1953-03-12

[Stage Direction]
Fourth report of the standing committee on banking and commerce.-Mr. Cleaver.
Third and fourth reports of the standing committee on miscellaneous private bills.- Mr. Winkler.


[Stage Direction]
Hen. Douglas Abbott (Minister of Finance) moved:
That the public accounts and the report of the Auditor General for the year ended March 31, 1952, be referred to the standing committee on public accounts.
Motion agreed to.


Hon. Lionel Chevrier (Minister of Transport):: Mr. Speaker, hon. members of the
house will be interested to know that tenders have been received for the construction of a navigation lock at the northern end of the Canso causeway now being constructed across the strait of Canso between Cape Breton island and the mainland. T. C. Gorman (Nova Scotia) Limited, one of nine firms which tendered, submitted a tender of $4,817,777 and this tender has been accepted. A contract will be entered into with this firm and in the meantime they have been instructed to commence work immediately to enable its completion on schedule. It is extremely important that the work commence as soon as possible so that the coffer dam construction can be completed before ice conditions occur during the winter of 1953-54. The time schedule for closing of the gut of Canso and the operation thereon of highway and railway traffic is December, 1954, with full operation of the lock in late summer, 1955.



QUESTIONS


Mr. Robichaud:: 1.	What has been the total cost to date of Canada's NATO troops' commitment?
2.	What have been the annual outlays of money by Canada, in each and every year, since our participation in the NATO defence plan?
3.	What are the countries in which Canadian troops have been and are presently stationed under our NATO troops' commitment?
4.	What have been the annual outlays of money by Canada, in each of the above countries, in each and every year, to the 1st of January, 1953, for the maintenance therein of our Canadian troops, since our participation in the NATO defence plan?


Mr. Blanchette:: 1,	2, 3 and 4. Canada is one of the countries included in the area to which the North Atlantic treaty applies and consequently all expenditures on defence made by Canada, with the exception of expenditures on Canada's part in the United Nations' action in Korea and the Far East, are expenditures in support of the North Atlantic Treaty Organization. As part of the Canadian effort, there are Canadian forces at present stationed in Canada, the United Kingdom, France and Germany.
SIMARD INDUSTRIES LIMITED	r


Mr. Herridge:: 1.	Is Simard Industries, Limited, Montreal, producing certain equipment for use by the Royal Canadian Navy?
2.	If so, has the government rendered any financial assistance in the development of this plant for the manufacture of this equipment?
3.	Is there any other firm in Canada already equipped to undertake the manufacture of these items without government assistance?
He said: With the permission of the house I should like to withdraw this question so that it can be reworded.


Mr. Speaker:: Question dropped.



WAINWRIGHT MILITARY CAMP


Mr. Fair:: 1.	Has any provision been made by the Department of National Defence or any other department of the government for the housing of civilian personnel employed at the Wainwright military camp?
2.	If so, what does this accommodation consist of?
3.	What is the cost of the above?


Joseph-Adéodat Blanchette: 1 and 2. No housing has been provided, specifically for civilian employees at Wainwright. However, one temporary married quarter is at present occupied by a civilian employee. Departmental policy provides that civilian employees essential to the opera-

Questions
tion of a camp may be provided with accommodation at the discretion of the GOC command if no suitable accommodation can be otherwise obtained. The employee in question is responsible for the repair and maintenance of all essential services, sewers, electricity, within the camp.
3. The accommodation in question is a wartime hut converted to a temporary married quarter in 1945 at a cost not in excess of $2,700.



SALT COD EXPORTS, NEW BRUNSWICK

Mr. Robichaud:: 1.	Was any salt cod exported from the province of New Brunswick to Cuba, since January 1, 1949, to this date?
2.	If so, what quantity was exported and in what year?
3.	In what county or counties of the said province had this salt cod been processed?


Mr. Mcllrailh:: 1 and 2. Exports are not recorded by province of origin but rather by the province through which the goods clear for export. The exports of salt cod to Cuba through customs ports in the province of New Brunswick were as follows:-
Calendar Year	Pounds
1949		 132,300
1950		 206,200
1951		 172,100
1952		 361,600
3. Information not available.



NEW BRUNSWICK-IMMIGRANTS SETTLED

Mr. Robichaud:: 1.	How many immigrants settled in the province of New Brunswick, during the years 1949, 1950, 1951 and 1952?
2.	From what countries did these immigrants come?
3.	How many of each nationality settled in the said province, during each of the above mentioned years and in what county did they settle?


Mr. Harris:: 1.	1949, 782 gave New Brunswick as destination; 1950, 663 gave New Brunswick as destination; 1951, 1,423 gave New Brunswick as destination; 1952, 1,020 gave New Brunswick as destination.
2.	Statistics maintained do not provide information requested. Breakdown by racial origin given on attached statement.
3.	Statistics maintained do not enable an answer to be given by nationality and province or county, nor do they enable the answer to part 2 to be broken down by counties.
[Mi'. Blanchette.]
Immigration to Canada from overseas by racial origin and total from U.S.A., destined
to the province	of New	Brunswick,	calendar years 1949	to 1952.	1949	1950	1951	1952English 	. 181	59	159	150Irish 	. 27	16	23	26Scottish 	. 57	23	51	66Welsh 	. 14	3	7	1Totals 	. 279	101	240	243Arabian 	9	Belgian	. 2	1	7	4Bulgarian 	. 1	11	Chinese 	. 3	3	12	15Czechoslovakian .	10	12	31	Danish 	. 6	9	43	30Dutch 	. 39	121	278	218East Indian	2	Esthonian 	. 26	19	24	2Finnish 	. 1	1	33	12French 	. 17	4	15	10German 	. 5	19	180	170Greek 	. 7	5	8	6Hebrew 	. 13	2	8	9Italian 	. 26	20	65	24Jugoslavian 	. 6	2	41	8Lettish 	. 14	25	10	5Lithuanian 	. 16	2	7	Magyar 	7	46	4Maltese 	1Negro 	. 1	1	1	1Norwegian 	4	19	1Polish 	. 43	34	77	9Portuguese 	1	3	1Roumanian 	2	10	1Russian 	. 1	1	7	1Swedish 	. 3	4	1Swiss 	9	2	5Syrian 	1	8	5Ukrainian 	. 9	9	15	4Totals 	. 249	316	974	547From U.S.A	. 254	246	209	230Grand Totals .	. 782	663	1,423	1,020
Source: Immigration branch', Department of Citizenship and Immigration.
CANADIAN SERVICES COLLEGES ADVISORY BOARD Mr. Pearkes:
1.	Has an advisory board for the Canadian services colleges been authorized in regulations published by order in council in 1950?
2.	If so, what are the duties and responsibilities of the advisory board?
3.	To whom are the reports and recommendations of the board submitted?

4.	Who are the members of the board?
5.	How many meetings has the board held since 1950?
6.	When is the next meeting of the board?


Mr. Blanchette:: 1.	Yes.
2.	To advise the minister on all matters pertaining to the colleges.
To hold one general meeting a year at each college alternately.
In addition to the annual general meeting, to meet as directed by the minister.
(See also page 2909.)



QUESTION PASSED AS ORDER FOR RETURN


Mr. Herridge:: 1.	Does the Department of National Health and Welfare own and operate a T.B. hospital at Moose Factory island, James bay?
2.	If so, what were the reasons for building this hospital on Moose Factory island?
3.	What is the total expenditure to date for (a) land; (b) hospital buildings; (c) furniture; (d) equipment?
4.	What is the number of houses built and the cost?
5.	How many patients can this hospital accommodate?
6.	What was the total cost of operating this hospital for the year ending March 31, 1952?
7.	Of this total cost for the year ending March 31, 1952, what were the total (a) patient days; (b) number of staff by classification; (c) salaries paid; (d) cost of food; (e) cost of medical supplies; (f) cost of fuel?



TELEVISION


[Stage Direction]
On the orders of the day;
Mr. T. H. Goode (Burnaby-Richmond):: should like to direct a question to the Minister of National Revenue. Will he confirm that the Canadian Broadcasting Corporation intends to construct its British Columbia television station in Burnaby, British Columbia?


Hon. J. J. McCann (Minister of National Revenue):: I am not in position to confirm that at the present time.


Mr. Fulton:: If so, why?



PRINTING BUREAU


[Stage Direction]
On the orders of the day:
Mr. D. S. Harkness (Calgary East):: I should like to ask the Minister of Public Works what is the height of water standing in and around the basement of the new public printing building in Hull and what means are
Inquiries of the Ministry being taken to prevent a constant recurrence of this situation?


Hon. Alphonse Fournier (Minister of Public Works):: If there is any water around the printing bureau, it is frozen. Being the member for the riding in which this building is located, I was up there about ten days ago and there was no water at all.


Douglas Scott Harkness: Have you been there in the last day or two?


Alphonse Fournier: I do not go every day. I am giving these answers because I know the people in my riding are most interested in these queries. They know the situation and they have not complained about water or ice.



RADIO BROADCASTING


[Stage Direction]
On the orders of the day:
Mr. H. W. Herridge (Kootenay West):: should like to direct a question to the Minister of Transport and I must apologize for the short notice I was able to give, but this was occasioned by an unfortunate disturbance in my usual schedule.
In view of the disestablishment of the receiving licence section of the telecommunications division of the Department of Transport, occasioned by the announcement in the budget of the abolition of the $2.50 annual radio licence fee, would the minister inform the house what provision is being made for the continued employment of the 108 employees in this section, and whether the services of all the personnel are being continued in other branches or departments without reduction in classification?


Lionel Chevrier: I am sorry that my hon. friend's office was not working on all fours today, but I received notice of this question as I was coming into the house. I can assure him that this matter has been receiving the close attention of the officers of the Department of Transport. We have been placing some of these people, who might have been affected by the abolition of the radio licence fee, in certain branches of the Department of Transport without any loss in their classification. We are trying to place others in other departments and thus far we have received the full co-operation of the civil service commission. I am not in position to say how many have been placed, but I can say that we have placed a substantial number thus far.
2862	HOUSE OF
The Budget-Mr. Harrison THE BUDGET



ANNUAL FINANCIAL STATEMENT OF THE MINISTER OF FINANCE

[Stage Direction]
The house resumed, from Wednesday, March 11, 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. Macdonnell (Greenwood), and the amendment to the amendment of Mr. Coldwell.
Mr. J. H. Harrison (Meadow Lake):: Mr. Speaker, when the house adjourned at six o'clock last night I was discussing the fact that at the time of the 1950 railroad strike the hon. member for Melfort (Mr. Wright) was the only member of the C.C.F. who voted for the resumption of railway service and the ending of the strike. Apparently he was the only one who was interested in the welfare of the farmers of Saskatchewan whose crops were lying out in the open exposed to the weather. Possibly the moving factor in his voting for the resumption of railway service was the fact that his own crop was exposed to the weather. That was the situation with respect to the C.C.F. stand on the railway strike.
Recently we had a short debate on the effect of railway strikes, namely, an increase in freight rates. I gathered from the speeches of my friends in that debate that possibly they might be going back to Saskatchewan and telling the people there what a good job they had done for them with regard to freight rates, that they had suggested to the government that the 7 per cent increase should not be put into effect, and that the government should do something about the board's decision in that respect. Their position was very clear in 1950. At that time they said they wanted the settlement of the strike postponed in order to protect the bargaining rights of the union. I have nothing against that, but that was their opinion. They wanted to be sure that free bargaining rights were maintained. They wanted to have us wait in order to protect free bargaining rights rather than have the strike settled on any other terms.
The C.C.F. party moved an amendment to the amendment to the motion for second reading of the bill to end the strike. Their amendment to the amendment included a provision that a wage increase of greater than 4 cents an hour should be granted to the workers. They did not say how much greater. They did not care how much


greater. It also included the following provision:
The implementing of the forty-hour week for forty-eight hours' pay at a date earlier than September 1, 1951.
They did not care what date it was as long as it was prior to that date. As far as they were concerned it could be back in the days of King John. So far as the monetary provisions were concerned, they were in favour of any settlement as long as the amount was big enough. Then they turn around and get up in the house and complain because freight rates have been increased. That is their position on freight rates.
I would not mention that except for the fact that the stage was being set here the other day for them to be able to go back to Saskatchewan and say what a fine job they had done for the people with respect to freight rates. We have had previous experiences along that line. In the days when we were discussing the settlement of the five-year wheat agreement with the United Kingdom, our friends in the C.C.F. were going around Saskatchewan and taking bows for voting for a final payment of 25 cents a bushel under the agreement, which would have amounted to some $350 million. Finally the hon. member for Maple Creek (Mr. Studer) had to get up in the chamber and straighten out that matter. No such vote ever occurred in the house. In speaking about the question the hon. member for Maple Creek said that most of the C.C.F. members from Saskatchewan had not even been in the house to vote for the $65 million that was paid to the farmers. The only reason we got the $65 million was the fact that the Prime Minister (Mr. St. Laurent) realized that something was coming to the farmers of the west from Great Britain and that as the government had taken part in the deal they were morally affected by it. It was only the fact that the Prime Minister realized that, that caused him to bring in a government measure to pay the $65 million, and if the government had been defeated on it they would have been out of office.
That is the only reason the farmers got the $65 million, and that was pointed out by the hon. member for Maple Creek. Prior to his doing so-and we knew he was going to do it-the hon. member for Moose Mountain (Mr. Smith) came over and sat on this side of the house. He said to me, "I am coming over here so I can have a clear view of our C.C.F. friends from Saskatchewan." He said, "I think there is one bird over there who is going to rise and take wing." When the hon. member for

Maple Creek made the statement that the boys from Saskatchewan in the C.C.F. party had not even voted for the $65 million, we were sitting over here and, sure enough, when he made the statement I found that the hon. member for Moose Mountain was a great psychologist. He certainly knew what was going to happen.
The bird got up and started to fly. He rose and said that he had voted for the $65 million whereupon the hon. member for Moose Mountain got up and said that he had not voted for it and had not been in the house. This occasion, I might say, was known among Liberal members from Saskatchewan as "operation mallard". It was a shooting expedition and was properly arranged. Our friend took his seat, but being a man of valour he got up again and started to fly as it were on one wing. He said he thought he was in the house that night and he thought he had voted for the $65 million. Whereupon the hon. member for Moose Mountain immediately got up again and said he knew the hon. member had not done so and every member in the house knew he had not.
The nails were really put in the coffin by the hon. member for Assiniboia (Mr. Argue), himself, because in stating that he had got up that evening and voted for the measure he, proved beyond doubt that he was certainly wrong. As everybody knows, the vote was taken in the afternoon, and he could not possibly have been here in the evening and have voted for it. So much for that, Mr. Speaker. They go back to Saskatchewan and try to make out that these things took place in a different light than actually was the case.
During my term here since 1949 there have been three occasions on which our friends opposite have got up and said that the country should have price control. They went into that matter very extensively but we did not get price control.


An hon. Member:: The C.C.F.


John Hornby Harrison: That is correct. I did not mean to include the hon. member who has just spoken. But they have risen in the house and suggested that we have price control. We have got along fairly well without it and in the only place where it was put into effect, south of the border, it was a gigantic failure. We have got along very well by doing exactly the opposite to what the hon. members across the way have suggested. A Liberal government has been in office for the past eighteen years. The C.C.F. also came into the house eighteen years ago, and they have consistently said
12, 1953	2863
The Budget

Mr. Harrison that the government was wrong on every measure that has been brought before the house. I think there is some reason to believe that the government has been right. The fact of the matter is that we have done fairly well in the past eighteen years.


Mr. Thatcher:: Despite the government.


John Hornby Harrison: Let me discuss for a moment what our friends are doing in Saskatchewan. There has recently come to my attention a letter

I might say it could be regarded as a pastoral letter to his flock-put out by a friend of theirs by the name of A. M. Nicholson who, I understand, was the former member of parliament in this house for Mackenzie. He said:
It is important that an agricultural province like Saskatchewan should have a larger number of C.C.F. members in parliament determined to fight for a larger share of the national income for agriculture.


Herbert Wilfred Herridge: Hear, hear.


John Hornby Harrison: Well, if they fight for that the same as they did for the $65 million, and the way they have done for freight rates, I would say to the house and to the people of Saskatchewan that maybe there is some reason why they should not be here.


An hon. Member:: They won't be here.


John Hornby Harrison: In the debate on price controls the C.C.F. stand is very clear. There again, were they working for the farmers in Saskatchewan? Well, I will give you the stand of one of them. My hon. friend the senior member for Halifax (Mr. Dickey) was trying to get them to clarify their position with regard to wages. They wanted food controlled-and that was the main thing they wanted to control-but they did not want wages controlled. The only person who grows food is the farmer and when you suggest that food only be controlled you are suggesting that only the farmer be controlled. This is what the hon. member for Halifax had to say on Tuesday, February 13, 1951, at page 332 of Hansard:
I would say also to my hon. friends of the C.C.F. party that I think it would be well for them to outline pretty carefully the way in which they want the various opposing groups to interpret their subamendment, because the support of the Social Credit party has been offered to them on the distinct understanding that the C.C.F. subamendment means that wage controls must be part of the program;
The hon. member for Winnipeg North Centre (Mr. Knowles) said:
"Wages are controlled already."
Well, so much for that. Their policy is clear anyway at that time. They are not working for the farmer and their whole interest is that food prices be controlled and
2864	HOUSE OF
. The Budget-Mr. Harrison that wages be left uncontrolled. Anybody knows that those things which the farmer has to buy of a manufactured nature have about 70 per cent of their price made up by wages. Actually the C.C.F. are advocating that the prices of goods which the farmer has to buy go uncontrolled while goods that the farmer has to sell should be controlled. That is the way they have been operating as far as helping the farmer is concerned, since I have been in this house.
Now, I would like to say a few words on the budget. The first thing I would like to note here is a remark made in the debate in the provincial house by Mr. Fines, in his economic review of the situation in Saskatchewan. He says that the federal government is allowing a shrinking of export markets. He says there is a shrinking of export markets. Well, what is the answer to that? What shrinkage have we had in our export markets? Eighteen years ago, in 1935, when the C.C.F. came into this house and when this federal government took power, we had a total trade of $1,288 million. This year, eighteen years later, and following a policy laid down by this government which is exactly opposite to that suggested by our friends across the way, we have a trade of $8,386 million or an increase not double, not triple, not quadruple, but seven times the trade we had back in 1935. As I say, that has been achieved by following proposals which are in exact opposition to those of our friends across the way.
Our foreign trade last year did not decrease, as our friend Mr. Fines says, but it went up $100 million with the United Kingdom, and it went up $200 million with Europe and Latin American countries. In the case of those latter countries it showed an increase of 25 per cent. On a per capita basis we are the greatest trading nation in the world. There is nobody who can touch us. The biggest trading nation in the world, without taking into consideration the population factor, is the United States; but on a population basis in 1951 each citizen of the United States had a stake in foreign trade of $168. In Canada, in the same year, each Canadian had a stake in our total foreign trade of $577-over three times the figure for the United States. That should be answer enough to the finance minister in Saskatchewan when he states we are losing our export markets. That has been achieved anyway by a Liberal federal government.


Mr. Speaker:: Order. I must inform the hon. member that his time has expired.


John Hornby Harrison: Mr. Speaker, it had been my intention to criticize the budget and I


know my hon. friends would like me to do so. However, I will do it very shortly.


Some hon. Members:: Order.


John Hornby Harrison: It had been my intention sir, to say that, before this budget came down, what this country needed was a good five-cent cigar. After the budget came down it still needed a good five-cent cigar. Outside of that I think the budget has taken care of everything. These small items, even though they are insignificant, when they affect people personally often appear more important than major items.
I know that there are some Irishmen on the other side, so I will conclude by reading a report appearing in a Dublin paper. It says:
How are such miracles performed?-
They are talking of our budget.
-the Dublin Daily Irish Independent asks today in commenting on Canadian budget reliefs announced last week.
The cynic will recall that a general election is due this year-


Some hon. Members:: Hear, hear.


John Hornby Harrison: -says the newspaper in an editorial. Others will point to the almost fantastic growth of Canadian wealth during and since the war.
There are more fundamental reasons. The government has steadily followed a policy of directing investment into strictly productive channels.
My friend from Moose Jaw (Mr. Thatcher) will appreciate that.
It has refrained from widespread increases in its own expenditure. It has adjusted taxation on business-
That is also something for my friend from Moose Jaw.
-so that companies are encouraged to plow back their earnings.
I think my friend from Moose Jaw will plow back some of his earnings. Under this budget he stands to gain something in the neighbourhood of $4,000 or $5,000 this year. We will get it back from him, however, because he will start another hardware store and hire three or four clerks and, ultimately, our friend "Doug" Abbott will have more than he had before-and that is free enterprise.
The Dublin paper goes on:
Finally it has recognized that the taxpayer is better able to use his money than even the minister of finance. It is a sound budget.


Mr. Speaker:: Order. The hon. member's time has expired.


Edmund Davie Fulton: Mr. Speaker, I observe that in his concluding remarks the hon. gentleman who preceded me found it difficult to discover words adequate to

describe the budget. Particularly did he find it difficult to find words adequate to describe the way in which the budget has helped one section of the community but has failed altogether to help the others.
Although the hon. member found it difficult to coin a single word to describe the budget, he found no difficulty in recognizing the fact that this budget presented by the Minister of Finance (Mr. Abbott) on February 19 is a budget designed to serve almost exclusively the interests of business.
The budget has been called a number of names ranging from the complimentary to the critical. Whatever may be said about it, Mr. Speaker, whatever name may be applied to it-I have an idea of my own what it should be called-it is a fact that must be recognized by all that it is a business budget. It is a budget designed to help business, and it is good for business. The trouble with it is that the concessions to business are so great that there is no room for real concessions to be made to the average taxpayer. Whether or not one criticizes the help that has been given to business, it is I think a pity that the Minister of Finance attempted to dress his budget up and present it in the guise of a budget which would bring real relief to the average taxpayer, because it does no such thing.
The Minister of Finance coined his own name for the budget. He called it a social dividend budget. If he was going to give a dividend, as he said he was, to the Canadian taxpayer who has earned this dividend through his hard work, the sweat of his brow and his increased productivity, why did the minister not give the dividend to the average Canadian who has earned it instead of confining the real dividend to the man with invested income and to corporations themselves? We have had figures-I am not going to rehearse the record again-showing that the actual relief given to the average taxpayer, the man in the average income group between $2,400 and $3,000 a year, amounts to perhaps $1 this year or in some cases even a slight increase over what he paid last year. So, the man who earned this social dividend, who made it possible for the minister to give this dividend, does not get anything by way of a dividend. The substantial benefit is confined exclusively to the well-to-do, those who have substantial income from investments in corporations, and, as I have said, to the corporations themselves.
I suggest, Mr. Speaker, that instead of being called "the social dividend budget" it should be called "the social register budget", because the benefits are confined almost exclusively to those in the upper brackets who may find their names on the social
The Budget-Mr. Fulton registers of our larger towns and corporations. The budget gives nothing to the farmer or to the average Canadian. I think of the situation facing the ranchers in my constituency, with rising costs and declining prices for the things that they produce. There is no hope of tax reductions which amount to anything for them. Indeed, they are going to have to pay some sort of extra tax on the tires for their farm vehicles. If the minister had not confined his tax reductions, small as they are, almost exclusively to business, he would have been able to give some concessions to these hard-working Canadians. But no, the minister confined his concessions to those in the social register group, and the ranchers in my constituency will get little or nothing.
The minister had no concessions left over to make to the war veterans who are in receipt of war veterans allowance. They are still subject to that most miserable of institutions, that most discriminating principle called the means test. This test is still applied, with all its rigour, to the payment of war veterans allowance. I still hope the minister will find it possible, before the resolutions based on the budget are adopted, to make some change in that regard.
The minister has done nothing to help the average Canadian-as he might have if he had not confined his concessions to business- by way of reduction of the sales tax which so directly increases the costs of the things the average Canadian has to buy. And yet the budget had done nothing to leave him with a bigger share of his own income with which to meet these increased costs.
The minister says he is going to help the average Canadian. Why did he not reduce the sales tax on such non-luxury commodities as automobiles? The government likes to say that the sales tax applies to items which do not enter into the cost of living; that it is not a tax on necessities. Figures have been given by those in the automobile industry itself to show that the ownership of a car is not a luxury. The ownership of a car is not something confined to the rich people. The ordinary man who has to drive to work, the farmer who has to get from his farm into town, and the average Canadian generally, needs an automobile just as much as those who are in the social register group and who are helped by this social register budget. Those who need an automobile are not helped; they have not had the sales tax reduced.
Here is a statement made by the president of the Studebaker Corporation, as reported in the Toronto Star of February 9, 1953. This will give you an idea of the effect of this sales tax. He points out that in 1951
2866	HOUSE OF
The Budget-Mr. Fulton the Canadian automobile industry produced
415,000	units with a sales value of $650 million. He pointed out that 81 per cent of the Canadian cars are owned by people earning less than $4,000 a year. He shows what happens in Canada when a man buys a $1,836 car. He pointed out that the average list price of the three lower-priced four-door sedans was $1,836 in Canada-that is the factory price. What happens when a Canadian buys this car? He pays $326 to the federal government, while in the United States he pays $134. Mr. Gaskin concluded by saying:
We feel it is time the taxing authorities realized what they are doing to the essentials of life.
That is the whole criticism we have with regard to this sales tax. It hits those in the lower income groups so hard. They are hit when it comes to buying the necessities of life. Tax is mounted upon tax so that they get no relief from this budget with respect to the amount taken away from them by income tax, and the burden of meeting the cost of living is increased by what they have to pay through sales tax.
Then, not content with trying to dress this budget up and present it as a budget giving relief to all Canadians, the minister made a certain statement with respect to the effect of the budget which simply cannot be left unchallenged. As I said, I think it is a pity the minister did not present the budget for what it is, that is, a budget for business, instead of trying to disguise it as a budget for the average Canadian. In the course of clothing this budget in its misleading garments, the minister made this statement which is found on page 2135 of Hansard:
A year ago taxes were reduced by $146 million a year. This evening I have proposed further reductions totalling $361 million a year. This makes the very substantial total of $507 million of tax reduction in two years . . .
Mr. Speaker, there could not be a more misleading statement. It is significant that there could not be a statement more carefully worded if it had been designed to give an impression which is totally false. It could not have been better calculated to give that false impression. What are the facts? The minister says:
This makes the very substantial total of $507 million of tax reduction in two years . . .
It means no such thing. The minister himself, in the course of his budget speech last year, stated that his reduction amounted to $116 million for the fiscal year which is now concluding. In the course of his budget speech this year he told us that the tax reductions will amount to $237 million for the fiscal year about to commence. Those two figures indicate a total of $354 million


tax reductions in two years, not $507 million. The Canadian people would have been better served by the minister if they had been told the truth about this matter in simple language, namely that, far from having their taxes reduced by $507 million in those two years, they will have reductions totalling only $354 million. Mr. Speaker, the difference between $354 million, the actual figure, and $507 million, the figure used by the minister- and repeated by him on the radio in a speech, in which he used almost exactly the same words, to describe the effects of the budget, a speech designed to have its effect in this year which is an election year-is $153 million; and $153 million is too big an error to have been made accidentally by as well informed a person as the Minister of Finance (Mr. Abbott).


Mr. Speaker:: Order. I cannot allow the hon. member to charge that the minister has deliberately said what is not true.


Edmund Davie Fulton: Mr. Speaker, I do not think I have said that the minister deliberately said what is not true. I have said that the minister used words in a way which has created an impression which is completely at variance with the facts.


Some hon. Members:: Oh, oh.


Mr. Speaker:: I think the hon. member went further than that and said-although I do not recall his exact words-that the minister used figures which he must have known were incorrect.


Mr. Cruickshank:: He is getting a little bit rattled.


Edmund Davie Fulton: No, Mr. Speaker. What I said was that the difference between the figure of the actual tax reductions in these two years, namely $354 million, and the figure used by the minister of $507 million, is too large for the discrepancy not to have been known to the minister or to so well informed a person as the minister. I am not saying what the motives were with which he used those words or figures. I am merely pointing out that that is the way he used them.


Mr. Speaker:: I cannot allow the hon. member to say that the minister used figures that he must have known were incorrect.


Edmund Davie Fulton: Mr. Speaker, I did not say that. What I said was that the minister has used that figure of $507 million in a way which suggests that that is the tax reduction that the people are getting immediately as a result of this budget-a reduction of $507 million. Those are the figures used by the minister. I said he used them in a way that would create the impression that this was the reduction being received by the people in these

two years whereas the actual reductions received are only $354 million in these two years.


Mr. Speaker:: As long as the hon. member does not intend to imply that the minister deliberately used figures to deceive, I have no objection to what he is saying.


Edmund Davie Fulton: Thank you, Mr. Speaker. I know that it would be improper for me to say in this house that the minister intended to do that. I am placing the one set of figures beside the other, and the figures for these two years beside the words used by the minister, and I am suggesting that the facts should be drawn to the attention of the Canadian people. That is as far as I wish to go.
When the minister used those figures he also repeated in his radio speech that tax reductions had been given amounting to 11 per cent, or rather that there had been an 11 per cent reduction in income tax. Actually the reduction is not 11 per cent, even on the basis of the minister's figures, for this year. The reduction is a maximum of 51 per cent. He then went on in his radio speech to say that tax reductions amount to $1 million daily. It is true that in a full fiscal year they may amount to almost $1 million daily, but they certainly do not amount to that figure in this election year and they certainly do not amount to $1 million daily in the taxes paid by the ordinary taxpayer of Canada. They certainly do not help the average taxpayers to the extent of $1 million a day.
I should also point out that if there is any reduction this year from the excessive rate applied in the past years, it is only made possible because those rates have been jacked up to a point so high that they amount to plundering the pockets of the taxpayers. If the rates are now reduced, by infinitesimal proportions so far as the average taxpayer is concerned, I suggest that he has no reason to be thankful to the minister because the minister now restores to the taxpayer a mere fraction of what belonged to him but which had previously been taken away from him.
Then of course the most significant feature of the budget is the fact that not one cent of tax reduction is brought about as a result of any economy being practised by this government. This year they are spending, according to the figures tabled in the main estimates, $314 million more than they have ever spent before, even although defence costs this year have not gone up in comparison to those of last year. The minister's constant theme is that increases in government spending are due to the mounting costs
The Budget-Mr. Fulton of defence. This year, according to the estimates, the costs of defence are within $1 million of what they were last year; yet government spending is going up by $314 million.
The minister's constant theme, repeated in every budget that he has presented here for the last three years, is that no further economies are possible; that the government is bending every effort to bring about economy in governmental services so as to prevent their costs from rising and that everything possible is being done. In fact, he challenged us-I recall that in the budget debate of 1950, when I was discussing this matter in the course of my speech on the budget, the minister indicated that he was prepared to challenge us to show where economies could be effected. Mr. Speaker, other members have shown, as I have-and as I intend to show this afternoon-examples of gross extravagance. These examples have been brought to the attention of the Minister of Finance and of the government but they ignore them. They simply repeat the same old theme that economies are impossible.
The Prime Minister (Mr. St. Laurent) adopts the same defeatist attitude. He says that there may be some "imaginary overtaxation" but that, because of the mounting costs of national defence, it is not possible to make any real reductions. Nothing could prove more clearly that we shall not get tax reduction until we get reduction in spending and that we shall not get reduction in spending until we get a change in government. I suggest to this government that if only the ministers and the government as a whole would display, in controlling government expenditure, one-quarter of the energy they display in saying that it is not possible to control it, we would get some results.
The Prime Minister calls it "imaginary overtaxation". The Minister of Finance says, "We have defeated inflation" and "We have cut government spending to the minimum". I point out to you, Mr. Speaker, that a comparison of the rate by which government costs have mounted with the rate of increase in the consumer price index-which is about the nearest comparison one can get-suggests that the government have been falling far short of their duty in economizing in spending the people's money. I do not suggest that this is a perfect comparison by any means, but I have here some tables which I hope the house will permit me to put on Hansard. I will give an outline of them and if it is desired that I should read them in full, I can do so; they are not very long. I took the set of figures for government spending from the minister's own white paper tabled with the budget. I got the other set
2868	HOUSE OF
The Budget-Mr. Fulton of figures, for the consumer price index, from the dominion bureau of statistics. When you compare the increase in government spending for the last five years, and deduct from the total figure of government spending the cost of defence, and of defence production, so that you are dealing only with non-defence spending, you find that since the fiscal year 1948-49 the amount spent by the government has gone up by 25-2 per cent. That is, there has been a 25-2 per cent increase, quite apart from what was spent on defence. On the other hand, the consumer price index in that same period has gone up by only 17-6 points, the index being based on the year 1949 as 100.
I should like to place these figures on Hansard. During the fiscal year 1948-1949, the average of the consumer price index for that 12-month period was 98-4. For the twelve months ended March 31, 1953, the average was 116, or an increase of 17-6 points. On the other hand the total government spending for the fiscal year 1948-49, apart from defence, was $1,907 million. For the fiscal year ended March 31, 1953, they spent $2,388 million, or an increase of 25-2 per cent, as against an increase in the consumer price index of 17'6 points.
With the consent of the house I should like to place these tables on Hansard.


Some hon. Members:: Agreed.


Mr. Dickey:: Would the hon. member permit a question?


Edmund Davie Fulton: Yes.


John Horace Dickey: Has he also the percentage increase across the board in civil salaries? For instance, in the matter of wages of government servants for the same period of time.


Edmund Davie Fulton: I have not that percentage, because it had not been worked out. But I did ask the bureau of statistics if they would attach any importance to that percentage increase, and their answer to me-and I do not want to prejudice them in the eyes of the government-but it would be the impression that the increase in civil service salaries and wages did not keep pace with the increase in the cost of living index.


George James McIlraith: Of what civil servant did you ask that question?


Edmund Davie Fulton: The fact is that civil service salaries and wages would not have gone up at as great a rate as the increase in the consumer price index. Therefore if that were taken into consideration, and weight were given to that factor, the increase in the consumer price index as compared with the


increase in government spending would have shown even greater disparity than what is shown now.


John Horace Dickey: Will you agree that the total increase in salaries and wages has been an important factor in the increase in government expenditures?


Edmund Davie Fulton: The hon. member may attach such weight as he wishes to that factor. But, as I said, the increase in civil salaries and wages is not as great as the increase in the consumer price index.


George James McIlraith: What is your authority for that statement?


Edmund Davie Fulton: And yet the increase in government spending as a whole has gone up very much faster than the increase in the consumer price index. The point which my hon. friends are now trying to make, instead of telling in their favour, tells against them.


John Horace Dickey: Would a new government economize in taking off the salary increases?


Edmund Davie Fulton: Mr. Speaker, if the hon. member has any questions to ask, then I wish he would ask ministers of the government who are responsible for these increased expenditures, and not expect the opposition to answer them. We are not able to control them.


George James McIlraith: We are questioning your statement.


Edmund Davie Fulton: If they have statements to make, then let them get up and make speeches in the house. The parliamentary assistant to the Minister of Trade and Commerce could ask his own minister why they cannot control these things.


George James McIlraith: The hon. member has asked permission-


Some hon. Members:: Sit down.


George James McIlraith: The hon. member has asked permission-*


Mr. Speaker:: Do I understand that this is a point of order?


George James McIlraith: Yes. The point of order is that the hon. member has asked permission of the house-unanimous consent-to put some tables on record, in connection with which he has made statements of fact. I question those statements of fact.


Edmund Davie Fulton: I do not see any point of order in that. If the hon. member does not accept my figures, then let him rise in his place and make his own speech, attacking them. But I do not see that there is any point of order.


George James McIlraith: Then I have to ask that the hon. member read the figures, instead of having them tabled.


Edmund Davie Fulton: I have given the gist of those figures. I have not time now to read them all into the record. If the hon. gentleman objects, I shall withdraw the table from Hansard, and shall not table it. I have given the effect of the figures, both the starting and ending points, with the over-all percentages. I believe I have given sufficient information so that hon. members may be able to make a fair comparison-a comparison which, Obviously, is so worrying to hon. members opposite that apparently they do not want the whole table to go on Hansard. So I am happy to leave the matter where it is.
The Minister of Finance has challenged us from time to time to show where economies can be made. In this connection let me give some figures of government spending. Recent figures tabled in the house show that there is to be spent an estimated total of $2,267,040.45 to provide Central Mortgage and Housing Corporation with a central office. Any hon. member who has driven down the Montreal road and has seen that palace will ask himself the question which I know the Canadian people are going to ask themselves: Do we vote these moneys for Central Mortgage and Housing Corporation to build houses for the Canadian people, or to build palaces for their head.office? They will ask this question: Do we vote money so that Central Mortgage and Housing Corporation can build houses for the Canadian people, or so that it can build an auditorium in their head office at an estimated cost of $40,000, of which sum $2,500 was required as an extra to put in a spring-filled floor on which they can dance?
Then, I think the people of Canada will ask themselves why Central Mortgage and Housing Corporation required 281-5 acres for their head office, and why the buildings and grounds are going to take 21-3 acres out of that total of 281-5, which incidentally were purchased at an average price of $824.30 an acre.
And I think the Canadian people will ask themselves some questions about the proposed national film board building. The national film board is an organization of which I think the people of Canada may be proud, so far as most of the work of that organization is concerned. But I question very much whether the people of this country would be prepared to consent to the spending of $5,225,000 to build a central office for the film board in Montreal. I wonder if it would not be possible to establish an adequate central office without spending nearly five and a quarter million dollars?
I have been interested to look up comparative real estate prices in Montreal. Of course an absolute comparison is difficult to achieve.
The Budget-Mr. Fulton Figures I received in a return the other day show that this building is intended to provide 271,711 square feet of accommodation. We realize that the question of the locality must be taken into consideration. However, I have made some comparisons, and I have found that a building with 65,000 square feet in a comparable area in Montreal is for sale at the moment for $170,000. If one multiplies
65.000	square feet by four one obtains almost the equivalent of 270,000 square feet. If you multiply $170,000 by four you get $680,000.
Then take another example, a building west of Guy street in Montreal. This is a 2-storey, semibasement, reinforced concrete building, 55,000 square feet and priced at $225,000. There is another building with
130.000	square feet, 4-storey, reinforced concrete, sprinklered, for $500,000. Multiply
130.000	by two and you get 260,000 square feet; multiply $500,000 by two and you get $1 million.
Of course the comparison is not complete because these would not be new buildings. They would require alterations. I do not know whether it would be correct to say that if you could get a 130,000 square-foot building for $500,000 you could get one twice as big for only twice the price. I believe the cost of building per square foot comes down as the area goes up. But the difference between $1 million and $5,225,000 is $4,225,000. I suggest that you could do a lot of modification and alteration and modernization for $4 million, that is if you were not this government spending money. I wonder if they have looked into the possibility of acquiring one or more of these buildings and altering and modernizing them to suit their purposes with the object of saving some money. However, the possibility of saving money does not usually occur to this government. They just draw up their plans and decide to spend $5,225,000 of the people's money to provide a head office in Montreal for the national film board, without regard to cost.
There are many other examples of extravagance that could be cited, but I want now to turn to another matter, the difficulty of obtaining accurate information upon which to base suggestions for economy. We have had example after example where we have tried to get information and have been refused. We are asked to give concrete suggestions as to economies. I have given some. I want to point out to the house and to the country the difficulty of making concrete suggestions as to economies when information of extravagance is denied to us.
We have seen recent examples in the house this year, which, coupled with examples of former years, set a consistent pattern of

The Budget-Mr. Fulton the government refusing information because they know that information is going to embarrass them. We can see how absurd the situation has become when we remember that not so long ago the Associate Minister of National Defence (Mr. Campney) rose in the house and gave us a lecture on the desirability of obtaining information, of coming to the department and to the house to get information before making any statements. That same minister without a shadow of justification yesterday refused a motion for papers which would have given us information.


Mr. Speaker:: I do not think the hon. member should discuss that feature.


Edmund Davie Fulton: That was not a debate, that was a motion for papers.


Mr. Speaker:: The motion was moved by the hon. member for Kamloops.


Edmund Davie Fulton: I know the rule that you cannot refer to matters-


John Horace Dickey: On a question of privilege, the statement has been made by the hon. member that the Associate Minister of National Defence refused to give this information. That statement is not correct and is without a shadow of justification. The decision was made by this house and it was not a refusal by the minister at all.


Edmund Davie Fulton: I will accept the correction made by the hon. member.. The refusal was made by the vote of the Liberal majority in this house; the Liberal majority backed up the minister who had said that he did not want to produce the information. That was enough for the Liberal majority in this house, just as it has been in the different committees of this house ever since I have been here. We have seen that pattern repeated time after time. Their majority supports the government in refusing to give us information because they know its production would be extremely embarrassing.
I am not going to repeat the request I made yesterday for the production of information, but I think we can all see why the government did not want that information produced. They knew that to do so would embarrass them. But in this instance a certain amount of that information fortunately has come into the hands of the public. These reports to which reference has been made, and copies of which I have been seeking to obtain for some time, deal with various activities of the Department of National Defence, and one of them particularly confirms the fact that everything said by Mr. Currie in his report is one hundred per cent correct. Furthermore, they show that the situation found by Mr. Currie was not a new situation but was one which had existed


for at least two years previous and was one of which the government had had knowledge.
The report describes a situation which existed two and a half years before Mr. Currie made his report, yet they did nothing about it. The situation was exactly the same when Mr. Currie came to make his inquiry, as is shown by a significant passage in the Currie report referring to the situation at Halifax. He points to that case as an example of what can be done to remedy conditions quickly. He says that when he first went to Halifax in September he found an appalling situation that was immediately drawn to the attention of the government, and when he went back in November he found that remarkable changes had been made.
The earlier report made in 1949 to the government-two years earlier-drew attention to the same situation in Halifax in the following words:
The slowness of the tradesmen (at Halifax) is a standing joke in the garrison. As an example I was shown a plywood partition about six feet wide and told that it actually took four carpenters two weeks to build it.
Another example:
I came to the conclusion that No. 6 works company must be known in Halifax by workmen as a good place to get a soft job and a- good place for third-class tradesmen to roost to their heart's content.
It would not be important by itself if information of this type were refused merely to a group of individuals, instead of to the House of Commons. We members are not entitled to preferential treatment as individuals, but we represent the Canadian public and in asking for information we do so as representatives of the people. We are asking for information to which the people are entitled.
We are asking for information where we think the people's money has been wasted so that we can make concrete suggestions in order that money may be saved and the people can have their taxes reduced. But when we find that the government is refusing information which would show the way in which the people's money has been wasted, that is important, not because the information has been refused to a member of the house but because it has been refused to the public. That is a matter which I believe will exercise the public and for which they will hold this government to account.
Now we find there was this report, based on a survey of army works services establishments made in 1949, two and a half years before Mr. Currie made his report, and it contains the following findings:
". . . the engineers (R.C.E.) are engaged in some very large (construction) projects and I think it

is fair to say that their attitude toward costs of construction indicates their attitude to finance generally, including money spent on staff. It seems to me that they are under the impression that . . . cost is no object when they want to do something.
Then the report refers to what took place at Shilo, and I point out to you, sir, that all this is on all fours with the remarks made by Mr. Currie two and a half years later when he complained about the war psychology and said that what we need is to get rid of war psychology, which counts nothing of cost, and set up an organization capable of functioning smoothly and of being integrated into our whole economy. These same findings were made two and a half years before. The situation was known to the government but they permitted the mess to continue. They permitted the waste of thousands, if not hundreds of thousands, of dollars of the people's money because to produce the information would have been embarrassing and because they did not know how or were unwilling to act upon the information themselves.
I do not know whether the report ever got to the department. Maybe it did not. If it did not, it should have, and if it did not I suggest the reason it did not was that the government did not like this report, it did not think too much of it, and therefore it thought it would put it away in a pigeonhole and not act on it. They might have got away with it and perhaps people would not have thought very much about it if it had not been for the fact that two and a half years later Mr. Currie came along and things became so bad they could not hide them any longer. They had to appoint an investigator and announce it. Mr. Currie was appointed and he found exactly the same thing as this report had drawn attention to two and a half years earlier.


George James McIlraith: Is that the report you are reading from?


Edmund Davie Fulton: Here are some of the other things it says:
My point is that the department and the army should not be regarded merely as an accommodating place to provide jobs.
Here is another one:
However, I could not fail to be impressed with the fact that for such a tremendous administrative machine there appears to be very little effective fighting strength.
Then, another quotation:
-a tremendous amount of money is being spent to provide an administrative machine which, to my way of thinking, occupies a large part of its time in a futile paper war with the reserve army which has neither the strength in numbers, the equipment, nor the inclination to respond.
The Budget-Mr. Fulton


Mr. Lesage:: Mr. Speaker, would the hon. member identify what he is quoting from?


Edmund Davie Fulton: I suggest that the hon. member ask the government to produce the report.


Jean Lesage: What are you quoting from?


George James McIlraith: You are purporting to quote from a document.


Edmund Davie Fulton: I am reading from a report in-


George James McIlraith: You are reading something, a newspaper report-


Edmund Davie Fulton: Certainly.


George James McIlraith: -and it is questionable where the newspaperman got it. He probably got it from you, and then you come back here and give it as a quotation.


Edmund Davie Fulton: If my hon. friends question the authenticity of a word I have said or a word I have quoted, let them go and get the report and find out for themselves what is in it.


Jean Lesage: Mr. Speaker, on a point of order-


Some hon. Members:: Sit down.


Edmund Davie Fulton: You know, Mr. Speaker, we have had so many phony points of order-


Jean Lesage: I have always understood that when an hon. member quotes he must identify the source of his quotation. He has to say what he is reading from.


Mr. Speaker:: I understand the hon. member is quoting from a report.


Edmund Davie Fulton: I am quoting extracts from a report which appeared-


Mr. Speaker:: The hon. member should tell the house from what he is quoting.


Edmund Davie Fulton: I am reading from a report which appeared in the Montreal Gazette-


Some hon. Members:: Oh, oh.


Edmund Davie Fulton: -of February 27, containing extracts from a report made to the government.


John Horace Dickey: Mr. Speaker-


Edmund Davie Fulton: If my hon. friend will just-


John Horace Dickey: On a point of order-


Edmund Davie Fulton: -be patient and let me do this in my own way, I will tell him.


John Horace Dickey: On a point of order, Mr. Speaker-


An hon. Member:: He needs another soothing syrup.


John Horace Dickey: The point of order raised by the hon. member for Montmagny-L'Islet is
2872	HOUSE OF
The Budget-Mr. Fulton that the hon. member for Kamloops has purported to quote from a report. He has put certain language on record which I understand he intends to appear in Hansard as a quotation-


Edmund Davie Fulton: Certainly.


John Horace Dickey: -from a report. When the point of order was raised, Your Honour quite properly indicated to the hon. member for Kamloops that he should indicate the source of his quotation. I make that statement for the benefit of the hon. member for Kamloops and the members with him because apparently they- do not recognize the responsibility that lies on any member of the house when he takes it upon himself to quote from something that has appeared or has been said outside the house. In response to Your Honour's request, he said he was quoting from a newspaper report, but it was quite obvious that he was also quoting a quotation which appears in that newspaper report as being a quotation from a report submitted to the government. If he takes the responsibility of doing that, then I submit that he has to disclose to Your Honour and to the house what report he is referring to.


An hon. Member:: Let us have the report.


Edmund Davie Fulton: Mr. Speaker, it is amazing how sensitive the government is over this matter.


John Horace Dickey: On a point of order-


Mr. Speaker:: Order. I understand the hon. member for Kamloops is going to advise the house further as to the source of his information.


An hon. Member:: You had better get a bottle of soothing syrup.


Edmund Davie Fulton: Mr. Speaker, I said a moment ago that it is amazing how sensitive the government is-


Jean Lesage: Mr. Speaker-


Some hon. Members:: Sit down.


Mr. Speaker:: Order.


Edmund Davie Fulton: I am going to give the facts, but I will do it in my own way. The hon. member has asked for it and he will have it. The hon. member will have the facts.


Mr. Laing:: You have had fifteen minutes now.


John Horace Dickey: On a question of privilege, Mr. Speaker-


Edmund Davie Fulton: Mr. Speaker-


Mr. Speaker:: Order.


John Horace Dickey: On a question of privilege-


Edmund Davie Fulton: I am going to raise a question of privilege myself.


John Horace Dickey: On a question of privilege-


Mr. Speaker:: Order. The hon. member for Halifax has risen on a question of privilege.


Edmund Davie Fulton: I want to raise a question of privilege myself.


Mr. Speaker:: Order. I can only hear one question of privilege at a time. The hon. member for Halifax.


John Horace Dickey: On a question of privilege, the hon. member for Kamloops said that I have the facts.


Edmund Davie Fulton: I did not state that you had the facts. I said that I would give you the facts if you would give me a moment to do so.


John Horace Dickey: My question of privilege-


Edmund Davie Fulton: Mr. Speaker, his question of privilege is obviously out of court because I never said any such thing.


Mr. Speaker:: Order. The hon. member for Kamloops states that he did not say that the hon. member for Halifax has the facts.


Mr. Ross (Souris):: The "Dickey" bird wants to sing.


Edmund Davie Fulton: I think one might raise a question of privilege in this respect, that a member surely should be allowed to deal with one question raised by my hon. friend, whether it is in order or not, before my hon. friend raises another. I have been endeavouring for five minutes to give him the facts, but my hon. friend reveals such an extraordinary sensitivity about this matter that I have not had a chance. I can understand why my hon. friends would be so sensitive, having refused yesterday this very information to which the house was entitled. I have been reading, as I said, and as I was endeavouring to explain, a report in the Montreal Gazette of February 27 by Arthur Blakely in which there are certain quotations from a report. The reference in his article is to a report made to the government.


John Horace Dickey: By whom?


Edmund Davie Fulton: My hon. friends are saying that I have to establish the authenticity of the report. I say to my hon. friends-


Alphonse Fournier: Just say you are quoting from the Gazette.


John Horace Dickey: I will explain to my hon. friend what we are questioning.


Mr. Speaker:: Order. I hardly think that is necessary.


John Horace Dickey: He does not want to know.


Edmund Davie Fulton: I think I can clear up-


Mr. Speaker:: Order. I think the hon. member for Kamloops should conclude his remarks as soon as possible. On account of the interruptions I have allowed him considerable time over his 40 minutes, but I now ask him to conclude his remarks as /soon as possible.


Mr. Byrne:: Stick to the rules of the house.


Edmund Davie Fulton: Thank you, Mr. Speaker. I know the rule, and I know the facts, and I say to my hon. friends, to the government and to the house that I will go farther. If they question the authenticity or accuracy of one word that was quoted in the Montreal Gazette I assure them that it was correct; that the report was correctly quoted there; and that such a report does exist. I take full responsibility for the accuracy of what I have said in this house and for the quotations which I have placed on Hansard.


Jean Lesage: A report to whom?


Edmund Davie Fulton: If my hon. friend will display the same interest in directing his questions to the government and getting information from them about this report, then he might be serving a more useful purpose. We have asked for this report and it has been refused. It has been refused by the vote of the Liberal majority in this house, as have other reports on which public money has been spent-for instance, the report of Mr. Walter L. Gordon to which I have also referred. It is a matter of public knowledge that there was such a report, and it was made at public expense. I have asked for these and other reports on three occasions, one of which I am not at liberty to refer to in detail, in the defence expenditure committee, and twice in this house. On each occasion I have been turned down.


Mr. Speaker:: I cannot allow the hon. member to refer to the committee.


Edmund Davie Fulton: I said that I would not refer to it in detail.


Mr. Speaker:: The hon. member must not refer to anything respecting the committee's proceedings.


Edmund Davie Fulton: I then confine my point to the fact that we have been refused this information twice in the house.
All I can say in conclusion, Mr. Speaker, is that it is time that this iron curtain around the Department of National Defence, and government activities generally, was torn down. Let us have the facts and find out just what has been the cause of extravagance, waste and inefficiency that is going on, so that members of parliament on behalf of the people of Canada can come to grips with the situation, suggest ways and means to
The Budget-Mr. Gibson improve it, and then reduce expenditures and reduce the people's taxes. I suggest to the government that if they are not willing to do that they make way for a government which will.


Mr. J. L. Gibson (Comox-Alberni):: This afternoon I intend to refer to the budget only in general terms because it seems to me that in this long debate the details of the budget have been pretty well tossed back and forth from both sides of the house. I think the Canadian people have a pretty good idea of what is in it and how everybody feels about it.
It seems to me that the Minister of Finance (Mr. Abbott) has displayed great ingenuity and resourcefulness in spreading the tax concessions he has made throughout such a large segment of the Canadian economy. I, personally, am very pleased to see that he was able to eliminate the nuisance taxes and also I am pleased to see the fine job that he did in encouraging investment of Canadian people's savings in Canadian industry.
I think it is a matter of great gratification to us all that our per capita debt continues to be reduced and that our net debt is a smaller proportion of our national productive capacity than it has ever been. Despite the last great war and our great contributions to it, and the gifts which this country has made since, we have the second highest standard of living of any people on earth. I think that is a great thing to realize. When we actually consider the per capita debt that we owe, and the future of this country, we can probably say that Canadians are the richest people in the world.
I would say that we should in all fairness give a certain measure of credit to this government for the prestige this country holds throughout the western world. I am sure that when Canadians go overseas to attend the coronation this year they will be able, and I quote the words of the Minister of National Health and Welfare (Mr. Martin), "to say with meaning and to say with pride that they are Canadians".
This has, of course, been called an election budget. Perhaps it is more fair to say that this is the last budget we shall have before *an election.


James Arthur Ross: Oh, no.


John Lambert Gibson: I hardly think that there is enough in this budget to make all of the people in British Columbia happy.


James Arthur Ross: Nor all Canadians.


John Lambert Gibson: I just talk about what I know.


James Arthur Ross: But you have been around a bit.
2874	HOUSE OF
The Budget-Mr. Gibson


John Lambert Gibson: Sometimes my triends depart from that policy and they get in trouble for it. I commend it to them as a really good basic policy.


Douglas Scott Harkness: You are a taxpayer in this eastern country too.


John Lambert Gibson: Just civic taxes. I think perhaps the attitude of British Columbia towards the federal government is partly psychological. We are hemmed off from the rest of Canada by those great ranges of the Rocky mountains. I find that there is a lot of merit in what the late Senator G. G. McGeer said when he was in this house. He said that it was 3,000 miles from Vancouver to Ottawa but it was 10,000 miles from Ottawa to Vancouver. I find that people out there still think that way, and perhaps that is why they are not as familiar with the workings of the federal government as are the people of some of the other provinces.
I think it might be of some value to look at the picture in British Columbia and see just what the similarity is between the position this federal government holds there and the position that the last Liberal government held there before they were thrown out. Both this government and the last Liberal government we had out there were administering the affairs of the country at a time of great general prosperity. Great general progress was being made. I think the same thing, of course, can be said of this government here. The government in British Columbia was honest, and I think we can concede this one is; and, in the main, the governments were both efficient. There is a certain attribute of all governments, I think, after they have been in power for a long time, that they sometimes give the appearance that they feel they are infallible and that they have ineffable wisdom. The people of British Columbia feel, and this has been expressed by a number of members from British Columbia, that this government has not done too well as far as the control of radio and television is concerned. They feel,
I think, that for a free enterprise government it is not right that we should have the industry controlled by a government agency; they feel that the Canadian Broadcasting Corporation should not be both judge and jury.


Mr. Ferguson:: It has taken you seven long years to find these things out.


John Lambert Gibson: Well, I am a little slower on the pick-up than my hon. friend but I often try to be more objective-after all, I am an Independent.
When I am speaking of this government control of radio and television, which is essen-


tially, as it should be, a private industry in this country, I think it might be well if the government just gave some consideration to the thought that it would not be a bad thing for the country if Canadian Pacific Air Lines were allowed permission by the air transport board to put another competing air cargo service through. I think perhaps a little competition for Trans-Canada Air Lines might be an excellent thing.
There is another matter that Liberal members and members from all sides have mentioned, but I expect the government listens to the Liberal members more than the others. I heard the hon. member for Vancouver-Burrard (Mr. MacDougall), the hon. member for Fraser Valley (Mr. Cruickshank), and numerous other British Columbia Liberals ask the government if it would not set up the veterans affairs committee and just take a look at the problem facing old war veterans. Perhaps there is something we can do for them.
In British Columbia I think we have the greatest percentage of people on war veterans allowance, and the people of British Columbia say that they hear that old folks are not getting along very well in some instances. Perhaps we should set up this committee and take a look at the whole picture, to satisfy the people of Canada generally that we are trying to take care of some of these problems that are arising in their lives.
It seems to me, too, that the people of British Columbia-and as I say they are a long way away-feel that this government has not explained too well or answered too clearly the charges of some of the members of the opposition here that there has been waste and extravagance in the administration of certain government departments. I think perhaps they are thinking of the Department of National Defence. I have often wondered why it would not be a good thing if perhaps the Prime Minister (Mr. St. Laurent), or perhaps all members of parliament, explained to the Canadian people that these so-called luxuries and amenities we have provided for the members of our armed services are really the result of the fact that we have voluntary military service in this country. I think it is generally agreed by most Canadians that voluntary military service is what we want, except in time of war. If that is what the Canadian people want, then we must recognize that our armed forces in peacetime are servants of the Canadian people as are members of parliament. If we are going to attract these people to our armed services, then we must compete, in both wages and the

amenities of life, with the very high standard of civilian living which obtains throughout Canada now.


Mr. Hodgson:: And assure them that they will have a living after they are through fighting.


John Lambert Gibson: I imagine we are doing a fairly good job on that. I think we all agree that, so far as pensions for members of the armed services are concerned, we must all recognize that they cost money. When we are quoting comparable figures concerning what it costs to maintain a man in this country as compared with what it costs in a European army, we are not being fair because the European armies do not have a voluntary system of military service.
Those are all the general remarks I am going to make concerning the budget. I come now to a problem that is really vital to my riding, perhaps more important to my riding than it is to any other riding in British Columbia. As hon. members know, lumbering and fishing are the two great stand-bys of the economy of Comox-Alberni. Last fall during the debate on the speech from the throne I referred to the fishing industry. From what I have read in the press concerning a speech delivered by the Minister of Fisheries (Mr. Sinclair) to the fishermen's union in Vancouver recently, I have great hopes that we may be able to do something for that industry with regard to trade with the United Kingdom.
I want to talk today-I am very glad to see the Minister of Finance (Mr. Abbott) has come into the house-about the logging industry, which is one of the basic industries in the economy of British Columbia and particularly my riding. As the minister is aware, our new Social Credit government in British Columbia has applied a new 10 per cent tax on logging profits. This action, of course, is particularly unfair to the principal industry in my riding. I do not want it to be inferred that I am placing the entire blame for this action on the Social Credit government. It seems to me that it is a fact that for the past ten years, since our tax agreements have been in effect, the federal government has taken unfairly tens of millions of dollars out of the B.C. logging industry, and has been putting practically nothing back into the forests of British Columbia. I say "unfairly" because timber cutting by owners out there, both large and small, has been subjected to a virtual capital gains tax imposed by this federal government. This one industry has been singled out from all industries in Canada for a capital tax of approximately 50 per cent, by reason of the methods of computing timber values for income tax purposes.
The Budget-Mr. Gibson In the past ten years the federal government has taken at least $40 million, I say unjustly, from the British Columbia timber owners, both large and small, and to that industry there has been very little contribution from the federal exchequer. When I think of what this government does for the prairie provinces, with the P.F.R.A. and the P.F.A.A.; the bonus of $65 million to wheat producers, and then another $40 million this year to support hog and beef prices, it seems to me that for the tremendous revenue the minister has been taking out of British Columbia he has not been putting very much back. Usually, you know, if anyone in Canada "clips" the Minister of Finance for $2 million, he is up here screaming like a wounded steer. In this particular instance when he read about this new tax in the newspapers he realized that he was going to lose half of it, but for some reason or other I have not heard him say anything about it as yet. He took it very calmly.
The same thing, of course, applies to the mining industry in British Columbia. It seems so incongruous that this parliament should be asked to vote gold mining assistance, and then allow the provincial government to take that money back from the mines. Perhaps it would be better to give the money direct to the provincial government. The Minister of Finance has had such good plucking from this goose for so long that the logging industry is really his golden goose. He has this special taxation on the industry's capital gains, and it would seem to me he would have had some measure of consideration for that industry. Instead of that, under the dominion-provincial tax rental agreements, he takes the best provider he has and stakes him out for tiger bait. It is quite obvious that if the minister writes into an agreement that he does not want the province to tax anyone else except loggers and miners, the ministers of finance in the provinces are going to take a crack at them as soon as they need money.
Perhaps we cannot blame the minister of finance in British Columbia for having done this. As I say, the federal minister has protected all the other industries in Canada except these two industries which have been afforded no protection at all. I feel that the minister should take a look at these taxation agreements to see if they are actually fair. One must realize that in British Columbia 40 per cent of the tax revenue which comes to the minister is based on the timber industry. It seems to me that if we extract more from a province like British Columbia, which has an extractive economy, it would be fairer if the minister, in his taxation agreements with all the provinces, would
2876	HOUSE OF
The Budget-Mr. Gibson insist that the provinces not tax mining or logging any more than the provinces tax anyone else. He might say, if you cut five billion feet of timber in British Columbia, perhaps I will allow you fifty cents or a dollar a thousand. That would be a much fairer basis of working. The same principle should be applied as was applied in the prairie provinces, where we have an extractive industry in that they are probably depleting their soil, and where this government has taken very effective steps to see that money and effort were put back into maintaining those assets. Actually, we are taking care of their extraction.
It is a particularly difficult thing for the small loggers in British Columbia. The federal government has been taking all this revenue from the forests of British Columbia and, as a result, the provincial government has not been able to make the forests pay. This has resulted in the government having to charge a far too high stumpage to the small loggers. The old companies that went in forty or fifty years ago got timber as cheap as twenty-five cents a thousand. Some of that timber is standing right alongside timber for which the present provincial government is asking small loggers to pay $20. It does not take much imagination to see how difficult it is for the small man on that basis. The provincial government feels, and with some justification, that the timber sold thirty or forty or fifty years ago was sold in a very poor deal. However, instead of putting on another tax, it seems to me the provincial government should come to Ottawa and try to get our present Minister of Finance to disgorge some of these, I would say, almost ill-gotten gains acquired over the past ten years.
Perhaps I appear to be speaking with some bitterness this afternoon, Mr. Speaker. Of course, I was brought up in this district of Comox-Alberni. My friends and their families have been pioneers there and brought it to its present stage of development. When I look over that beautiful land, partly stripped of the wonderful forest wealth that we had there; when I think that a large measure of the wealth has come down here to enrich the coffers of the federal treasury; and when I see so many people in my riding isolated, with no road transportation, and this government refuses to connect up our airports there with military roads-we have two magnificent airports at Port Hardy and Tofi.no on Vancouver island-I can understand why some folks out there have a certain amount of bitterness as far as the general taxing powers of this country are concerned.


Sometimes I have heard some of them say it is a bad deal ifi that we ever went into confederation.
Vancouver island is a natural protective barrier for half the British Columbia coast. Yet our Department of National Defence has not seen fit to put in any highway communication to those airports that I have mentioned. If those two airports were ever taken over by hostile forces, they would certainly be able to be a great menace to the whole of the Pacific northwest. I have often wondered whether this Department of National Defence rather feels that we are, as it were, expendable in that country out there. I certainly cannot imagine any members from the maritimes in this house putting up with a similar condition. Can you imagine the people in Nova Scotia not having roads along their coast, for national defence if for nothing else? As I say, the Pacific coast is much more vulnerable to attack than is the Atlantic coast.
I know that the Minister of Finance is anxious to take part in the debate this afternoon, so I do not intend to speak much longer; but I just want to say this. As far as British Columbia is concerned, and the timber industry out there, I feel that we are getting a rather shabby deal from the federal government here. I sincerely hope that the Minister of Finance and the government will at least think over what I have told them today.
Just before I pass on, I should like to say another thing in support of what the hon. member for Fraser Valley (Mr. Cruickshank) said the other night with regard to river bank protection in British Columbia along that vital avenue of communication for both the Canadian National Railways and the Canadian Pacific Railway. I certainly hope that my good friend the Minister of Public Works (Mr. Fournier) will do something in behalf of the hon. member for Fraser Valley and will see if he cannot protect our national lines of railway by river bank protection in the Fraser valley.
I am sorry that the leader of the Social Credit party is not in the house because I thought perhaps I would give him a little bit of advice this afternoon, if I might be so presumptuous as to do so. It just seems to me that hon. members should take a little bit more care down in that corner of the house because, from what I have heard in this debate, it seems to me that some of his henchmen down there have been consorting too closely with the members of the C.C.F. party. Some of them appear to be almost becoming socialists. I think we should ask you, Mr. Speaker, to put up an iron curtain between the two parties.

I listened with great interest the other night to the hon. member for Wetaskiwin (Mr. Thomas) when he was speaking. It seems to me that this young man needs a lesson in elementary economics. I do not think that his leader should try to teach him social credit economics because I do not think he would understand those. I do not think even the Minister of Finance understands them. But I think his leader ought to give him an education in just basic economics.
The hon. member for Wetaskiwin the other night was speaking of the surpluses that corporations in Canada had created in the last twelve years. He computed them roughly at about $6 billion; and if I recall correctly what he said, he suggested that the Minister of Finance should make a capital levy on that $6 billion. It seemed to him that there was too much money drifting around loose some place, and he thought it was an excellent plan to put a capital levy of one-eleventh on that amount. I do not think that the hon. member realizes, of course, that this procedure was more or less tried out in the old country by the socialists there but they found that it did not work very well.
I might also point out to him-I will just give him an elementary lesson in economics- that surpluses of this kind of course are usually invested in brick, mortar and in the creation of jobs for our Canadians. He says that corporation surpluses have increased by $6 billion in that time. I think it is a good thing that those surpluses have increased because we have almost one million more wage earners in Canada. If his arithmetic is sound he will realize that it takes $6 billion at least to create jobs for an extra million people. I can tell him something about the logging industry, for instance. When I was a young fellow, about thirty years ago, I used to go out in an Indian dug-out canoe. My brother and I were hand loggers. We would get a canoe for $20. We got a pump jack for $75. We had two saws for about $10 apiece. We had a peevy, an eight-pound sledge hammer and two five-pound felling wedges.


An hon. Member:: And elbow grease.


John Lambert Gibson: Yes, and a lot of ambition. Actually that is about all the capital you had to have at that time. But I would point out to him that, for one man to be employed in the logging business now, it takes a capital investment of $10,000. While our socialist friends and perhaps our friend the hon. member from Wetaskiwin may think it is an evil thing that it should take that much, I am still sure that they are extremely glad that the economy of Canada is such that we have been able to provide tools of that
The Budget-Mr. Abbott kind to create the efficient economy that we have which produces so much money and so much prosperity for the people of Canada.
I am sure the Social Credit leader is going to speak later in this budget debate. I hope that he will really assure us at that time that this capital levy that has been suggested is not a standard policy of the Social Credit party, because I think the people of British Columbia would be greatly interested to have that point made clear to them before the next provincial election. It seems to me that perhaps Alberta and British Columbia are hardy enough to stand a period of Social Credit provincial government, but I shudder to think what would happen to the financial standing and the prestige of this country if the Social Credit party ever took over our federal government and obtained control of our banking and currency. I am afraid that we would all agree that such an eventuality could have nothing but disastrous results.


Hon. Douglas Abboil (Minister of Finance):: Mr. Speaker, I would not ordinarily take part in the debate again at this time on the subamendment moved by my friend the hon. member for Rosetown-Biggar (Mr. Coldwell). However, it will not be possible for me to be here in the house tomorrow. This debate has gone on for some time-I hope it will not be unduly prolonged-and there are a few matters which have been raised in the course of the debate with which I should like to deal before it concludes. I do not intend to detain the house for long, but there are a few things that I want to take up.
I have listened carefully to most of the speeches that have been delivered on the budget; and those I have not been able to listen to I have read in Hansard. I followed closely the speech of the financial critic of the official opposition, and it seemed to me that he found it a bit difficult to make up his mind just what line he was going to take. At the outset he taxed me with producing an election budget. Then in the next breath he reproached me for having failed to give any relief to the majority of the voters. Then he seemed to approve the reduction in the corporation tax, but at the same time he argued that this relief should have gone somewhere else

I suppose to places where the voters are more numerous. All I can say is that I can only leave that criticism to the good judgment and the common sense of the majority of the voters themselves.
The hon. gentleman devoted most of his time to making a point that the tax cuts could have been greater if the government had been more prudent in its spending; and he indulged in the usual sweeping, general
2878	HOUSE OF
The Budget-Mr. Abbott charges of waste, extravagance and inefficiency without, as usual, particularizing any of those charges. The fact that he or others assert that to be the case does not make it so. I certainly would be the last to assert that in any spending program of four and one half to four and three quarters billions of dollars every cent was wisely spent, and that no errors of judgment had been made. That, of course, would be manifestly absurd.
But I do say this, that there has not been widespread waste, widespread inefficiency, widespread extravagance. And I do say this, that every effort has been made by government departments and by my own department to see that the taxpayer gets the maximum value for his dollar. And we will continue to exercise that care. Whether or not the results satisfy the people of Canada-I am sure, of course, that they will not satisfy the opposition-remains to be seen. I think they do; and I make this further assertion, that Canada is getting as good or better value for its defence dollar, and for its expenditures on public matters in other fields, as any other comparable country.
One or two members have been a bit more specific in their criticisms of alleged waste and extravagance. One was the hon. member for Nanaimo (Mr. Pearkes) who, I am sorry, is not in his seat at the moment. He read from what appeared to be a typewritten sheet excerpts from letters which he said he had received from taxpayers complaining about what they believed to be wasteful expenditure in connection with the construction of radar stations. That was dealt with in part the other day by my colleague the Minister of Trade and Commerce (Mr. Howe), and dealt with, I thought, pretty effectively. My criticism of the method used by my hon. friend from Nanaimo is this, that in reply to a question which I put to him he acknowledged that that was the first time he had brought the matter forward; that he had not brought it to the attention of the Department of National Defence, or my department, and that he was bringing it forward in the house without any names, without places, without dates or anything else.
I am going to make this suggestion to him. He said he was concerned about the position of the taxpayers. So am I, as I assured him at that time. And I suggest to him that he could serve the taxpayer better if he had called a stenographer here in the House of Commons, who is paid by the taxpayer, and dictated a letter to be transcribed on paper, which is also paid for by the taxpayer, handed it to a messenger, who is also paid by the Canadian taxpayer, and sent it down to me or to some other minister, also paid by the Canadian taxpayer.


I have a highly competent staff who would have been happy to investigate a matter of that kind, and who would have done it. And then, if my hon. friend was not satisfied with the explanation, not only would he have been within his rights but it would have been his duty to bring it forward in the house. But he would not have got headlines in that way.


Some hon. Members:: Oh, oh.


Douglas Charles Abbott: No, he would not have got headlines in that way. But I think he would have made a greater contribution to efficiency in government if he had done it that way than by following the procedure he did follow.
Another self-appointed guardian of the treasury is the hon. member for Moose Jaw (Mr. Thatcher). He is not given to understatement, either, when it comes to setting forth what he conceives to be waste and extravagance in government expenditures. The other day in the course of his remarks he said this, as reported at page 2535 of Hansard:
It is now fairly clear that the government has tossed money around recklessly on defence in the past year.


James Allen (Jim) Byrne: Just as reckless as your statement.


Wilbert Ross Thatcher: I do not think it is so reckless.
And then he went on to say this:
I charge this government with milking the Canadian taxpayer in those years to provide frills in defence spending.
I ask you to mark those words, "frills in defence spending". Then he proceeded to enumerate, presumably, what some of those frills are:
In the first place, as has been pointed out in recent days, you will find 25 contracts for landscaping various government buildings, with more than a million dollars spent for this particular service. At Fort Nelson, $27,500 was paid out for the construction of a single well. At Wainwright, Alberta, a swimming pool cost $22,000; a gymnasium, $280,000; bowling alleys, $54,000. Is it for such things that this government is taxing the Canadian people?
Well, my answer is yes. We are asking young Canadians to join our armed forces as a career, and if necessary to fight for their country. We hope they will not have to. If those young men were working in the hardware business in Moose Jaw-I am assuming there is a Y.M.C.A. in Moose Jaw-they could swim in the Y.M.C.A. building there. They could use the gymnasium. They could go to the moving pictures, or attend any other entertainment they might have in that delightful city.
I have not seen my hon. friend's house in Moose Jaw, but I am sure it is a very fine house. I am sure it has a sidewalk in front of it, and I am sure it would have lots of

snrubs around it. And I can see no reason in the world why these young men who are asked to accept a career as soldiers for our country should not be provided at least with some of the amenities that we have. So I can answer my hon. friend's assertion, when he says these are frills, by saying that they are not; and his assertion that we should not use the Canadian taxpayer's money-


Julian Harcourt Ferguson: What about horses?


Douglas Charles Abbott: The hon. member for Simcoe North (Mr. Ferguson) cannot think about anything but horses; but I do not know which part of the horse.


Some hon. Members:: Oh, oh.


Julian Harcourt Ferguson: You would like to forget those horses.


Mr. MacDougall:: Hee, hee, hee.


Julian Harcourt Ferguson: And you have a few jackasses in the party, as well.


Douglas Charles Abbott: Then my hon. friend from Moose Jaw went on to enumerate a lot of other things, and I shall not weary the house by reading them all. He said, for instance, that $25,000 was spent for air-conditioning the office of the central ordnance depot, that a ventilating system for a building had cost $48,000, and so on.
I shall not attempt to place on record all the statements he made. But he made no attempt to demonstrate that these prices were out of line with what they should have cost. They were all done by public tender, and the lowest tenders were accepted. I do not know whether there was any hardware in any of them, but if there was, and if it was provided by my hon. friend, I have no doubt the prices would have been a bit higher.
My point is that that sort of criticism could not be more superficial. It is absolutely meaningless, except to try to convince people, people who read only the headlines, that there is something wrong with the government spending program: "Charge of Waste and Extravagance; Young Member from Moose Jaw Lashes out at Government Waste". Well, so far as I am concerned, the public can draw their own conclusions. These charges of widespread waste and extravagance and inefficiency in my judgment neither exist nor have they been substantiated in the house by hon. members who have attempted to do so.
The hon. member for Rosetown-Biggar (Mr. Coldwell) delivered his usual sincere, consistent and thoroughly orthodox criticism of the budget, from his point of view. I have heard the hon. member make the same type of criticism of budgets for 13 years, and his 68108-183
The Budget-Mr. Abbott speech was no surprise to me. The hon. member is a convinced socialist; and he consistently pleads with me that when taxes are to be raised, the burden should be put on the rich, or the more well-to-do. And when taxes are to be lowered he would like to have most of the reduction given to those who are less well off. I concede that he is thoroughly consistent in arguing that inconsistent policy. I am sorry I cannot meet him in that respect, but I have gone about as far as one could go, with responsibility.
Let me review what has happened in connection with our taxation program. The house will recall that in 1949 we brought in a post-war scale of income tax rates, steeply progressive, which represented the lowest point reached at the end of the war, and was about half the rates of wartime taxation. It was the best and lowest scale we were able to devise at that time. Incidentally that was confirmed in September after the June election. In the budget in the spring of 1950 we made only minor tax reductions. Then came Korea, and in September of 1950 I brought in my budget and recommended almost a 15 per cent increase in the corporation tax. I increased the excise tax on a line of less essential goods from 10 to 15 per cent, but did not touch the personal income tax. That tax remained at the 1949 schedule.
Then in the spring budget of 1951 we imposed a 20 per cent surcharge on corporation taxes and personal income taxes. Mark you, that 20 per cent surcharge on the corporation income tax was on the rate increased by 15 per cent in September, 1950. At the same time we increased the special excise tax from 15 to 25 per cent on this list of less essential goods to which I have referred. That was the tax scale which prevailed through that year.
In the spring of last year, when it became evident and more clear as to what expenditures were likely to be in connection with the war in Korea and our brigade group in Germany and our defence forces by and large, we eliminated about one-third of the surtax on the personal income tax but made virtually no change in the corporation tax. That was 50-6 per cent and we eliminated the *6 per cent to round it off to the even 50 per cent. We dropped the special excise tax rate from 25 back to 15 per cent.
In this budget we are recommending the complete elimination of the surtax that remains on the personal income taxpayer and are putting that back to the 1949 level. Mark you, that was a level where the exemptions were higher and the tax rates lower., and substantially lower, than in any comparable country in the world.
2880	HOUSE OF
The Budget-Mr. Abbott
So far as the corporation tax rate is concerned, this year we are making very modest reductions in the standard rate of three percentage points. With respect to the smaller businesses it is true that the relief is much more substantial. We are not touching the special excise tax rate which remains at 15 per cent, or the general sales tax rate which has not been increased since 1935 except by the 2 per cent added to pay for old age security. So that in effect added defence costs so far as the tax structure is concerned are being borne by the corporation income taxpayers and the special excise taxes.
As the hon. member for Rosetown-Biggar pointed out the other day, I recognize that in large part the corporation tax will be passed on to the users of goods and services produced by the corporations so that to that extent the people are continuing to pay their share of defence costs through that medium. But that is the picture; that is the way in which tax reductions have been made.
As the house knows, I rarely quote from editorials or periodicals or publications, but I am going to depart from that rule today and quote from a recent issue of the Economist. I do not need to indicate the standing of this publication. It is one which the hon. member for Greenwood (Mr. Mac-donnell) often quotes. It is clearly not a Liberal party organ and it is not published in this country. Some hon. members may have seen the issue of February 21 which contains am extremely interesting series of articles entitled "Canada, The Expanding-Economy". This article indicates what has been taking place in this country during the last ten or fifteen years. I commend the reading of these articles to all hon. members who may be interested ini seeing an outside picture of what is going on in this country. I should like to quote just one short passage from one of the articles headed "Capital, Not Men" as follows:
The financial policies of the Canadian government have been commendably strict, and have generally kept inflationary forces well in hand. Indeed, it is one of the interesting paradoxes of the postwar years that the country which has been developing most quickly has had less inflation than almost any other. There could be no more convincing evidence of wise financial and political management.
My good friend the hon. member for Vancouver East (Mr. Maclnnis), in one of his usually able speeches, yesterday quoted from a speech that I had made last December before the Canada Club in London. He also quoted with approval a portion of my budget speech in which I said that the very satisfactory results which we had had during the last year or two had been due in large
(Mr. Abbott.]

measure to the added efforts of the Canadian people. Then he quoted with some disapproval a further passage in which I said that these results had been due in part to wise political management. His thesis was that it would have happened anyway, that it was all due to the war and to other causes.
Of course that is a philosophy with which I do not agree. My friend is a socialist, and I respect his beliefs. I know perfectly well that the views which he voices are sincerely held by him and have been so held for a great many years. As he knows, I have a different political and economic philosophy.
In the last issue of the Economist which has come to my hand

this is the last time I am going to quote from that publication- there is a series of articles devoted to Australia. They contrast the development in Australia with the development in Canada, I must say to the advantage of Canada. As the house knows, for the greater part of the last ten or fifteen years Australia has been governed by a socialist government. I should like to quote briefly from this article in the Economist of March 7 entitled "Developing Dominions". After outlining the contrast between the development in Australia and in Canada it goes on to say:
This contrast between Canada and Australia has a broad significance. Is Canada's economic development more forceful and healthy simply because Canada has greater natural advantages- of resources, geography or climate? Or does the divergence in economic prospects reflect social and political differences that are to some extent within the control of governments?
Then after elaborating a bit, this is the way in which the question put in the first paragraph is answered:
The reason why Canada is taking the opportunity so well, and Australia so hesitantly, is political. It lies in economic policies, not in the facts of nature. This is not to say that change-a shift back to the expansion of primary production-is easy for Australia. The excessive concentration on secondary industry reflects inexorable social pressures that can hardly be overcome until the deep class and political tension among the nine million Australians has been reduced. There is, nevertheless, some comfort to be drawn from the comparison between Canada and Australia: for its lesson is that to some extent, at least, a country and its government can choose expansion or reject it.
While I would be the last to assert that the remarkable growth which has taken place in this country during the last ten or fifteen years has been due entirely to government policy-I have never said that-I do submit that it has been due to a combination of good people, good luck and good management, and I do say that good management has played a significant part. I for one am proud to have formed part of the government which has formulated and put into effect policies

which I think have contributed significantly to the outstanding results which have been achieved in this country during the last ten or fifteen years.
Now, Mr. Speaker, if I may digress for a moment, I should like to deal with a point made by the hon. member for Assiniboia (Mr. Argue) in the speech he delivered the other day. In the course of that speech he had something to say about the amount of income tax paid by farmers in the central provinces compared with the amount of tax paid by farmers in the west. He produced some figures which purported to show that the average Ontario farmer paid less tax than the average Saskatchewan farmer, although the Ontario farmer's net income was larger. Similarly other figures were given as proof that the average Quebec farmer paid less tax than the average British Columbia farmer, although the Quebec farmer's net income was higher.
I have not the slightest quarrel with my hon. friend's arithmetic, but I do object to his use of the figures which he produced. The use of averages can of course often be very helpful, as I hope to show, but it can also be very misleading; and although I am sure these figures which were produced by my hon. friend were not intended to be so-


Some hon. Members:: Oh, oh.


Douglas Charles Abbott: No, no-the averages which he used were in fact misleading for this reason.


Mr. Maclnnis:: You do not recognize a gentleman when you hear one.


Douglas Charles Abbott: It may be perfectly good arithmetic, Mr. Speaker, to say that an average income tax liability of $30.95 was incurred for 1950 by each of the 112,018 occupied farms in Saskatchewan, but it is at least as accurate, and much more meaningful, to say that 10,950 Saskatchewan farmers incurred an average tax liability of $316.62 and the remaining Saskatchewan farmers incurred none at all. Similarly the $12.60 liability for the 149,920 occupied farms in Ontario might in my opinion be better expressed as an average tax liability of $196.57 for 9,610 farmers.
This example illustrates what I had thought was the well-known fact that income tax is not calculated on the average income of a whole group in any locality but upon the actual income received by each individual taxpayer. No one can determine how much tax should be paid by a particular group except by ascertaining the net income of each individual in the group and applying those provisions of the Income Tax Act that 68108-183J
The Budget-Mr. Abbott are appropriate in each case such as the exemption for dependents and the total amount of tax so found for each individual. What it is important to know then, it seems to me, when comparing the tax potential of one group of individuals with another, is not the average net income but the number of individuals who have a taxable income and the way in which this income is distributed among the various income brackets.
Unfortunately there are no statistics available that show the distribution of farmers' net incomes by provinces. However, lack of statistics need not prevent us calling to mind certain well-established facts. First, farming operations in Saskatchewan are, I think it is fair to say, on the whole on a larger scale and more highly mechanized than in Ontario, and might be expected to yield a larger net return per farm. It is not surprising, therefore, that for 1950 there were slightly fewer farmer taxpayers in Ontario than in Saskatchewan and that the average tax paid was also somewhat smaller. Second, the average size of the farm family is much smaller in Saskatchewan than in Quebec, and somewhat smaller than in Ontario. This means that Saskatchewan farmers on the average have smaller exemptions and consequently larger taxable incomes than Quebec farmers even if their average net incomes are the same.
These are two averages which I submit are useful and not misleading. There are many other factors which have to be taken into account in making a proper comparison of potential income tax liability in the west and in the central provinces, but I hope I have said enough to indicate the danger of jumping to conclusions on the basis of insufficient evidence. I know that I speak for my colleague the Minister of National Revenue (Mr. McCann) as well as for myself when I say that every effort is being made to ensure that Canadians of all occupations and in all provinces are being given fair and equal treatment under the present income tax law.
The present budget which is before the house is based on the assumption that Canada will stay prosperous with a moderate expansion in production over the next twelve months. Prices and the cost of living appear to be relatively stable. Revenue estimates assume only a modest increase in the gross national product of 4 per cent. Prudent and reasonable estimates have been made regarding expenditures for the coming year, and on the basis of these careful, responsible calculations it appeared that about $250 million was available. More revenue would be coming than would be needed to meet expenditure and accordingly, in line with past policies

The Budget-Mr. Brooks during the last two or three years, this surplus was devoted to tax reduction.
The tax reduction proposed has, I sincerely believe, been fairly and sensibly distributed. There is nothing devious or misleading about the budget. It is not an election budget; it is not a rich man's budget. It is an honest and straightforward budget in which an earnest attempt has been made to pass on to the people of Canada, in as fair a manner as possible, the reward for an excellent record of hard work and production.


Mr. A. J. Brooks (Royal):: Mr. Speaker, I had not expected to be placed in the difficult position of following the minister this afternoon. I have listened to his remarks with much interest, and I would say that his speech was very modest and mild compared with the budget speech he delivered a short time ago. I do not think anyone could claim that he dealt with the subject with the same assurance as he showed previously.
The budget debate is usually a wide-open one and allows great latitude of discussion by the members of the house. I intend to take advantage of this opportunity to dwell on some matters which concern my part of the country particularly. I think that is only right, because the budget itself affects the lives of all of us and deals with living conditions in every section of the country.
The minister said a moment ago that the budget had been called different names. That is quite the usual thing. We have heard it called a sunshine budget, an election budget, a sunset budget, a rich man's budget, and the other day I heard someone call it a moonshine budget. I think that is a very appropriate term to apply to it because it shed a very dim light of hope for most people so far as reduction of the great burden of taxation is concerned. The budget was well presented by the Minister of Finance (Mr. Abbott) and was greatly applauded by the government supporters. It sounded good at that time, but I fear that the enthusiasm which was general then was very short-lived. I am sure that many supporters of the government are now wondering just what they were applauding at that time.
Even corporations, which received the most benefit, are dubious about those benefits because there is no cut in expenditure which would give the tax cuts a dependable foundation. A brief presented by the Canadian Chamber of Commerce to the Minister of Finance (Mr. Abbott) a short time ago reads in part as follows:
Economy and efficiency in government is as essential to the economic health of the country as economy and efficiency in business is to the health of business. The executive council therefore feels that a searching examination of government

expenditures in all departments should be made. Even small economies are important, because they tend to develop within government and its administration a cost consciousness, and if there are enough of them they have a cumulative effect which can be substantial.
To them, if this is meant to be a businessman's budget, the basis of the relief it offers -tax cuts without economy-may appear rather unbusinesslike.
Mr. Speaker, I might say that I come from a rural constituency, where 80 per cent of my constituents are farmers. I have listened to the protests of the farmer members in this house and I agree with the protests that have been made, that the farmer has received very little as far as this budget is concerned. Added to that, farm prices across Canada are lower, but what farmers are buying today has increased in price in many parts of the country. Now we have an increase in freight rates which will bear very heavily upon the farming population.
In my own province, New Brunswick, there has been a substantial drop in farm prices. I was interested to notice that, according to the dominion bureau of statistics a short time ago, the most serious drop in farm prices has occurred in the provinces of New Brunswick and Prince Edward Island. The index of prices in New Brunswick has dropped 13 - 2 per cent and in Prince Edward Island 12-7 per cent, while the average in Canada was a drop of iV of 1 per cent.
Allied with farming in the maritime provinces, fishing is one of our great industries. I am not going to dwell upon the plight of fishermen this afternoon, as that was ably dealt with by the hon. member for Gloucester (Mr. Robichaud) a few days ago, except to say that I am heartily in accord with the arguments presented by him. He asked for a reduction in the sales tax, which would have helped and benefited the farmers and fishermen in my province very greatly.
I wish also to approve of the arguments which have been used in favour of some assistance to the municipalities across Canada. I agree that government companies and federal properties should pay taxes to municipalities, and that it would only be fair as well that the machinery which is used by towns, villages and municipalities should be free from sales tax.
I should like to read briefly, Mr. Speaker, from an article which appeared in the Loyalist, a weekly paper published in the city of Saint John, dated March 7. The headline is "New Brunswick municipalities get warning-tax defaults past danger point". The minister of education in that province pointed out that there has been tremendous default

in different municipalities and that it was practically impossible for municipalities to pay their taxes. He issued this warning:
Municipalities were warned that "some of our municipalities may have to take extreme measures to maintain their solvency."
That very well illustrates what the situation is not only in New Brunswick, Mr. Speaker, but all across Canada, as far as municipalities are concerned.
There was appreciation for some relief in certain cases, cigarettes, stamps, radio tax and so on. Those are small reductions and I have no doubt they are appreciated to the extent to which they give relief, but they have been of very little help indeed to the farmers, fishermen and labourers throughout the country. Even the assistance which was given to the corporations does not benefit certain sections of the country as much as it does others. That is quite obvious.
We in the maritime provinces lack great corporations and industries such as are found in the central provinces and, consequently, in that regard we are not receiving anywhere near the benefits that are being received by the central provinces. I might say that, in spite of the fact that we have few industries compared with other parts of Canada-and hon. members from other parts of the maritimes have mentioned this in this debate-we have some outstanding industries that we are proud of, industries which, over a long period of years and in spite of difficulties, have been able to maintain their existence and prosper to a certain extent. I can refer to Ganong's chocolates, in the town of St. Stephen; the Simms' brush factory in the city of Saint John, now three or four generations with that family; the McAvity foundry in the city of Saint John; the Hartt boot and shoe factory in Fredericton, which I am told turns out some of the finest boots in Canada. I do not want to do any advertising for these people-


Douglas Charles Abbott: They deserve it.


Alfred Johnson Brooks: -I just want to point out that we have in the maritimes many outstanding industries. We have Red Rose tea and coffee, Stanfield's underwear-


Some hon. Members:: Hear, hear.


Alfred Johnson Brooks: -the Atlantic sugar refinery and many others. We are not devoid of industries in the maritime provinces, and while we lack them in quantity we certainly have them in quality.
I listened to the hon. member for Saint John-Albert (Mr. Riley) when he spoke the other day about children's allowances and old age pensions. He indicated that we received back from the central provinces
The Budget-Mr. Brooks considerable money in this connection. Well, I know the people of my own province and I know the people of the other maritime provinces. We do not wish to subsist on old age pensions and children's allowances or other handouts of that kind. What we want and what we need in our province is more industry.
I might say that we in the maritime provinces feel that we have all the essentials there for the carrying on of industry. We have industrious and intelligent people, and I think we have proven that conclusively to all parts of Canada and to many parts of the United States. There is no finer place to live in Canada than down by the sea. We have splendid recreational facilities of all kinds, and we have a delightful climate. All those things should tend to encourage industries to come to those provinces by the sea. However, we have a lack of industry and we have our unemployment problem. The hon. member for Saint John-Albert will bear me out when I say that in the city of Saint John, which is one of our great winter ports, there are many men unemployed this winter because there is a lack of the shipping that we might expect.
The other day I received an answer to a question regarding the immigration sheds in the city of Saint John, and I want to call this matter to the attention of the Minister of Citizenship and Immigration (Mr. Harris). We have a well equipped immigration shed, perhaps the best equipped in Canada, but there is just a trickle of immigrants coming through the port of Saint John. The minister told me last year that the matter would be looked into and would be corrected.
Mention was made by the Minister of Trade and Commerce (Mr. Howe) of the prospects of improving trade with South America. Not long ago I brought up in this house the question of trade with the West Indies. Trade with the West Indies and and with South America is practically the same thing. A few days ago, Mr. Speaker, I was amazed to learn that a line of boats owned by the Canadian National Railways, a government-owned railway, which had been plying between Halifax, Saint John and the West Indies for the past 25 years, was discontinued. If we are to build up trade with the West Indies and South American countries we must have some means of ocean transportation to those countries. In the same newspaper which announced that the "Lady" boats, as we call them in the maritimes, were to be taken off, I was pleased to read that an English company would commence service. I suppose the company was looking forward to this trade which we hope

The Budget-Mr. Brooks to develop with the South American countries. The article announced that the English company, the Lamport and Holt Line, would begin regular calls at Montreal this year.
This is an item taken from the Montreal Gazette of March 10, and it says that the line, which has a fleet of 15 motor and 3 steam vessels, will offer shippers from Montreal service between Montreal and the South American ports of Bahia, Rio de Janeiro, Santos, Montevideo and Buenos Aires. It goes on to say that these vessels will call at the port of Saint John in the winter months. These boats are being brought to Canada by the Canadian Pacific Steamship lines, and not the Canadian National.
I am very pleased to know that this is the case, Mr. Speaker, because I think there are tremendous possibilities for the development of trade between the maritime provinces and the South American countries. We are in a natural position to trade. Transportation by boat is the cheapest kind of transportation. I believe that we have and could manufacture what the South American people would need in the way of manufactured goods, and they have things in other lines that we need.
There is another matter which I should like to mention, Mr. Speaker, which was mentioned by the hon. member for Saint John-Albert the other day and has been brought before this house time and time again by members from the maritime provinces. The hon. member for Cumberland (Mr. Black), the hon. member for Colchester-Hants (Mr. Stanfield), as well as practically every maritime member in this house, have spoken of the need for more hydroelectric power in the maritimes. I recall that during the war I asked the Minister of Defence Production (Mr. Howe) why the maritime provinces had not received more orders for defence production. His reply at that time was that we did not have the electric power with which to produce the goods. The greatest lack today in the economy of the maritime provinces is this hydroelectric power.
It is not necessary for me to tell what benefits power can bring. The great pulp and paper industry in the northern part of our province is due to the hydroelectric power development at Grand Falls. It has provided many people with employment and has built up such towns as Edmundston, Campbellton, Dalhousie and Bathurst, the home of the hon. member for Gloucester (Mr. Robichaud). We need more hydroelectric power.
TMt. Brooks.]

The other day the hon. member for Temiscouata (Mr. Pouliot) mentioned the possibility of New Brunswick developing hydroelectric power on the Saint John river. I do not know how far this plan has gone or just what development there might be. I do know that just before the election in New Brunswick a plan was outlined, I think as election propaganda. What will be done later I do not know.
There is one thing I should like to say, and I am sorry the hon. member for Temiscouata is not here; that is that we in New Brunswick have no intention of hurting in any way the province of Quebec. We would not bully the province of Quebec for anything, and so far as the constituency of Temiscouata is concerned we have no intention of building dams to flood that beautiful constituency. There are no people more kindly disposed towards the people of Quebec than are the people of New Brunswick, because we are next door neighbours. I believe there is more interchange between our peoples than between any other sections of the country.
Now I come to what I have advocated a number of times in this house, and that is the development of power at Passamaquoddy. Whether or not such a plan is feasible is not known at the present time. For many years the people of New Brunswick have dreamed of harnessing these tremendous tides in the bay of Fundy, which rise to a height of 40 feet or more and which come in with their tremendous force twice a day. It has been a dream, as I say, of our people that this tremendous power could be harnessed for the benefit of our people and for the creation of industry. In 1950 there was an investigation by the international joint commission into the scope and costs of the Passamaquoddy tidal power project. I should like to quote a paragraph or two from the report of this commission, at page 4:
It is the opinion of the board that an international Passamaquoddy tidal power development can be physically engineered, constructed, and operated. However, information now available is not adequate to permit determination of its economic feasibility.
The hon. member for Saint John-Albert spoke about this the other day. He said he hoped a further investigation would be made as to the economic feasibility of the project. This report goes on to say:
An investigation to determine the economic feasibility for any plan of tidal power development at Passamaquoddy bay should consider: (1) all possible types, arrangements and capacities of tidal power development:	(2) co-ordination with
auxiliary hydroelectric and/or pumped storage projects and with existing power systems: (3) potential known and possible new power markets for the project output;

I shall not read them all.
(5) the effect of a tidal power project on the fisheries of the region;
That is one very important aspect of the project, and one of the objections which New Brunswick has taken to the development of this tidal power plan, that it may adversely affect the fisheries of the province.
Then I quote paragraph 15:
15. The scope of such an investigation is described in detail in part III of this report and its cost is estimated at about $3,900,000.
That is what it would cost Canada and the United States to make an investigation into the economic feasibility of the development of hydroelectric power at Passama-quoddy. Of this $3,900,000, $300,000 would be for the investigation to ascertain the effect of the project on the fisheries of that area. I should like to quote from page 8 of the report what the commission said about the effect on the fisheries. It states:
The herring population is produced beyond the influence of local mixing and no way has been foreseen by which the dam would render the outer Quoddy region or the bay of Fundy less favourable to the existence of herring arriving from elsewhere.
And later on:
There appears little probability of the proposed dams affecting the sardine fishery along the coast of Maine or even seriously at Grand Manan.
Then a little later in the report:
During the years 1930 and 1931 the commercial herring catch for Passamaquoddy and Cobscook bays inside the proposed dam form 2-5 per cent-
Note that, Mr. Speaker; just 2.5 per cent. *-and the areas outside the dams from St. Mary bay, Nova Scotia, to Cape Elizabeth, Maine 97-5 per cent of that for the whole region.
From this report, then, it would look as though the argument which has been used in my province for a good many years against this development-namely that it would affect the fisheries-would not stand up on a thorough investigation. However, this report asks for and recommends an investigation; and I think one should be made.
I should like to say something about the attitude of Canada and the United States to this further investigation of Passamaquoddy power. I have here a letter from Hon. Margaret Smith, United States senator for the state of Maine. She wrote me on February 9 in reply to a letter of inquiry I sent to her. She says in part:
Washington is very interested in the Quoddy proposal. However, there is a general impression that Canada has a relatively negative attitude on the proposal-and that impression is acting somewhat to the prejudice of the proposal. I hope that is not true and that you can help to clear up the matter.
The Budget-Mr. Brooks She also sent me a copy of a joint resolution, presented by herself, which is now before the senate of the United States and is getting the support of practically all the New England senators, all the congressmen from the New England states and, I understand, receiving quite general support in the senate. I might say that ex-President Truman and the late President Roosevelt agreed that this waterpower development, if feasible, should be gone ahead with. In a letter that I received from Senator Smith on March 6 she had this to say.
Let me assure you that we will keep plugging on this side-hoping that you and Mr. Riley and those in Canada who share your views can bring about a change in the official attitude of the Canadian government.
That seems to be the sticking point, Mr. Speaker, as far as the further investigation is concerned, namely that our Canadian government, not the United States government, is opposing it. Senator Smith sent me a copy of a letter dated December 3, 1952, in reply to a letter which she had sent to the Department of State in Washington. The letter reads as follows:
*wiy aear senator Smith:
With reference to your letter of November 19, 1952, concerning Canadian participation in the proposed Passamaquoddy project investigation, Canadian officials told the State department informally on December 2, 1952, that the Canadian government would probably grant permission to the United States government for the surveys in Canadian waters which are anticipated in connection with the Passamaquoddy survey. Permission would have to be sought through formal diplomatic channels.
It was also stated informally that the Canadian government is not interested in sharing the cost of the surveys or any part thereof. Lack of Canadian interest is related to the determination of that government that the power needs of the areas of Canada which would be affected can best be met y smaller installations involving more reasonable amounts #of power and lower costs.
I do not know what authority the federal government has to make that statement, Mr. Speaker. I know, however, that for years we have been asking for power, and I know that for years we have been without it. Despite the fact that the hon. member for Temiscouata (Mr. Pouliot) the other day said that we had power enough, I know that we have not. We in the maritimes are starving for electric power. With the great developments which we have every reason to expect in connection with our mineral resources, we shall need more and more power. For instance, we do not want these base metals which are being found in large quantities in the province of New Brunswick, to be shipped away in their raw state. We want our own smelters down there. We want our base metals to be refined and smelted in our own refineries and our own, smelters.
2886	HOUSE OF
The Budget-Mr. Brooks This can only be done if our province has more electric power.
I am not going to dwell on that subject any longer, but I hope that the government will accede to the wishes of the members from New Brunswick and the other maritime provinces, and will make an investigation of this Quoddy project. It is not going to cost much. They will have the assistance of the United States government; and according to reports the United States is anxious to go ahead with the investigation.
In closing, Mr. Speaker, may I say there is a matter which I shall just touch on for a few moments because it has been dealt with by many others in the house during this debate and at other times. I refer to the war veterans allowance and the ceiling in connection with it. Last year in the veterans affairs committee this matter was brought to the attention of the government. We urged the government to increase the ceiling. We pointed out that it was a great injustice to war veterans that the ceiling was so low. As a matter of fact, before the amendment in 1952 the ceiling was higher than it was after the act had been amended that year. The former ceiling was $125 for single veterans. It allowed income over and above the allowance of $125 for a single man and $250 for a married couple. Now the ceiling is $120 for a single man and $120 for a married couple. It does not allow a war veteran any opportunity at all to earn money on the side.
The government felt they were doing a grand thing when they put in the War Veterans Allowance Act section 4, which permitted war veterans to earn money on a monthly basis and provided that then, after they had worked a number of months, they could return again to the war veterans allowance. The government thought that provision was going to satisfy large numbers of war veterans and more or less take the place of other improvements which we had asked for. On March 3 I asked the question of the Department of Veterans Affairs:
How many veterans receiving war veterans allowance have taken advantage of section 4 War Veterans Allowance Act, as of March 1, 1953?
The answer is that out of 29,998-practically 30,000 men-in receipt of war veterans allowance, only 258 took advantage of section 4; or in other words only 258 were working on a monthly basis. That, in itself, shows that the recipient of the war veterans allowance has reached the age where it is practically impossible for him to do a full day's work.


Today the average age of the veteran is, I believe, over 60 years. I do contend that these men should have received more consideration last year at the hands of the government, and of our war veterans committee. I	hope the government will
again set	up	a war veterans committee so that amendments can be made to the War Veterans Allowance Act, raising the ceiling so these men may be allowed to earn more money while at the same time taking advantage of their allowances.
I have noted a number of cases which to my mind show injustice. First there is the veteran who is not able to do a full day's work, but who could handle a part-time job, such as that of janitor in a small school or church. Perhaps, with his wife, they could take in boarders. But the difficulty is that if they earn over $120 the war veterans allowance is decreased by that amount.
Then there is the thrifty and prudent man who has earned for himself a small retirement pension of $25 or $30 a month from some organization for which he worked. I am not in this instance referring to the veterans' pension. But again, his war veterans allowance is reduced. If he is married he is not allowed to receive more than $1,200 a year or, if single, $720.
Then there is the case of the disability pensioner. If he is entitled to the war veterans allowance and receives more than a 50 per cent pension, he gets very little assistance. The single veteran with a 50 per cent pension receives no assistance whatever. The other day I received a letter from a veteran in my constituency, whose wife was also a veteran, having served as a nursing sister during the war. She had incurred some disability and received a 20 per cent pension. When this man was put on the war veterans allowance his wife's 20 per cent pension was reduced because it was contended that the husband and wife were receiving more than the ceiling permitted.
These are all matters which should be brought to the attention of a committee on veterans affairs. I recommend, as I have on many occasions in the house, that a committee on veterans affairs should be set up on a permanent basis to deal with matters of this kind.


Mr. Victor Quelch (Acadia):: Mr. Speaker, during the presentation of the budget Liberal members opposite were loud in their applause. I could not help thinking that the Prime Minister (Mr. St. Laurent) in all probability must have given them a pep talk, reminding them that last year when the budget was brought down there was press comment to the effect that it had been

received in stony silence. Probably he urged them to express appreciation for whatever small concessions might be granted in the budget.
However it seems to me that having had time for sober reflection, Liberal members must admit that there was very little cause for the rejoicing and the hullabaloo of that time. I think it must be clear to them now that some important ingredient was missing from the Abbott brew which, while apparently it had an intoxicating effect upon Liberal members at the time it was served, since that time has not only gone flat but has become decidedly sour.
A great deal has been said during the course of the debate about the taxation proposals. I shall touch upon them only briefly. By many the budget has been called a rich man's budget, and I think that is a fair description of it. Certainly there is very little relief in it for people in the lower income brackets.
In closing his speech this afternoon the minister stated that the budget was based upon the assumption that Canada will remain prosperous throughout 1953. That being so, I think there would have been every reason to reduce taxation upon that class of people who are not able to enjoy that prosperity today. In other words there would have been every justification for making a reduction in the sales tax and the income tax affecting people in the lower income brackets. After all, that would have helped to bolster effective demand.
It will be recalled that in his budget speech the minister pointed out that the demand fell off in the fall of 1951 and the early part of 1952; but that later on, when restrictions on credit buying were removed, demand picked up. Throughout the latter part of 1952 there was a heavy increase in instalment buying, charge accounts and personal loans from chartered banks.
I do not think it is a very healthy situation when certain groups of people have to go into debt in order to buy their daily requirements, especially when the debt increases at a time when there is such a high level of prosperity. Had the Minister of Finance (Mr. Abbott) used the $250 million he had to play around with for the purpose of reducing the sales tax and increasing income tax exemptions, it would have helped to improve the situation.
I should like for a few moments to deal with agriculture. In his budget speech the minister referred to the high level of production, wages and income, and stated he was gratified that this situation had continued at a time when the wholesale price 68108-184
The Budget-Mr. Quelch index had fallen by 7 per cent and the retail price index by 2 per cent. Well, the minister may have been gratified, but he cannot expect agriculture to share his gratification when we consider the fact that practically the whole of the drop in the wholesale price index can be traced to the fact that the wholesale price index on agricultural products had fallen by 17 per cent.
Attention is drawn to this fact by the governor of the Bank of Canada in his annual report for the year 1952 wherein, at page 2, he says:
Livestock production also increased; there was an abundant supply of meat on the domestic market and prices fell considerably, accounting for about the whole of the decline during 1952 in the consumer price index. Export markets for livestock and meat, however, were limited following the outbreak of foot-and-mouth disease early in 1952.
While the Minister of Finance may have been gratified to see the fall in the wholesale price index, he could not expect the livestock growers in this country to be gratified, when the fall in the prices they received was solely responsible for the reduction in the wholesale price level, and especially at a time when their costs of operation were rising.
When the Minister of Agriculture (Mr. Gardiner) was speaking he indicated that he did not like comparisons being made between 1952 and 1951. He pointed out that in 1951 we had a record in both production and gross income for agriculture. My point is that when the Minister of Agriculture referred to the record production and prices for agricultural products he did not point out that while there had been a large gross income for farmers, the cost of production had increased considerably during that period.
I want to point out that 1951 was not by any means the best year for agriculture, as indicated by the Minister of Agriculture. The best period which agriculture has had in Canada was between 1916 and 1920. During that period the farmers of Canada, representing 30 per cent of the population, received 30 per cent of the national income. In other words, from 1916 to 1920 agriculture received a parity of income. In 1951 the farmers, representing around 20 per cent of the population, received only about 10 per cent of the national income.
If we take the years 1916 to 1920 as a base period, according to figures obtained from the bureau of statistics we find that in 1949 the index for the price of wheat was 87, while the index for the prices of farm machinery was 209. By 1950 the index for the prices of farm machinery had increased to 218 while the price of wheat had fallen

The Budget-Mr. Quelch due to the exchange rate on the dollar. The Minister of Agriculture pointed out that there was no change in the price of farm machinery in 1951 and therefore the index can be taken to remain at 218, but as hon. members know the price of wheat fell still further on account of the Canadian dollar going up in relation to the United States dollar so that the index for the price of wheat in 1951 would be below 87.
The Minister of Agriculture made quite a point of the fact that farm machinery represents only from 8 to 9 per cent of the costs incurred by agriculture as a whole. That may be true of agriculture as a whole, but if you take the highly mechanized state of western agriculture you find that machine costs are greatly in excess of 8 or 9 per cent of the cost of raising wheat. If you consider other commodities which enter into the cost of farming you find a situation similar to that with regard to machinery. For instance, wages have gone up considerably since the period 1916-20. Freight rates have gone up over 100 per cent in the past five years. Fuel for tractors has gone up, and in addition taxes have increased considerably since that period.
The Minister of Agriculture tried to substantiate his claim that the period during the post-war years had been exceptionally good, and he made a comparison between that period and six years before the war. I think it is important to remember that the six years immediately prior to the war were the last six years of a ten-year depression. During that period western Canada suffered a serious drought. It was a period during which many farmers were practically in a state of bankruptcy. During that period, in order to maintain their actual living costs, farmers allowed their capital and machinery to depreciate considerably. A farmer cannot operate efficiently when he allows his capital to depreciate. At the same time purchasing power in Canada was at a low level, thus reducing the domestic market for agricultural products.
When the minister compares the six postwar years with the six years of the depression he is not making a very sound comparison. If the Minister of Agriculture had really been interested in making a sound comparison he should have compared during the past five years the relationship between the prices received for agricultural products and the costs of production. If he had done that he would have found a very different picture from the one he gave.
During his speech the Minister of Agriculture referred many times to the federation


of agriculture and pointed out that in his opinion their criticisms, generally speaking, were fair. I should like to quote from an article referring to the annual convention of the Canadian Federation of Agriculture held this year at Victoria, British Columbia. The Western Farm Leader of February 6 contains the following:
"For those who have the erroneous impression that farmers have been enjoying unprecedented prosperity," said Mr. Hannam, "it would be well to restate the fact that the farmer's income depends not upon prices alone, but farm prices in relation to farm costs. In recent years, farm costs have risen more than farm prices.
"Based on price relationship, the farmer's purchasing power, if represented by the index of 100 in 1948, has been less every year since. For 1952 it stands at 82. Since it is generally agreed that farm prices may be down somewhat and farm costs are expected to hold or go a little higher, this farm purchasing power relationship may well drop to 80 or less during 1953, down by 20 per cent or more since 1948."
That is an important point that must always be taken into consideration when you are assessing the position of agriculture. You must at all times keep in mind the relationship between farm prices and farm costs. When you have a period in which farm prices are falling while farm costs are rising, you do not have a very healthy situation.
We depend a great deal upon the United States for markets for our products. Therefore it is important to farmers in this country to know what happens in the United States. I have here the Alberta Wheat Pool Budget of February 27, 1953 which quotes an article entitled "Farmers Being Squeezed" which appeared in the U. S. News and World Report, a magazine which is quoted quite often in the house by ministers. This article reads in part as follows:
Farmers, even with government help, are in a squeeze right now.
A farmer, on the average, in 1953, will get a smaller proportion of the national income than in any years since the depression bottom in 1932. He will have many more dollars than in 1932, but relative to other parts of the population, his share of the total will be back at a low level.
Put it this way: One person out of six in the country is a farmer. In 1946, when times were best for farmers, $1 out of $9 in national income went to the farmer. In 1953, $1 in $15 will go to the farmer.
Then another matter of interest to the Canadian farmer is the future agricultural policy of the new United States government. I think it will be of great interest to note a statement made by President Eisenhower, and I quote from the overseas report on agricultural developments, economics division, marketing service, Department of Agriculture, which contains the following on page 4:
Some changes, perhaps of a substantial and1 fundamental nature, may be made in agricultural policies by the new Republican administration. In

his state of the union message to Congress on February 2, President Eisenhower referred to the slow, irregular decline in farm prices which has been going on for two years, and promised that prices of basic commodities will be supported at 90 per cent of parity until the end of 1954 . . . We should begin now to consider what farm legislation we should develop for 1955 and beyond. Our aims should be economic stability and full parity of income for American farmers.
I hope the Liberal government will give due consideration to that statement because that is something we have never been able to get the government in this country to recognize, the right of the Canadian farmer to a parity of income. President Eisenhower states that support prices will be continued until 1954, and then the administration will try to devise a policy which will give the American farmers not merely 90 per cent of parity but 100 per cent.
Every time the question of parity is brought up with the Minister of Agriculture (Mr. Gardiner) he says he does not like the use of that term because it can mean so many different things. But you cannot dispute what parity of income means. Parity of price may mean several things, but parity of income means one thing and one thing only; that the farmer will receive his fair share of the national income in proportion to the population.
Therefore, Mr. Speaker, when we take into consideration the situation in the United States and the fact that we in Canada are having difficulty in selling to the United Kingdom because of their lack of dollars and, as the Minister of Agriculture pointed out, because of the price level in that country, then I say there is every reason for concern on the part of our farmers with respect to the present situation.
What is the advice given by the Minister of Agriculture at the present time to the farmers of this country in order to deal with that situation? He emphasizes the importance of the home market, and I am sure we all agree how important the home market is and that everything possible should be done to maintain the purchasing power of the people in the home market at a high level. Then he suggests that farmers should actually reduce their production of certain commodities so as to be less dependent upon the world market.
Last year, when he addressed the annual convention of the Canadian Federation of Agriculture at Montreal, he advised farmers not to increase their production of certain farm commodities, mainly livestock and dairy products; but when he addressed the conven-, tion this year he went even further. He did not merely advise farmers not to increase 68108-184J
The Budget-Mr. Quelch their production; he advised farmers to actually reduce their production in order to get a better price. Again I will quote from the Western Farm Leader of February 6 which contains the following:
Mr. Gardiner stated that the government can get our farm products into the United Kingdom market tomorrow, if we are willing to meet the competition of beef from Argentina at 16 cents a pound and bacon from Denmark at 31-5 cents. Rather than coax farmers to produce things they cannot sell at prices that pay, the proper thing, the minister said, is to produce less for more money.
Before passing on, I would point out that while the figures he gave as to the prices paid by Great Britain for Argentine products may have been correct at the time he spoke, they are not correct today because there is a report in the same issue of the same paper of a new agreement signed between Argentina and the British government, which report reads as follows:
Meat Prices under New Argentine Agreement
Under their new trade agreement with the Argentine, Britain will pay 20*1 cents (U.S.) per pound for top quality frozen beef sides, 22-6 cents for chilled beef, 18-5 for lamb, and 32-8 for pork cuts. Argentina is to take manufactured goods from Britain in exchange.
In other words this is a barter deal. In my opinion, Mr. Speaker, there is no question that we in this country could greatly expand our exports of farm products to Great Britain if we were willing to do the same as Argentina and accept British goods in exchange for Canadian products or, if we are not prepared to do that, at least to accept sterling in payment which could be utilized for the purpose of buying goods produced anywhere within the sterling area.
I want to make it plain that I am not for one minute criticizing the Minister of Agriculture for giving that advice, because no doubt he considers it the only way in which farmers can protect themselves under existing government policy. But on the other hand I would bitterly criticize a government policy which makes it necessary to reduce the production of any commodity at a time when there are millions of people in the world on the verge of starvation. I would criticize that policy on two main grounds; first as an anti-social policy, and second because I believe it will greatly weaken the agricultural program in western Canada.
I wonder if I could call it six o'clock, Mr. Speaker.	.
On motion of Mr. Quelch the debate was adjourned.
At six o'clock the house took recess.

Committee on Railways and Shipping AFTER RECESS
The house resumed at eight o'clock.


Mr. Deputy Speaker:: Is it agreed that we revert to government notices of motions at this time?


Some hon. Members:: Agreed.



RAILWAYS AND SHIPPING


Lionel Chevrier: That a sessional committee on railways and shipping owned, operated and controlled by the government, be appointed to consider the accounts and estimates and' bills relating thereto of the Canadian National Railways, the Canadian National (West Indies) Steamships, and Trans-Canada Air Lines, saving always the powers of the committee of supply in relation to the voting of public moneys; and that the said committee be empowered to send for persons, papers, and records and to report from time to time, and that notwithstanding standing order 65, in relation to the limitation of the number of members, the said committee consist of Messrs. Benidickson, Bourget, Browne (St. John's West), Carter, Cavers, Churchill, Cleaver, Dumas, Follwell, Fraser, Fulton, George, Gillis, Healy, Helme, James, Knight, Macdonald (Edmonton East), Macdonnell (Greenwood), McCulloch, McLure, Mott, Mutch, Picard, Pouliot, Thomas.
He said: Mr. Speaker, this is the usual motion which is made each year for the establishment of the committee on railways and shipping. That is the committee which deals with the affairs of the Canadian National Railways, of Trans-Canada Air Lines, of the Canadian National (West Indies) Steamships, and other related matters. It is a routine motion that precedes the discussion in the committee of these railway matters.
This year I am happy to say that the net surplus of the Canadian National Railways, after all fixed charges, will amount to $146,000. It is the first time in many years, or for several years at least, that there has been a surplus. I believe, although I have not yet seen the budget for the year 1953, that the officers of the railway are budgeting for a similar small net operating surplus.
I would hope, Mr. Speaker, that it would be possible to appoint this committee without too much discussion.


Mr. G. K. Fraser (Peterborough West):: Mr. Speaker, I am glad the minister made a short statement, though I thought he would make a much longer one. I am pleased to see that there is a surplus for the Canadian National Railways, but I imagine that surplus is due to the new capitalization.


Lionel Chevrier: Oh, yes.


Gordon Knapman Fraser: The recapitalization does put the Canadian National Railways on a little better footing with the Canadian Pacific Railway. That was the intention. It makes things much better for the Canadian National Railways because I think it will give the employees a little better star to shoot at than they had before, when they really had an anchor around their necks all the time.
I am in hopes that now the Canadian National Railways have a surplus they will go out and try to improve the lines more than they have in the past, especially the passenger lines. I do not think that in the past they have gone after business the way they should have. In the past ten or fifteen years the people of Canada have gradually moved over to buses. Although the war did hamper the railways, I feel that the trend is partly accounted for by the fact that the railways have not built up their passenger service the way they should.
In a return that was tabled here I was very pleased to see that Canadian National Railways have bought some 141 new passenger cars. I believe they are buying some in foreign countries, and are spending $32i million on new passenger cars which are being built here in Canada. It is too bad they are not all being built here in Canada, but I imagine that the company is anxious to get these new passenger cars in service as quickly as possible.
The line from Ottawa to Toronto goes through my home city of Peterborough. On that line we have some mighty poor passenger cars.


An hon. Member:: They'll ship those to the maritimes.


Gordon Knapman Fraser: I hope they never ship them to the maritimes, because if your railway lines are not much better than ours you will not have many passengers travelling on them. Because of poor passenger lines people are using their automobiles rather than the trains and people will have to be educated to use the trains again. On some of the lines in the United States the cars really ride smoothly. It is a pleasure to ride in them, but some of the cars here shake the mischief out of you. I was going to use another word, but it might not be parliamentary.
Coming in on Monday I noticed that on one line they are using diesel engines, mostly for the freight service. I think the Canadian Pacific Railway is doing the same thing. I hope, and I know, that these diesel engines will make a big difference. The electric components of diesel electric engines are made in my own home town, and many improvements

are being made on those engines all the time.
I expect that in a very short time-some say 15 years and some say 30 years-there will not be any steam locomotives on the railways at all. I hope they will ship the steam locomotives out of the country or junk them and that they won't send them to the maritimes.


John Lorne MacDougall: They just want reefer cars there.


Gordon Knapman Fraser: They want them for their potatoes, yes. A diesel, however, pays for itself in the saving of fuel within three and a half to five years. That fact ought to help the overhead of different railway companies, and especially the Canadian National Railways, making it possible for the latter to continue to have a surplus.
Mr. Speaker, this committee will also deal with the accounts of Trans-Canada Air Lines. I noticed ini an article in the Gazette of March 11 that a Mr. Richard Lewis, of the trade paper Canadian Broadcaster and Television, stated that the Trans-Canada Air Lines fares on the 348-mile run from New York to Montreal, where they are in competition with a private United States air line, are $3.75 less than on the run from Montreal to Toronto. That run is 11 miles shorter than the New York to Montreal run. On the Toronto to Montreal run, however, Trans-Canada are not in competition with any other company. They have a monopoly and, therefore, they are charging the Canadian people $3.75 more than on the other run. This is not fair to Canadians, because Canadians own Trans-Canada Air Lines. I hope that in the committee I may be able to convince the officials of Trans-Canada Air Lines that this fare should be reduced to make it the same or less than the Montreal to New York fare.
Now, Mr. Speaker, I will have a lot more to say in the committee, but I do not want to detain the house any longer.


Mr. Clarence Gillis (Cape Breton South):: Before the committee meets, Mr. Speaker, I should like to get a little advance information from the minister. The minister of mines and labour in the Nova Scotia government made a statement in the house to the effect that there was a possible chance of delaying the placing of diesel engines on the run from Moncton to Mulgrave. Perhaps the Minister of Transport (Mr. Chevrier) will recall telling the house that the program called for 10 diesels on that run in 1953. Has the minister any knowledge as to the correctness or otherwise of that statement made in the legislature?


Lionel Chevrier: I do not know what my position is if I answer questions.
12, 1953	2831
Committee on Railways and Skipping


Mr. Deputy Speaker:: If the minister
answers questions now, he will close the debate. He may reply when he does close the debate.


Mr. Gordon Graydon (Peel):: About a year ago, on another occasion in this house, I gave some support to the hon. member for Van-couver-Burrard (Mr. MacDougall), who introduced an item of legislation with which I found myself partially in agreement. Now I find myself in agreement with him again, and I hope this means he is right, because that has an intimate bearing on my position as well. When I heard the hon. member mention the question of sleeping car reservations about a week or two ago, I wondered whether or not the situation was as bad as it was then described. Because I was interested in the matter I made some investigation myself, and found that the hon. member had rather accurately pictured the situation.
I want to tell the minister that the Canadian National-I suppose the Canadian Pacific isi in exactly the same position-is losing scads of money on these sleeping car reservations. I think it is a scandal that the situation has continued as long as it has. I have spoken with sleeping car conductors and others who are interested in this subject, but of course they are governed entirely by the policy of the railway. When the committee meets I think that is one of the things that ought to be dealt with. I am not a member of the committee, and that is the reason I raise the subject here; it is the only opportunity I shall have.
Apparently what happens is this. People reserve these lower berths, bedrooms and the like, and then they have reservations on the plane as well. If the plane happens to make the trip, that is the last the railway hears of the reservation. It is still there on the books, however. I suppose if these people are good customers the railways do not like to be too tough. The result is that the railway carries that reservation, although the man is perhaps at his destination before the train leaves the station. This berth is kept for him, and that accommodation is wasted so far as revenue to the railway is concerned. I would not be at all surprised if the minister found that the railways were losing somewhere between 10 and 15 per cent of their sleeping car revenues through this rather stupid policy, if I may call it that, in connection with reservations. I am amazed that the railways have allowed the situation to continue as long as it has.
So far as the commuters around Montreal and Toronto are concerned, the railways put up a great story about losing money on commuter traffic. I want to say that they need
2892	HOUSE OF
Committee on Railways and Shipping not be so self-righteous about saving money so far as the poor commuters are concerned when they throw money out the window on these sleeping car accommodations. I feel rather keenly about that, because frankly I always had the idea that somehow or other you could only reserve sleeping car accommodation until a certain hour. For instance, if you were leaving at night on the 11 o'clock train, I understood you had to get your sleeping car ticket before 3 o'clock in the afternoon. I believe that is the policy the railway followed with me. I am now wondering if I am being singled out for special attention. Apparently one does not have to pick up the tickets by 3 o'clock, but can let the matter go right up until the time the train leaves. The railway officials do not bother you.
People call up and ask for accommodation on a certain train on a certain night, and they are told that the railway cannot give them accommodation that night because all the sleeping car space is taken. Of course it is reserved, but it is not filled when the train leaves.
I believe the member for Vancouver-Burrard has a very important point. I should like to know, and I think the committee would be able to find out, just how much is being lost through this foolish system of reservations. This will be notice to the railway officials when they come before the committee that they ought to tell the committee, and through that committee the House of Commons, just what the situation is. If this reservation business is conducted largely as a matter of accommodation for customers, then it should not be followed to the stage where the railways are carrying empty berths for long distances across Canada. In many instances these people seem to be so thoughtless that they are not even courteous enough to notify the railways that the berths are not going to be needed. I think that is something the railways ought to consider.
I have no doubt that if the railways have a surplus of $186,000 now, they would have about twice that much if they ever collected the fares for this empty space that is carried on so many trains. What makes me particularly concerned is that, while we are fighting for some justice for the commuters, the railways talk about the losses they have and then allow the loss of revenue from this waste space to continue. I think that is not quite fair. If we ever go before the board of transport commissioners again in connection with commutation rates, the railways need not expect us to swallow all that talk

COMMONS	[
about cutting expenses to the bone and getting every five-cent piece of revenue they can, because it looks to me as though this is revenue they are losing which they do not need to lose, and which, if it were accumulated over the years, it seems to me would amount to a rather immense sum of money. If this is any indication or any pattern of how the railways run their business in some other ways, may I say that I do not think much of it. I wanted to make that just as clear as I could tonight because when the committee meets, I hope its members will take up that matter.


Mr. R. R. Knight (Saskatoon):: I should like to say, Mr. Speaker, that I welcome the setting up of this committee for several reasons. I have been making representations to the railroads, particularly to Mr. Gordon, the president of the Canadian National Railways, in regard to areas of free express delivery in our city of Saskatoon. Like other cities, Saskatoon has been growing rapidly and there are certain districts which are now, I think, entitled to delivery from the railroads free of charge. I am glad to say that matter has been straightened out and that Mr. Gordon has informed me by letter and I have also been so informed by the transit board, if that is the correct term, that these free deliveries will now take place in the south corner of the city. That is one matter which we shall not have to take up in the committee.
I have been greatly interested in this discussion in regard to the demotion of Mr. Pitt. That issue has been a live one in my city for the last few months. I have a large file on it. I welcome the setting up of the committee so that we may have there the proper witnesses who may be questioned in regard to that particular matter.
The minister has taken the position, as have others, that this is a matter of internal management. While one must admit that to a certain extent that is true, at the same time we must remember that, after all, the C.N.R. is a public body. I am not interested in Mr. Pitt's case personally; I have never met the gentleman. But I am interested in seeing that any servant of the government of this country or of any corporation of the government in this country should receive justice and that, when he is dismissed or demoted, he should have good reasons given therefor.
I think I am safe in saying to the minister and of the minister that he has committed himself rather strongly in this particular matter, not only in reply to the hon. member for Lake Centre (Mr. Diefenbaker) this afternoon but to me and, I fancy, to others who have written to him personally with regard

to the demotion of Mr. Pitt. The minister's position being what it is, there is ah insinuation there. It may not prove to be an insinuation; it may be unfounded in fact. But as far as I am concerned-and I have a large file on the matter-I have not been able to find anything against Mr. Pitt in this matter. The minister, if I may quote from his letter, shows that caution which is exhibited at all times by my honourable and learned friends when he says:
It may well be that the reasons for the transfer of Mr. Pitt, if made public, would react unfavourably to his cause.
Of course I should have to admit that; and Mr. Pitt is in the unfortunate position that he is an employee of the railroad and to that extent his mouth is closed. But those who are intimately in contact with Mr. Pitt tell me that Mr. Pitt has nothing to fear from any investigation. I would express the hope that before that committee we may have those witnesses who can be questioned on this matter in order that we may get the thing cleared up once and for all.
May I say that I do not put any particular stock in the assertion that the Prime Minister (Mr. St. Laurent), as Prime Minister, had anything to do with this particular matter.
I have more respect for the Prime Minister than to think he would be mixed up in any such affair. But I think that there are lesser men who like to show a large authority. I hope that the facts may be elicited before this committee, and I hope the correct witnesses may be called with regard to the matter. For instance, I would suggest Mr. Pickersgill be called. His official position,
I understand, is that of secretary to the cabinet; and I would also suggest that Mr. Sommerville be called. I understand that he is general manager of C.N.R. hotels throughout Canada.
I am aware that there is a long story behind this thing, which goes away back to the wartime when Mr. Pitt went out on the service of his country, and to the time when he came back and found another man in the position which he would have expected to fill.
I expect there is rivalry there. I expect there is a long story which I cannot go into here. As I say, I have much information on the subject. But I want to say this. In my own city of Saskatoon Mr. Pitt was considered to be a public servant above reproach, a man who gave excellent public service.
I made some inquiries with regard to the employees at the Bessborough hotel where Mr. Pitt was manager. Those people are unanimously in support of Mr. Pitt's cause in this particular issue. I can find nothing against him. On the other hand I found a good deal of criticism with regard to the
12, 1953	2893
Committee on Railways and Shipping man who has been in charge, if I may put it that way, of Mr. Pitt's destinies over the last few years. So far as I am concerned, I am not satisfied with things as they are. Whatever the truth is, let us get at it. Let us have the thing out. Let us have these witnesses before the committee.
I know the government has had lots of notice about this thing. The hon. member for Lake Centre raised the matter in the house. I think I myself raised it perhaps first of all. The government have had lots of time to prepare their case. All right, let them prepare their case, and let them be prepared to submit it to a public tribunal, this committee, when it is set up.
I am not interested in Mr. Pitt as a senior man in the service. I am interested that the humblest man in the public service of this country, whoever he may be, should receive justice from the people for whom he works. That is what I am interested in. I hope this committee will reveal the truth, whatever it may be, let the chips fall where they may.


Mr.  W. Chester S. McLure@Queens: Mr. Speaker, as one member of this committee I should like to bring a few matters to the attention of the Minister of Transport (Mr. Chevrier). One of them is this. For the benefit of the members of this committee, the reports should be in their hands at as early a date as possible. Last year I think the reports were not in the hands of the members until a couple of days before the committee sat. There is no reason why we should not have those reports at least fifteen days before the sitting of the committee.
The next matter is this, and I do not know whether the Minister of Transport would care to say anything about it or not. What is the reason for these large orders for cars going outside of Canada? I refer to the new cars that are going to be made. After waiting for years, I do not think the company needs to be in such a great hurry to get this equipment. I believe that procurement could be distributed over a certain period of time in order to provide employment in our own country. Surely Canadian companies can make as good cars for the railways as can any other companies in America.
Another matter I should like to draw to the attention of the minister is that the returns given with regard to the operations of each division are very general indeed. We have never been able to get returns on eastern or western divisions, or even our own division in Prince Edward Island. The convenience of having those returns would be worth something to our shippers, and to the committee in general. They would give
2894	HOUSE OF
Committee on Railways and Shipping definite proof whether the operation of diesel engines is a good thing financially.
Last season the only information we had was as the result of a direct question I asked the president, when he gave us to understand that $300,000 was saved by dieselizing the Prince Edward Island railway. If we had a statement for the whole railway system showing the present operating expenses as compared with what they used to be, perhaps it would be one of their best arguments for the dieselization of the whole Canadian National Railways system.
No doubt the Minister of Transport (Mr. Chevrier) is aware of the fact that the hotel employees are now ready to go on a grand strike all across Canada. Perhaps this is only a scare put out ini order to bring the pay of hotel employees up to a better standard, and also to have shorter hours. Perhaps the minister would be prepared to urge upon the hotel employees' association that, if at all possible, a strike should be avoided. The railways have not yet been notified of any final date set for the calling of the strike.
Then I suggest that we are entitled to more information in connection with the operation of the ferry service between Borden and Tormentine. This service is operated by the Canadian National Railways. The only bookkeeping of which we are aware is that they pay themselves their own subsidy. I suggest we should be shown a statement of the earnings of that ferry service. It must be a paying proposition, because I understand the Canadian National Railways now have their eyes glued on a private enterprise ferry operating between Wood island and Caribou. They are anxious to get control of this ferry service, and thus have a monopoly of that means of transportation. I hope the minister will never permit or assist the Canadian National Railways to get control of all our ferry service, especially this independent line that is giving one of the best services that has ever been given ini that capacity.
In closing I would express the hope that I have not asked any questions I should not have asked at this time. If I have, then it is within the minister's power to refrain from answering.


Edmund Davie Fulton: Mr. Speaker, before the minister replies there is one point I would ask him to clear up in connection with the powers and privileges of the committee. The impression the house and country may have gathered from the statement made yesterday by the minister may have been that the committee to be set up would be entitled to the production of certain letters. I think we should know whether it is 

the minister's position that those letters not only may be but will be produced in the committee, if we ask for them, or whether in the committee we will be entitled only to a statement from the president of the Canadian National Railways.
Obviously it is going to have a very important bearing upon the position of hon. members in the committee-the decision as to whether or not they will ask for that information-if we are to be provided only with a statement from the president of the Canadian National Railways, following which we will have no opportunity to demand the production of the documents, the letters, on the basis of which he makes this decision. Because if that is so, then obviously there is no reason why we should ask for the information.
We have found frequently in committee that we ask for information and are presented with statements on which we have no opportunity for effective cross-examination. We find we have no opportunity to require the production of documents upon which that statement is based. Yesterday, as I heard him, the minister gave the impression, at first at any rate, that the committee would be entitled to a full disclosure of all the facts surrounding the case of the former manager of the Fort Garry hotel.
I suggest we should have a statement from the minister at this point, before the debate closes, stating whether, if we ask for it, we are going to be provided with the correspondence, on the basis the minister stated in the house yesterday. Because if we are not going to have the letters, then I think it should be made perfectly clear that no member is to be criticized because he does not go in there and ask the president of the C.N.R. to make a statement which we will have no opportunity to refute.


Lionel Chevrier: Mr. Speaker-


Mr. Deputy Speaker:: If the minister speaks now, he will close the debate.


Lionel Chevrier: Mr. Speaker, I am grateful to hon. members for the short discussion which has just taken place on the establishment of the committee, a discussion which I believe will serve a useful purpose.
Many questions have been put to me, and I am sure the house will not expect that I should deal with all of them; because the purpose of the committee is to consider many of the questions which have been asked here this evening. To answer some of them would take considerable time, and I think I should leave to the officers of the railways, whose duty and business it is to deal with these matters, the responsibility of replying

to most of the queries which have been directed to me.
However, there are some questions to which I feel I should refer. One of these was mentioned by the hon. member for Cape Breton South (Mr. Gi'llis). He referred to a statement made by the minister of labour of his province who said that he hoped a delay would take place in the dieselization program of the Canadian National Railways.
All I can say with regard to that is that the minister of labour came to Ottawa with a delegation from the maritime provinces to see the Minister of Resources and Development (Mr. Winters), the Minister of Mines and Technical Surveys (Mr. Prudham) and myself. They made many representations, among which was this particular one asking for a delay in the dieselization program. I had to say to that delegation that this was a matter for the management of the Canadian National Railways, and that I would bring it to the attention of the officials of the railroad. That I have done.
The hon. member for Cape Breton South (Mr. Gillis) is familiar with the position taken by the Canadian National Railways in previous committees, and the program that was announced then. I do not think I should attempt to anticipate what the president of the Canadian National Railways will say, and I would prefer to leave this matter for him when he comes before the committee.
Some questions were asked about equipment purchased in the United States. As the house knows, the Canadian National Railways follows the practice of asking for tenders for equipment. The date of delivery in the tender has a great deal to do with the granting of the order. In the instance mentioned by the hon. member for Peterborough West (Mr. Fraser) and the hon. member for Queens (Mr. McLure) I believe a substantial portion of the orders went to Canadian firms because they were the lowest tenderers and the date of delivery was satisfactory. Substantial orders also went to United States firms because they were the lowest in their submissions and also because of the time factor. There is another point to be considered, in that some of this equipment will be used on the United States lines of the Canadian National Railways.
The question was asked about fares charged by T.C.A. on movements to the United States and between Toronto and Montreal. As the house knows, I am not the minister responsible for the operations of Trans-Canada Air Lines, but I can say that the tariff of fares charged by the various air
12, 1953	2895
Committee on Railways and Shipping lines are subject to approval by the air transport board. Tariffs must be filed with that board after notice has been given to competitors and to the public. Fares are determined, sometimes after a public hearing and sometimes without a hearing. I can say to my hon. friend that presumably the fares in this case would be determined on the basis of differential because of competition. I imagine that my hon. friend will want to raise this question when the president of T.C.A. is before the committee.


Edmund Davie Fulton: Surely the government determines whether there will be competition.


Lionel Chevrier: No, it is not the government. Competition is determined by air agreements which are entered into between various countries. Canada has an air agreement with the United States that provides that Colonial Airlines may operate between New York and Montreal and vice versa. What I was going to say is that since that competition exists and these tariffs must be approved, I would suppose that the United States line would have to have its tariff approved by the civil aeronautics board of the United States.


Edmund Davie Fulton: The point I am trying to make is that it is surely government policy which decides whether there will be effective competition on the Montreal to Toronto route.


Lionel Chevrier: Government policy in connection with the Montreal to Toronto route is that T.C.A. shall be the only air operator. That has been the government policy for a number of years and still is.


Gordon Knapman Fraser: If there had been competition the rates would be lower.


Lionel Chevrier: That is a matter of government policy and for decision by the air transport board. On the other hand, this is a matter of public domain. That has been the policy not only in that area but elsewhere. I think that policy has proved to be a pretty good one.
Then again there is another point. Is the traffic on the transcontinental route heavy enough to warrant another operator, such as the C.P.A., coming in? That is a matter to which the government and the air transport board must give consideration. Up until now it has been felt that the T.C.A. should continue to operate on the transcontinental route while the other competitors should operate on the north-south routes.
Other questions were asked by the hon. member for Peel (Mr. Graydon), and I understand the other evening by the hon. member for Vancouver-Burrard (Mr. MacDougall). My hon. friends will excuse me if I do not deal with these questions, but they cover matters
2896	HOUSE OF
Committee on Railways and Shipping with which I am not too familiar. I think they should be left for determination by the committee.
I come now to the questions raised by the hon. member for Saskatoon (Mr. Knight) and the hon. member for Kamloops (Mr. Fulton). The hon. member for Saskatoon said that he had taken a keen interest in the case of the former manager of the Fort Garry hotel. I am glad he has done so, and I hope every facility will be afforded him to obtain the information which he requires. However, he seems to have put this matter on an entirely different footing. He says that Mr. Pitt has nothing to fear from an investigation. It is not Mr. Pitt who is being investigated, if I understand aright; it is the Canadian National Railways which is being investigated by certain members of this house. They feel that there is something wrong, that some grave injustice has been committed by the Canadian National Railways. I simply repeat in effect what I have said earlier, that the Canadian National Railways has nothing to fear from any investigation. Those hon. members who are members of the committee can, and I hope will, have the right to ask the president and the other witnesses who may be called for information which they are desirous of obtaining.
Somebody suggested that certain witnesses should be called. That is a matter for the committee to determine. This brings me to the question asked by the hon. member for Kamloops. He asked: What is the position of the minister? What attitude is the minister going to take? The minister does not direct the activities of the committee.


Edmund Davie Fulton: That is not what I said.


Lionel Chevrier: I shall deal with what you said if you will just hold your peace. The minister is not even a member of the committee. As I understand the rules of this house they are that the committee is the master of its own destiny. The committee determines what evidence it will hear, and what papers and the like shall be filed or tabled.
My hon. friend has asked about the production of certain letters. All I need say to him is that anything I have said is on the record.
I think he understands the English language as well as I do, perhaps even better because he has had a far better education than I would presume to say I have had. I think the words I have placed on Hansard axe quite clear. They are not subject to half a dozen interpretations. Therefore I repeat that the committee, as has been the custom with all such committees that have been established, will be the master of its own proceedings and will determine what evidence will be heard and what witnesses will be called. I think 

that is the long established practice and custom of the house. I do not think there is anything else I have to say.


Edmund Davie Fulton: Before the minister sits down may I ask him this question. Does he remember an occasion about two years ago, I think it was, when in this committee a question came up with regard to information concerning whether or not an honorarium had been paid or was to be paid to a retiring president? Does the minister remember that, sitting then as a member of the committee or sitting in the committee, he expressed certain opinions which had a great influence on the decision of the committee? If he remembers that, then I am asking him here, and have asked him earlier, to answer the question whether or not in the committee he would consent to the production of the letters to which reference has been made because his opinion which he expressed on that previous occasion, if he remembers, is obviously going to have a vital bearing on the decision of the government majority on the committee.


Lionel Chevrier: The question which my hon. friend asks is surrounded with a lot of contingencies. For instance, he asks what will the position of the minister be if the question is raised, if he is sitting in the committee. I think this is the answer to his question. Let us establish the committee. Let the committee be formed and let us see what the nature of the questions is.


Edmund Davie Fulton: You have had a pretty good
education. I can see that.


Lionel Chevrier: When we get there we will be able to determine, as and when the questions are asked, what attitude should be adopted.


[Stage Direction]
Motion agreed to.


Lionel Chevrier: that the house go into committee to consider Bill No. 38, respecting the Saint John Bridge and Railway Extension Company.
Motion agreed to and the house went into committee, Mr. Beaudoin in the chair.
On section 1-Mortgage transferred.


Alfred Johnson Brooks: This bill has been considered by the standing committee, and I do not think there is anything controversial about it.


Lionel Chevrier: Thank you very much. The hon. member feels there is nothing controversial, Mr. Chairman.


Louis-René Beaudoin: The hon. member is quite right. The bill has been carefully considered by the standing committee on railways, canals and telegraph lines and was reported to the house without amendment.


[Stage Direction]
Section agreed to.
Sections 2 to 4 inclusive agreed to.
Title agreed to.
Bill reported, read the third time and passed.


Lionel Chevrier: that the house go into committee to consider Bill No. 39, to amend the Canadian Overseas Telecommunication Corporation Act.
Motion agreed to and the house went into committee, Mr. Beaudoin in the chair.
On section 1-Cablehead.


Louis-René Beaudoin: This bill has been carefully considered by the standing committee on railways, canals and telegraph lines and has been reported to the house without amendment.


Mr. Browne (St. John's West):: Mr. Chairman, bearing out what you have already said, this matter was before the committee and was given very careful consideration. I have nothing to add to what has already been said.


[Stage Direction]
Section agreed to.
Sections 2 to 11 inclusive agreed to.
Title agreed to.
Bill reported, read the third time and passed.


Lionel Chevrier: the second reading of Bill No. 191, to amend the Canada Shipping Act, 1934.


Mr. Green:: Would the minister explain?


Lionel Chevrier: Mr. Speaker, hon. members will recall that the Canada Shipping Act was last amended in 1950. At that time extensive changes were made in the act which were required in order to implement the international convention for the safety of life at sea which was signed in London on July 10,
Canada Shipping Act
1948. That convention came into force on November 19, 1952 with respect to the countries, including Canada, which have ratified it, and the relevant amendments made to the act in 1950 were proclaimed effective December 31, 1952.
The 1929 safety convention will remain effective for one year between Canada and the parties to that convention which have not accepted the 1948 convention. Provision is made in the bill to cover this transitional period. After November 19, 1953, ships of countries which by that time have not accepted the 1948 convention will no longer have the protection in Canadian ports of an international certificate, and consequently will be subject to the requirements of the Canada Shipping Act in respect of safety equipment.
The amendments proposed in the bill which is now before the house are not extensive. The first amendment is technical, relating to certificates issued to engineers on steamships. As defined in the act, the term "steamship" includes ships propelled both by steam and by internal combustion engines. There is a great disparity between the actual power developed by a steam engine and an internal combustion engine. Under section 114 of the act certificates to engineers are based on nominal horsepower, which is the term used in describing the size of the engine but does not correspond to the actual horsepower developed.
It is proposed to amend this section to require engineers on ships propelled by internal combustion engines to have a higher grade of certificate than engineers on ships driven by steam engines of the same nominal horsepower. This will bring a measure of uniformity in the certificates issued to engineers employed on the two classes of ships. Provision is made so that the rights and powers of certificates now issued will not be affected.
The second amendment relates to radiotelegraph and radiotelephone installations. I have indicated on previous occasions that amendments would be introduced relating to radio installations on ships plying coastal waters, particularly on the west coast. Under subsection 2 of section 406 of the act, passenger ships carrying more than 50 passengers and plying on certain coastal voyages such as those on the west coast are required to be equipped with a radiotelegraph installation complying with the provisions of the international safety convention, and to carry the prescribed number of operators. Subsection 2 of section 406 also applies to cargo ships of five thousand gross tons and upwards going

Canada Shipping Act
on voyages of more than two hundred miles from one place to another, unless exempted by the governor in council.
It is proposed to amend this section to require all passenger steamships over sixty-five feet in length going on any voyage outside of a port to be fitted with a radiotelegraph installation complying with the provisions of the safety convention. The amendment provides that radio operators shall not engage in any other duties which in any way interfere with the keeping of watches. Provision is also made for exempting certain vessels where it is expedient to do so, having regard to the nature of the voyage in which the ship is engaged and the radiotelephone installation on the ship, or other circumstances of the case. In the case of ferry ships, or other vessels going on short voyages in protected waters, there would not appear to be the same necessity to carry radiotelegraphy as in the case of ships going on longer voyages in open waters, particularly if these vessels carry radiotelephone.
The proposed amendment also covers cargo steamships of five hundred gross tons and upwards and steamships under five hundred tons engaged in towing another vessel of five hundred tons or over, or towing any. other floating object, such as a raft of logs, having a dimension in any direction of one hundred and fifty feet or more where the vessel towed does not carry radiotelegraph equipment. Provision is made for exemption as it is considered that where these ships are equipped with radiotelephone and are plying on short voyages or in protected waters the provision of a radiotelegraph installation may not be necessary.
At the last session of parliament approval was given to the agreement made between Canada and the United States for the promotion of safety on the great lakes by means of radio. The instruments of ratification have been exchanged between the two governments, and the agreement will come into force in 1954. It is necessary to amend the Canada Shipping Act in order to implement this agreement, and provision is made in the bill for regulations to be made by the governor in council requiring ships navigating on the great lakes and St. Lawrence river above the Lachine canal and the Victoria bridge at Montreal to be equipped with radiotelephone. Broadly speaking, the great lakes agreement covers passenger ships over sixty-five feet in length, cargo ships of five hundred gross tons and upwards, and ships under five hundred gross tons engaged in towing vessels of five hundred gross tons or over where the latter vessel does not carry radiotelephone. 
The third amendment concerns the inspection of tow barges. Under the law as it now stands tow barges that carry passengers are subject to steamship inspection and to the requirements of the act in so far as they are applicable to that type of vessel. Tow barges that carry a crew but not passengers are not subject to inspection. It is considered that tow barges carrying crew but not passengers should be subject to the regulations respecting lifesaving equipment, fire extinguishing equipment, precautions against fire and the provisions of the act relating to inspection of boilers in tow barges. The amendment to section 475 of the act is designed to carry out this purpose.
There are two other minor amendments, one providing for the appointment under the Canada Shipping Act of port wardens and deputy port wardens, and the other relating to the coming into force in Newfoundland of certain excepted provisions of the act.
On the whole, Mr. Speaker, -the amendments proposed in this bill are the result of a study made in the committee, which is a continuing committee in the Department of Transport and which, from time to time, deals with matters affecting the Canada Shipping Act. At times it hears representatives from other bodies too.
When the bill has received second reading I will propose, and I am sure there will be no objection, that it be referred for further study to the standing committee on railways, canals and telegraph lines.


Howard Charles Green: I am very glad to hear the minister say that he intends to have this bill referred to the standing committee. Incidentally, I hope that it will not be considered at the meeting of the committee which is to take place tomorrow morning, because several of us have to go to Chalk River with the atomic energy committee.


Lionel Chevrier: I give my hon. friend that assurance now.


Howard Charles Green: The Canada Shipping Act is of the utmost importance to people in all those parts of the country which are interested in shipping. They, of course, include not only Canadians on the east and west coasts but also those living along the St. Lawrence river and on the great lakes. A very large proportion of the Canadian people are directly involved in shipping matters.
This act is very long. It is a whole volume in itself; it is very involved, and the amendments which are proposed require careful study. For that reason I believe the minister is very wise in referring the bill to the committee.

The amendments seem to be beneficial, although there is some uncertainty in my mind as to just how far they go. We have had a great deal of worry on the west coast with regard to the question of passenger ships carrying Marconi operators, referred to in the bill as "radiotelegraph operators". There has been a tendency on the part of some of the shipping companies to make the radiotelegraph operator do other work such as acting as freight checker, part-time purser or engaging in other operations. That meant that he was not devoting his whole time to his instruments and it was a very dangerous trend. The difficulty has arisen partially because of the development of the radiotelephone. Quite a few shipping people thought the radiotelephone might do away with radiotelegraph. I am convinced that such is not a proper step, but I realize that there is some difficulty in working out the respective spheres of these two types of communication.
As I read the bill, discretion has been left pretty largely to the department to decide which ships are to have a radiotelegraph operator and which will be allowed to get by with the radiotelephone. I doubt whether the bill, as it is introduced, defines the spheres in a sufficiently clear manner to be satisfactory for many years. Perhaps it is a matter of trial and error and, as time goes on, we will be able to make the proper division.
However, there is one omission in the bill which I hope the minister will explain when he closes this debate. There is no mention whatever of radar. On our coast the use of radar is becoming quite widespread. It is not entirely satisfactory, and there have been some pretty nasty accidents where the radar was not in operation. I know that steps have been taken on a voluntary basis to train ships' officers in the use of radar; but there is no compulsion about it, and no standards have been set which must be reached in that training. So far as I know there are no regulations under the Canada Shipping Act dealing with the use of radar. It may be that this wonderful invention has not been developed to the stage where regulations can be enacted in respect of it. I would ask the minister to explain just what the present position is with regard to the use of radar on ships.
On the west coast there has been tremendous development. I need only remind members of the great aluminum plant which is being built at Kitimat, a few miles south of Prince Rupert. As a result of these developments there has been a great increase in shipping on the coast. Many of the channels
Canada Shipping Act
are dangerous, and ships are operating in weather in which they would not have operated a few years ago. The whole problem of the safety of ships on the west coast has become very important. I would ask the minister to tell the house about the present situation with regard to the use of radar on Canadian ships.


Angus MacInnis: shall only take a few minutes, Mr. Speaker, to tell the house that I am happy that the Minister of Transport (Mr. Chevrier) is introducing these amendments at this time. I am especially pleased about the amendment dealing with radiotelegraphy-I think perhaps that is the term. I am sure that ships' crews on the Pacific coast have drawn to the attention of the minister, his department and others, the great need for better radio equipment on, ships than is in use at the present time. As the hon. member for Vancouver-Quadra said, this is a very technical and involved act. I do not claim to have any understanding of it, but I just wanted to say that I think this is a step in the right direction.


Mr. A. W. Stuart (Charlotte):: I should like to say a few words with regard to the amendments which are proposed to the Canada Shipping Act. I believe sincerely that any regulation or any amendment which will protect the travelling public should be supported by each and every member in the House of Commons. During the past few years there have been several tragedies on the inland waters of Canada which have brought a great deal of criticism so far as the Canada Shipping Act is concerned. The general public seems to feel that the regulations have not been enforced to the extent they should be. One other criticism one hears on many occasions is the fact that, in some cases, the regulations are enforced on small boats when the general public feels it is not necessary. Again I would say that any regulation which protects the travelling public should be supported.
The hon. member for Vancouver-Quadra (Mr. Green) has mentioned the radiotelephone and radar. I would say that in the bay of Fundy region the radiotelephone is one of the greatest things that has ever come to the assistance of men who work on the water. As many hon. members know, I spent many years on the water myself. When you are out at night, miles away from any contact of any kind and with nothing but a diesel or gas engine to depend upon, you put in many anxious hours. Today, with radiotelephone equipment, you are in touch with your office or other boats every ten or fifteen minutes, and that removes a great deal

Canada Shipping Act
of the worry. You know that if anything happens someone can come to your assistance.
One other thing mentioned by the hon. member for Vancouver-Quadra was radar equipment. Again* I want to agree wholeheartedly with what he has said. I should like to refer briefly to a ferry service in my county which plies between Deer island and L'Etete, which is on the mainland. This ferry service carries thousands of cars and tens of thousands of passengers annually. The distance is only about three miles, but it is through very dangerous waters. There are two narrow passages where the water flows very rapidly in both the flood tide and the ebb tide. There are ledges for the whole distance of three miles.
The men who operate that ferry, particularly in foggy weather, have an enormous responsibility. I do believe that radar equipment would tend to eliminate a lot of that, and would be a great protection to the public. I feel that in the not too distant future it may be necessary to insist that that type of equipment be installed on services of that nature to protect the general public. We have had one or two accidents on that ferry service, but without loss of life and without loss of property. They could have been serious. I do endorse the idea of radiotelephone equipment on any type of boat or ferry that is carrying passengers, particularly since the cost of that type of equipment is reasonable.
This bill will come before the committee. I am a member of the committee, and I am sure it will be interesting to have an opportunity to discuss the different amendments which are under consideration at this time. Before I take my seat, I want to emphasize the fact that anything we may do that will compel these operators to instal radiotelephone and radar equipment will be endorsed by the general public.


Herbert Wilfred Herridge: should like to say a few words on this bill, Mr. Speaker. I am not quite sure whether it applies to minor waters, but I do want to bring to the minister's attention a situation that exists in my constituency. From 1898 until about 1948 the passenger steamers that are operated by the Canadian Pacific Railway, and which gave very good service to that district during those years, were in the habit of carrying drums of gasoline on the bow of the steamer for delivery to small, isolated points where there is no other means of communication. I mention this because I see that a section in the bill deals with some exemption for steamships under five tons, yachts and tow barges.
(Mr. Stuart (Charlotte).]
I think in 1948, owing to a visit by an inspector of the Department of Transport or the maritime commission, these steamers were prohibited from carrying drums of gasoline on the bow for delivery to these isolated settlements. This proved a great hardship to many of these people. I know of people with good farms 20 to 30 miles away from any other settlement, who have to hire a tug and barge to get a few drums of gasoline in to operate their spray pumps, farm machinery and so on. At the present time the Canadian Pacific Railway also operates these passenger steamers on the Arrow and Kootenay lakes, to push railway car barges going to various points. Even under present circumstances they are prevented from putting a few drums of gasoline on the bow of the railway car barge being pushed by the steamer. This has proven a great hardship to many people living in isolated districts on the Arrow and Kootenay lakes.
I bring this matter to the attention of the minister because I understand that they are allowed to carry empty gas drums on the steamers which, from my point of view, are much more hazardous as far as fire is concerned than are full drums of gasoline. I should like the minister and his officials to give consideration to the really unusual circumstances in which many of these communities have been placed because of this recent prohibition against the carrying of gasoline on the bows of passenger steamers or even on car barges being pushed by passenger steamers. I know of one community- its name is Johnsons Landing; the hon. member for Vancouver-Quadra (Mr. Green) would know it quite well-where difficulty has arisen. Just recently I had a letter from farmers in that district who require gasoline for the operation of their spray pumps, their tractors and things of that sort, and who actually are obliged to hire a tug and a barge at a cost of $100 a* day in order to take into that small landing two or three dozen barrels of gasoline.
I mention this matter, Mr. Speaker, because I think it is a somewhat unusual circumstance. I cannot see any fire hazard in allowing these steamers to carry gasoline on their bows or on the bows of barges, as they did from 1898 until 1948.


William Joseph Browne: Mr. Speaker, I have tried to study this bill, and I find that it is extremely complicated, and certainly one which can best be dealt with by being referred to a select committee. There are, however, one or two things to which I should like to make reference, and perhaps the minister may find it convenient to refer to them when he is closing this debate.

In the first place I am wondering whether section 114 of the act as it stands at present has been applied in all its extremity to conditions as they exist in certain places in Newfoundland outside of the main centres like St. John's, Corner Brook and the Grand Falls area. Many of our vessels are fitted with large modern engines with horsepower which I think would be more than that mentioned in some of the subsections of section 114. I am sure the owners of these vessels have been in a- position to engage men who have been able to take certificates as third engineers.
Then again, when the minister was speaking he made no reference, or at least I did not hear any, to the meaning of port wardens who are going to be appointed. I assume that is something new under the Canada Shipping Act. I have never heard of them before. We have never had any in Newfoundland.
I do not know whether there were any elsewhere in Canada, or whether that is an entirely new provision. The explanatory note says:
The purpose of the amendment is to provide for the appointment under the Civil Service Act of port wardens and deputy port wardens.
When the minister was speaking he said the purpose was to appoint them under the Canada Shipping Act. I think he must have made a slip of the tongue when he was speaking, as the explanatory note says the purpose is to provide for their appointment under the Civil Service Act.
Then again, according to section 5 of this bill, section 21 of the present act, which hitherto has not applied to Newfoundland and which deals with security that masters must give for some prospective liability which the crown may incur on behalf of the ship, is now to be applied to Newfoundland, and also part VI which deals with pilotage. I am wondering whether the minister, when he speaks, would be good enough to say whether this matter has been taken up with the Newfoundland government, and whether any representations have been made to the contrary.


Lionel Chevrier: Mr. Speaker,-


Mr. Depuiy Speaker:: If the minister speaks now, he will close the debate.


Lionel Chevrier: -there is not a great deal that I wish to say at this time, for the reason that the matter will be referred to the committee on railways, canals and telegraph lines. However, I want to deal with the question which was raised by the hon. member for Vancouver-Quadra (Mr. Green) and by the hon. member for Charlotte (Mr. Canada Shipping Act
Stuart), namely that in this bill there is no mention of radar.
It was stated that most ships have radar.
I think the hon. member for Vancouver-Quadra himself gave the answer or the reason for the non-introduction of radar in this amendment. It is that radar is a new development. We know something about telephones and telegraph. In fact we know a great deal about telephones. We have them in operation every day. We operate them on ships. We operate them from ship to ship and from ship to shore, and they work well. We know the telephone is a sure factor. The same thing can be said about telegraphy. But the same thing cannot be said concerning radar. By that I do not mean that radar is not a good aid to navigation. I believe that it is; and we most certainly encourage all our government ships to have radar on them. But the position of radar is that it is not required by the safety of life at sea convention.
The safety of life at sea convention studied and considered the necessity of radar as an aid to navigation and have recommended against it. The last convention discussed the matter fully but did not make mandatory the installation of radar on ships. As I stated earlier, radar is but an aid to navigation and is not meant to replace the efficiency of the captain, the master or his mates, because the vessel is always in his charge. It is felt that the best we in the Department of Transport can do with reference to radar is to encourage the officers and the crew to receive training in radar. That we are doing at the moment for all new officers, and we make it a requirement for them in obtaining a certificate of proficiency. I think that answers the point which was raised.
May I say that during the course of last summer I remember an occasion when I was on a government ship trying to get into a port on the north shore of the river St. Lawrence when there was an extremely thick fog. In the radar we could see the bell which was anchored some distance from the wharf. We could see the wharf. We could hear people talking on the wharf but we could not get to it because at a certain stage in the course of the ship we went beyond the wharf and then it seemed that we were completely lost in so far as radar was concerned. We therefore had to go on our journey, anchor some distance from that wharf and go to it the next morning.
I realized then that while radar is an extremely important thing, and you can see ahead of you the whole river or the coast or the gulf, there are times when, if you get

Canada Shipping Act
off your course, it can be ineffective. Our thinking therefore has been that until the safety of life at sea convention and others who are experts in the field make it mandatory, we should not include it in the amendments to the Canada Shipping Act.
There were several other questions dealing with individual sections, and I doubt whether I am authorized to deal with them. I see that Mr. Speaker is shaking his head-


Howard Charles Green: Could the minister not answer the question asked by the hon. member for St. John's West?


Lionel Chevrier: I think perhaps I could. I know what he is interested in particularly. Perhaps I could answer it in this way, and I am sure this will meet with his satisfaction. While the Canada Shipping Act has been made applicable to the province of Newfoundland, in view of the fact that there are many difficulties in putting it into effect according to the strict letter of the law the minister has, as the hon. member knows, discretionary powers to grant exemptions; and we have seen to it that no ships will suffer because of the fact that it has not the required certificate or because of the fact that the ship has not the required certificated number of masters and mates on board. I know that on several occasions I have had to grant exemptions in the case of Newfoundland, but always they are granted on advice from our officers in charge in the province, who recommend that a case is a deserving one.
I would not want the hon. member, or other hon. members on this side of the house from Newfoundland, to take from that statement the understanding that there will be a continual granting of exemption. No; we want to encourage all those in Newfoundland who are subject to the act to abide by it as quickly as possible. I trust it will be possible to put the act into effect so that it may operate equitably, and so that no one will suffer by it.
There were two or three other questions, but I hope my answering them will not be insisted upon. For instance, there was a question with respect to port wardens. These are matters with whiqh I really have no authority to deal. The hon. member for Kootenay West (Mr. Herridge) referred to the movement of gasoline on passenger ships. That point is not discussed in the bill, but I can tell the hon. member that the regulations under the Canada Shipping Act were amended a short time ago to prohibit the movement of gasoline on passenger ships because of the hazard involved in so doing.
Again, however, we try to arrange so that in coastal areas as well as isolated centres

movements of gasoline may be made at certain seasons of the year. Permits have been given from time to time to move gasoline under those circumstances. However, there is no amendment in the bill dealing with that situation.
I shall ask that the bill be referred to the committee on railways, canals and telegraph lines.


[Stage Direction]
Motion agreed to, bill read the second time and referred to the standing committee on railways, canals and telegraph lines.
[Stage Direction]
The house in committee of supply, Mr. Beaudoin in the chair.

[Stage Direction]
444. Departmental administration, $1,368,375.
Lionel Chevrier: Last year, Mr. Chairman, before any discussion took place on the details of the estimates of the Department of Transport, I gave a short summary to the members of the committee on the affairs of the department, touching upon the major projects and explaining some of the increases which appear therein. If it meets with the approval of the committee, I would like to follow the same practice this year.
For 1953-54 the net total estimated expenditures for transport, including the air transport board, the board of transport commissioners, the Canadian maritime commission, and the national harbours board, amount to $118,256,000 as against $110,307,000 for the fiscal year 1952-53, or an increase of $7,949,000. For the Department of Transport proper the estimated expenditures for the coming fiscal year are stated at $105,365,000, or an increase of $4,747,000.
I would like to refer in this short statement to the Department of Transport only, and to review the estimates along the lines of the summary of standard objects of expenditures and special categories attached to the estimates book.
The first object is that which deals with civil salaries and wages. It is estimated that the department will need $975,000 more in this coming fiscal year than in the previous year, to cover the 11,351 positions on the establishment. This additional money requirement is brought about by such items as annual increases; basic salary rates increases; over-all increases for prevailing rate employees, etc.
However, I should like to call attention to the fact that some $300,000 of the increase is traceable to the need of providing 60 crew

members for the new icebreaker D'Iberville, which will come into operation early in 1953, and 22 additional positions to cover enlarged meteorological services for the Department of National Defence.
Despite the need for the 82 positions to which I have just referred, we have managed to pare our requirements to such an extent that we are providing for 191 positions less than in the fiscal year 1952-53. For the most part this substantial reduction was effected by electrification of certain aids to marine navigation, installation of more modern equipment on the older main-line canals and the leasing, for operation on a concession basis, of the Skyways Club hotel and the bakery at Gander, Newfoundland, which were formerly operated by the department with a staff of 143.
In short, the highlights of this object are the reduction in the number of positions covered in the estimates and the additional cost brought about by increases in the various rates of pay for employees in the department.
Object No. 4 is for professional and special services. The expected increase for the coming fiscal year amounts to $319,000. Of this sum, $210,000 is made necessary by expansion in investigation and planning for the St. Lawrence seaway, and $71,000 is due to increased rates of pay for lightkeeper assistants and for increased costs of operating three lightships by contract.
Possibly this would be a good place to pause for a moment to bring the committee up to date on the present position of the St. Lawrence seaway project. The committee will remember that in 1951, following the delays and the shelving to some extent by Congress of the 1941 agreement, the Prime Minister (Mr. St. Laurent) went to Washington and discussed the project with the then president of the United States. It was then agreed that Canada and the United States would jointly make application to the international joint commission for approval of the power works in the international section, on condition that Canada would give its undertaking that it would build a seaway on the Canadian side of the international line.
The next step following that visit of the Prime Minister to the president of the United States was legislation brought down in this House of Commons. That legislation first of all established a St. Lawrence seaway authority providing for the building of the two canals, one at Lachine and one at the international section, and the locks of the Beauhaxnois canal, and the operation and maintenance of those canals.
The other piece of legislation was an agreement between Canada and Ontario by which
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Ontario undertook to build and construct all works having to do with power. Following that legislation a joint application by the governments of Canada and the United States was made to the international joint commission. As the committee will recall, this commission sat in several places, both in Canada and the United States; and after sitting for less than five months brought down a decision approving of what is known as the 238/242 single stage control scheme. In other words, the international joint commission stated that the scheme was a feasible one from the engineering standpoint, and issued its order of approval.


Howard Charles Green: What date?


Lionel Chevrier: I think that was in October, 1952; less than five months after the application was launched. There were certain conditions attached to the order, one being the removal of the Gut dam. As the house knows, the Gut dam was removed in a very short period of time, and I believe by early January there was nothing left.
The next step was an application by the New York state power authority to the federal power commission of the United States for a licence to develop power in the international section jointly with an entity to be named by Canada. Of course the entity named by Canada in the legislation is the Ontario Hydro Electric Power Commission. That application is still pending. Evidence has been heard by the examiner, and at the last hearing which took place late last month the examiner had to deal with the applications of New York and another applicant. What his report will be to the federal power commission I am not in position to state because it has not been made public, but that is where the matter stands.
Two things still require to be done before we can go ahead with the power development. The first is the granting of the licence to the present applicant, the New York state power authority, and the naming of the entity, which I presume would be the licensee, by the government of the United States. The moment those two things are done the project can proceed immediately.
Meanwhile a series of bills have been placed before Congress for consideration. One by Senator Wiley would seek to develop jointly with Canada the navigational features of the project, and takes for granted that the power commission will grant a licence to the New York state power authority. The other bill is by Senator Lehman and has to do with both power and navigation. It also concerns the division of responsibility for power as

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between the state and the federal government. In effect that is where the matter rests today.
Our hope is that the federal power commission will grant a licence to the New York state power authority and that the administration at Washington will name the licensee as the entity. The moment that is done we can proceed.


Howard Charles Green: That is with the power plan.


Lionel Chevrier: We can proceed with the power development. It follows that not very long after we must proceed with the navigational features of the project.
Object No. 5 deals with travelling, transportation and removal expenses and shows an over-all increase of $4,800. The civil estimates of the department for 1953-54 under this object actually show a decrease of $8,900, but this is offset by the Department of National Defence item recoverable of $13,600 under their meteorological services.
Object No. 6 covers freight, express and cartage and shows a net increase of $18,900. As in the previous item of travelling expenses, the department proper will be able to get along with less money but a national defence department requirement of $22,800 in meteorological services will more than balance our decrease.
Object No. 8 covers telephone, telegrams and other communication services. There is an increase here of $205,900 over last year's requirements. The main reason is the expansion of meteorological services, both civil and for national defence.
Object No. 12 deals with materials and supplies. Here we have been obliged to allow for an increase of $372,400. Primarily the increased requirement under this object results from the need of providing $260,000 to cover the first year's operation of the new icebreaker D'Iberville.
While I am on this object I should like to mention that the leasing of the Skyways hotel and bakery at Gander, Newfoundland enables the department to show a decrease in materials and supplies requirements of some $220,400. Hon. members will agree that this is a step in the right direction, as I see no need for the Department of Transport to operate facilities which can be leased on a concession basis to private enterprise.
Object No. 13, covering construction or acquisition of buildings and works, including land, constitutes the second largest item of expenditure in the Department of Transport for the fiscal year 1953-54. There are 15 votes included, 8 of which show decreases

totalling $2,600,000 and 7 votes with increases of $6,300,000, making a net increase in this object of $3,700,000.
I would like to review briefly some of the projects that come under this object. In canals, for instance, there is a reduction of $1,400,000, brought about because we have completed the St. Remi tunnel under the Lachine canal. We have an item in here for the building of the Atwater tunnel. The estimated cost of this new tunnel, under the Lachine canal which was undertaken to alleviate traffic conditions on one of the main arteries of Montreal, is $6,500,000. Hon. members will remember that there were two suggested tunnels to be undertaken by the department, the first one, which I mentioned earlier, being the St. Remi tunnel. By virtue of an agreement made between the city of Montreal and the Department of Transport, the city is contributing one-third of the cost up to $4,500,000 for St. Remi and $6 million in the case of the Atwater tunnel. The estimated gross expenditure to the end of the present fiscal year at Atwater is $4,700,000, and the balance of $1,800,000 is now being provided.
The next largest item is to provide proper facilities in the Laredo channel on the west coast of British Columbia for shipping services at Kitimat. This channel has been chosen as the best route for ocean-going vessels entering and leaving the terminals of the Alcan development. After several meetings held with shipping and pilotage interests, it was decided that one major light station and fog alarm would be required. I need not go on to deal in detail with what is being done, as I cam go into that later. The main point I wish to make is that we have decided to provide proper navigational facilities to assist in the development at Kitimat.
In the appropriation for the river St. Lawrence ship channel, contract dredging, we have included an annual amount called for by the contract, namely $2,500,000. This is a five-year contract which was awarded in 1952 to Marine Industries Limited after calling for tenders, and calls for an over-all expenditure of $13,022,000. The amount being provided in this year's estimates represents a decrease of $300,000.
By far the largest item under construction of buildings and works in the Department of Transport for this coming fiscal year is that associated with continuation of the crossing of the strait of Canso involving the construction of a causeway with a lock on the Cape Breton side to allow navigation through the strait. Last year parliament voted the sum of $2,250,000. This year we are asking for $6,700,000, or an increase of $4,450,000.

Hon. members will recall that on May 16, 1952, I announced that a contract for the rock fill required in the causeway had been let to the Northern Construction Company and J. W. Stewart Limited for $5,786,000. It is estimated that by March 31, 1953, $1,300,000 will have been spent on the causeway proper, and we are making provision for $3 million to cover this phase of the work.
An amount of $2 million is included here for the navigation lock at the northern end of the causeway, and the house will remember that this afternoon, prior to orders of the day, I announced that the contract for the lock had been awarded to T. C. Gorman (Nova Scotia) Limited of Halifax at $4,800,000 odd.
The Canadian National Railways is expected to initiate the relocation of its railway trackage in connection with the causeway during the coming fiscal year, and we are providing $1,450,000 to cover the cost of that work. I am happy to say that the contract for the rock fill with the Northern Construction Company is progressing very satisfactorily. Over 1,000 feet of the causeway had already been constructed to the end of January, and reports which I have from the firm of consulting engineers who are supervising the Canso project, O. J. McCulloch and Company, indicate that no delay is foreseen in the completion of the project in late 1955.
I should like to refer now to some of the contracts having to do with transportation services between Newfoundland and the mainland. At North Sydney the construction of new terminals, which began in late 1949, is progressing in a satisfactory manner. The contractor on this project is T. C. Gorman (Nova Scotia) Limited of Halifax who completed the dredging necessary for construction of the dock. In the coming year we expect that the new North Sydney terminals will be completed, and we are providing for an expenditure of $599,000 to cover the transit shed, elevators on the dock, railway trackage, roadway paving and the construction of an office and waiting room and a parking lot. The total cost of the new terminals when completed will be in excess of $2,900,000. The amount required for the present fiscal year is smaller than that for the previous one by $581,000.
The Port aux Basques terminals will cost the federal government $4,400,000 over and above the expenditure to be made by the Canadian National Railways at that point. The estimated expenditure to the end of the fiscal year 1952-53 is slightly less than $2 million, and during the coming fiscal year we are anticipating an expenditure of $2,-
300,000	with the work to be finalized in the
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late spring of 1954. The main contract for the construction and excavation was let to McNamara Construction Company of Toronto, and tenders are to be called shortly for the foundation and erection of the transit shed on the dock itself. The contract for the design and manufacture of two 25-ton capacity marine elevators was let to Colby Crane and Engineering Company of Vancouver at a cost of $220,000. The design and supervision of the dock and transit shed is under contract with O. J. McCulloch and Company, consulting engineers of Montreal. In addition to construction of the terminal facilities at North Sydney and Port aux Basques, there is the construction of the auto ferry vessel, and I shall deal with this vessel in my subsequent remarks on object No. 16, construction or acquisition of equipment.
I turn now for a moment to expenditures having to do with the air services branch of the department and which reflect the expansion of air navigation throughout the country.
I shall treat first with the civil aviation division. Although the total outlay for that division is especially large-the exact amount is $8,465,500-it is difficult to explain the item in anything more than a very general manner. The reason for this lies in the fact that the component parts are characterized by their number rather than by their size. For instance, there is $2,800,000 provided for new runways or extensions at ten locations such as Charlottetown, Forestville, Timmins, Regina, Prince Rupert. There is $1,085,000 for strengthening and resurfacing of runways and clearing approaches at several airports.
There is approximately $1J million covering installation or improvements of lighting at 39 airfields. There are 21 projects for water, sewer, steam lines, etc. There are 40 projects having to do with the construction of power plants, living accommodation, garages, workshops, hangars, stores buildings and the like. Nevertheless there are a few major undertakings which go to make up substantial parts of the $8J million. Those which I have in mind are:
Dartmouth, $850,000 for reinforcing and lengthening one runway to accommodate heavier aircraft.
Gander, $750,000 for rehabilitation of runway and taxi strip.
Grande Prairie, $500,000 for runway reconstruction.
Regina, $500,000 for construction of a new runway.
Saskatoon, $400,000 for construction of terminal building.
Timmins, $375,000 for construction of one runway. This field will eventually replace Porquis.

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Forestville, $300,000 for extension and paving of runway to accommodate heavier aircraft.
Rouyn, $300,000 for the same purpose as at Forestville.
Prince George, $210,000 for reconstruction of taxi strip and turning button.
Gander, $200,000 to cover first stage of renovation of terminal building.
Our radio aviation services financial requirements for capital construction and acquisition total $2,100,000 and relate to all radio facilities necessary for operation of the airways system, such as radio range stations, beacons, communication facilities, radio installation for instrument landing systems, and associated dwellings and the like.
The telegraph and telephone services contemplate expenditures aggregating $900,000 in connection with the reconstruction and expansion of their existing facilities. There are two large projects involved: (1) installation of a radio relay system between Ashcroft and Prince George, British Columbia, which will be capable of handling a large number of commercial long distance telephone circuits, for which $300,000 is included, and (2) installation of carrier and repeater equipment in the interior of British Columbia, at a cost of $100,000.
I think I could finish in about five minutes, Mr. Speaker.


Some hon. Members:: Go ahead.


Lionel Chevrier: Under object No. 16, which has to do with construction or acquisition of equipment, it will be seen from the title of this classification that there must necessarily be a very substantial annual expenditure by the Department of Transport because it comprises numerous operating units entirely distinct one from the other. A glance at the summary will show that we are proposing a total expenditure of $10,081,000, and that this represents a cut-back of approximately $1J million from last year's figure. I should like to deal with these seriatim.
Topping the list under this object is an amount of $6,368,000 which is included in vote 472, construction of auto ferry vessels, and covers the anticipated expenditures during 1953-54 in respect of the North Sydney-Port aux Basques vessel and the Yarmouth-Bar Harbor vessel.
As to the North Sydney-Port aux Basques vessel, the committee will recall that by virtue of the terms of union between Canada and Newfoundland in 1949 the government undertook to provide a ferry service capable of handling motor vehicle traffic between North Sydney and Port aux Basques as soon as the

highway was completed in Newfoundland. I understand that a through highway between St. John's and Port aux Basques will not be available until 1956; nevertheless we have gone ahead with the improvement already mentioned for new terminals at North Sydney and Port aux Basques, and at the same time parliament last year approved money to be expended on the construction of a new automobile ferry vessel. The construction of the vessel, together with the preparation of detailed plans and specifications, was allocated to Canadian Vickers Limited of Montreal on February 17, 1951.
I have already given on a number of occasions details of the construction of this specialized unit, and I thought I would simply say that it is the feeling of the government and of the Canadian National Railways, who will be entrusted with the operation of the new ferry vessel, that it is expected this ship, together with the new terminals, will bring tremendous improvement in the transportation service to Newfoundland and will for the first time make it possible for motor vehicle traffic to be carried across Cabot strait.
It is true that the ship as now designed will not carry a large number of trucks or trailers, but one must bear in mind that until such time as a clear indication is given of the type of traffic which will be moved by truck, it is well-nigh impossible to design a vessel which could be operated economically and, at the same time, provide a year round service for the bulk of the traffic which is handled by the Canadian National between the two points.
My officers have gone into the question of the movement of refrigerated fish traffic and advise me that it is very doubtful that fresh fish from Newfoundland could move by truck to market. The research and development department of the Canadian National is now working on a method of handling fresh fish which might very well revolutionize the fishing industry in Newfoundland and in the maritimes. This new method is still in the process of being developed in co-operation with the fisheries council of Canada. Furthermore, I am informed that the movement of heavy tractors and trailers in the province of Nova Scotia is very much restricted by the size and condition of highway bridges.
I must repeat again that it is a specialized construction, and numerous problems have lo be ironed out from time to time between ihe naval architects, the shipyard, manufacturers, etc. The target date has been reviewed recently, and I am advised that the ship will be ready to enter into service in the summer of 1954. The estimated cost is $7,500,000;

$2,200,000 has already been spent, and provision is made in this year's estimates for $5,368,000.
The second car ferry is to operate between Yarmouth, Nova Scotia, and Bar Harbor, Maine. Tenders were called last fall and the shipyard which has received the contract for its construction is Davie Shipbuilding and Repairing Company Limited of Lauzon, Quebec.
This ferry vessel is also a specialized unit, since it must carry passenger automobiles and trucks as well as provide accommodation for the handling of a large number of passengers. The service speed of the vessel has been set at 18J knots, in order to allow her to make a round trip every day between the two terminals. This is an important feature in the operation of the vessel in order that it may, we hope, be operated without the provision of a subsidy. We must obtain the greatest utilization possible from this unit, hence the necessity for its high speed.
I have already given to the house the details of the construction of this ship, but I want to add that we are providing for the expenditure of $1,000,000 in the 1953-54 estimates.
The next largest amount to which I draw attention is the sum of $1,200,000 provided in vote 452, steamers construction. This particular sum is $4 million less than we were obliged to expend last year, and such reduction is traceable to the fact that, whereas last year approximately $4,300,000 was needed for the new icebreaker D'Iberville, an amount of $300,000 only, being the final payment, is now required. The appropriation to which I have referred just now also includes $750,000 for the lighthouse supply and buoy vessel which will operate out of Saint John, New Brunswick. The estimated cost of this vessel is $2,225,000. It is expected to call for tenders for this vessel in June of this year.
A further $100,000 is being provided to cover the first stage of construction on a lighthouse supply and buoy vessel for the agency at Victoria, British Columbia, which will cost approximately $1,125,000. This latter vessel is urgently needed. The two vessels now used in the agency in maintaining the navigational aids are both very old and are proving quite inadequate.
Mr. Chairman, I do not want to impose any longer on the patience of the house. I have covered, in a general way, the main votes
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that will be brought forward for consideration of the committee, and I am sure that with this general statement all members will be in a far better position to discuss the estimates.


Howard Charles Green: Can the minister tell us when we may expect the annual report for his department for the fiscal year ending March 31, 1952? It may have been issued, but I have been unable to get a copy and I understand that it is not yet available for distribution.


Lionel Chevrier: No, it is not, and unfortunately I cannot give an exact date. I do know that there is always some delay in that report because it is a pretty comprehensive one. Perhaps tomorrow I will be able to tell my hon. friend just exactly when we can have it for him.


Mr. McLure:: May I ask the minister a question or two? I did not hear the amount that was in the estimates for the new boat to be built for the Wood island-Caribou service. There was a lot of conversation going on behind me, and I did not get just what amount was included for the new runway extension at Charlottetown.


Lionel Chevrier: The answer to the first question is that the decision to build the Northumberland ship was not arrived at until after the main estimates had been tabled. It is not covered in the main estimates, and it will be included in the supplementary estimates.
The answer to the second question is that we have determined to spend an amount to extend the runway at Charlottetown provided the city will undertake to operate and maintain the airport. I do not know where that stands, but my recollection is that the municipality is willing to do that. There will be an item, but I cannot give the amount.
Item stands.
Progress reported.



BUSINESS OF THE HOUSE

Alphonse Fournier: Tomorrow we shall resume the debate on the budget, and I am so hopeful that we shall conclude that debate that I will announce that we shall take up the estimates of the Department of Citizenship and Immigration afterward.


[Stage Direction]
It being seven minutes after ten o'clock the house adjourned, without question put, pursuant to standing order.
[Stage Direction]
Friday, March 13, 1953