue which the government gets from the sales tax. With that amount taken from their total undistributed profits the corporations would have left a residue of $4,501,818,182, and it would mean that the people of Canada would still be contributing to those profits at the rate of $321.34 per capita.
During the eleven years 1940 to 1950 inclusive, corporation shareholders, who of course are the privileged class in Canada, received cash dividends at the rate of $305.22 per capita of Canada's 1951 population. But the government has extended to this group more privileges in this budget by making it possible for them to escape taxation on their individual incomes until they reach the astounding figure of over $9,000 per year.
If the levy I have mentioned were made on undistributed profits of corporations it would be possible for the government to relieve the low bracket taxpayer of $32.14 in the way of taxes, and the government would be merely assisting the corporations to pay back to the taxpayers a small portion of the money the corporations had taken from them in profits, much of which was completely unjustified. This would be a form of profitsharing plan.
Such profit-sharing plans are being tried in various industries. I have here an article from the Globe and Mail of last week headed "Profit Sharing Helps Company Employees: Lush" which I should like to place on the record. It reads:
The lowest hourly rated female employee working for the full year 1952 at Supreme Aluminum Industries, Ltd., received a total from profits of $843-$335 in cash and the balance in retirement credits. This amounts to $16.22 per week for the entire year, or 37 cents per hour for 44 hours of 52 weeks.
The highest hourly rated male employee received during the same period $1,639 from profits. This is equal to $31.52 per week, or 72 cents per hour on the same basis. Of this total, $200 represented past service credits. Over a period of five years, this hourly employee has a balance in his retirement fund of more than $6,000, and in addition has received some $1,500 in cash.
Using these two illustrations to indicate the worth of profit sharing to the individual employee, H. V. Lush, president, told guests at the profitsharing dinner at the Royal York last night that since Supreme Aluminum began its profit-sharing scheme five years ago, employees have received $513,781 in cash and retirement fund credits from profits. During the same period, the company increased its working capital by 80 per cent and its net worth by 63 per cent.
"This enviable record has been largely the result of increased efficiency," he declared. "In our fabricating division, production per wage dollar in 1951 increased by almost 10 per cent over 1950.
The Budget-Mr. Thomas And last year, this same department increased its output per wage dollar by a full 10 per cent over 1951."
There you have an outstanding example of what corporations can do under present circumstances. Remember that Supreme Aluminum paid taxes to this government on the high level which this government has been exacting. But in spite of that they have been able to increase their working capital by 80 per cent and their net worth by 63 per cent, while at the same time passing back to the employees very large benefits in the form of cash bonuses and retirement allowances. Supreme Aluminum Industries Limited are to be congratulated on a remarkable achievement. What they have done sets a pattern of what other corporations could do if they had the will to be fair and just rather than merely to become powerful.
It is quite apparent that these corporations do not need the reductions given in this budget nearly as badly as do the wage earners. We say that very little assistance has been given to the wage earners, and practically nothing has been given to the western farmers. Of course there are some things for the western farmers. I am sure they will all be glad and thankful to the minister for taking the tariff off plow bolts. I am sure the wives of farmers will be able to make good use of the straight pin that will be saved in that way during the coming years. That is just about all that they will get.
As for the income tax reduction of 11 per cent, this is effective on July 1 and the actual reduction for the year is only 5-5 per cent. If the Minister of Finance (Mr. Abbott) had wanted to give the people of Canada a reduction of 11 per cent, why did he not make it effective on January 1 as he did with the corporation tax, instead of July 1? This way of putting forward income tax reductions is much the same as the method adopted by loan sharks in attempting to fool prospective borrowers. When they say the rates are only $5 a month it does not sound nearly as big as 60 per cent a year. That is exactly what the minister tried to do but in reverse, of course. He says it is 11 per cent but he makes it effective for only half a year, and he knows very well that a new budget will be introduced within a year and that the 11 per cent will not carry on beyond that time.
Speaking of taxes, I cannot help but protest again, as I did on an earlier occasion during this session, against the gestapo methods employed by some of the investigators of the Department of National Revenue. The investigators of the department seem to be picking on the farmers, particularly in my riding, more than on anyone
2774	HOUSE OF
The Budget-Mr. Thomas else. Their high-handed attitude has certainly antagonized a good many people in my constituency. It is very much like one farmer expressed it to me when I was home. He said:	As low as the Canadian dollar
can fall, it will never stoop as low as government officials will go in order to get it. I am inclined to agree with him. The taxpayers of Canada are putting up with this type of collection method, with exorbitant taxes and no relief in sight merely to pay for the waste, extravagance and inefficiency of the government.
The investigation into the army works services is a good example. I know that government members will say oh well, that is a very small branch of only one service of the armed forces. But let us remember that that is the only branch of government that has been investigated for a good many years, and as far as we know this waste, extravagance and inefficiency may be spread throughout the whole field of government operations. Only a change in government will tell us that. On that point I am going to have to agree and also disagree with the hon. member for Eglinton (Mr. Fleming) who on February 26, at page 2431 of Hansard, had this to say:
If they cannot do anything about it, then let them make way for a government that will do something about it.
Then someone interjected "C.C.F.". The hon. member for Eglinton went on to say:
No, it will not be C.C.F. Whatever may be said for my hon. friend, the fact of the matter is that there is only one place for the people of the country to turn to in this situation if they want an end to this extravagance, this waste, an end to these scandalous irregularities, if they want an end to this extortionate burden of taxation, if they want an end to these attempts to fool the people on the eve of elections.
As far as that part of his statement is concerned, I can agree with the hon. member for Eglinton. However, he goes on to say:
There is only one place for them to go and that is to go to the Progressive Conservative party, and go to that party they will at the next election.
Apparently the hon. member for Eglinton has not dug very deeply into the history of Conservative governments in this country. As a matter of fact, it will not take me long to go through the entire history of Conservative power in the House of Commons. I am not going to say in this respect, as has been said by many hon. members opposite, that the Conservative government of 1930 to 1935 caused the depression of the thirties. Far be it from me to say that, because the policies of the prior Liberal government were directly responsible for that depression. But the Conservatives did absolutely nothing to stop us from sinking into the mire of the depression. Neither, as a matter of fact, did the Liberals


when they came into power in 1936. It was not until the war came along that we found ourselves solvent again as a nation.


William Joseph Browne: May I ask
the hon. member a question? Has he heard of the imperial economic conference of 1932 and the agreements that were made then by the Conservative government?


John Lambert Gibson: What did Gladstone say in '76?


Ray Thomas: That is right. We will not worry about what agreements were made. We saw the results, and that is all we are interested in. It is quite apparent too that some newspapers have the same idea I have. I have here an article from the Victoria Times which was reprinted in some of the weekly newspapers. It reads as follows:
The Conservatives have never erected a clear, understandable and Conservative policy which the people as a whole could grasp and accept.
In Alberta and British Columbia at least, Social Credit has done this.
As things stand, the only chance he-
The reference is to the Leader of the Opposition (Mr. Drew).
-offers them is to vote for the Conservative brand of socialism.
I do not believe the people of this country want that any more than they want the sort of government we have had in the past few years. I listened to Conservative speeches during the last parliament and I heard them criticize one piece of legislation after another, but never once have I ever heard them put forward a single policy which would rectify any of the blunders made . by the Liberal government, and there have been plenty of them. Of course the Leader of the Opposition has been pounding on the fact for quite a long time that the Liberal government believes in order in council government. I should like to read an extract from Hansard for January 21, 1935. The leader of the opposition at that time, Mr. Mackenzie King, had this to say as found at page 33:
I shall continue to look with a great deal of care, not upon the alleged but upon the real purpose lying back of each and every measure as disclosed by some of its provisions. That has been the occasion of such opposition as the Prime Minister has had in this house to any measures he has introduced. The opposition has not been to what was good in any measure; it has been to what there has been of stealthy alienation of the authority and control of parliament over many aspects of public affairs.
At page 55 Mr. King had this to say:
To this end it would repeal the legislation enacted by the present administration, which deprives parliament of its control over expenditures and taxation, and invests the executive with unwarranted arbitrary powers, as for example:

(1)	legislation permitting the executive to enact measure by order in council for peace, order and good government, and
(2)	legislation providing the executive with a "blank cheque" for expenditures of any kind.
It is quite apparent that in that respect there is no difference whatsoever between the two old-line parties. They both like to do it while they are in power and they each criticize the other when the other is in power for doing the same thing they would do themselves. On February 24 the hon. member for Athabaska (Mr. Dechene) had this to say when speaking in this debate, as found at page 2373 of Hansard. He was referring to the meeting between the Alberta and British Columbia premiers.
As I was saying, the two premiers met together and amongst other propositions they suggested a western outlet through one pass which is not the one that should be used anyway, but they suggested it.
That statement, Mr. Speaker, is absolutely false. It is untrue. The premiers did meet and they did discuss a railway outlet from the Peace river district to the west coast, but at no time did they ever suggest any route. Apparently the hon. member for Athabaska allowed his political ardour to run away with him when he made that statement.
I have one more point to mention, Mr. Speaker. The other day I received an answer to a question I placed on the order paper concerning the sale of certain Canadian National property in the city of Edmonton. I was amazed when I found no tenders had been called. The Minister of Mines and Technical Surveys (Mr. Prudham) purchased that property through direct negotiations. The minister says he paid more than anyone else would pay. Well, that may be true; I do not know. I have not seen the property. If he had been so sure no one else wanted to pay that much, then he should not have objected to tenders being called; that is the way the sale should have been handled.
The press reported that one of the cabinet ministers-no name was mentioned in the article-stated that whether or not the minister had received any special consideration hinged on the price. The price might be fair, as I said before; I do not know. The question is, who else wanted the property? Did anyone else want it? In my opinion the price itself does not enter into it too much. It is the propriety of the whole thing. The minister may be within his legal right; I do not know because I am not a lawyer. In a statement to the press the Minister of Mines and Technical Surveys said he had been trying since 1946 to obtain this property. It is quite apparent from that that the Canadian National did not want to get rid of it, because
The Budget-Mr. Ward he had been trying to obtain it for four years before he became a cabinet minister. I think it is a strange state of affairs when a minister of the crown can negotiate directly with a crown corporation to buy property without benefit of bidding. In my opinion, Mr. Speaker, the Minister of Mines and Technical Surveys has no alternative whatever except to hand in his resignation effective immediately.


John Lambert Gibson: Will the hon. member permit a question? I am interested in this subject too. I do not know whether he has been particularly fair in his summation of this case. If you wanted to buy a piece of property from the Canadian National Railways, which you may have occasion to do in the course of your normal business, would you not approach the land department of that railway by private negotiation with them rather than by open tender? Is that not the way you would buy the piece of property?


Ray Thomas: I certainly would if I were a private citizen, but I see no reason why a minister of the crown should be able to enter into direct negotiations with a crown corporation. In my opinion, if he had done what was right he would have resigned his interest in his various business enterprises when he became a minister, the same as the Minister of Trade and Commerce (Mr. Howe) did in 1935 when he became a minister in this government.


John Lambert Gibson: That may be true. If that happened to be true, we would have very great difficulty getting men of the calibre we require for the public service of Canada, if they had to divest themselves of any business interests they might have.


Ray Thomas: They always do. I am wondering how much trouble the government had in getting the Minister of Trade and Commerce.


John Lambert Gibson: I am glad they got him.


Mr. W. J. Ward (Dauphin):: I do not often take part in the debates in this house, Mr. Speaker. When I came here 32 years ago, I, like many other young fellows, did a lot of talking. I quickly discovered that any comments made by the other young fellows of my age, and young women too, were mainly for propaganda purposes. I decided that I could make my own speeches outside of this house just as well as I could inside, so of late years I have not made many speeches in this house. I would not be speaking tonight were it not for the speech delivered by the hon. member for Greenwood (Mr. Macdonnell). I happened to be visiting my home when his speech was delivered, but on my return, as I usually do, I carefully read
2776	HOUSE OF
The Budget-Mr. Ward Hansard to see what the boys had been doing in my absence. I found some statements made by the hon. member for Greenwood which, according to my memory, were completely at variance with the facts.
I have a very high regard for the hon. member for Greenwood, and for his integrity. I was sure he had not looked up the history of the Canada-United States trade agreement of 1935, or he would not have made some of the statements he did make.
Before going on with that, Mr. Speaker, I thought perhaps the house might be indulgent enough to afford me the privilege of saying a word about the district I represent.


James Arthur Ross: Don't forget that curling championship.


William John Ward: I only do this because I do represent a very famous district. A team of curlers from my home town has just won the Brier cup. We are all very, very proud of our champions.
The district I represent happens to be one that was traversed by the white man perhaps a hundred years before there was an Ottawa. Count La Verendrye and his three sons, who were the first white men to traverse what is now the prairie provinces, built a fort, Fort Dauphin, somewhere around 1741. In the district that has maintained the name of Dauphin and the lake has also remained Dauphin lake, many of our societies are called La Verendrye and we do revere the name of La Verendrye. We feel our district has been honoured by these people who came there in the early part of the eighteenth century, and for many years maintained a fort in that district.
However, to come back to the hon. member for Greenwood, in referring to the Canada-United States trade agreement he had this to say-and it is going to be necessary, Mr. Speaker, for me to read what the hon. member said, and then read what the then leader of the Conservative party, Mr. Bennett, said in this house on February 10, 1936. The hon. member for Greenwood had this to say as recorded at page 2345 of Hansard for February 24, 1953:
It is in these circumstances, and in this atmosphere, that R. B. Bennett made his proposal to the British' and all other governments of the empire. These resulted in providing Canada at the time with a sheltered market, especially in Britain. But Mr. Bennett did not stop there. He made a definite proposal for a trade agreement with the United States, and in his proposal he included what Mr. Fielding would not include in 1911, an offer of the intermediate tariff. Up to this time, no Canadian leader or other statesman had dreamt of offering the intermediate tariff to the United States. This resulted in a trade agreement made between Canada and the United States in November, 1935, thirteen days after the King government was returned to power.
IMr. Ward.]

Now, listen to this:
What they really did was to sign on the dotted line the agreement that had been on the point of being signed while Bennett was still in office.
Farther down the hon. member continues:
It is true that in 1930 the Bennett government had made substantial increases in the Canadian tariff right across the board.
I should like to remind the house that I was very active in political affairs at the time. Most of these tariffs were around 80 per cent, let that be remembered. On textiles and many of the necessities of life the tariff was 80 per cent or more, and some tariffs ran above 100 per cent. They were nearly all around 80 per cent. Then the hon. member goes on:
Rightly or wrongly, he did what practically all countries in the world were doing, including Britain, for the first time in nearly three-quarters of a century, that is, taking measures to protect the national economy against the devastating fall in world prices and shrinkage in world trade.
Mr. Bennett did not do much by his threatened blasting into the markets of the world. I pause here to say this. I recall that in the election campaign of 1930-I was a candidate and was defeated in that election-Mr. Bennett, in speaking throughout the west and his lieutenant who spoke in Dauphin, Dr. Manion, at that time said that if Mr. Bennett was returned to office he would reduce the imports coming into Canada by at least half a billion dollars.
Shortly after that I happened to be addressing a meeting in the same town and T made these remarks or predictions. I said if Mr. Bennett is returned to office and does the things he says he is going to do, this is what will happen; and I warned them that I had every confidence that Mr. Bennett would do exactly as he said he was going to do. Some of my Conservative friends said, "Oh, that is just political talk." But I knew Mr. Bennett well enough-I had sat in this house with him long enough to know that he meant what he said.
I predicted that if Mr. Bennett was elected and did the things he said he was going to do, this would be the result. I said to my farmer friends: You will sell your good wheat that is now worth a dollar for 25 cents per bushel. Your good two-year old or two and a half-year old steers for which you are now getting $45, you will sell for $15. Your good bacon hogs for which you are getting 11 cents per pound on their feet you will sell for 2J cents per pound.
The morning after that meeting a good friend and a good Liberal came to me and said, "What was the matter with you last night?" I said, "I never felt better in my life. What do you mean?" He said, "I am talking

about those crazy predictions you made." "Well," I said, "if you will just be patient and just tuck it away in the back of your memory; then when it happens, come and tell me."
Mr. Bennett was elected; and two years and four months almost to the day from that morning, this same man rushed into my office with his hands over his head and said, "My God, it has all happened." It had all happened. Why did it happen? Because of the very same things that this party of which I was once a member-I am an exConservative; I escaped in time, though

are now advocating such as tariffs on sugar, protection for this and protection for that.
If we do not buy, we will not sell. That is the reason we are selling today, and the reason our good friend the Minister of Trade and Commerce (Mr. Howe), who is the greatest salesman to ever breathe the air of Canada, has been able to sell 650 million bushels of the crop of wheat threshed last year. I wonder how long it would have taken our Conservative friends to sell 650 million bushels of wheat under the policy that was not only advocated but practised during the last years of their term in office.
I now want to turn to something else. I have read what the hon. member for Greenwood said about that agreement. I want to turn now and read what Right Hon. R. B. Bennett said of that agreement on February 10, 1936, as reported at page 56 of Hansard:
Now what is the case today? Today an agreement has been made that in my judgment-I may be wrong; I never undertake to speak with any sense of certainty in these days-


Some hon. Members:: Oh. oh.


Mr. Bennett:: I have never undertaken during the last five years of flux and change to speak with any degree of absolute certainty about anything connected with trade, for the situation has changed from day to day and from night to night. I can recall an order taken by a firm in Canada to be shipped to the United States; the goods were packed and when they reached Windsor to go across, the rate of duty owing to another classification had been so increased that it made it impossible to ship them without losing thousands of dollars. These things happen from day to day. I can only say that if we have adopted, as apparently we have, the principles laid down in the papers tabled today-
That was the agreement.
-we shall find it to be a very sorry day indeed for this Dominion of Canada. For I assure you, sir, that at any time before October it would have been possible to arrive at that arrangement, but I would not make it. I stand here tonight and say that I condemn it. I believe it to be bad and I am as certain as one can be in this changing world that the agreement which has been consummated will bring disaster to Canada.
That was the Conservative party's view in 1935. The strange thing about it, Mr. Speaker, is that it is still their view after the
The Budget-Mr. Ward five years of the most terrible conditions which this country has ever known and which I hope to God it will never know again. Some time later in the same debate Mr. King, then prime minister, was speaking; and as reported at page 86 he said:
There are only two other subjects to which I will refer before I conclude; they are the two which I imagine are uppermost in the minds of hon. members. The first is the Canada-United States trade agreement. That agreement will come up for very full discussion in the course of another few days. There is at the present time on the order paper a notice of motion which I have given asking the house to approve of the agreement. There will subsequently be introduced bills which will provide the necessary legislation for giving effect to all of its provisions. In due course, therefore, we shall have ample time to discuss the merits of this agreement.
What I wish to touch upon this afternoon is the impression which my right hon. friend sought last night to convey, that this agreement, so far as Canada is concerned, was the result of-
And I would ask hon. members to listen to this.
-hasty and possibly immature action. He resented very strongly the fact that the government should have concluded, in something less than a month after its return to office, an agreement so far-reaching in its nature. He began by referring to the negotiations having extended over a period of weeks. He then reduced the period to days, and finally got down to the point where the agreement had been arrived at in an hour or two. If my right hon. friend had been aware of the facts, he would have known that in those three weeks no government ever worked harder on any measure than did the present administration with respect to this particular agreement.
A little farther down Mr. King went on to say:
If I have been able, in connection with the negotiation of this particular agreement, to play a part that has been helpful, I attribute it above all else to the fact that it was known, when I went to Washington, that for nearly seventeen years I had had the loyal and wholehearted support of the Liberal party-a party which from one end of Canada to the other had advocated a reciprocal agreement with the United States-and that at no time had the leader of any other government in this dominion behind him such a following as I had at the time I began the negotiation of the agreement. In other words, there was a guarantee at once that we were in earnest; that we meant business, and that we were in a position to carry nut effectively what we might undertake to do.
And a little further on Mr. King, speaking of Mr. Bennett, said this:
He knows that since confederation up to 1911 an effort had been made on the part of both political parties to get a reciprocal agreement with the United States. He knows that under one Liberal administration, that of the Hon. Alexander Mackenzie, an agreement was negotiated but was defeated by the senate of the United States. He knows also that under another Liberal government, the great administration of the Right Hon. Sir Wilfrid Laurier, a splendid agreement was negotiated with the United States; and he knows, better than anyone else, that no one in Canada worked harder to defeat that agreement than he himself.

The Budget-Mr. Ward


Colin Emerson Bennett: Hear, hear.


Mr. Mackenzie King:: And he says, "Hear, hear".
May I recall to him the words of the Bight Hon. Sir Wilfrid Laurier in reference to himself when he came into this house, I think it was-


Mr. Lapointe (Quebec East):: In 1911.


James Horace King: -as a young member. Sir Wilfrid Laurier said that he thought my right hon. friend (Mr. Bennett) would live to see the day when he would regret having opposed a reciprocity agreement with the United States.
I could go on and read quite a bit more because there is a lot more here that is pertinent. Mr. Bennett then said:
Oh, no.
He did not regret it. I continue:


James Horace King: Oh, yes, he did; he would
regret having done it, and he would come to see the wisdom of an agreement being negotiated with that country. That prophecy came true. It is not like the prophecies of my right hon. friend. He shakes his head and says 'No." Then he explains his whole position, because he now makes it perfectly clear that he never actually intended to try to secure an agreement.
We go a little further and we find that later on when the house was considering the agreement itself Mr. Maybank, who was then a new member in the house, said this, as reported at page 818 of Hansard:
No; we do not have to worry about the balance of trade with any particular country. We all know now; we have learned to our sorrow in the last five years, that we cannot sell if we do not buy, and that people outside cannot sell to us if they will not buy from us. Naturally I shall support this treaty because it is the one bright spot in the fiscal policy panorama of this country for a great many years.
I go on a little further and I find that a vote was taken on the agreement. It will be very interesting to learn how that vote went. I do not suppose it would be permissible to put the names of those who voted against the agreement on the record, but I will read a few of them. Thirty-nine Conservatives voted against the agreement. There was Mr. Barber who was then the member for Fraser Valley; Mr. Beaubier, the member for Brandon; the Right Hon. R. B. Bennett; Mr. Casselman, the whip of the Conservative party; two or three other members from British Columbia; Mr. Graydon; Mr. Perley, the member for Qu'Appelle, and several other members from Ontario and from different parts of the country. Apparently the party voted solidly against that agreement. I thought it was worth while, Mr. Speaker, to put that on the record because we believe that that agreement of 1935 brought more by way of prosperity to Canada than any other single act that could have been committed by any government; but it was followed within a few months by fifteen more trade agreements entered into with different countries by the government of Mackenzie King. Our

prosperity and our economy went up and up. I have some figures here to show-


Mr. Macdonnell (Greenwood):: Will the hon. member permit a question at this point? The hon. member began by saying he considered that I had been inaccurate in what I had said the other day, and I gathered that the inaccuracy that he referred to is to be found at the top of page 2346 of Hansard, where I said:
This resulted in a trade agreement made between Canada and the United States in November, 1935, thirteen days after the King government was returned to power. What they really did was to sign on the dotted line the agreement that had been on the point of being signed while Bennett was still in office.
My question is, does the hon. member for Dauphin question the accuracy of that?


William John Ward: Definitely. I was here; I lived through it.


James MacKerras Macdonnell: Let me pursue my question further. Does he deny that the agreement signed was the agreement which had been under negotiation, or virtually so, at the time the election took place? Does he agree with that? He does not suggest that this was all done in 13 days?


William John Ward: My hon. friend himself suggests that it was all done in a hurry, and his leader of that day suggested it might have been done in a hurry.


James MacKerras Macdonnell: The hon. member for Dauphin was very fair in his reference to me at the opening. I want to ask this question. I made that statement in good faith. I believe it. Does the hon. member question that simple statement that what they really did was sign on the dotted line the agreement that had been on the point of being signed while Mr. Bennett was still in office? There are other points which arise by reason of what the hon. member for Dauphin has read subsequently, but I am asking whether that statement is true.


William John Ward: I do not question the integrity of the hon. member for one moment, but I do question definitely his statement. My hon. friend did make the statement-it is all on record here-that there were some few minor changes.


James MacKerras Macdonnell: That is right.


William John Ward: Could those changes be sufficient to wipe out the whole principle-


James MacKerras Macdonnell: Well-


William John Ward: Just a minute-to wipe out the whole principle of the agreement between two countries that brought such prosperity to Canada? Surely Mr. Bennett must have been

sufficient of a realist, if he was sincere in his desire to effect a trade agreement with the United States, to compromise to the point of overlooking these trifling little changes the hon. member speaks of. Why did Mr. Bennett vote as he did after the debate in 1936? Why did he not say the things then my hon. friend is saying now? My purpose in reading the debate of 1936 was to prove to my hon. friend that he was wrong. I do not think he did it deliberately at all, but he is wrong and definitely wrong, or Mr. Bennett would have corrected it at the time.


James MacKerras Macdonnell: If I may
again interject, I come back to my question because I do not think the reasoning of the hon. member for Dauphin is necessarily correct. I have not had the advantage of reading the speech of Mr. Bennett to which he refers, and Mr. Bennett may, by the time he made that speech, have felt that more concessions could have been obtained; but that is irrelevant at the moment.
I am coming back to the one point. Does the hon. member agree that the agreement that had virtually reached the point of signature before the election was the agreement that was signed, with the trifling changes, after the election? That is what I said, and that is the question I am asking the hon. member to answer. He said I was inaccurate. I hope I was not. I certainly tried not to be, and I am asking again: does he deny that the agreement which was signed 13 days after the election was in fact the agreement which had been under negotiation I believe for many weeks if not for many months before the election?


William John Ward: Mr. Speaker, I should like to answer that partly by asking my hon. friend a question. Where did he get his information?
The Budget-Mr. Ward


Some hon. Members:: Ten o'clock.


William John Ward: Where did he get his information that led him to the conclusion he came to in the address which he made a week ago Tuesday?


James MacKerras Macdonnell: It is now ten
o'clock and I shall certainly come back later on the matter, but I think it is a matter of common knowledge. I have not had a chance of reading the debate fully, but I think it is within the common knowledge of everybody that the agreement that was signed was in fact the agreement that was on the point of being signed before the election.


William John Ward: Why then was it not signed?


Alphonse Fournier: It was the agreement Mr. Bennett would not sign; he said so.


James MacKerras Macdonnell: According to what the hon. member for Dauphin said, he criticized it afterward. By that time he might have thought that a better agreement could have been made, but that does not affect what I understand to be the fact that that agreement was in existence and that it was in fact signed with trifling changes.


Alphonse Fournier: I heard Mr. Bennett himself say that the agreement was not worth anything; he would not have signed it. I heard that myself.


An hon. Member:: Ten o'clock.
On motion of Mr. Ward the debate was adjourned.



BUSINESS OF THE HOUSE

Alphonse Fournier: Tomorrow we will continue this interesting debate.


[Stage Direction]
At ten o'clock the house adjourned, without question put, pursuant to standing order.
[Stage Direction]
Tuesday, March 10, 1953