1953-02-27

Mr. F. H. Larson (Kindersley) moved: the first reading of Bill No. 189 (from the Senate), to incorporate Mid-Continent Pipelines Limited.


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


Mr. Cruickshank:: Mr. Speaker, is it customary to give first reading to a bill before it has been presented to the members of the house?


An hon. Member:: It is from the Senate.


George Alexander Cruickshank: I am not asking you. I am asking Mr. Speaker. I am not a lawyer or an authority on the little green book; and I should like to know whether first reading of a bill can be given before a member has that bill on his desk or in his office.


Mr. Deputy Speaker:: May I say that normally the Speaker settles questions of order only when they arise and does not reply to questions asked of him from the floor of the house. However, I may tell the hon. member for Fraser Valley that this is a Senate bill which is coming before this house for first reading, and that, to cause this bill to be printed and distributed to members of this house, first reading must be assented to.
Motion agreed to and bill read the first time.



CANADIAN CITIZENSHIP ACT


Hon. Alphonse Fournier (for ihe Minister of Citizenship and Immigration) moved: the first reading of Bill No. 190 (from the Senate), to amend the Canadian Citizenship Act.
Motion agreed to and bill read the first time.



FLOOD RELIEF-CONSIDERATION OF PERMISSION TO EXCEED MARKETING QUOTA

[Stage Direction]
On the orders of the day:
Mr. M. J. Coldwell (Roseiown-Biggar):: Mr. Speaker, before the orders of the day are
68108-15?
called I should like to direct a question to the Minister of Trade and Commerce. Has the minister, or I suppose I should say the government, considered advising the wheat board to permit individual farmers to market grain in excess of marketing quota where such excess grain is donated to the national fund for European flood relief?
Right Hon. C. D. Howe (Minister of Trade
and Commerce): Mr. Speaker, the subject matter of the question has been carefully considered by the wheat board and by the government. I think I can do no better than to read a letter that I directed to Mr. Probe, who is the chairman of the Saskatchewan committee for European flood relief, It reads as follows:
Dear Mr. Probe:
I have your telegram ol February 21st with reference to contributions to the European flood relief fund.
Even though your objectives are so worthy, I am afraid that it is not possible for the Canadian wheat board to authorize deliveries above the established quota for the plan you have in mind. You will appreciate, I am sure, that the purpose of the delivery quota system is to provide maximum delivery opportunities to all producers. The board is exerting every effort to permit the highest possible quota at each delivery point. To the extent that deliveries in excess of quotas were permitted, it would mean that other producers would be unable to deliver up to their own quotas.
Many requests of this nature, for delivery of grain over and above the quota, are received. In most cases, the objectives are very worthy- churches, charitable drives, etc. In each case, however, it has been necessary to advise that, due to the necessity of providing maximum delivery opportunities to all producers, the request could not be met.



PRISONERS OF WAR


[Stage Direction]
On the orders of the day:
Mr. Clarence Gillis (Cape Breton South):: May I address a question to the Associate Minister of National Defence, a copy of which I sent to the Minister of National Defence who I understand is Acting Secretary of State for External Affairs. With respect to the dollar a day that is to be paid to exprisoners of war who were held by the Japanese, is the department considering making that dollar a day applicable to all exprisoners of war who suffered under similar circumstances?
(.2 -w .

Inquiries of the Ministry


Right Hon. L. S. St. Laurent (Prime Minister):: The hon. gentleman's notice sent to the Minister of National Defence as Acting Secretary of State for External Affairs has just been sent over to me. This is not *a matter to be handled by the Department of External Affairs; it is a decision that will have to be made by the government. The government appointed, as the hon. gentleman knows, the chief justice of his own province to examine the question of the rules that should apply to the distribution of the funds held by the custodian of enemy property, which are insufficient to cover all the claims that could legitimately be made against that fund.
The chief justice of Nova Scotia, as a royal commissioner, made a very careful study of the whole situation, and submitted a report, which in general was accepted by the government, with some slight modifications that were discussed with the commissioner after he had submitted his report to iron out some little difficulties in administration.
That report provided that it would be assumed that all prisoners of war in the hands of the Japanese did suffer maltreatment and should get an award on the basis of one dollar for each day of internment, and that with respect to other prisoners there would not be a general assumption that they had been subjected to maltreatment beyond the usages of warfare between civilized nations, but that any who had been subjected to maltreatment could make a special claim and their claim would be considered by the claims commissioner.
Representations have been made that the presumption that all prisoners were subjected to maltreatment should extend to the prisoners held by the axis powers, by the Germans or the Italians. No decision has yet been made by the government to depart from the recommendations of the commissioner. Representations have been made that we should do so and I understand that further representations by an organized group of war prisoners are expected to be made. That is the present position. There has been rfo decision to depart from the recommendations of the commissioner, but representations have been received and further representations are expected.


Clarence Gillis: Thank you, sir.


Mr. Noseworthy:: May I ask the Prime
Minister a supplementary question, arising out of his answer just given? Inasmuch as the Prime Minister has told us that there are not sufficient funds to meet all these war claims, has the government considered

giving priority to claims made by prisoners of war over claims made by commercial interests?


Louis Stephen St-Laurent: Oh, if the hon. gentleman had taken the trouble to read the report of Chief Justice Ilsley in his role as commissioner he would have found that that has been very carefully gone into and that a list of priorities has been determined whereby prisoners of war get the top priority for their claims.


Mr. Green:: May I ask the Prime Minister a supplementary question? Was there not some finding in the Right Hon. Mr. Ilsley's report to the effect that those soldiers who were in the prison camps run by such criminal organizations as the S.S. would receive an automatic payment?


Louis Stephen St-Laurent: There is some discussion
of that question. I would not attempt from memory to say now just what it is, but the general rule was that the presumption of maltreatment would apply to all camps of the Japanese, and would not apply to all camps of the Germans or Italians, but there would be consideration given to those who had been in camps where maltreatment was the order of the day.


Howard Charles Green: I think some of the camps, for example, those run by the S.S., were put in the same category as the Japanese.


Louis Stephen St-Laurent: I think the hon. member
is right, but I would not like to give a positive answer without having the actual terms of the report before me.



COMBINES INVESTIGATION ACT


[Stage Direction]
On the orders of the day:
Mr. E. D. Fulton (Kamloops):: I should like to direct a question to the Minister of Justice. Can the minister advise us what is the present status of the consideration being given to the combine commissioner's report on the fine paper companies, and whether a decision to prosecute has yet been reached?


Hon. Stuart S. Garson (Minister of Justice):: In reply to my hon. friend's question, may I say that that report is now in the hands of outside counsel who are considering it with a view to reaching an opinion as to whether they believe a prosecution should be launched. We will reach a decision ourselves as soon as we get their opinion.


Edmund Davie Fulton: May I ask a supplementary question? Has the minister had any report or representations from his colleague, the

Minister of Labour (Mr. Gregg), regarding representations made to the Minister of Labour by the International Brotherhood of Paper Makers in this respect?


Stuart Sinclair Garson: I have, and we are now in the process of drawing up a reply to such representations, which we regard in some respects as being erroneous.



THE BUDGET


[Stage Direction]
The house resumed, from Thursday, February 26, 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. John Decore (Vegreville):: Mr. Speaker, during the course of this debate some hon. members of the opposition have attempted to label this budget a rich man's budget, as a budget which does precious little for the small man, or as a budget which is doing very little for the little fellow. In their endeavour to establish this point they laid great emphasis on the personal income tax, and attempted to establish that the so-called little fellow gets only a very small reduction. As an example they lay stress on the married man with two children, having an income of $2,400, who gets a small reduction. I think they could have emphasized further that this same man with an income of $2,400 will pay a tax of only $15. They could have gone farther, if they wished to be fair, and emphasized that this same man with a wife and two children and an income of $2,300, will not have to pay any income tax at all.
Let us take a man with a wife and two children and an income of $3,000. He is drawing family allowances. His income tax on $3,000 would be $105, yet he receives from the federal government by way of family allowances an amount of approximately $150 for the year. In fact the so-called little man gets a bonus, if you want to put it that way, from the government of some $45 for that year.


Mr. Harkness:: Not the government.


John Decore: From the dominion government or the people of Canada. I am trying to point out that the so-called little man is not being left out in the cold; and the same applies to the man with an income of $2,400. He pays a tax of $15, and he gets from the federal government approximately 68108-1574
The Budget-Mr. Decore $150. Thereby he is receiving a bonus of $135 on top of the income of $2,400.
Furthermore I am sure that every hon. member in the house has personal knowledge of young married couples, with two children, who have also in their care their fathers or mothers who may have reached ages of 65 or 70 years. These young married people perhaps do not have a legal obligation to look after their fathers and mothers in their declining years, but 'they certainly have a moral obligation.
Again, under our system of government, as we have it, these old people are receiving assistance and, at the same time, the young people in the lower income brackets are receiving an indirect benefit. But let us not forget that the government is spending this year for purposes of social security, such as family allowances, old age pensions and social security in other forms the sum of approximately one billion dollars.
This legislation dealing with social services was intended for and was designed to assist the so-called little fellow. Let us, for example, consider family allowances. The purpose of that legislation was to help those people who are in the lower income brackets, to assist them in buying food, clothing and school books for their children, so that those children, who eventually will take our plapes in our national life, may receive that degree of help. And so one can talk almost indefinitely about the assistance this government is giving to people in the lower income tax brackets.
I wonder if there is any member in the house who would rise in his place and say that we in Canada have not the best form of social services in the whole world. And may I say further that when reference is made to the so-called little man or little fellow, the small man, I take objection to these terms. In my view it sounds more like the sort of thing the Russians were and still are teaching in Soviet Russia. Those expressions remind me very much of what we heard in Alberta when people were talking about the fifty big shots who were running Canada. In my view that is the wrong kind of psychology being applied by some politicians in classifying the people of this country.
I do not know whether one ought to judge a person by the size of his pocketbook; but in my opinion the so-called little fellow is just as big and probably in some respects bigger than the hon. member for Peace River (Mr. Low) who used this term. On the other hand, the so-called big shots could be just as small as the smallest of the so-called little fellows. The use of these terms should be avoided, because it is a clear case

The Budget-Mr. Decore of discrimination when we refer to big shots and little shots, big fellows and little fellows, big fry and small fry. That kind of classification is not only undesirable but also detrimental to our Canadian way of life.
Returning to the question of the personal income tax, let us examine whether we have before us a rich man's budget. Again I refer to the married man with two children who are eligible for payments under the Family Allowances Act. Let us consider the case of the man who has an income of $50,000 a year, and see what happens to him under this budget. One sees at once that he would be required to pay an income tax of $21,099. Is that a rich man's budget?
Let us go farther. Supposing the man with two dependents is fortunate or unfortunate enough to make an income of $200,000 a year. How much does he have to pay in taxation? Under this budget, out of his $200,000 he will have to turn over to "Doug" Abbott-I mean to the Minister of Finance- the sum of $125,504.
Is this a rich man's budget? Does not part of the $125,000 this man pays as income tax go by way of a contribution to our billion-dollar social welfare program, in order to help out the man in the lower income brackets, by way of family allowances, old age pensions, and other forms of social security?
The other day the parliamentary assistant to the Minister of Finance spoke in the debate-and, incidentally, I thought he made a valuable contribution to it. I turn to his speech, as it is reported at page 2394 of Hansard, and I challenge any hon. member in the opposition, or any other member in the house, to disprove these words of the parliamentary assistant:
We must not forget that In spite of all we have had to do in all fields, in spite of all that we have done, our rates of income tax here in Canada are the lowest in the world and our exemptions are the highest in the world. That is true in spite of the fact that the government here in Canada has one of the best systems of social security in the world; in spite of the fact that we have the best system of old age security in the world today; in spite of the fact that we are looking, through social security, after the small people of this country-because, contrary to what has been said on the other side, we are making transfer payments to those who are in need.
This stands as a challenge to any hon. member who believes he can prove the contrary.
And what about our corporations? Sometimes people seem to like to refer to corporations as sinister bodies organized for the purpose of robbing the poor, and the sole purpose of which is to prevent the so-called little fellow from taking his proper place in
[Mr. Decore.1
the world. Let us examine how much income tax these corporations have to pay and, for the purposes of our investigation, we will take the round figure of a million dollars. The corporation with a net income of $1 million is required to pay back to the people of Canada, under this budget, nearly half of that by way of income tax. Not only do these corporations provide jobs for millions of people in this country, but it is also very desirable in a young nation like ours to have groups of men getting together in common ventures for the development of the resources of our country and the creation of jobs for our people.
I am a great believer in free enterprise. I am a great believer that every man in this country should be free to take risks, to use his initiative in order to better conditions, not only for himself but for his community and country. Canada is a young nation with tremendous resources, some of which have already been tapped. Year by year we are pushing back the frontiers. My grandfather came to this country with a pioneering spirit, a spirit of free enterprise, and so did all our pioneers. In fact, the development of Canada would never have been possible had it not been for the pioneering spirit of those who came here in the years gone by, to settle not only in the west but in other provinces of this great country. They had that spirit of free enterprise which has made it possible for Canada to go ahead as she has.
We have had many ministers of finance in this country. Some of them were truly great, but I think history will record that one of the greatest was our present Minister of Finance. In spite of our gigantic social security measures and our gigantic defence preparations, since the last war Canada has been able to reduce her national debt, a debt incurred because of two previous wars, to the extent of some $2,500 million, thus saving the people of Canada $63 million each and every year in interest charges.
Referring to the national debt, the hon. member for Peace River had this to say, and I quote from page 2367 of Hansard of February 24 as follows:
While the minister revelled in what he called a spectacular federal debt reduction, he said nothing at all about the increase in the gross holdings by foreigners of Canadian assets.
And again:
The net amount of those assets, held mainly by Americans, is no less than $5,800 million. They constitute a foreign debt owed by the people of Canada collectively, and in every way they serve to drain out of our country very large quantities of goods to pay the interest and dividends.

Does the hon. member not realize that most of that United States capital went to his own province of Alberta? That was not due to the policy of this government, it was due to the policy of the provincial government which has jurisdiction over natural resources in the province. I have said it before and I repeat that since the discovery of the Leduc field from 75 per cent to 90 per cent of the proven oil reserves in the province are now in the hands of United States corporations.
Many challenges are thrown out on the floor of the house by the hon. member for Peace River about the type of government they have in Alberta. Not so long ago he challenged the hon. member for Rosetown-Biggar (Mr. Coldwell), who incidentally accepted the challenge, and since then the hon. member for Peace River has been walking in a daze. Just to indicate some of the things he has said, I refer again to another statement he made, as reported on page 2368 of Hansard:
There is another question that we have to face. That prospect in my judgment is very real as a consequence of the shortsightedness of this government in matters of trade and finance. We should have been promoting trade with the United Kingdom and other sterling countries with all our energy, on a barter basis if necessary, in order to avoid the dangers we now face as a consequence of running up these serious adverse trade balances with the United States.
That is what the hon. member said on the floor of this house. But not so long ago the hon. member addressed the Rotary Club in Montreal, and I quote from the Gazette of February 11, 1953, as follows:
He said it was unthinkable to suggest Canada could compete successfully on the open markets of the world.
Free trade is a myth. There is nothing we produce in Canada today that is not protected in some fashion.
Mr. Low declared Canada was now at the crossroads of conflicting views. He asked what course the country should follow.
Shall we talk foolishly about free trade and thereby induce action that will destroy thriving industries and occupations that contribute to the strength and vitality of our nation?
Or shall we adopt a policy of careful conservation of our resources that will make our country great?
If ever there were conflicting views, not in the minds of the Canadian people but in the mind of one man, this is an example. It looks to me like a case of split personality and I am reminded of Dr. Jekyll and Mr. Hyde.
Let me turn now to the budget. Our total expenditures under this budget amount to $4,750 million. Of that total, $2,000 million will go for national defence; $450 million will be paid out as interest on the national debt created by the last two wars; and $1,000
The Budget-Mr. Decore million will be paid out in the form of social security payments to which I have already referred. In other words, nearly three-quarters of our total expenditures will be used, first, for maintaining our security from outside aggression and, second, for maintaining our national security. The keystone to the greatness of Canada is her ability to look after the welfare of her own people and to defend herself against outside aggression.
This budget indicates that not only have we been able to bring about a tax reduction, but the dangers of inflation have been lessened and at present they are not as real as they were before. I think this is due to our record production. As a westerner coming from Alberta, one of the three prairie provinces, I should like to point out the contribution which those provinces have made to the national production. Of course, I am talking about wheat.
Sometimes we who come from western Canada are accused of talking too much about wheat. But we must not forget that agriculture is not only the basic industry of Canada, it is the most important industry in the west. Our most important agricultural product is wheat. In 1952, our last crop year, the farmers of the three prairie provinces produced 668 million bushels of wheat, an achievement which has never been equalled before. This was the largest crop in the history of Canada. Of that total wheat production, 96J per cent was produced by the provinces of Alberta, Saskatchewan and Manitoba.
That was the achievement of only a handful of farmers. There are only 231,000 farmers in the three prairie provinces, whereas the statistics indicate that there are 5 [DOT] 5 million farmers in the United States, or twenty times as many. Yet the volume of wheat produced by Alberta, Saskatchewan and Manitoba was approximately one-half of the entire wheat production in the United States. Let me put it to you differently. The farmers of western Canada produced a volume of wheat equal to 66 per cent of the total production of Soviet Russia which includes the Ukraine, known as the grain basket of Europe. Still differently, we in western Canada produced 40 per cent of the average production of the entire continent of Europe in pre-war years. Still differently, we produced 285 million bushels more than the entire production of Australia and Argentina combined in recent years. You can readily see that agriculture is not only Canada's basic industry but also her most important industry, and wheat one of our most important products.
2468	HOUSE OF
The Budget-Mr. Rowe
I hope that the negotiations which are now going on in Washington between the importing and the exporting countries of the world for the renewal of the international wheat agreement will be successfully concluded. In view of the high cost of production and especially the high cost of machinery, I do feel that the price we should get for our Canadian wheat should be more than $1.80 per bushel.


Hon. W. Earl Howe (Dufferin-Simcoe):: Mr. Speaker, I join with those who have extended their sympathy to the family of the former deputy minister of finance, the late Dr. Clark, and to those in the department with whom he was associated. I know that, while some may have differed with some of his financial philosophy, he has nevertheless left a mark of respect and of the dignity of his office, and he will live in the memory of his family and those who were his friends.
I realize that the hon. member for Vegre-ville (Mr. Decore) has emphasized some features in the budget that are important. I hope he will not assume that it is any reflection on the type of argument he put forward if I do not follow his remarks as closely as he might expect. I realize and appreciate with him that agriculture is the basic industry of Canada. I sometimes wonder if it has not been somewhat forgotten by those who have been emphasizing our progress and prosperity in other respects. I observed that the hon. member differed considerably with the hon. member for Greenwood (Mr. Macdonnell) who so ably demonstrated exactly what this budget means in dollars and cents. I am not going to question either the correctness of his speech or his reference to the effect that the man with a low income was saving a lot more in taxes than the hon. member for Greenwood said.
I believe the hon. member for Greenwood said that a man with a salary of $2,400 would save $1. The hon. member for Vegreville said that the hon>. member for Greenwood was away out in his figures because a man receiving that salary would actually save $3. So there is quite a difference. It is three times as much as the hon. member for Greenwood said; but, because of the effect of inflation on the value of the dollar, if he saves $3 it will only buy about half as much as the same amount would have bought ten or fifteen years ago.


John Decore: On a point of order, I wonder if my hon. friend listened to my speech. I never mentioned anything about $3.


Mr. Rowe:: I know the hon. member did not but I followed what he said. I listened very carefully. In fact I could not help but
EMr. Decore.]

hear him. The hon. member for Vegreville said that he would pay $15 instead of $18.
I think my arithmetic is still right and that the difference would be $3. The hon. member for Greenwood said he would pay $18 instead of $19. I wonder which is true, so I hope that they will check their figures, because if either man is wrong I think we should let the public know. As I say, I am not going to indulge in argument because this is much more than a $3 proposition. This is the most gigantic budget that has ever been presented to the house. Whether it is $1 less than last year or $3 less than last year, it is taking on the average, visibly and invisibly, directly and indirectly, approximately $1,700 for every family of five in Canada.
Why, Mr. Speaker, never in our history has anything nearly approached the size to which government business has grown in this country. It is certainly the biggest business we have in Canada. We have a population of some 14 million people, and I doubt whether any similar number of people in the world have ever been called upon to raise the tremendous amount of money that is involved in this budget of almost $4| billion.
We have heard a great deal about prosperity, and I realize that we have a degree of prosperity. Some have called it a false or artificial prosperity. Others say: Well, it is prosperity anyway. But to say the least, by the very nature of this prosperity it must appear to you, sir, and to every hon. member in the house and the taxpayers of Canada, that it is at least an inflationary type of prosperity. It is built up chiefly on the greatest enterprise in Canada, the government's inflationary spending policy. One would almost imagine that the government was trying to spend itself into prosperity. It seems to me that they think that the more they spend the more prosperous the country is going to be.
Of course, as the hon. member for Eglinton (Mr. Fleming) said so ably yesterday, if we had an election every year we might get some of this $1 or $3 relief for those who are termed the small taxpayers, because it seems to be only at election time that any thought of tax reduction has even been intimated. In 1949 and again on the eve of an election now the government has done the same thing. They are not giving quite as much tax relief on the eve of this election as on the eve of the last one, and they are only making it effective for half a year. It makes one wonder after all, with all the guesses and anticipation reported around the capital, whether or not we are going to have an

election this year. I think that the government members are as doubtful about that as they are about everything else. I think they said:	In case we do not have an
election we will not risk the whole thing this year; we will just give half of the reductions this year and then we will have the rest for next year. We will save something for another session. If we do not go to the people until next year, and if our popularity slips as much as it has in the past year, then we will give them a real gunshot prescription next year for an election in 1954.
I know that it has been called an election budget, and it has been called a sunset budget; but I see very little relief in it for the great mass of taxpayers, 75 per cent of our people. I have mentioned the government's spending policy, and I believe that is what it is. We are to spend $2 4 billion for defence, and I often wonder what would happen if there were no fear of war to impose such an obligation on this young country. I often wonder what would happen if such an occasion should arise because the government is spending enormous sums of money on a cost-plus basis and I have seen no signs at all of any economy. This so-called prosperity is bolstered by cost-plus contracts, subsidies, bonuses, pensions and so forth. We have never seen such a lavish distribution of such a huge amount of taxes taken from the people of the country.
I have mentioned that very little economy is shown by the government. When you pause and consider, Mr. Speaker, the complacency and extravagance, the irregularities and thefts by individuals-some call it petty theft but the government, I believe, calls it normal theft; some other minister I believe called it just theft as usual where there is a lot of money being handed around-you would think this government, these tired old incumbents who have been in office too long, would not so disregard money. But they have said:	What is a
million dollars? The Prime Minister (Mr. St. Laurent) said not long ago when the Leader of the Opposition had shown him how to save a lot of money:	Why, if all of these
proposals you have made were put into effect we would not save more than $100 million.
After all, surely, Mr. Speaker, we have good resources but not so great that we can say that $100 million does not mean very much. Surely the people paying taxes in this dominion, as the hon. member for Vegreville (Mr. Decore) said, have a right to some consideration. The total national revenue of this dominion is enormous at present, coming from industries that give employment to people and who pay about 50
The Budget-Mr. Rowe per cent of their earnings in taxes. Savings in private income taxes are infinitesimal compared with the taxes paid in other ways-by the man who buys an automobile, by the man who buys boots and shoes for the baby, by the man who buys clothes and many lines of foodstuffs-I refer especially to sales tax. It is amusing to me because I can remember how these great champions of the Liberal party almost wept crocodile tears when the sales tax was put up to 6 per cent. I remember the late prime minister saying that we should not have any sales tax at all, but then he got to like it and almost doubled it before he retired.
Many departments in the government seem to be running almost by themselves and we have had all sorts of rumours about camps here and camps there and $24 billion of the taxpayers' money being spent for goods that were being destroyed and wasted. We only have one little peek at about 1 per cent of that whole expenditure-because we finally stirred the government to have an investigation made. As a member on this side has just said, there is a great difference in the bookkeeping. One report said there was no bookkeeping at all and the Auditor General said they had at least eight different kinds of bookkeeping, none of them sound.
Seriously, Mr. Speaker, it is not a joke when you see departments acting almost as though they were endeavouring to see how much money they could spend-whether it is on nylon stockings, silk petticoats, bedroom slippers, cement stolen or cement that is not needed or, as someone else has said, fish ponds for fire protection. We have all sorts of signs, as I have said, of irregularities, extravagance, and reckless disregard for money and, yes, even theft itself. It is to be expected, when a government is in power for a long time, for almost a third of a century with the exception of four or five years. This government seem to think they are the greatest legislators that this country has ever had. They say what is $1 million? What is $100 million? We can spend our way into power; we can get ourselves popular and pull ourselves up by our bootlaces and it doesn't matter what we spend.
In 1939, for instance, printing and stationery costs of this government were about $1 million. This past year they were $13 million. The figure for film broadcasting, advertising, radio broadcasting- generally advertising the political wares of the government with the people's money-is up from $600,000 in 1939 to $7 million. Then, of course, Mr. Speaker, it is generally recognized now that members of this government are the greatest travellers we

The Budget-Mr. Rowe have had since confederation. They go all over the world and they go in great groups. They take fellowship tours to South American countries, Europe, and all over the world. They come back and tell us what great trips they have had and we, certainly as taxpayers, hope that they have enjoyed themselves, because I notice that in 1939 travelling and transportation cost the government of this country $4 million. Last year it cost $53 million.
Then, Mr. Speaker, we have telephones and telegraph expenses-telephoning back to each other to find out how the situation is in the different ridings, how the C.C.F are doing in Saskatchewan, perhaps whether the Social Crediters are making any more gains in British Columbia, and so forth. In 1939 those telegrams, telephone calls and stamps cost about $1 million. Last year they cost $13 million.
Now, Mr. Speaker, these things get out of hand and that is what happened across the border in the United States. When Sarnoff was asked to investigate expenditure for defence in the United States recently he found that the government over there, which the American people thought had been in too long-and in fact thought about the same of them as our electors are now thinking of this government in Canada-had been extravagant. That government was defeated, and one of the reasons was that when Sarnoff reported he said there was so much plush and extravagance in their expenditures that he was sure that with any kind of caution at all they could be cut by at least 10 per cent.
Just imagine, Mr. Speaker, if our expenditures could be cut by 10 per cent. It would certainly pay the taxpayers of Canada to change their board of directors. As I say, we have had an investigation on only 1 per cent of the picture. We do not know whether we could save 10 per cent on expenditures or not, but the rumours we have heard indicate callous extravagance and irregularities which have not been investigated in other departments. There is no use mentioning it here because this government will not believe what they already have found-let alone look for more. They are sorry they even looked as far as they did.
Every sincere businessman in this country is concerned about how this enormous tax burden is being spent. I say with all sincerity that there has never been such a demonstration of laxity, carelessness and negligence in departmental administration as we have seen. I am forced by rumours that I have heard, and by the evidence I see of this type of expenditure, to conclude that the


department that has been investigated is probably not much worse than any other department. I hope that this government during the coming summer, and in the twilight of their long term, will at least become cost-conscious. I know that the Minister of Justice (Mr. Garson) is in a great minority today in the house, but he will certainly do his best, surely, when he thinks of the tremendous recklessness that has been demonstrated in the past, to try, at least in the last few months this government expects to be in office, to save some of the taxpayers' money so that the situation will not grow worse as the year goes on. Millions of dollars have been wasted and millions of dollars have been spent on architects and engineering services on cost-plus contracts. It almost appears a case of the more the cost the more the tax will be. At Wain-wright, Alberta, they spent $22,000 for a swimming pool. They spent $280,000 for two gymnasiums; and $54,000 for bowling alleys. Crown Assets Disposal Corporation sells airplane hangars for $6,300, and in Newfoundland the defence department spends $283,700 just for dismantling-


Mr. Prudham:: You know very well that
first-war hangars are obsolete.


William Earl Rowe: Mr. Speaker, that does not add much to what I was going to say.


Mr. Riley:: It takes away a lot.


William Earl Rowe: You people should know
because you have taken more away from the Canadian taxpayers than any other government since confederation.


Mr. Sinnotl:: And given back more too.


William Earl Rowe: I am not going to follow along the lines of extravagance because I do feel that the public in this country today knows of it and is quite conscious of this unprecedented carelessness. The blacksmith, the grocery store man, the country doctor and the housewife know about it. It is common gossip now-it is not only parlour talk; it is kitchen talk and garage talk; it is all over the dominion-that this is the most extravagant government that this country has ever known.


Mr. Cardiff:: They have taken more money than have any other government and have done less with it.


William Earl Rowe: Yes.


Mr. Studer:: It is still gossip, though.


William Earl Rowe: On many occasions I have mentioned the importance of the great basic industry of agriculture. I cannot help being in agreement with the hon. member for Vegreville in that regard when he says that

agriculture is basic. There is nothing more important to the life and economy of the country or no enterprise more indigenous to the whole economy-yes, of our very life- than is agriculture. It does not matter how many men get rich in it. It is not a matter of how much money they roll up or put in the banks or in investments. It is the life of our people. It is important in time of peace, and it is fundamental in time of war, that we keep a healthy agriculture. I know that truth has been felt in this country since the days of confederation. It has been felt across the border by the great statesmen in the United States all down through the years. It is a matter which is not even debatable because every hon. member in this house, no matter to what party he belongs, recognizes it as a fact.
President Lincoln of the United States once said that any government which failed to recognize agriculture, by allowing any other industry to conflict with its progress, was certainly sacrificing the very integrity of the nation. If that was true then, Mr. Speaker, it is certainly doubly true today because the population of the world is so much greater than it was at that time. When millions of our brothers and sisters in Europe and all over the world are starving to death this very minute for want of food; when we have a world organization trying to develop food production; and when we have the fear of war to the extent that we are spending these huge sums of money to prepare for our defence, surely there is no one within the sound of my voice who does not believe that it is just as important now to keep agriculture on a sound and permanent basis.
Mr. Speaker, I cannot help thinking that it has often been forgotten that the farmer holds a unique place in our economy. He is not only a producer of the essentials for our very livelihood but he is a capitalist and a labour man all in one. He is running a corporation that needs more skill every day than it did in the years that are past. He must provide his working capital. He must keep his machinery and efficiency up to standard so that he can produce economically, or he goes out of business, because it is a fairly marginal business that he is in. His costs are rising and his prices are falling. He is certainly disturbed as to what is going to happen. His income must maintain his family and educate them. Today, with the high price of automobiles and machinery the high level of municipal taxes and so on, the burden is more complex than ever before. His return from his investment and his labour is the lowest-in percentage gain on capital investment-of any industry in Canada. He therefore travels on a small 68108-158
The Budget-Mr. Rowe margin. His hourly rate of wages is away below normal. Even though he is paying his hired man, usually, almost five times as much as he did ten years ago, even so that hired man is getting less money than is his brother who is working in manufacturing plants, and certainly much less than the government is paying in government employment in the neighbouring districts. Statistics show that over the last twenty years Canadian farmers as a whole, if they had taken the same money for themselves and their wives as they pay to their hired men and hired girls, would have made no money on their capital investment. The current outlook is not good, Mr. Speaker. Farm prices are declining rapidly. No one who is watching the economy of this country can be unaware of that fact. No one can appreciate the complexity of the problem as well as can those who have been engaged in the industry and who are familiar with farmers generally.
I believe Mr. Hannam of the Canadian Federation of Agriculture said:
For those who have the erroneous impression that farmers have been enjoying unprecedented prosperity, it would be well to re-state the fact that the farmer's income depends not on prices alone but on farm prices in relation to farm costs. In recent years farm costs have risen more than have 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.
He goes on to show-and these are facts1- that the farmers income is down about 18 per cent since 1948, that it has gone down a great deal during the last eighteen months, and is likely to be down, over 20 per cent before the end of this year.
I feel that the government is somewhat more responsible now probably than in normal times because during the last ten years they have developed a monopolistic control of the farmer's business and they have almost made it look as though they were heading agriculture toward a socialized industry. A number of years ago this parliament enacted a farm prices support act. What has been done about floor prices? They change from day to day, from week to week, from month to month and from year to year. It depends on what the Minister of Agriculture (Mr. Gardiner) seems to have had for his breakfast as to what you are going to get for bacon, eggs and other products. I believe the Minister of Agriculture told us here a short time ago that there was absolutely no shortage of butter and that there would not be for a long time. But two days afterwards he takes the freeze off the butter and lets a supply go out.
2472	HOUSE OF
The Budget-Mr. Rowe
Surely, Mr. Speaker, we should have some rationalization of this policy. Whether it is a sound policy for agriculture or whether it is the right way to approach this unique problem of agriculture in our country is not now my problem but at least it should be rationalized so that the producer would be protected against the terrific changes, dependent upon the mood of the Minister of Agriculture or on how he and the Minister of Trade and Commerce (Mr. Howe) are getting along.
Mr. Speaker, Canadian farm prices have been declining so much that we are already in a recession if not almost in a depression. For instance, our prices have dropped, as I have mentioned, about 18 per cent in the last two years. Between July of 1951 and December of 1952 the weekly wages in industry manufacturing products which the farmer buys have gone up by 12 per cent. There have been some declines in other industrial prices; some I believe have probably fallen slightly. I believe prices of building materials have fallen about 2 per cent; prices of iron and steel products are up 5 per cent.
The decline in many of these important farm prices is much more than the 18 per cent to which I have referred. To take a few examples, I would mention livestock, poultry and eggs-animal products, you might call them. In the last year and a half those products have dropped in price between 25 per cent and 30 per cent. In the same time the costs of the farmer in operating his farm have gone up by 35 per cent. They have gone up about 35 per cent during the last two years. The government surely could not have taken this fact into account, because they have added another 15 per cent on the rubber tires that the farmer uses on his implements. If there ever was a man forgotten by this government it is the farmer. This government seldom have forgotten the voters but they have certainly forgotten the farmer in this budget. The government have lost his markets; have increased his costs; have monopolized his business; have cost him millions of dollars in wheat trading, and have lost his animal products markets. The government say: That is not our fault. Nothing seems to be their fault when the thing is going well. When the goose hangs high, of course, it is all to their credit. But when prices begin to fall, then it is somebody else's fault, not theirs. It seems reasonable that a government which has elected to follow this type of policy should take some responsibility for the results. It is not enough merely to say that it has not been successful, or to give other reasons. We have urged from this side of the house on scores of occasions that the government should have
IMr. Rowe.]

encouraged the calling of a commonwealth conference on trade before they did. When it was called they reluctantly took part in that conference. We have urged that something should be done; that conferences and meetings should be called at which convertibility of exchange could be discussed and finally brought about.
The Canadian Federation of Agriculture have been very much alarmed. When they are alarmed at this government it is certainly time to stop, look and listen, because they are usually very courteous to the government. They now see the danger signs, and they are urging the government to bring out some policy. I quote from one of their meetings, as follows:
Return to convertibility of sterling and dollar currencies.
Removal of restrictions on dairy products moving into the U.S.
Establishment by nation-members within the United Nations' food and agriculture organization of an international program to handle surpluses.
They are wondering how they will get rid of their surpluses; they are fearful about the fact that the livestock market in Britain is lost entirely, and that the United States, in spite of the Geneva pact, refuses to take our cheese. They are conscious of the fact that we have imported into this country substantial quantities of cheese, beef and poultry products as well as pork products, canned and otherwise, even though we have lost the markets for our own products overseas.
The record of this government in dealing with the farmers' problems is one of bungling, misrepresentation, misjudgment, guesswork; and it now looks like a patchwork quilt as you look back upon it. We have told the Minister of Agriculture and the government during the last two or three years that they were losing hundreds of millions of dollars for the western wheat grower. It is now a matter of historical fact that hundreds of millions of dollars more could have been received for their wheat when the deals were made. The fact is that the government does not seem to know now what to ask for the wheat under the new international wheat agreement. I see that the United States are talking about asking $2.50 a bushel. The government has thought they needed a little more than $1.80. Now they suggest they should have $2.20 or $2.25. On another occasion they said they might take $2.15. Later on they thought they would get $2.10. It sounds like an auctioneer in a farm barnyard trying to sell a product. Whether it is the right system or not I am not going to argue. But this strange type of bargaining, underselling our wheat at $1.50 under world

prices at times and now dickering on an international wheat agreement and considering selling it at 60 cents to 70 cents below world prices, is hard to understand. It is very difficult for the farmer to know where he is. I am more directly concerned with the dangerous spectacle confronting the dairy farmers of this country and the beef producers; in other words, the mixed farmers from coast to coast. I think that the farmers might have had a better deal. Those who are using a lot of machinery and have big production, as have the western farmers in recent years, are not in as bad a plight as some of the other farmers. But there is not a member within the sound of my voice who knows anything about farming communities in either Ontario or Quebec who does not know that every dairyman and every livestock producer in Canada is worried sick these days. They are wondering what is going to happen. They know the government has oleomargarined the dairy industry. They know that you have made the pork industry so uncertain that the farmers do not know whether to keep more hogs or fewer. They know that this government paid 69 cents a pound for bacon, stored it and then sold it at 47 cents a pound. Somebody said 32 cents.


Mr. Lennard:: One of the government
members said that, yes.


William Earl Rowe: I would not be surprised at what they sold it for because, Mr. Speaker, if any business was run like that the management would be fired.


Lewis Elston Cardiff: They are going to be.


William Earl Rowe: If any big business was managed in the way that this government has managed the biggest business in this nation, regarding markets and the government spending, why they could not face their shareholders. That is why I suppose they are wondering when they should face them; but the day of reckoning is coming fast. Their record consists of errors, bungling and miscalculation. If their guesswork is no better about election day then it has been with regard to Canada's economy, then I do not pay much attention to those who pound their desks and make loud noises when some of their colleagues get up to speak, and say, We had a big majority last time and we shall have it again. That does not sink in very well when you realize what is happening in this country. I do not know whether any member of this government knows, because there are a lot of things they do not know, that conditions will get better or worse during the year. Certainly if they get worse I would say to the few ministers who are left in the house: Beware of the rumbling in the mulberry 68108-158i
The Budget-Mr. Rowe bushes. You had better think twice. You might get one more year in office, one more year in power, if you consider that discretion is the better part of valour and do not go to the country until next year, because your days are now numbered.
In the ten years from 1941 to 1951 Canada's farm population, according to the recent census, was reduced by 10 per cent. I know that many farmers will say the answer to that is the big combine and the improved farm machinery. We have had farm machinery for quite a while. True it has increased somewhat in recent years. You who come from the bountiful wheat fields of western Canada can produce more with the same machinery and the same amount of help than you could years ago; but in eastern Canada, in Ontario and Quebec on mixed farms, it helps a little but not a great deal. I do not know that you can milk ten cows any faster in 1952 than you could in 1942 with the same machines. We had milking machines then. I have done a little of that, but perhaps not as much as some of the people have. I do not think you can clean the cow stables out much quicker with the same kind of litter carrier and the same kind of manure fork than you could ten years ago. With regard to the help on the farms in Ontario and Quebec, I think the livestock farms are employing just about the same number of men as they were before. But what about Canada's population over-all? The population of the cities and towns in Canada has grown by 32 per cent in that time.
What is the government trying to do about trade, Mr. Speaker? So far as agricultural trade is concerned, they have done absolutely nothing. They have done less than nothing so far as British trade is concerned. They did not even try to hold the British market. They lost it just as rapidly and just as completely as the same party lost it between 1921 and 1930. I was in this house at that time. If I made the same speech now that I made in 1928 it would fit the picture almost perfectly, because in 1921, when this party came into power, we had an enormous market in Britain. We sold 255 million pounds of bacon and more cheese than we had sold any time in the previous hundred years.


Irvin William Studer: What about the price? What was the price in 1921?


William Earl Rowe: That is not analogous at all. We sold more cheese in 1921 than now. We sold over 100 million pounds of cheese away back in 1900. The British market has been the best market for agricultural products of any place in the world over the last seventy-five years. I want to say to my hon. friends from western Canada-I know they

The Budget-Mr. Rowe will agree with me, or at least most of them will-that we have lost our market for dairy products, cheese and animal products. I am getting very tired, and I have been tired for a long time, of this looking to the north and south for agricultural markets. I am not going to argue-


An hon. Member:: What about prices in 1930?


William Earl Rowe: If my hon. friend does not know that the prices are higher now than they were in 1930 I am surprised that he is even here. Mr. Speaker, I know that many people do not like to hear all these things. But it is a good thing for some people who have not been here long to know that history does repeat itself.
Yesterday the Minister of Trade and Commerce told us about that delightful trip he made, and he told us that certain men made the trip with him. They were all good fellows, and so is he. The South American people could not help liking the Minister of Trade and Commerce. We all like him here, personally. But I never heard him mention agriculture once.
He was down there looking for markets for industrial production, looking for markets that we might have for automobiles, and things like that.


An hon. Member:: What about wheat?


William Earl Rowe: Well, we sold wheat before there, too. But what about butter and eggs? His viewpoint, that we have to look north and south for trade, is just the same as their party's viewpoint was before the turn of the century. His party lost an election in which they wanted commercial union with the United States, and they have been looking north and south ever since. This Conservative party sitting to your left, Mr. Speaker-[DOT] and which will likely be sitting to your right after the next election-has consistently said that we must have markets in Europe, and in other places that need our food. Does anyone think that Argentina will buy beef from Canada? Does anyone think that Texas will buy beef from Canada? Do you think they will send our farm products down to a country where they milk a thousand cows on one farm, but do not need a barn.
I visited one place in the southern United States where they milk a thousand cows, but they did not even have to have any frost-proofing-nothing but a shelter to keep the rain off their cows. They are out, the whole year round.
Mr. Speaker, Canadian agriculture is unique in that regard. Canadian agriculture is carried on in a cold and frigid country. But


we should remember agriculture is part of our great wealth. But our climatic conditions are not as favourable as they are in tropical areas.
However, Mr. Speaker, I do hope that the government will give some thought to restoring these markets, which are natural markets for Canada. I have made reference to our increased costs'-and I see that the time at my disposal is rapidly running out. I am not going to delay the house unduly, but with the few minutes I have left I shall not place on record further figures dealing with increased costs and lower prices. These are figures anyone can read, and I shall leave them with hon. members.
The government has done very little, if anything at all, to help the farmer who is engaged in mixed farming. They have done very little for the livestock producer or the dairy producer to retain the markets that we had. And when we are in that position, I ask the government to be very careful when they import, as they are doing today, 14 million pounds of beef, 5 million pounds of pork, 2i million pounds of poultry products and 10 million pounds of cheese. We are exporting very little, if any, cheese. 1 ask the government to be very careful about these importations, especially at a time when these export markets are slipping from us.
It seems to me the only evidence of concern shown by the government is that it plans to lend the farmers an additional $100 million. They seem to think that these loans are the only way they can help the farmers.
The fruit and vegetable industry in this country has suffered greatly. I should like to place on record some information that has been made available by the federation of agriculture. They point out that in the nine months just past we have imported over $7,500,000 more of fruits and vegetables than we did in the year before. I urge the government to look carefully into this matter. They have received deputations and petitions from the fruit and vegetable growers throughout Canada urging them to look into the tariff situation, so that the vegetable producers will have their seasons when fruit and vegetables from outside Canada are not permitted to come in. I do not believe the department has even looked at this problem, because last year we imported into Canada for nine months alone fruits and vegetables to a value of $32,499,000. The vegetable growers in the riding I have the honour to represent, notably those in the Holland marsh area, have sent petition after petition urging the government, not for a high tariff wall to be erected around their product, but rather

for regulations so that these products will not be allowed in at certain times, and so that in one year $10 million worth more of them will not come than came in in a previous year.
In conclusion I urge that the government give some thought to its $5 billion defence program in the next two or three years, and that at the same time it give thought to what may be done to help maintain agriculture in a better position, whether in a time of war or of peace. Because it is not fair to let agriculture slip as it has been slipping.
Then, in the matter of income tax, let me point out that only about 3i per cent of the total farm population in Canada, comprising some 700,000 people, have gross revenues from products sold, before making deductions for exemptions, interest on depreciation and interest on investment, of over $10,000 of gross income, and only 14 per cent have gross incomes of over $5,000. I say the government should have a clear-cut policy as to how these taxes are to be collected. I am sure that, in most cases, if the farmer took anything out as payment for managerial duties he would have no income tax to pay at all. I am not sure that the government needs so many people receiving high salaries racing up and down the concession lines of this dominion, men who know very little about agriculture, but who are hunting out the farmers and who are arbitrarily telling those farmers how much they ought to pay, how much they are worth, how much the housewife has been spending on mink coats, champagne and caviar, and telling her that she must have spent so much.
No one who understands agriculture believes that is a sound procedure. There should be some simpler form; I do not believe a farmer should have to hire a lawyer or an accountant to decipher many of the questions asked. The fact is that he is making only a fraction of what he is assumed to be making.


Daniel Aloysius Riley: Mr. Speaker, I hope I am exhibiting the proper degree of humility in rising at this time, after such a splendid and thundering oration from the hon. member for Dufferin-Simcoe (Mr. Rowe).
When he spoke so ominously about recessions and depressions my mind harkened back to what must have been the vast amount of background of experience he has had in these matters. The great knowledge he no doubt gathered about recessions and depressions was perhaps accountable for the award he received in the dying days of the Bennett regime. I am wondering if, when he spoke about this government facing its shareholders.
The Budget-Mr. Riley he was not, in retrospect, looking back to the time when he, and the government of which he formed a part, had to face their shareholders in 1935.


An hon. Member:: 1939.


Daniel Aloysius Riley: And perhaps a little later, when the Rowe-boat sank.


Some hon. Members:: Oh, oh.


Mr. Ross (Souris):: A legacy from the Liberal government before 1930.


Daniel Aloysius Riley: Breaking with the fashion so recently established by the hon. member for Kamloops (Mr. Fulton) and the hon. member for Eglinton (Mr. Fleming), I am not going to demand that the Leader of the Opposition (Mr. Drew) resume his place in the house while I am speaking. I am not going to suggest that, because of the probably urgent business which often requires him to be absent from the house and which may have taken him away at this time, he would be guilty of contempt of parliament. I realize that anything which I might add to this debate would hardly deter him or other members of the official opposition from continuing to launch their verbal broadsides at the frail form of the Minister of Finance (Mr. Abbott). Rather I am moved to say that the superintendent of public functions, the financial critic, has portrayed his role with all the majesty and imperial zeal of a noble Roman tribune.


An hon. Member:: There are only a few Liberals present.


Daniel Aloysius Riley: I do not know who has just said that there are only a few of my own party listening. Am I to take it that the opposition benches are completely vacant, more so than they usually are? Normally the task of the financial critic is an arduous one, but this year it was made even more difficult by the fact that the Minister of Finance announced that the Canadian people, because of their hard work and their success in developing this nation, would receive something in the nature of a social dividend or bonus in the form of tax relief.
With production and national income at an all-time high, with new mineral resources being exploited and developed, with the national debt drastically reduced, a broader application of the Liberal principle of fair distribution was declared to be in order. Add to this the fact that Canada continues to maintain her fair share of overseas assistance commitments and to maintain an enormous although necessary defence program, and one can readily appreciate the bleak reserve and
2476	HOUSE OF
The Budget-Mr. Riley silence with which members of the loyal opposition greeted the 1953-54 budget.
I am going to risk being repetitious and refer, as did the parliamentary assistant to the Minister of Finance (Mr. Lesage), to an editorial which appeared in the New York Times of February 21. In that editorial the writer said that the pale green look on the faces of New Yorkers of the day before had been envy. As a spectator of the drama here on the 19th, I wondered at the time if perhaps the pale green look in New York was not a reflection, brought about by some of these new-fangled rediffusion processes, of the dark green look which appeared on some of the faces of those in the front benches opposite.
When the hon. member for Greenwood (Mr. Macdonnell) rose he clutched his toga tightly to his body, from which by the way had been torn and eradicated all the brand marks of big business, and he proceeded with funereal intonations to dispel this aura of brightness and hope and confidence, which the people of Canada have in the future of their nation, and to enshroud his listeners with a rather dismal cloak of gloom. The budget was a bad budget. Sombrely and relentlessly, on and on he went primly and dutifully pointing out that this government, this group of shall we say dubious Canadians who sit on this side of the house, were guilty of extravagance, waste and mismanagement. Then he went on with the inevitable albeit modest inference that he himself might make a pretty good finance minister. I do not think ever before in the history of this country has there been a more pathetic application for a post in the public service.
My reaction to the budget was somewhat different from that of the hon. member for Greenwood. I welcomed the tax relief coming as it did in its various forms. I find it increasingly difficult to pay income tax. I have always regarded the radio licence and the stamp tax as nuisances. For a while after the 19th I felt a little elated for myself and my fellow New Brunswickers because the Minister of Finance had seen fit to relieve us of some of the cigarette tax. However, a couple of days later the new Progressive Conservative government in New Brunswick decided in their budget that they were going to place more taxes on cigarettes. Some of us are beginning to wonder how long it will be before they find means of reviving a direct tax on radio listeners in that province or new stamp taxes.


Mr. Brooks:: The previous government left things in such a mess that they had to.


Daniel Aloysius Riley: I can well understand the hon. member for Royal (Mr. Brooks) saying that.


If he wants me to rehash some of the Tory speeches during the last campaign, in which no doubt he took part, I can do so. I can tell the house a few of the things which they promised to the people of New Brunswick and which they have failed to deliver.


Alfred Johnson Brooks: They have only been in a few months.


Daniel Aloysius Riley: They have not got very much longer to look forward to, fortunately for the people of New Brunswick, unless the hon. member for Royal decides that he will go back to lead them out of the morass.


Alfred Johnson Brooks: They have a good leader.


Daniel Aloysius Riley: Apparently the legislators in New Brunswick are not in accord with the hon. member for Greenwood and his New Brunswick colleagues here in Ottawa. After they had claimed that the minister had not taken off enough of the cigarette tax, they hastened to raise the price again. I suggest that there should be a federal-provincial conference of the Tory party.


Alfred Johnson Brooks: The Liberal government put on a sales tax that was not put on by the federal government.


Daniel Aloysius Riley: The Conservative government was going to take off the sales tax, but they have not done it yet. If the hon. member for Royal, who is constantly interrupting me, will come up to my office after I finish my speech I will give him quotations from some of his New Brunswick colleagues during the last provincial campaign when they said that as soon as they were elected they would wipe out the sales tax. There is no doubt that is what he wants me to put on record, so there it is. If he wants names, I will give them to him. To me as a maritimer, representing as I do a seaboard section of the Atlantic provinces, the most significant news in the budget speech was that dealing with southern trade. I was very pleased to hear the Minister of Finance tell us that trade with the Latin American countries amounted to $272 million during the last year, or more than double what it was in 1949. This is confirmation of the bright picture painted by the Minister of Trade and Commerce (Mr. Howe) on his return from the 20,000 mile trip which he recently made to these countries. I predict that the story of the success of that trip is going to find a permanent place in the annals of this nation. If the Minister of Trade and Commerce has ever doubted the Canadian people's appreciation of the tremendous achievements he has accomplished on their behalf over the past years, I think he can safely assume now that these doubts can be dispelled.

But the ministers did not tell all of the story. It could have gone on for hours describing how Peru, Bolivia, Mexico, Brazil, Panama and many other countries are willing and anxious to do business with Canada, and how favourable is our trade position with them at the present time. During the first nine months of 1952 our exports to Peru were nearly four times what they had been for the similar period of 1951. Our exports to Mexico amounted to 30 per cent more than what they had been for the similar period in 1951. Exports to Brazil more than doubled. We should take every advantage of this trend because to us in the Atlantic provinces it is very good news. These are our natural markets. These are the markets of which we should be taking advantage. These are markets, I might suggest to my Tory friends opposite, into which we do not have to blast our way.


Alfred Johnson Brooks: It took you a long time to think of them, eighteen years.


Daniel Aloysius Riley: I guess my hearing must be very poor.


Alfred Johnson Brooks: I say it took you a long time to think of them. It is eighteen years, and you have now discovered there are markets there.


Daniel Aloysius Riley: I regret that I was not here eighteen years ago.


Alfred Johnson Brooks: It would not have made any difference.


Daniel Aloysius Riley: The hon. member for Royal (Mr. Brooks) was here, I believe.


Alfred Johnson Brooks: I was not in the government.


Daniel Aloysius Riley: He was not here then? To many of the people of Royal it seems that he has been here longer than that.


Alfred Johnson Brooks: He will be here longer too.


George Alexander Cruickshank: Why don't you do something about it?


Daniel Aloysius Riley: Well, I wish him luck.


Mr. Hodgson:: He will likely be here when you are gone.


Daniel Aloysius Riley: I enjoy these interruptions because they give me an opportunity to refer to some of the figures I have in my notes. Hon. members know that generally speaking the economy of the Atlantic provinces is lagging. Because of our unfavourable geographical location in relation to the heavily populated sections of the country, we are out of step with the booming economy of the nation. My heart has been particularly heavy this winter over the plight of the dock workers and longshoremen of the port of Saint
The audget-Mr. Riley John. Residents of the cities of Saint John and Lancaster have been suffering for want of freight going through our ports to the various markets of the world. A lot more freight might have gone through the ports of Saint John and Halifax if some of our Canadian industries were more prone to route their export traffic through our ports rather than through United States ports.
I am very glad that elsewhere yesterday some startling figures went on record pointing out to the public of Canada, and more particularly to the people of the maritime provinces, what shocking discrimination has been practised in respect of our ports. I might also tell the Leader of the Opposition (Mr. Drew), or I would tell him if he were in his place in the house but in his absence I will point it out to some of the other leaders over there, that if they would get in touch with some of their big business friends in this part of the country they might be able to suggest to them that they should begin routing some of their export traffic in manufactured products through the ports of Saint John and Halifax in increasing volume.


Alfred Johnson Brooks: Have you no business friends up here?


Daniel Aloysius Riley: I have not got as big business friends as has the Tory party.


An hon. Member:: Oh dear.


Daniel Aloysius Riley: These gentlemen on the other side of the house are always talking about government interference with business and commerce. If something is not done with respect to routing Canadian manufactured goods through United States ports, it might be a good thing if we had a little government interference in business-


Mr. Nowlan:: A change of government.


Daniel Aloysius Riley: -because the yawning indifference of some Canadian industries, whose products find ready markets in the maritime provinces, to the ports of Saint John and Halifax, is matched only by the failure of the life insurance companies to reinvest in our provinces a fair proportion of the huge premium income which they so gladly take from us each year. We who live in the Atlantic provinces live there because we love that part of Canada. Living there, we want to see an opportunity for our children whom we also want to live there. But prospects of such opportunity grow dimmer as the years go by. Lack of home markets and high freight tariffs retard our industrial expansion. For the most part profits flow back to the central part of Canada because we cannot meet competition. Were it not for the social

The Budget-Mr. Riley security program of the present administration and preceding administrations over the last 17 years-my Tory friends might also say "hear, hear" to this-were it not for some of those things like unemployment insurance, old age pensions, mothers' allowances and other benefits, the flow would be all in one direction.


Alfred Johnson Brooks: A terrible picture.


Daniel Aloysius Riley: Speaking of mothers' allowances, I am reminded of a speech made by the hon. member for Annapolis-Kings (Mr. Nowlan) in the house on December 15 last. Some of his words were not recorded in Hansard. I wrote his words down at the time. I was sitting over here near the hon. member for Ottawa West (Mr. Mcllraith), and in confirmation of what the hon. member for Annapolis-Kings said may I point out that the hon. member for Ottawa West referred to his words in a speech which he made a few minutes later. The hon. member for Annapolis-Kings urged the Liberal party not to rehash old speeches of the Leader of the Opposition in the forthcoming election.


George Clyde Nowlan: Mr. Speaker, on a question of privilege, I have no recollection of what the hon. gentleman is referring to, but I suggest that he is bound by Hansard as well as the rest of us. When he says he is quoting something which he took down and which Hansard did not record, then he is reflecting on Hansard and I do not think he can do that.


An hon. Member:: You cannot take it, eh?


George Clyde Nowlan: I can take it, but I am not going to have some person remember something which he says was said.


Some hon. Members:: Oh, oh.


George Clyde Nowlan: I am on a question of privilege. I am saying that no man can recall what someone else said six months ago, attempt to quote that statement, and say that he is superior to Hansard.


John Sylvester Aloysius Sinnott: You had better take a look at it anyway.


Daniel Aloysius Riley: Bowing to experience, I shall be very glad to take back what I said even though I did write it down at the time.
Speaking of old speeches by the hon. Leader of the Opposition (Mr. Drew), as a member from the Atlantic provinces, having regard to the fact that through this social security measure we get back some share of the profits which we send to other parts of Canada, I for one am not going to let the mothers of the Atlantic provinces forget that the Leader of the Opposition said that the family allowances bill was wicked and unjust.


John Sylvester Aloysius Sinnott: Talk that one off.


George Clyde Nowlan: How long ago was that?


Daniel Aloysius Riley: The hon. member asks how long ago that was. Well, it was not when the Leader of the Opposition was' a mere stripling of a boy. That was when the Leader of the Opposition was a mature-minded premier of the province of Ontario, a man who should be fully conscious of the enormity of the consequences of his words. Now, he may say that he did not say that the family allowances bill was wicked and unjust, but he did. He said it was iniquitous, and there are only two definitions for "iniquitous" in the Concise Oxford Dictionary. Those two definitions are "wicked" and "unjust". Therefore, I think that it is fitting that I, and every other Liberal member or every other man who might be a candidate in the forthcoming election, should remind the mothers of the Atlantic provinces that the Leader of the Opposition referred to the family allowances bill as being wicked and unjust.


An hon. Member:: Is it still his policy?


Daniel Aloysius Riley: I cannot say that it is still his policy. He has made statements since that appear to be somewhat contrary, but I have never heard him get up in the house and say: I did say that and I apologize to the mothers of Canada. I said that at a time when I was not a national leader but when I was representing a section of the country- and I take back everything that I said.
Getting back to southern trade, I have always felt that the ports of Saint John and Halifax could be kept busy or could be helped to be kept busy the year round by a constant flow of imports and exports to and from those markets. I have always felt that the industries of New Brunswick, Nova Scotia and Newfoundland could be enormously stimulated by such trade. In the centre of those provinces lies Prince Edward Island, whose agricultural products could feed twice the population of the surrounding provinces with lots left over for export. With such a stimulus to industrial expansion, perhaps we might have an increased population in the maritime provinces. With increased population perhaps we might get home markets and then perhaps we could wave our hands at the high freight rates which we are now facing. With this in mind I am going to ask the Minister of Trade and Commerce (Mr. Howe) to send another trade mission to the Latin American countries-a trade mission made up of representatives and businessmen from the Atlantic provinces.


George Alexander Cruickshank: And British Columbia too.


Daniel Aloysius Riley: Yes, if my friend from Fraser Valley (Mr. Cruickshank) wants to have some sent from British Columbia I would concur.


Mr. Gibson:: We will dress up the delegation.


Daniel Aloysius Riley: It is really heartening to hear the voice of the independent member for Comox-Alberni (Mr. Gibson) coming from this side of the house instead of the other side. I am glad that he has now found his proper home.


Mr. Maclnnis:: You always had him.


Daniel Aloysius Riley: It is no idle fantasy to suggest that the success of such a move by the Minister of Trade and Commerce might help to mark the beginning of a new era in our part of Canada. For, with the prospect of industrial expansion, we might find ourselves where we could easily have a more stable economy in the early future.
The story of the mineral deposits in northern New Brunswick is heartening news and, coming with that, news from New York that large financial interests have decided to carry on further exploration and development work in the New Brunswick oil fields brings a new ray of hope to the people in my part of Canada. The discovery of large deposits of refractory materials in and about the constituency of my hon. friend from Royal is also very encouraging.
I am going to suggest to the Minister of Mines and Technical Surveys (Mr. Prudham) that his department might inject a little more assistance into the development of the mineral potential of my province. I am going to suggest that perhaps he might put more geological survey crews in the field. I am going to ask him, in ithe light of the fact that our economy is lagging, and in the light of the fact that we need some extra stimulation, if his department will not be ready to come down to New Brunswick and make more diamond drilling equipment available-and perhaps give more impetus to the already encouraging prospect of large mineral finds within the boundaries of New Brunswick.
I might offer a suggestion to the Minister of Resources and Development (Mr. Winters) as well. I could suggest to him that, now Canada is rapidly expanding and rapidly developing into one of the great nations of the earth, there is need for more imagination and more vision among the engineers of the various government departments, including his own. I might suggest to him that when the Boulder canyon project was first mooted it received rather cold treatment in the minds of most engineers; yet men of vision, men of foresight and men who had great confidence
The Budget-Mr. Riley in the future of their country pressed vigorously for the project, as they also pressed for the construction of the Tennessee valley projects. The fruits of these vast projects went beyond even their wildest dreams.
There may be great possibilities in the maritimes, great possibilities which are meritorious of more consideration by government engineers. I am thinking of projects like Passamaquoddy. I am not one of those who suggest that the Passamaquoddy power project should be constructed immediately. I am not even going to suggest that it is economically feasible. But I am going to suggest, as I have suggested to the Secretary of State for External Affairs (Mr. Pearson), that for the sum of $900,000 we in Canada can pay out share of the cost of a complete survey and find out once and for all whether or not the Passamaquoddy project is economically feasible. Having regard to the wealth of this country and having regard to the enormous boom which the larger sections of the country are experiencing, I do not think that is too much for the maritimes to ask for.
We are grateful for public works; we are grateful for anything. We are grateful for the social security program of the government. But we feel that at this time some greater impetus should be given to the development of those sections of the country which do not appear to have such vast mineral resources to be tapped as do others; which do not have such densely populated areas and which do not have such a rich industrial potential but which are none the less part and parcel of the country and should therefore be part and parcel of the national concern.
When I was speaking a few minutes ago about the potential of southern markets I neglected to mention the news; and I attribute this fact to the hon. member for Royal (Mr. Brooks), he having found it necessary to interrupt me so often.


Alfred Johnson Brooks: I am sorry.


Daniel Aloysius Riley: I know he apologizes, and I accept his apology.


Alfred Johnson Brooks: I am not apologizing at all. I was just trying to keep the hon. member straight.


Daniel Aloysius Riley: I have here a quotation that I want to read. If I go over my time limit, Mr. Speaker, perhaps it is only because I lost five minutes owing to the fact that the speaker who preceded me took 45 minutes.


An hon. Member:: Keep on.


Clarence Gillis: You are doing a good job.


Daniel Aloysius Riley: You think I am talking myself into trouble?


Clarence Gillis: No; you are doing fine.

The Budget-Mr. Herridge Mr. Riley: Perhaps I may have a wordi to say about the hon. member for Gloucester (Mr. Robichaud).


Mr. Robichaud:: I am all ears.


Mr. MacDougall:: Get your quotation.


Daniel Aloysius Riley: Some Tory must have sneaked in behind me and stolen this quotation.


Daniel Aloysius Riley: Will the hon. member permit a
question?


Mr. Herridge:: Willingly.


Daniel Aloysius Riley: When the hon. member referred to the hon. member for St. John's, did he mean the hon. member for St. John's East or the hon. member for St. John's West?


Clarence Gillis: You should number your pages.


John Lorne MacDougall: Oh, make it up.


Alfred Johnson Brooks: Tell us in your own words.


Daniel Aloysius Riley: I could hardly make up something the Minister of Trade and Commerce (Mr. Howe) said. When he was speaking here, as reported at page 1841 of Hansard, the Minister of Trade and Commerce said:
Our balance of trade with Cuba Is very much in our favour, and Cuba is a very important market to the maritime provinces. It always has been and it always will be. The Cuban agreement on raw sugar was made as a means of stimulating that market and of protecting the market we have had. It has had that effect. There has been a very sharp growth in imports from the maritime provinces, and in talking to the people of Cuba I may say that they in Cuba believe that market can be stimulated a great deal more.
It was necessary to conduct these negotiations with that thought in mind. Certainly I have no intention at any cost of disturbing that market for products of the maritime provinces.
He made that statement in answer to the Progressive Conservatives who in this house made an attempt to disrupt that market. I am sure that had the hon. members in the opposition known what I was going to quote, they might not have been so ready to listen to me.
To sum it all up, when the history is written of this proud epoch in the development of a great nation, I should hate to have my children read and be taught, perhaps in another part of this or another land, that the Atlantic provinces had lagged in the wake of Canadian progress like the back field of an abundantly productive farm; or I should hate to have my part of the country depicted as the dying limb of an otherwise luxuriantly foliaged tree, one of the main branches withering for want of proper circulation of the sap of national concern.


Herbert Wilfred Herridge: Mr. Speaker, when listening to the hon. member for Saint John-Albert (Mr. Riley) I could not help thinking of that opening line of a famous poem, "111 fares the land, to hastening ills a prey". His, shall I say, criticism of government policies and his pointing out to the house that the maritimes have a small ray of hope in some directions give me greater courage to carry on with his condemnation of government policies.


An hon. Member:: He said "the hon.
member for Saint John-Albert".


Herbert Wilfred Herridge: Mr. Speaker, may I say that I am not quite sure which, but I think if I say that I was referring to the eloquent member who can speak with such magnificent and sonorous ambiguity, I would be describing him correctly.
Mr. Speaker, I rise to support the semi-pro-socialist amendment moved by the Progressive Conservative party and the subamendment moved by this group. Before proceeding I should say that I never expected in my lifetime to hear Tories continuously using the language of socialists. The reason for that, Mr. Speaker, is that the only alternative to government policies are the policies advocated by this group; and if you are going to give effective expression to the criticisms that are made of this government's policies, it must be given in the terms of the C.C.F. group in this house.


Some hon. Members:: Oh, oh.


Herbert Wilfred Herridge: 
Donald MacInnis: As the Liberals did after the budget speech was delivered.


Herbert Wilfred Herridge: The minister said the tax concessions were possible because of the 7 per cent increase in production. But there are no concessions for the 137,000 families in Canada whose total incomes are less than $2,000 a year. That was pointed out by the hon. member for Cape Breton South (Mr. Gillis) yesterday. In fact the minister emphasized the 7 per cent increase in production, which we all welcome because we in this group think our economics are based on sound premises. We realize that you cannot have increases in social services, you cannot have increases in wages, you cannot have increases in any of the good things of life unless you have an increase in production. We recognize that fact. Very minor relief has been given to the majority of taxpaying Canadians, while there was a great measure of relief given to the corporations, over $100 million.


Mr. Ferrie:: I told you before you should come over here. Accept the invitation and come on over.


George Alexander Cruickshank: He used to belong over there.


Herbert Wilfred Herridge: I am always interested in hearing the eighth wonder of the world that the people of Mackenzie have sent to this house.


Irvin William Studer: The hon. member for Moose Jaw.


Herbert Wilfred Herridge: An hon. gentleman from that end of the chamber, some ambiguous person, an unseen voice, said something about the member for Moose Jaw.


Irvin William Studer: He is close to you; you talk like him now.


Herbert Wilfred Herridge: I cannot hear the comments and I cannot answer unless I hear him. It is the usual barnyard chatter that you hear from Saskatchewan Liberals.


Gladstone Mansfield Ferrie: You ought to know about it; we are told that you work in the barnyard.


Irvin William Studer: One chicken coming home to roost.


Herbert Wilfred Herridge: Mr. Speaker, I trust you will not believe that there is a barnyard to my extreme right. These clackings and quackings
The Budget-Mr. Herridge and mooings and brayings that you hear are coming from the member for Mackenzie.
I must get on with the few remarks that I wish to make in connection with this important subject. I am particularly, shall I say, embarrassed and pleased with the rather representative and attentive audience that I have here this afternoon. I am not going to deal in detail with the budget. The hon. member for Rosetown-Biggar (Mr. Coldwell) did that very effectively the other day, and presented the views of this group so far as the budget is concerned. However,
I do wish to deal with a few aspects of the budget before proceeding with my pleas in connection with the need of the great host of unrecognized persons in Canada so far as this budget is concerned.
Before dealing with those things I wish to say in criticism of the budget I must say in fairness that some things are included in this budget that will be welcomed by the average Canadian citizen regardless of the party to which he belongs. I am sure the reduction in excise duty on cigarettes is welcomed by a large number of people. I know that since the reduction the manufacturers have dropped the price a cent or two a package. But I want to bring to the attention of the house the continuing discrimination against a certain group in this country in these budgets that are presented from year to year. We have legislation before the house to overcome discrimination as to race, creed and colour, and further proposals as to sex, and I am all in favour of these proposals. The Minister of Finance year after year continues to discriminate against the ancient order of dependable pipe smokers. I should like to know the reason for the failure to grant concessions to those who smoke cigars and pipes-


Irvin William Studer: They don't smell very good.


Herbert Wilfred Herridge: There is a considerable number of those people in this country who resent not receiving the same tax relief that is given cigarette smokers.


John Lorne MacDougall: You are speaking for yourself.


Daniel Aloysius Riley: He chews tobacco.


Herbert Wilfred Herridge: I speak for some important members of the cabinet; and in answer to the hon. member for Vancouver-Burrard (Mr. MacDougall), may I say that when I speak as a pipe smoker I am speaking for a group of people who are generally considered in any country as being a very stable and solid element. You find that most of our great artists smoke pipes. Our great theatrical producers, most of our university professors, most of the persons doing creative work and
2482	HOUSE OF
The Budget-Mr. Herridge a great number of, shall I say, the hardest working men in this country smoke pipes because they are less bothersome and easier to attend to than cigarettes under certain circumstances. I cannot understand why in repeated budgets there is a failure to give relief to those who smoke cigars and pipes in Canada. When the minister replies at the end of this debate I wish he would inform the house the reason for that obvious discrimination against a large number of people in this country.


George Alexander Cruickshank: I will attend to that on Tuesday.


Herbert Wilfred Herridge: I am pleased to have the cooperation of the hon. member for Fraser Valley. That will be the one little duty he has performed this session.
Everyone will be pleased with the exemptions allowed far dependent children attending university and over 21 years of age, with the raising of the permissible income for dependents from $600 to $750 and the allowance exemption for expenses on account of those elected to municipal office. That is a very reasonable proposal. In a good many of our city councils the aldermen give a very great deal of their time for little remuneration, and this is a very fair and justifiable provision.
With respect to the repeal of the sales tax on books, I am glad to say how pleased we are that the repeated pleas of the hon. member for Saskatoon (Mr. Knight) in that respect have been listened to by the Minister of Finance. I notice that there is also repeal of the sales tax on newsprint. I am informed that that will mean a considerable sum to the large newspapers of this country. It is strange that within a few days of the government giving that tax concession to newspapers the paper manufacturers increased their price a considerable amount per ton.
We are all very pleased with the elimination of the $2.50 radio licence fee. It was a difficult fee to collect, and was not paid by quite a large percentage of the people. It was also a costly fee to collect. It will be generally accepted across Canada as a good move. I am of the opinion that the provision to use the 15 per cent excise tax on radios and radio equipment to finance the cost of the operation of the C.B.C. is a sound and constructive move on the part of this government and will be generally accepted across the country.
It was a good move to remove the nuisance tax on money orders, cheques and other instruments. We thought that was something of an institution that was going to continue forever, and therefore it came as a surprise vhen it was removed. But in view of the


labour of printing stamps, and the nuisance of attaching them to cheques and other documents, having in mind always the total revenue received, I think it was a wise provision.
Then we were particularly pleased-not because of the amount but because of the fact-when the Minister of Finance (Mr. Abbott) finally did give some heed to the repeated pleas of the hon. member for Winnipeg North Centre (Mr. Knowles) for a reduction of the floor on medical expenses for income tax purposes. While there is only a reduction of 1 per cent, at least it is a start in the right direction; and we are pleased to note that the C.C.F. group in the house has made this small dent in the minister's armour. While there has been this reduction of 1 per cent, members in this group will continue to press for the complete removal of the floor.
In several budgets, if I remember correctly, the Minister of Finance has expressed concern about the high level of taxation on corporation profits, and he has now emphasized this concern by reducing the standard rate of corporation tax from 50 per cent to 47 per cent.


John Lambert Gibson: Until the Social Crediters get hold of us in British Columbia.


Donald MacInnis: You will get it back.


Herbert Wilfred Herridge: While there was a slight reduction last year, the general trend in corporation profits has been higher and higher. They have been increasing in amount every year. It is obvious to those of us in this group that, when considering the budget proposals, the minister gave consideration to representations of industrialists generally, and no consideration to that large group of families with incomes of less than $2,000 a year, or to single persons in the same category. The minister is bombarded from two sides. On the one side are the Canadian Chamber of Commerce, the Canadian Manufacturers Association-


John Lorne MacDougall: They do not pay taxes, anyway.


Herbert Wilfred Herridge: That is just the point. The hon. member for Vancouver-Burrard was asleep, and I woke him up at that point. He misunderstood completely what I had said.
The point I was making is that the minister is bombarded from two sides. No doubt he received representations-and rightly so- from the Canadian Chamber of Commerce, the Canadian Manufacturers Association and other business groups throughout the country, urging reductions in corporation taxes. On

the other side he no doubt received pleas from the large group made up of people who pay no direct taxes at all. Therefore I would make a few suggestions that, I believe, would make it possible to provide for many of those people who, so far as this budget is concerned, have been forgotten. The points I shall mention could be made effective without placing any additional burden either upon the corporations or the other taxpayers in this country.
The minister has made provision for a reduction in taxation on corporations in a full year to the extent of $120 million. Quite recently a United States commission investigating defence expenditures in that country made a report to the effect that, with the elimination of waste, graft and corruption the defence effort in that country could be carried on just as effectively and to the extent necessary with a 10 per cent reduction in defence expenditures.
From evidence that has been placed before the house, and is now being presented to the defence expenditure committee, I am sure that same state of affairs applies in this country, and that with the elimination of waste and extravagance we could surely reduce our expenditures on defence to the extent of 10 per cent, and still have an effective defence effort.
The $120 million to which I have referred, plus a possible saving of $200 million in defence expenditures, provides us with $320 million. Had the government not reduced the corporation tax to the extent of $120 million, and if the government were to groom defence expenditures and go after those who are wasting money and acting extravagantly with government funds, we would have $320 million, and this without any change in the taxation of the country. We would also provide for many of those people who, under the terms of this budget, are forgotten.
I have only a moment to conclude this phase of my argument, and I trust hon. members opposite will consider it an argument. This group believe in income tax according to ability to pay. We believe that income tax, under this system of government, is the fairest way to secure funds for a better redistribution of wealth. I have mentioned that, as we think, the minister has reduced corporation taxes unnecessarily. Capital development is going on at a terrific pace in Canada. Great strides are being made in capital expansion and investment; and we believe there was no necessity at all, in the present situation, to give large corporations a reduction in taxation, as this budget does.
Canadian Wheat Board Act
A preliminary estimate for the year 1952 shows that corporation profits were $2,730 million. After corporation taxes are deducted the balance or surplus left is about $1,405 million. That is a very large sum of money to be left for distribution as dividends and for reinvestment.
Mr. Speaker, would you call it five o'clock?


Mr. Deputy Speaker:: As it is now five o'clock, the house will consider private and public bills.



CANADIAN WHEAT BOARD ACT


[Stage Direction]
The house resumed, from Tuesday, February 17, consideration of the motion of Mr. Argue for the second reading of Bill No. 5, to amend the Canadian Wheat Board Act, 1935 (payment for farm storage).
Frederick Hugo Larson: Mr. Speaker, I believe I adjourned the debate on the last occasion this bill was before the house, and at this time I have only one or two further points to make.
I said before that, if it could be worked out equitably, I did not have any great objection to the payment of farm storage. I said I felt that while I would be benefited personally by the passage of a bill of this kind, I felt there were certain inequalities in it, and I was inclined to agree with the chairman of the wheat board when he said that it should be looked at again.
Speaking generally, among farmers in western Canada the facilities for marketing wheat can well take care of the wheat offered from time to time. Of course we do have situations develop as we saw in 1952, when it becomes necessary to store certain amounts of wheat on the farms because facilities to take the wheat to market are not adequate. If in our normal experience we could expect this condition every crop year, and it became necessary to have large quantities of grain stay on the farms because of the inadequacy of facilities to handle it, there would be a certain necessity for this kind of legislation. However, in the normal year with the facilities available being sufficient to bring the grain to market, as I stated the last time I spoke, I feel that certain difficulties would be met in having the grain flow into position as rapidly as it should, and it might be necessary for the wheat board to requisition grain.
When the hon. member for Assiniboia (Mr. Argue) spoke he said that out of 112,000 farmers in Saskatchewan less than 8 per cent farm over 5 quarter sections, which is 800

Canadian Wheat Board Act acres, and fewer than 10 per cent were paying income tax. That would not be a very large percentage when we are dealing with over-all production. There is only one thing that bothers me. I could spend the next ten minutes naming farmers I know who farm anywhere from 3 to 15 sections. These men are always faced with the inadequacy of the quota. They can deliver enough under the initial quota to pay their expenses because the size of their operation gives them a greater efficiency. But under the quota system they are of necessity forced to retain a sizeable amount of grain on the farm.
That argument is backed up to a certain extent by table 8 of the taxation statistics for 1952, which shows that out of 112,000 farmers in Saskatchewan, 10,950 were taxpayers. Their taxable income was $40,596,000 and they paid $3,467,000 in taxes. That number of 10,950 approximates 10 per cent of the total number of farmers. The net income of the farm population of Saskatchewan in 1952 was $265,200,000, of which $40,596,000 was taxable, which gives you a figure between 15 and 20 per cent as representing the percentage of the net total farm income being received by from 8 to 10 per cent of the farmers.
These relatively few farmers who have this large net income are, as I said before, forced to keep a good deal of grain on the farm. Many of them have reasons other than their inability to deliver. They may desire to keep it on the farm for tax reasons, or they may want to have a certain carryover of wheat. I feel that if a system of farm storage payments was inaugurated it would not be a year to year business. As X have said, we do not need it most years although this year possibly we do.
If a system of farm storage payments was inaugurated there would be a good deal of pressure to continue it. A large number of the larger farmers would be helped. They are holding back anyway, and they would benefit every month by the increase in the initial price being made to take care of this farm storage. There are certain farmers who would be pleased to have this system, but I still have to be convinced that the greater number of farmers, that is the 103,000 odd excluding the 8 per cent, would be particularly anxious to have to sell their grain in the fall in order to pay their bills and then see a neighbour with a large farm benefiting from a rise in the price of wheat at the rate of a cent or half a cent a bushel per month to allow for storage charges.
There is nothing more that I wish to say on this particular matter. We have an


adequate marketing system through the Canadian wheat board. The chairman of that board has expressed an opinion-I do not know whether he did it publicly, but I believe he did it privately-that while there is a good deal of merit in the payment for farm storage, a further survey should be made of the matter. As I have said before, I am not particularly opposed to this, nor am I advocating it. The chairman of the wheat board has done a good job in handling the grain crop, and if he feels that the matter should be taken under consideration I think we should take a further look at it. He feels that the necessity for this measure is not pressing, and I believe we should consider it further.


Mr. P. E. Wright (Melfort):: Mr. Speaker, I should like to answer one or two of the questions raised by the hon. member for Kindersley (Mr. Larson). He states that he does not think the small farmer would be benefited by this legislation, and that the large farmer would receive the greatest amount of benefit. If that is the case I cannot understand why the farm unions in western Canada, which I am sure represent the small farmer even more than they do the large farmer, are asking for this legislation.
The hon. member stated also that when grain was needed it might be necessary for the wheat board to requisition. If the wheat board needed grain at any time they could stop paying these storage charges. The bill does not make it compulsory for the wheat board to continue to pay storage charges for grain during the full season.
Another argument used by the hon. member is that the large farmers hold back grain for income tax purposes. That may have been true before the Income Tax Act was changed, but now the farmer can average his income over a five-year period and there would be no advantage in holding back grain. I do not think that argument is sound.
The main argument for this legislation, as I see it, is that under the conditions which exist in western Canada at the present time, and have existed for a number of years, the farmers in certain sections are able to deliver large quantities of grain early in the season. The way we are situated in western Canada we must get as much grain as possible to Port Arthur and Fort William before the season closes in early December. In order to get the greatest use of box cars, grain is hauled mainly from Manitoba and over the main line of the Canadian Pacific in the eastern part of Saskatchewan. Therefore you find that the quotas in these areas are raised to 15 bushels to the acre months before quotas

are raised in other parts of the western provinces. The result is that they get their grain out while farmers in the northeastern part of Saskatchewan, particularly, find that their quotas are not raised and they have to hold their grain on the farm whether or not they want to do so. 1 think we should have some compensation for that.
It is also true in the northeastern part of Saskatchewan, where at least some of our grain goes through the port of Churchill, that grain is held in storage in the elevators so that it can be moved to Churchill in the latter part of July and the first part of August before the new grain comes on the market. That results in a large amount of grain in that area having to be held on the farms, and we think we should have some advantage from the storage of that grain. The hon. member for Assiniboia (Mr. Argue) introduced a resolution asking for payment for grain properly stored on the farms, and I think this bill would help to solve some of the difficulties and iron out some of the inequities that exist in the marketing of our grain in western Canada. It would give the farmers some incentive to build storage on the farms, and I know of no better insurance that any farmer can have than a granary full of properly stored grain on his farm.
I think we should try to have anything that would encourage that put into legislative form. I know that in the 1930's and in the years when we have had drought in western Canada-and drought will recur-nothing gave more security to the farmer than a granary or two of grain stored on his own farm. If this legislation were put into effect it would encourage farmers to provide their own insurance against years of drought.
As long as we have these large carryovers of grain, and we are likely to have them for the next two or three years at least, I think this bill would provide a fair division of the amount of storage which we are having to pay. At the present time the elevator companies are building additional storage space. They are only doing so because they know that space is going to be paid for through the grain that will be stored in it over the next few years. I think we should encourage our farmers to build storage space on their own farms and store grain there so that it will be in position.
I remember that a few years ago in the area which I represent grain had to be shipped back from Winnipeg and the head of the lakes for seed purposes. Because of a short crop the grain had all gone out in the fall of the year before. There was no encouragement to hold it, and the result was that grain shipped in the fall and paid for at the
Canadian Wheat Board Act rate of 80 cents a bushel was bought back by the farmers in the spring at $1.25 a bushel for seed purposes, and freight was paid on it from that area to Fort William and back again. I think this is proper legislation, and something which would benefit the farmers of western Canada.


Mr.  A. J. Baler@The Balllefords: Mr. Speaker, I think it was last session that I spoke about grain handling and grain storage in northwestern Saskatchewan. I do not intend to take a great deal of the time of the house on this topic on this occasion, but I should like to say a few words about a government interior storage elevator that we should like to see erected at North Battleford. In this connection I might say that I have the endorsations of some 13 rural municipalities surrounding the city of North Battleford and also endorsations of certain farm union lodges.
So far as grain storage is concerned, there is something I should like to draw to the attention of the house. We read in the press ait the present time that considerable insect damage is being done to farm-stored grain. In the Saskatoon Star-Phoenix of February 16, 1953, there is the following Canadian Press dispatch from Regina:
R. E. McKenzie, director of the agriculture department's plant industry branch, said here that a large number of insects apart from the rusty grain beetle are damaging farm-stored grain in Saskatchewan. He said the common grain mite and the rusty grain beetle are the principal insects which damage the kernel of the grain, but investigation had also revealed the presence of other insects which merely live in the grain but can cause heating and spoiling. He urged farmers to examine their bins and piles carefully, taking samples from top to bottom.
There is also another article in the Manitoba Co-operator of December 18, 1952, which reads as follows:
Infestations of farm-stored grain by the rusty grain beetle have occurred in Alberta and Saskatchewan. This insect feeds on grain in storage and when present in large numbers causes the grain to heat and go out of condition. The result is loss in germination and deterioration in baking quality, according to F. L,. Watters, officer in charge, dominion Department of Agriculture laboratory of entomology, Winnipeg.
With respect to grain storage, I am of the opinion in so far as northwestern Saskatchewan is concerned that a greater number of farmers might benefit from the erection of a storage elevator at North Battleford. I think we will all agree that quotas are here to stay. In the Livestock Times of Saskatoon for February 6, 1953, there is the following:
The change from horses to mechanical power on farms has released 70 million acres for food production in the United States in the past forty years.
2486	HOUSE OF
Canadian Wheat Board Act
I do not know the figures tor Canada but I would say that the same proportion would apply here. Therefore I am of the opinion that, with the coming of farm tractors and with land still being broken up, regardless of any change in the system of marketing grain in western Canada we are still going to have the quota system.
Speaking of quotas, there is one thing I should like to suggest for the smaller operator, and I believe we should be considering the smaller operator in western Canada. I refer to the farmer's son who starts out on a half section or three-quarter section of land, and to our returned soldiers. To assist them in financing, I think there should be a minimum quota, and I would say 750 bushels. I was going to say 1,000 bushels but that might interfere a little too much with the first quota that might be delivered by all farmers, large and small. For the purpose of assisting the small operator and the returned soldier who starts out on a rather small farm, and who may not own combining and threshing machinery, I think consideration should be given to the establishment of a minimum quota.
In at least three periods when grain crops in the northwestern part of Saskatchewan have been good, in the twenties, the early forties and the last two years, the question of inadequate grain handling facilities in that part of the province has been a very serious one and the situation has been detrimental to the growers. With a view to alleviating the situation, recommendations have been made to Ottawa for the building of an interior storage elevator with cleaning and drying facilities. In connection with the erection of such an elevator, I might add that we saw in the thirties, and it might happen again, that these elevators could be used to a great extent for the storage of grain to meet seed grain requirements.
I think that is something that should be considered when we are talking about storing grain. Opinions differ as to what is the best thing to do to meet the situation. Some people advocate building more terminal facilities at the eastern seaboard. Others urge increased elevator facilities at Churchill, and some advocate requesting the authorities to pay storage to farmers rather than to construct interior elevators.
As we understand the situation, the greatest need for increased facilities today is during the harvest season when so many thousands of farmers are combining or threshing, and at the same time hauling grain to elevators or granaries as long as there is room. It appears to me that additional elevator facilities at an eastern seaport would be of no assistance to farmers in


northwestern Saskatchewan, when the accommodation is most needed. Additional facilities at Churchill would be an advantage to the prairie provinces as a whole and are undoubtedly desirable, but here again the added facilities would not meet the requirements of farmers in northwestern Saskatchewan when most needed.
There is no question at all but that in years when the crop is average or better than average, there would be a lot of grain left on the farms even after a four or five million bushel elevator had been filled and hundreds of carloads had been dispatched for export. It seems to me that nearby storage is what is most required.
This northwestern area, which is close to 20 per cent of the grain-growing portion of the province, is the largest area in the prairie provinces not at present served by an interior storage elevator. Elevators at Calgary and Edmonton serve the grain-growing portion of Alberta; elevators at Saskatoon and Moose Jaw provide facilities for central and southern parts of Saskatchewan. In southeastern Saskatchewan and Manitoba the crop is usually ten days to two weeks earlier than up here, and much of it is shipped to Winnipeg or elsewhere before car shortage becomes a problem.
If an interior storage elevator is built in northwestern Saskatchewan, we presume there is no argument but that it should be in North Battleford, where practically all the highways and railways of the area converge. There is an additional reason for having an interior storage elevator at a central point near the area of production. The grain could be shipped to eastern or western points, or to Churchill, or to interior points for home consumption, without any back-haul expense.
In so far as the resolution before us is concerned, Mr. Speaker, I think the greater number in my area would be getting more benefit if such an elevator were constructed in North Battleford because what the farmer wants to do, especially the average farmer, is to get out 10 or 15 bushels per acre as soon as possible in order to pay his running expenses. I think he requires that more than farm storage.
An elevator there in my particular area would be the best thing that could be done in connection with farm storage, taking into account the system of quota delivery as we have it today. As I have said previously, I think quotas are here to stay. No matter what system we have for marketing grain there is bound to be a system of quotas in order to give everyone a fair shake when it comes to delivering to the elevator.

I do believe that the minimum quota for the small operator should have consideration by the department. As I have said, our small operators and our soldiers who are starting up on a half section or three-quarter section will have an opportunity to pay their harvest expenses. Many of them do not own threshing and combining machines, but they would have an opportunity of meeting their running expenses and paying the owners of the machines who come in and harvest their crops.


Mr. William Bryce (Selkirk):: Mr. Speaker,
I will just take a couple of minutes. I want to support this legislation introduced by the member for Assiniboia (Mr. Argue) and supported by the hon. member for Melfort (Mr. Wright). I can save time by not repeating what they said but I think pretty much as they do.
I think that this legislation should be popular because it will not cost the taxpayer any money. I know that on the branch lines where the quota was small, owing to the scarcity of box cars at different points, it would have been a big benefit last year.
I know that merchants along some of the branch lines were laying out $15,000 or $20,000 in credit. The farmer was willing to pay, but he had only so many bushels of grain. If he had been paid for his storage he could have made a token payment on his bill with the storekeeper.
I was talking about this legislation outside of the house and someone I was talking with said that the big farmers would hold their grain indefinitely. Well, that is taken care of in the bill. There is provision that the wheat board may see that that does not take place. The wheat board can say that the storage is off and that they need the grain. That would take care of it so I do not think we need worry about a farmer holding grain.
My hon. friend from The Battlefords (Mr. Bater) has mentioned damage to grain by mites, and that sort of thing. We have always had them, and I had them on my own farm. If we wake up to what the people in the grain division tell us we can take care of it the same as they do in the big elevators.
I have much pleasure in supporting the bill.


Clarence Decatur Howe: Mr. Speaker, I spoke at
some length on this bill when it was before the house last session, and I do not propose to repeat what I said then.
The proposal is that the wheat board, out of funds belonging to all producers, will pay
Canadian Wheat Board Act storage on the farm for those who do not or cannot deliver their grain immediately after the harvest. I think it is fair to point out that if every producer had the same yield per acre and if the quota system were working uniformly across Canada, the payment of farm storage would leave every producer just where he would have been anyway, as far as final returns are concerned, except that there would be the additional mechanics of working out the storage adjustment.
I might point out to the last speaker that it would not be income to the farmer until he delivered his grain, because farm storage would only be paid, of course, when the grain is delivered. In other words it is of very little value to the farmers, assuming that the crops are about uniform and assuming that quotas are reasonably uniform across Canada.
At the present time-within a few days- we expect to have a uniform 15 bushel per acre quota right across the prairie provinces. Therefore no one would benefit from the payment of storage at the present time. However, assuming that crops are widely different as they are in some years, it would mean that the man with the small crop would bonus the man with the big crop. There is no doubt about that.


An hon. Member:: Hear, hear.


Clarence Decatur Howe: The man with the small crop
would be forced to deliver his crop because he would need the money immediately. The man with the big crop could deliver sufficient to pay his running expenses, hold the rest and collect storage on it.
Another feature of it is that it is a case where the poor bonus the rich. The poor man, however large his crop, needs to deliver it immediately to meet his immediate commitments. The rich man can say: "Well, it is paying a very nice return to me where it is; it is better than a bond. I will keep it, collect all the storage I can and deliver it in the spring." Then it has the effect of crippling the board in its endeavour to get the best possible return for the farmers' grain. As I pointed out last year, the winter market for coarse grain is the best market; and grain marketed in the winter months will bring to the board a better return than will wheat marketed in June and July. I demonstrated that fact by figures. I checked up the figures this year and they indicate exactly the same result.
The suggestion has been made that it is exactly the same thing to have grain in store in a country elevator as to have grain in store on the farm. From a practical marketing viewpoint there is all the difference in
2488	HOUSE OF
Canadian Wheat Board Act The world. The grain in the country elevator is in the possession of the wheat board. The wheat board owns the grain in the elevator. They can sell it. They can do what they like with it. It is their grain. They have made an advance payment on it. On the other hand, grain on the farm is not in the possession of the wheat board and it cannot be sold until it is delivered to the board. The board cannot go short. They cannot sell what they do not have. There is therefore no analogy at all between storage in a country elevator where the grain is owned by the wheat board and storage on the farm where the grain is owned by the producer and where delivery of the grain depends entirely upon the whim of the producer.
I know of no organization, except the farmers' union, which favours this proposal.
I have talked with the leaders of the three pools. They see nothing in it whatever for the producer. In addition to that, I have talked to individual farmers and they see no benefit from it. I think it is distinctly a minority of prairie opinion which is in favour of this measure. I know that the wheat board have explored the matter thoroughly, and I know that the wheat board believe that it would be of no benefit to the producer. Mr. Mclvor so expressed himself at a meeting of the farmers' union at Edmonton, and also at two or three other annual conventions of prairie producers.
I do not know that I need to say more, Mr. Speaker. I know a great deal against the bill and I know nothing for it. I have heard in favour of this bill no good argument that will really stand up to analysis. Therefore, Mr. Speaker, as the minister responsible for the administration of the Canadian Wheat Board Act, I cannot vote in favour of the bill.


Gladstone Mansfield Ferrie: Mr. Speaker, I should like to say a few words with regard to this bill. It seems to me that this debate has taken a strange trend in that we have had the hon. member for Selkirk (Mr. Bryce) supporting this bill. The funny thing about it is that the people he represents are the people who are forced to sell their grain first. Manitoba has always been about a week, ten days or two weeks ahead of the people in the northwestern part of Saskatchewan and Alberta. The northeastern corner of my constituency comes alongside Manitoba. That is one reason I am definitely against this bill. The simple fact is that my farmers would have to sell.
There is a clause which provides that if the board called for the grain to be delivered,


it would have to be delivered; and if it was not delivered, this storage would stop. In the second place, the grain that has been threshed in western Canada for these last two years has naturally caused a kind of agitation for this measure, but it has been on account of the big crop and the two crops together. But I am sure if it was stated definitely to the farmers that one farmer pays the other farmer, there would be no support for this bill. I cannot understand why the C.C.F. party, which feels so strongly about co-operation, expect the little farmer to pay for the big farmer. You cannot get away from the fact that it is going to have that effect, that the little man is going to pay for the big man. There is no other way out of it.
The simple reason is that this man is obliged to sell. If I have 10,000 bushels of grain and they are going to give me 4 per cent, 5 per cent or 6 per cent on my money, I am going to hold the grain. If the wheat board says that I must sell it then it will be an unfair proposition because some other fellow somewhere else is going to try to hold his grain. If you get into an intricate system of forcing people to deliver grain at certain times, it is going to be so intricate that it will simply be impossible to handle.
As to the farmers' union, I am satisfied that this resolution would never have been passed in a convention of that kind if it had been properly explained to the people on the floor of the convention that one farmer was going to pay the other farmer. Many of these farmers think the wheat board is paying the elevator companies and that as they are paying the elevator companies, they might just as well pay the farmers.
Let us consider how many millions of bushels just go into the elevator, into the box car and away they go. If we are talking about grain that is being stored while the elevator is being filled until it is full to the top, surely you do not want that stuff out on the farm. You want it there. You want it so that you can get it in position to be sold. Our main business in western Canada is not storing grain; it is growing it and selling it. We must get it in position to sell it. We do not want to say to the farmer in Manitoba or to the farmer in western Alberta:	You have to sell your
grain; you have to get rid of it. We do not want the wheat board to say that. What we want to do is stick to our quota system and try to get the grain out as fast as we can possibly get it out; and when you get that grain out and get it in selling position, as the minister has just told us, you can

get a good price for it and you can put it in a position where the rest of the world can come and get it.
There is another thing I should like to say and it is this. Once you set up a system of this kind, by saying that you have to deliver this grain you are going to have more kicks than you will have under the system you have now. If you have an ordinary normal crop, as I said before, it is our business to get rid of it; that is when the quotas are up to around 15 bushels in an ordinary year, and when the average of wheat in western Canada runs about 17 or 18 bushels to the acre. Of course, these last two years the average has run from 23 to 24 bushels to the acre. That makes a great deal of wheat and a great deal of handling. Naturally the elevators get full and the fellow out on the farm figures that he should get just as much for storing the grain as does the elevator company. I agree with him. But it is maybe in only one or two years in ten that this would happen.
I say right now that the best thing to do is leave this with the wheat board. They are handling it and doing a wonderful job. The farmers are very well satisfied with it. They are satisfied to carry this thing along the best way they can. As the hon. member for The Battlefords (Mr. Bater) just said, you cannot take care of the grain out in the country. You get mites in it, and when you get mites in it there is only one thing to do with it, and that is turn it. They can turn it in the elevator and fix it up so that they do not lose too much of the grain. If it is on the farm, the farmer has to turn it. How is he going to do that? He has to have another bin some place or take a few loads to the elevator so he can turn it. In the old days it was easy to ask the elevator man to take a few loads, and it would be possible for him to keep on turning his grain so that the mites would die. Now he is under the quota system and it is not possible to do that. Therefore he gets into trouble in storing the grain.
The main and burning question in my mind is this. Let us stay with the wheat board and let them settle the situation that exists in western Canada. They will get rid of the grain as they have always done and we shall have a fair price. We will not have much of a carryover, and if we get up to a quota of 20 bushels to the acre at the start of the next crop year I think you will say that we have had a good job done by the wheat board, and we should thank them for it.


Mr. H. R. Argue (Assiniboia):: Mr. Speaker,-
Canadian Wheat Board Act


Mr. Deputy Speaker:: Order. If the hon.
member speaks now he will close the debate.


Hazen Robert Argue: I want to deal with the first statement of the minister that a minority of the producers support this legislation. I have already quoted resolutions passed by farm union organizations. As far as I am concerned, these farm union organizations and their conventions-and I have been at a number of them-reflect correctly in almost every instance the opinion of the rank and file prairie producer of grain. I say that the vast majority of producers would support and do support legislation such as this.
I noticed in the speeches made by members in the Liberal party that two of them, the hon. member for Mackenzie (Mr. Ferrie) and the minister were strongly opposed to the measure. I noticed that the hon. member for Kindersley (Mr. Larson) shifted from one foot to the other. He said he did not see much value in it and he did not see much disadvantage in the legislation. The hon. member for The Battlefords (Mr. Bater) really spoke about something else. That suggests to me that we do need farm storage.
The hon. member for The Battlefords said that there should be an interior elevator in his area. He makes that demand now mainly because there is no farm storage paid. If there were farm storage of some type that demand would not exist to the same extent in that area. I certainly would not oppose an interior elevator in his area if such were to be built. But I say the very fact that you have the hon. member asking for the expenditure of a large amount of money to build an interior elevator shows that there is a real problem that needs to be dealt with, and legislation such as this would be of great value to the western farmer.
The main argument of the minister is that this bill is merely for the rich farmer; that the poor will be contributing to the rich. That is a rather strange statement after the budget this government has brought down. Suddenly the members of the government take a great interest in the poor farmer who they say will have to pay storage to the rich farmer. Right today the farmers as a group are paying storage to the elevator companies, and the elevator companies are increasing their storage capacity. Therefore you are making the farmers as a group pay storage to the elevator companies, and the elevator companies are getting the cream in storage payments. As long as we have large quantities of grain that cannot be marketed we are going to have those elevator facilities continually expanded, and each year more and more money will be paid to the
2490	HOUSE OF
Canadian Wheat Board Act elevator companies to keep grain in storage in annexes, grain that stays there usually for months at a time.


Gladstone Mansfield Ferrie: May I ask a question? Would you have it all on the farm instead of in the elevators and in the annexes?


Hazen Robert Argue: As a farmer I would rather
have mine on the farm in my own bin, for which I would receive storage, than have the grain in large annexes paying somebody else storage on it.
It has been mentioned in this debate that mites get in the grain and so on and so forth. Perhaps the farmers in my area know how to store grain better than they do in other areas, but I doubt that. However, I do not know of a single farmer who has ever .lost a granary full of grain on his farm. I know farmers who have had their grain damaged; I do not know one who has lost a single bin of grain. Therefore this talk about mites and the danger of grain spoiling does not mean anything to me.
The hon. member for Mackenzie said, using himself as an example, "If I produced 10,000 bushels of wheat, then I would keep it all at home and I would get storage." Well, he might. There might be a few farmers who would do that, but they would be an insignificant percentage. I would rather see the hon. member for Mackenzie, if he were producing 10,000 bushels of wheat and wanted to keep it at home in order to get storage, keep it at home as a farmer and get that storage so that some of the little fellows would have a better opportunity early in the fall to deliver their grain. If the 10 per cent of farmers who pay income tax are going to keep a slightly higher quantity of grain at home, then certainly the smaller farmer will benefit by being able to haul his grain to the elevator at an earlier time.


Clarence Decatur Howe: He will have to pay for the
benefit, by paying storage charges to his neighbour.


Hazen Robert Argue: Oh, yes, and he pays for keeping it at home; don't ever doubt that, because he has obligations. He owes the implement companies and the banks. They do not say; "Now, because you cannot deliver your grain we are going to cancel your interest." It costs him money to keep the grain at home now. The argument was that this measure would require the poor farmer to bonus the rich. That is a fallacious argument. It is not true. In fact all the farmers are now being forced to bonus the elevator companies.


Gladstone Mansfield Ferrie: May I ask another question?
Is he going to get a bigger quota? The 

quotas are going to be the same. He is going to have only so many bushels to deliver, whether he is a big or small fellow. He cannot deliver any more than the quota.


Hazen Robert Argue: The hon. member for Mackenzie made his speech, and if he wanted to refer to all these points he could have done so then. Of course you are not going to have much different quotas. My point is that today a farmer cannot deliver his grain; he cannot deliver his 15-bushel quota even now at a great many points. If this legislation did result in some farmers, better off farmers, being able to store more of their grain than the smaller farmers, and also some of the less well off farmers, that is fine and dandy with me. That is preferable, as far as I am concerned, to the money being paid to elevator companies so they may go on increasing their storage facilities and getting increased amounts of money from the wheat board.
In regard to the quota, the wheat board can establish the quota, and raise it when practicable. It takes some months to establish a general quota across the west. If the board at any time is unable, or feels there is a danger that it may be unable, to get the required quantity of grain in position, then I say at that time farm storage should cease. I do not say it should be wiped out; but if the increase in the initial payment has amounted to 5 cents a bushel because of storage, then at that point the price should be pegged, and that additional 5 cents a bushel paid to any farmer who delivers his grain in the future.
The hon. member for Mackenzie (Mr. Ferrie) says he is surprised to see the hon. member for Selkirk (Mr. Bryce) supporting this measure. In my opinion the hon. member for Selkirk and the hon. member for Souris (Mr. Ross) have taken a sound position. They have shown that they are not interested solely in what may or may not happen in a given locality. They have supported the measure, I believe, because they feel, as I do, that it would be in the interests of the western producers as a whole.


Mr. While (Middlesex East):: Mr. Speaker, I was paired with the hon. member for Middlesex West (Mr. McCubbin). Had I voted, I would have supported the motion.


James Arthur Ross: I was paired with the right hon. member for Melville (Mr. Gardiner). Had I voted, I would have supported the motion.


Mr. Deputy Speaker:: The hour reserved for private and public bills having expired, at eight o'clock the house will resume consideration of the business being dealt with at five o'clock.
At six o'clock the house took recess.
Internal Security AFTER RECESS
The house resumed at eight o'clock.



INTERNAL SECURITY


Mr. Pierre Gauthier (Portneuf):: Mr. Speaker, I should like to ask for the unanimous consent of the house to direct a question to the Minister of Justice which I think is urgent. I have already spoken to the hon. member who had the floor in the budget debate and he has given me permission to ask for the unanimous consent of the house.


Mr. Deputy Speaker:: Has the hon. member the consent of the house to ask a question of the Minister of Justice at this time?


Some hon. Members:: Agreed.


Pierre Gauthier: I should like to know whether the minister has seen in today's Ottawa Journal a news story based upon a signed statement made by Mr. Pat Walsh to the newspaper L'Action Catholique in Quebec in which he refers to instructions, plans for sabotage and the like which Bruce Magnuson has brought from Moscow to Canada. Has the minister any comment to make at this time?


Stuart Sinclair Garson: I have seen the story in question, and needless to say information such as that contained in Mr. Walsh's statement is always, as a routine security precaution, carefully investigated and analysed. Beyond that I have really nothing to say, because I think it will be appreciated by hon. members that our interest in a matter such as Mr. Walsh's statement has raised is one of internal security for Canada which it would be unwise for the Royal Canadian Mounted Police or myself as minister to discuss publicly.



THE BUDGET


[Stage Direction]
The house resumed 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. Deputy Speaker:: The hon. member for Kootenay East.


Herbert Wilfred Herridge: Mr. Speaker, I am the hon.
member for Kootenay West.


Mr. Deputy Speaker:: I offer my apology to the hon. member for Kootenay West.
2492	HOUSE OF
The Budget-Mr. Herridge


John Lorne MacDougall: You are getting pretty particular.


Herbert Wilfred Herridge: Just before the debate was adjourned at five o'clock I had commended the minister for certain proposals in the budget which appear very fair to this group. I had commended him for listening to a succession of appeals with respect to certain matters that have been made by this group in recent years. I had criticized him for giving relief to the corporations of Canada to the extent of $120 million in one year as provided in the budget. I had suggested that if he had retained this $120 million and had saved $200 million by eliminating waste and extravagance in the defence department in the same proportion as suggested by the United States commission, which reported for that country that if waste and extravagance were eliminated in the United States defence program a reduction of 10 per cent in expenditure could be made with no loss of efficiency or security, the minister would then have had a total of $320 million with which to do something for the large number of forgotten people in this budget.
I should like to make this point before proceeding to indicate to the house the groups that have made pleas to the government and the house throughout the years. We are possibly experiencing the most prosperous period Canada has ever enjoyed. That was indicated by the speech of the Minister of Trade and Commerce (Mr. Howe) yesterday afternoon, and it is very clearly indicated in the white paper issued under the minister's authority which I received in the mail this morning. Its title is "Private and Public Investment in Canada, Outlook 1953". The opening sentences of the white paper are as follows:
The capital expenditure intentions of business, institutions and governments and of individuals for housing for 1953 involve an outlay of $5-4 billion. If this program is realized it will mean that capital expenditures in 1953 will be 6 per cent greater in value terms than the previous record of $5-1 billion accomplished in 1952.
My point is that we are experiencing continued and unusual prosperity, and if we are going to do anything for the people who have requested assistance from the government and parliament, when can we better do it than under present conditions? With the $320 million to which I have referred, which the government would have if it would take the action I have suggested, we could very well remove the means test from pensions for the blind. Such action is supported by the Canadian National Institute for the Blind, and by many other groups and organizations.
Only two days ago I received a letter from a constituent of mine who has been blind


since birth. He receives the blind pension of $40 a month. He has a small garden, grows a little fruit, keeps a few chickens, goes out in the woods and cuts and saws his own wood and cares for himself. He is an independent, very small subsistence farmer. He writes to me and says: "Why at my age in life should I be subjected periodically to investigation as to my financial resources and so on, when it is obvious to anyone that all I have is the $40 a month and the very small amount I can contribute toward my upkeep from my activities on my own acre or so"? Therefore I suggest, Mr. Speaker, that we could very well remove the means test from pensions for the blind.
I think we could have increased the monthly payments for old age security. The government could also have given consideration to the proposals of the Canadian Legion. No one in this house will say that the Canadian Legion makes irresponsible demands. No one will say that the Canadian Legion goes before the cabinet and asks for something that is not sound and is not necessary and is not urgently needed.
In that connection, Mr. Speaker, I just want to refer briefly to the presentation to the cabinet by the dominion officials of the Canadian Legion on November 12, 1952. Mr. Speaker, when the minister was drafting this budget, it would appear to me that he listened to the appeals of the Canadian Manufacturers Association, the Canadian Chamber of Commerce and big business, rather than to the appeals of the groups that have been forgotten as far as this budget is concerned. This brief, Mr. Speaker, gives in some detail the situation which the Legion finds in the country with respect to needy veterans. It makes certain recommendations.
The Legion recommends that allowances similar to those paid on behalf of the children of pensioners be granted children of war veterans' allowance recipients. It recommends that where an allowance is granted on behalf of an incapacitated child over the age of 21, this be continued on the death of the surviving parent; that the federal government initiate a policy for the children of deceased servicemen similar to that in force for single student veterans attending university or vocational training schools and receiving a monthly allowance under the rehabilitation act. The Legion recommends that veterans of world war I who served only in the United Kingdom be granted war veterans allowance.
I want to refer to these veterans particularly. Some of these veterans have been in Canada 30 or 35 years and served with the

British commonwealth of nations forces, but because they were not residing in Canada at the time they served in the first great war they are still denied the benefits of the War Veterans Allowance Act. Surely if we can, give $120 million to the corporations of this country we can consider this small group of men in Canada whose case has to date been by-passed by this government.
The Legion recommends that widows whose husbands had service which qualified them for war veterans allowance be granted the allowance if they are prevented from accepting remunerative employment for any reasonable cause. They further recommend that widows of allied ex-servicemen be granted war veterans allowance in cases where the husband died before completing 20 years' residence in Canada, provided that the widow herself has 20 years' residence and her husband was otherwise eligible. I am sure every veteran member of this house will agree with that proposal.
The Legion also recommends that Canadian veterans resident outside Canada but otherwise qualified be granted war veterans allowance. That is to serve the needs of certain veterans who have to live in California or other climates because of disabilities which prevent them from living their lives out in this country.
The Legion recommends that any definition of casual earnings be generous and broad and that any earnings, whether regular or not, be categorized as casual if they are small enough to be considered inconsequential in the light of existing wage levels. They also recommend that section 4 be amended so that either the veteran or his wife might be free to take employment and still enjoy the benefits of this section.
In that connection I know of the case of a veteran of the first world war with three daughters who were quite clever. The only way it was possible for them to attend university was for the mother to go out working. This veteran received war veterans allowance, but he made a mistake and failed to notify the board that the wife was earning extra money. She earned something over $1,000 and used every cent of it to pay for the education of those children at the university. This was discovered and the man, under the present regulations, must pay back the sum by monthly deductions.
I will say, in fairness to the officials of the board, that they are most sympathetic and give every consideration to these cases, but naturally they are there to give effect to the law and to the regulations.
The Budget-Mr. Herridge
The Legion recommends that perquisites be not considered as income under the War Veterans Allowance Act, and that unless fraud is established no recovery be made under section 19 of that act. They recommend that the ceilings on permissible income be increased to $1,200 a year for single men and $2,000 for those who are married.
I wonder if the minister and the cabinet gave consideration to the representations of the Canadian Legion and the needs of thousands of veterans of this country when they made a present of $120 million to the corporations of Canada.
I have on my desk, Mr. Speaker, briefs from the Canadian non-pensioned veterans' widows association, from the Silver Cross Women of Canada and from the Canadian Arthritis and Rheumatism Society. I am not suggesting we can do all that is proposed in these briefs, but surely we can do something more for these people who are suffering want and are in need in this country at this time.
I wonder if the minister gave consideration to the provision of assistance to those people who are unable to work and earn a living. I think the majority of members in this house believe that something should be done for those disabled who are not covered by legislation, those v/ho are unable to earn a living. What consideration has been given to increasing family allowances? I just mention these things and give these facts as illustrations of the groups of people who have been entirely forgotten according to the terms of this budget.
I have to hurry along now, Mr. Speaker, as I see that my time is passing quickly, but I want to refer briefly to housing and to one other matter that concerns the residents of my constituency. I enjoyed the speech by the hon. member for Spadina (Mr. Croll) yesterday. I think he made an excellent contribution to this debate when he spoke on housing.


Mr. Dickey:: Hear, hear.


Herbert Wilfred Herridge: I think all members will agree that the hon. member for Spadina always makes a thoughtful, logical and purposeful speech. I am not going to repeat what he said, but I want to say that, as we all know, housing is one of Canada's top social questions. The housing shortage is general from the Atlantic to the Pacific. It is general in my constituency and is of great concern to the people of Trail, Nelson, Rossland, Fruit-vale, Castlegar and various other points in my constituency. We are very pleased to know there is a bill coming before the house which will alleviate to some extent the shortage of housing in Canada. I intend to have

The Budget-Mr. Herridge more to say on the subject later, but I wonder if the minister thought of the housing shortage in Canada-
An hon. Mejnber: Oh, oh.


Herbert Wilfred Herridge: I am not going to notice the impertinent interjection of my friend as I only have a few minutes left; but I wonder if the minister thought of possible benefits of subsidized low rental housing for some of these workers who move from place to place and are living under very unsatisfactory conditions at present.
I wonder if he thought of the fruit industry in British Columbia; and before concluding I just want to say a word or two in that connection. The policy of the British Columbia fruit growers' association is to discuss their problems with the Canadian horticultural council, with members of the British Columbia federation of agriculture, with members of the Canadian Federation of Agriculture and with the federal and provincial governments. I am sure the Minister of Finance is fully aware of the problem that has been created for certain fruit growers, particularly for growers of soft fruits, owing to the change in financial policy and as a result of exchange regulations and the exchange situation with respect to the Canadian and United States dollars.
I know the Minister of Fisheries (Mr. Sinclair), who is a cabinet minister from British Columbia, has full knowledge of this subject, and I know he is doing all he can to make representations on behalf of the fruit industry of British Columbia. I know that he is willing to render every assistance that he can and co-operate with that industry to find some solution for the problem that faces the soft fruit industry in particular at this time.
The total apple production last year was such in Canada and the United States that the growers received fairly reasonable terms. However, the soft fruit producers experienced a very poor year for two reasons:	first, the
very heavy crop in the United States and in British Columbia; and second, because of the change in relationship of the Canadian and United States dollars.
The first inclination of many people is, naturally, to suggest higher tariffs, but I belong to a party which believes in lowering tariffs if possible and in stimulating world trade. Therefore, in view of our general approach to the world trading situation, our obligations to the United Nations, and the general demand for increasing the flow of trade between countries, I do not think we can properly ask for higher tariffs to remedy this situation.


In view of the fact that the soft fruit growers' difficulties are to some extent caused by action taken by the Minister of Finance, I suggested this government has in their case a particular responsibility for measures to remove this injustice. I further suggest that on that account a floor price for soft fruits should be established this year and that the government, in co-operation with the industry, should make every effort to increase markets for tree fruits at home and abroad.
I had intended, Mr. Speaker, to speak at somewhat great length on this subject. I shall return to it in a later debate, but I thought I ishould mention it on this occasion. When the Minister of Finance gave $120 million to the corporations of Canada, I wonder whether he thought of what should be done about a floor price for any section of the agricultural industry which needs stabilizing at this time, and for these people who need the assistance of a floor price.
In conclusion, Mr. Speaker, our point of view in this group is that while corporations and large industries in Canada reap the harvest provided by this government in this budget there are thousands who will continue to need help which, with fairer budgetary arrangements, we could so easily give.


Harry Oliver White: Mr. Speaker, as one who listened intently to the Minister of Finance (Mr. Abbott) deliver his budget address a week ago Thursday and heard the cheering, I came to the conclusion that there was more cheering than cheer in the budget.
I now want to refer to a couple of remarks made by the hon. member who has just spoken. One was with reference to the Agricultural Prices Support Act which, to all intents and purposes, has been thrown out the window, and the other was in reference to the brief we have received from the Canadian National Institute for the Blind. I wish to support their brief at this time.
Earlier this afternoon the hon. member for Saint John-Albert (Mr. Riley) complained rather bitterly and at some length about the plight of the maritimes. My one comment on that complaint would be that they are suffering from 17 years of Liberal misrule.
Some praise was passed out to the Minister of Trade and Commerce (Mr. Howe), who has returned from a tour of the South American countries. Every Canadian hopes that trade will be extended in every direction. I was a bit perturbed to hear that some money was going to be spent on Mexican ports, because I believe there are many ports along the great lakes, in the maritimes and on the Pacific coast that could stand a bit of improving and fixing also. When I think of the Ming Sung

ships and the $12 million which we had invested in them and which slipped away, I feel that our foreign investments so far have not turned out to be paying propositions so far as dividends are concerned but have been a matter mostly of hopes. I think we had better look after some of our own ports before we start to be good fellows for all the people around the world. By the way, Mexico did not participate in either of the two world wars; therefore I think they should be able to look after their own ports.
I suggest that no government in history has lost more markets for primary products of this country than has this government. It does not take a great deal of ability-and I have said this before in the house-to sell scarce goods for less than they are worth; and that is what was done all through the war years. But it does take ability to sell surplus goods for more than they are worth; and that is something I have not seen this government doing yet.
Just yesterday, I believe it was, in the other place one of the senators from the maritimes was referring to the loss of shipping out of the Atlantic seaboard ports. After all, that means loss of trade and loss of business; and the labouring people who work on the docks are seeing their jobs being taken by labourers in another country. That is something the hon. member for Saint John-Albert also referred to.
Before I go on to some remarks about the budget, may I say that on February 23 I addressed a question to the Minister of Agriculture (Mr. Gardiner) and I am going to read it. It is to be found at page 2293 of Hansard and reads as follows:
I wish to direct two questions to the Minister of Agriculture. Have instructions been issued to the government veterinarians not to take blood tests until March 2 of purebred cattle sold for delivery in the United States during the first week in March? Is the minister aware that such instructions will cause delay in delivery and financial loss to the livestock industry?
The next day the Minister of Agriculture replied. His reply may be found at page 2333 of Hansard. I am not going to quote the whole of his reply, but in part it reads as follows:
I have made inquiries and find that under date of February 20 instructions were issued to all district veterinarians that it was expected the embargo against the importation of cattle and livestock products into the United States from Canada would be removed on March 1 . . .
In other words, the instructions were just the apposite to that suggested by the hon. member, and the department had already taken action to see that there would be the minimum of delay in such movement so that there would be no financial loss to the livestock industry.
The Budget-Mr. H. O. White
Mr. Speaker, such is not the case. Here in my hand I have a telegram signed by one of the livestock producers in my county. He says:
Many March freshening cows have been sold for export March 1. Federal Department of Agriculture refuses to collect blood samples until lifting of embargo. This will cause much confusion among veterinarians and delay shipment some days-
This telegram was received at 3.32 p.m. on February 19. Within the next five minutes I called up the departmental officials and they got into quite an argument with me, saying that they were not going to take samples because they did not want to offend the Americans. I replied by saying that the Americans did not care whether or not they offended us when they shut off our dairy products, and they do not care whether or not they offend us when they bring in fresh fruit, fresh vegetables or what not. They do not wait for a week or two weeks. As soon as the day comes, they bring them in. I will name the gentleman to whom I spoke. It was Dr. Childs. He finally agreed to send out the instructions. On Tuesday, February 24, I received a telegram from the Middlesex Holstein association, signed by its president, and reading as follows:
Middlesex Holstein association request permission from government for T.B. kits to be released so Holstein cattle can be tested. Ready for shiD-ment to United States.
Then the next day I had a telegram from the same gentleman saying that the kits had been released on the 24th. This telegram was signed on the 25th, but the kits were released on the 24th. This morning I had a letter from the first gentleman who asked me to take action to see that testing was commenced immediately and not to wait until March 1. He says:
Would like to pass the following on to you About two weeks ago the Department of Agriculture, London, advised a neighbour that nothing would be done until the embargo was lifted On February 19 Dr. Harrison of Aylmer' was refused blood kits and forms. He was informed that instructions from the department were to the effect that no blood test would be taken until the embargo was lifted.
The minister turned right around and left the impression that my information to the house that day was not correct. Just because the minister wants to play politics, I will play the game myself.


Mr.   Mc@: Read the whole of his answer in Hansard.


Harry Oliver White: I read the whole thing.


Mr.   Mc@: I was following it as you read it, and there was quite a bit left out.
The Budget-Mr. H. O. White


Harry Oliver White: No, there was not.


Mr. Mcllraith:: Yes, there is.


Harry Oliver White: No, there was not.


George James McIlraith: Yes, there is.


John Sylvester Aloysius Sinnott: You can't get away with that.


Harry Oliver White: What did I leave out?


George James McIlraith: It will be found on page 2333 of Hansard.


Harry Oliver White: Oh, certainly.
I thought you meant the telegram. You want to take up a lot of my time.


George James McIlraith: No.


Harry Oliver White: It doesn't mean a thing.


George James McIlraith: Read the whole answer; the answer is fairly good.


Harry Oliver White: Good politically.


Irvin William Studer: There won't be any politics in that answer.


George James McIlraith: There is much more to the answer than what was read.


Harry Oliver White: I will read it to you, then. Mr. Speaker, the hon. gentleman is trying to take up my time. You and he and all the rest of the members can read it.


John Sylvester Aloysius Sinnott: Put it on Hansard, and it will not take up your time.


Mr. Deputy Speaker:: Order.


Harry Oliver White: Quite some time ago, in the twentieth parliament, I referred to the fact that if we wanted to build up a strong western nation under NATO we would have to build up freer trade; that unless we had free trade between those nations we could not expect them as allies to stick together because of the backward and forward movements of trade and the desire to gain advantages. I noticed that last week a speech was made in the other place referring to that same question. Because we live in a world that is suffering from restrictions of trade, I want to put forward the idea that we must take greater steps than we have in the past to free the channels of trade.
It was interesting to note that some six months ago the Detroit board of commerce, of all people, came out for world free trade. Since that time Henry Ford II, president of Ford Motor Company, has on occasion advocated the same thing.

The Budget-Mr. H. O. White
other individual holding of the stock approaches 18 per cent, the employees as a group will eventually possess the largest single unit of equity ownership and voting control of this corporation.
It is difficult to conceive any plan or procedure which would do more to underwrite future employer-employee harmony and prosperity than the deferred proat-sharing plan which this enlightened American corporation has installed.
The brief sets out the philosophy of profitsharing in this way:
An employer installs a profit-sharing plan because he believes his shareholders will receive greater dividends as the result of the increased productivity of his employees and the increased stability of his labour force.
An employee accepts employment with and continues in the employment of an employer having a profit-sharing plan became he believes his productivity will be rewarded and because he enjoys the feeling of direct participation in the success or failure of an enterprise-a feeling otherwise enjoyed only by shareholders and management.
The basic goal of a profit-sharing plan is to create a common interest between the employees and the shareholders. Speaking in the broad and long-term sense, if this common interest cannot be created, we can only look forward to increasing industrial strife as the battle over the cutting up of the economic pie continues. We believe the inevitable long-term result of industrial strife is socialism as the only higher authority, government, is likely to be called upon with increasing frequency to intervene.
Such situations have already arisen.
If employees' remuneration is to be forever tied to uniform negotiated wage levels; if, unlike doctors, lawyers, farmers and other individual entrepreneurs, their remuneration cannot be directly related to their productivity; if they are not allowed to see the relationship between what they produce and what they earn; it is only natural that they will lose interest in a system which is supposed to be founded upon rewarding individual enterprise.
The brief then goes on to point out the difference between an immediate and deferred profit-sharing plan, and I quote:
There is nothing in present legislation to prevent an employer from installing an immediate profitsharing plan. Such a plan distributes cash on an annual or more frequent basis to employees in accordance with the employer's profits. The employer can write off such profit-sharing payments and the employees pay income tax on such payments just as though they were wages.
And again:
The concept of a deferred profit-sharing plan is quite different. The employee must be paid a good going wage, sufficient to maintain him on the standard of living considered reasonable in view of the type of work he is doing. Employer's profitsharing contributions, although allocated to the employee contingently, are made available only when they are really needed; when the employee dies, when he leaves after a certain number of years of service or when he retires.
And again:
Section 71A of the present Income Tax Act specifically requires an employee to pay income tax currently on employer contributions contingently allocated to his account in the trust fund. Since a deferred profit-sharing plan will almost always


incorporate a vesting schedule which withholds any right to the employer's accumulated profitsharing contributions until the employee leaves at retirement or terminates after completing a certain number of years of service, section 71A not only requires the employee to pay tax currently on income to which he has no immediate right, but also requires him to pay tax on income which he himself in many cases will never receive. Obviously it is difficult to set up a deferred profitsharing plan under such unfavourable legislation.
And finally:
After carefully examining all other possible solutions, we have come to the conclusion that the only' practical solution to the tax problem of deferred profit-sharing plans is to amend section 71A of the Income Tax Act in such a manner that:
(a)	The employer's deferred profit-sharing contribution will be allowed as an operating expense, as- it now is.
(b)	The employer's deferred profit-sharing contribution will not be subject to tax in the employee's hands unless and until he receives it.
(c)	The earnings of the trust fund must not be taxed in the hands of the trust.
(e) The terms of each deferred profit-sharing plan would be subject to initial and continuing approval by the Department of National Revenue, just as pension plans now are.
I was glad last June when the Minister of Labour (Mr. Gregg) complimented me upon the remarks I had made at that time in connection with profit-sharing plans. I had said that I hoped industry, labour and the government would do all they possibly could to encourage the setting up of this type of arrangement. I had the opportunity to visit some industries in London, Ontario, which have set up this type of plan and they told me it was working most satisfactorily.
I have mentioned the remarks of the right hon. Minister of Agriculture (Mr. Gardiner) and I am just going to say what several hon. members have said already, that there seems to be a possibility of an election. I suppose that possibility is not too remote. I want to say to members of the house and to all those who read Hansard:	Whom are you
going to vote for?


An hon. Member:: A Liberal.


Harry Oliver White: Looking across at the cabinet I realize that possibly some members are going to the bench; others are probably going to retire, while some more will most likely be appointed to the Senate. We have heard that the Prime Minister (Mr. St. Laurent) would like to retire but that his followers have suggested that they would prefer that he lead them through another election. I can well understand their wanting him to do that. The Minister of Finance (Mr. Abbott) has indicated fairly clearly that this is the last budget he will bring down. Then in any election there are always those who do not return.


An hon. Member:: There will be no one left with whom to make a cabinet.


Mr. While (Middlesex Easl):: That is just what I was going to say.


An hon. Member:: Nobody on that side either.


George Stanley White: I say to the
house, to the readers of Hansard and the public generally: Whom are you going to vote for?


Irvin William Studer: There is a lot of good material over here.


Mr. Slick:: We would like to know what the hon. member is going to do. Is he going to retire?


George Stanley White: Not unless I have to. Let me conclude by saying that the farmer these days must be a pretty smart man. He has to weed out from the advice given to him by governments just what is going to do him the least harm.


Mr. Daniel Mclvor (Fori William):: Mr. Speaker, I must admit that I enjoy speaking at this hour of night, though I have never done it before because of the character and ability of hon. members who stay here on Friday nights. I want to repeat what the Conservatives have said, with perhaps a slight addition. This is a bad budget. It is bad for the Conservatives. It is bad for the big people. Therefore it must be good for the little people. When the minister completed his budget I considered it to be a good election budget. Why shouldn't it be?
This budget is good for three reasons. It is good because of the way it has dealt with the past. It is good because of the way it "s dealing with the present. It is certainly good for the way it intends to deal with the future. What has it done for the past? I can remember when certain groups in Canada were predicting a depression after the second world war, just as one had occurred after the first world war. That depression has not started yet. I agree with the Leader of the Opposition (Mr. Drew) that there is no depression in sight, and that this country will have a population of 30 million before very long. The Leader of the Opposition does say some good things with which I agree. Because we are going to have no depression in the future, there is no reason to make a change.
This budget is good because of the way in which it has taken care of the war debt. I think the minister has tackled this problem very well. In the words of a heavy taxpayer who is known to me very well, the hon. member for Dufferin-Simcoe (Mr. Rowe), the Minister of Finance (Mr. Abbott) has not cut his taxes but he has cut the national debt. I think in doing that the minister
The Budget-Mr. Mclvor showed good sense. A reduction of $2-2 billion in the national debt represents a lot of money. I find it difficult to imagine how much a million dollars is because I have never had that much in my hands or in my possession, and I do not expect I ever shall. When it can be shown that $63 million is the amount of the reduction in our interest burden every year I think it will be realized that this is a good budget in the way it has dealt with the past.
An individual should pay his debts. Not long ago I was talking to a doctor who told me that he could retire to Florida if 40 per cent of the money owing him were paid. He agreed that a man should pay his debts if he could. Therefore a country should pay its debts if possible.
What effect has this paying off of the national debt had on others? It has had two effects. First of all, it lowered our debt and the interest charges thereon. Second, it advertised Canada all over the world, and I think you will admit that we have not enough people selling Canada today to the world. We are the greatest country on earth. Notwithstanding what has been said, we have lower tax bills than the United States, Great Britain, Australia or New Zealand. Canada is the greatest trading country for its size in the world. There is nothing like it, and I was not a bit surprised to observe the tense interest that was shown in the report made by the Minister of Trade and Commerce (Mr. Howe). Of course he did not polish it off with stories and incidents. He stuck to facts, and his speech will be long remembered.
Therefore I say that this is a good budget for everybody in the country. It is not a bad budget for the big man or the small man. There are those who say that some help has been given corporations, but who gets part of that help? Not all the money in corporations comes from rich people. You and I know that hundreds of people have small holdings in corporations. Who is it that gets the benefit? It is the man who makes the corporation live, the toiler, the artisan, the labourer. I was certainly greatly pleased to hear the hon. member who just sat down say, putting it in my own words, that the hope of labour is to share in profits. The hon. member for Dufferin-Simcoe (Mr. Rowe) will forgive me for quoting him so often but I admire him in a way and some of the things he and his company have done for Fort William. The men now share in the profits in a way.
We have some business concerns in Fort William that do share the profits with their workers after their salaries are paid. They are a credit to the place. That is the cure
2500	HOUSE OF
The Budget-Mr. Mclvor for strikes. I do not want to see strikes eliminated until something better is put in their place. Strikes have done some good and they have done some harm. They are like an operation on the human body. They are an eruption, and it takes a while to cure them. I am sorry to say that we have a strike in Fort William today that has not yet been settled. I refer to the carpenters' strike. Many of the contractors have settled with their men, but there is one contractor who has not settled yet. I do not know what his background is or why he has not settled. Perhaps 1 will know better tomorrow why the contractor for the Central Mortgage and Housing Company will not settle with the union. I expect he will have to settle with the union before very long; and I regret this difficulty very much.
I think the budget is a good budget in dealing with the past. I would say it is also a good budget in dealing with the present. It is a good budget for the common people in the present. My first point is the tax exemption for the ingredients that go into bread. Not very long ago I saw a picture put out by the bakers showing that they are trying to get the vitamins back into bread again. One medical expert wrote me and said that white bread is not worth eating because the vitamins have been taken out of it. Now the vitamins are going back into the bread again, and the baking companies are doing it. The ingredients that are to put back the vitamins in bread are to be tax exempt. Bread is eaten by everybody; therefore that is a good move at this time.
There are many people who say that the reduction in the tax on cigarettes does not amount to very much, but I notice that there have been some very favourable comments. This again is something that concerns everybody. It is not only the rich and wealthy who smoke cigarettes. If you go up to the cafeteria you will find people with a cup of coffee or a bottle of pop and a cigarette; and I know the cafeteria entertains the aristocracy of the House of Commons and the Senate. I know they all enjoy a cigarette, and they like them much more now because they can save 4 cents a package. I do not save anything because I know cigarettes would not do me any good. They would not make my head any clearer, my lungs any better, my heart any steadier or my stomach any more fit. Therefore I do not want cigarettes.
Another comment I should like to make having to do with the present concerns the deduction for medical expenses. This does not only concern rich people. It concerns


everybody, because at one time or another most people have a pain, and the increase in the allowable deduction for medical expenses is something that concerns the present. I remember hearing from many sources in the house remarks about the radio licence. It did not amount to very much before the budget was brought down, and now that it has been done away with I would say that it is a good thing because it touches so many people. I would say that the budget is a good budget for the present in its elimination of this nuisance tax.
Another tax change that I appreciated very .much more was the elimination of the tax on books and newsprint. I should like to have seen all taxes on books and newsprint removed. There should be no tax of any description on reading matter that is worth reading. There are those who have been telling us that the farmers are having a terrible time, that they are terribly hard up, that they were never so hard up. Perhaps they did not go so far as that but anyway, according to them, they are having a terrible time making ends meet. That is not my experience, but I do remember the time when I could have bought eggs for 10 cents a dozen 36 miles south of Fort William. However, I gave the lady 15 cents a dozen. They wanted to get cash.


An hon. Member:: Very generous.


Daniel (Dan) McIvor: 
William Earl Rowe: Hear, hear.


Daniel (Dan) McIvor: -but if we have any Scotsmen here they will remind us that many a little makes a muckle.
Now, income tax has been reduced, but the opposition says this does not touch the small man. Well, if 40 per cent of the wage earners do not pay income tax you cannot expect the Minister of Finance to help those people, but the government does help them in other ways. The government does not wait for the budget as a cure-all for the needs of the people. Several times in this debate we have been reminded of the benefit to the wage earner of unemployment insurance; and it is in good standing today. The waiting time has been reduced from eight days to five and I expect it to be further reduced because the assets are growing. That is to the credit of the past minister of labour, the present Minister of Labour (Mr. Gregg) and to Mr. MacNamara, who came into this department with the former minister when labour was in a bad state. He-showed his ability and brain power and, of course, I was a bit partial to him because he came from Winnipeg and he had done well there. The income tax reduction is welcome, and I do not think that there are any of the opposition who do not welcome it. There are small people, too, who pay income tax.
I have dealt with the past and with the present, but what about the future? Well, I think the future looks pretty good. It looks bright; and the Leader of the Opposition will agree with me when I say there is a great future ahead for Canada. Why? Not only because we have an honest and efficient federal government, but because we have provincial governments of different types which are trying to serve the country efficiently and well. The outlook is bright, and I would name a few of the things that make me feel that conditions will be better in the future.
First, we have entered a new age, the age of atomic energy. Nobody knows how far it is going in the future, but you have heard often in this house of the benefits that have come to those who are afflicted with cancer. When a man or woman had cancer it was considered almost hopeless; but we have now heard of so many cases that have been helped by the cobalt bomb.
Looking at the future, what will the St. Lawrence waterway do for us? We know that it will do something for the lakehead, and it will do a lot for Canada. It will do a lot for Ontario, and there is no doubt in our
The Budget-Mr. Mclvor minds but that the waterway is going to be developed before very long.
Look at the fact that the government in the old land, the British government, sent the chancellor of the exchequer here to find out the best ways and places in which to invest British money. Why? Because there is no doubt about it that investment in Canada today is safe.
According to the Minister of Trade and Commerce (Mr. Howe) trade is going to extend to the south. It cannot help it. The markets are there, and if we have goods to sell it is up to Canada to advertise and sell those goods.
There is one other outstanding reason why I think the future is going to be great. While I am not a prophet, I would say that the war in Korea is not going to last many years. I think it will end; but there are some people who say that when it does end the bottom will drop out of everything. Well, the bottom did not drop out of everything after the second world war because the Minister of Trade and Commerce was able to manipulate and manage things with businessmen all over Canada so that instead of a depression industry picked up; and you all know what happened in Ontario and Quebec.
In my own way of looking at it you are not going to have peace on earth by preparation for war only. You will only have lasting peace when the people of Russia, China, Britain, Canada and the United States follow the teaching of the Prince of Peace and practise it in the -way I know some of you practise it.
There are one or two other things I would like to say. I congratulate you, Mr. Speaker, the former Speaker and the Minister of Public Works (Mr. Fournier) on the greatly improved acoustics we now have in this chamber. It is a fine thing for the house, for the press gallery and for the public galleries, but there is one weakness in it. Why is it that I can hear a man in the far corner very well but I cannot even hear the Prime Minister (Mr. St. Laurent) and those who are close to me? I cannot hear him half as well as I could before. I heard him then distinctly enough, but I cannot hear him now. I understand that situation is going to be remedied, and if so it will be a fine thing.
I would like to see the Minister of Finance and the government do two things. I would like to see them grant pensions for the incapacitated men and women who cannot earn a dollar, people who are loved by their own fathers and mothers and other folks but who cannot earn money. It is one of the greatest needs in Canada today and whether I am in this house or whether I am not, I am
2502	HOUSE OF
The Budget-Mr. Gagnon going to fight for that until I close my eyes and sleep. Then I think the means test should be removed in the case of pensions for the blind, because they are in a far worse state than men in this house who get old age pensions. Old age pensioners in the majority are not nearly as badly off as are the blind, and the means test for them should be removed.
Some of you might like to buy or build a home in Fort William, and there you will find bright prospects. I belonged to and was foreman of a fire brigade at one time, and I appreciate the services of a good fire brigade. In Fort William we have a brigade that is second to none. They have three-way radio and up-to-date equipment. The firemen are mostly young, sober, well trained and efficient. The result is that insurance rates in Fort William have dropped. Therefore if anyone thinks of retiring and coming to Fort William he will have protection of the right kind, and one of the finest water systems in the world.
Thank you, Mr. Speaker, for being so patient and not calling me to order.
(Translation):


Mr. Paul E. Gagnon (Chicoutimi):: Mr. Speaker, this year again the workers of the Chicoutimi district will not benefit from any important reduction in the taxation burden.
The very slight reduction in income tax will really be felt only next year and even then it will not be very noticeable. The elimination of stamps on cheques and the deduction concerning dividends benefit mainly rich people and large business concerns.
The Minister of Finance (Mr. Abbott) who, seemingly, endeavoured to please everyone apparently brought disappointment to many people.
We must regret that the government did not deem advisable to do more to protect the wage earner, the small wage earners, the little fellow, who have to face the problems of life; we regret that they refused to raise exemptions to $3,000 for married people and to $1,500 for single persons, as has been often requested.
We must also deplore the way the farmers are being neglected and forgotten. The wholesale price index of farm products has fallen by nearly 20 per cent, and that of machinery and labour has increased or has remained at a very high level.
The government should show more consideration for the working classes and be less concerned about big corporations. Agricultural and industrial workers deserve


special treatment and it must be remembered from time to time that on their own prosperity rests the prosperity of the whole nation.
As for the sympathy of the minister for the provincial authorities, deprived by him of their main source of revenue, it may show his good nature but, unfortunately, it does not change the situation.
The blunt fact is that out of every tax dollar paid by the citizen of Quebec, the government in Ottawa takes approximately 77 cents, the provincial treasury 13 cents, and the municipalities 10 cents.
Last December, I stated in this house that as a result of the fiscal agreements concluded between the other provinces and the central government, Quebec now found itself isolated. I added that Quebec should not be blamed for this state of affairs, but that the responsible party was the Ottawa government who, with the millions of dollars exacted from the French Canadians, were now proceeding to offer to buy their rights from them.
But the present day French Canadians, fortunately, just as those of bygone, days, are much too proud to be the servants of Ottawa and to live on its subsidies. The part of beggars in confederation is not made for us.
The struggle for the last remnants of provincial autonomy, which is so gallantly being waged by the premier of Quebec, is the very same struggle begun by the great Liberal leaders of our race: Laurier, Mercier, Gouin and Taschereau.
Sir Wilfrid Laurier said in 1883:
I repeat: every time a particular province is divested in this parliament (Ottawa) of a right it exercises, insignificant though it may be, it is one more step towards legislative union.
On November 24, 1871, he said:
It is an historic fact that the federative system was adopted solely in order to maintain Quebec in its exceptional and unique position on the American continent.
The interference, the impingement of the Ottawa government in matters coming under the jurisdiction of the provinces is not of recent origin. We must admit, however, that this intrusion has increased in the course of the last few years, to such an extent that it has now become a very acute problem. We are therefore justified in protesting against the violations of the clauses of the B.N.A. Act by the federal authorities, and in denouncing the systematic infringements of the promoters of centralization in spheres which concern the provinces only. Allow me to quote, in support of these arguments, a few statements showing the merits of our claims and the soundness of our fears.

Mr. Mercier, in a speech he made before the legislative assembly on April 7, 1884, said:
I have the honour to move that an address be presented to His Honour the Lieutenant Governor asking him to kindly transmit to His Excellency the Governor General the following resolutions:
1.	That the British North America Act, 1867, was intended by its authors to sanction the autonomy of the provinces of the confederation, and that this act has definitely settled the respective powers of the federal parliament and the provincial legislatures;
2.	That the frequent encroachments of the federal parliament upon the prerogatives of the provinces are a constant menace for the provinces; and that this house, rightly alarmed at such encroachments, believes it is duty bound to express emphatically its resolve to uphold the provincial rights and to proclaim loudly the autonomy which it enjoys and which has been sanctioned by the federal act.
When confronted with such dangers as those which threaten us at present, and when faced with a plot directed against the privileges and the independence of the provinces, the party man vanishes, to be replaced by the citizen, who sets the interests of his province above his personal success and for whom his country is more important than his party.
The provinces existed before the dominion became an entity; it is the provinces who granted the dominion its powers. The provinces had responsible government in 1867; they had their legislature, their laws and that measure of autonomy which a colony is allowed. In the interest of the country as a whole, the provinces delegated part of their powers; that part they did not delegate, they withheld and it is still theirs. Within the sphere of their prerogatives, they exercise sovereign power and any infringement upon this sovereignty is a breach of the federal pact.
"Legislative powers are rather ill-defined in the federal act, and the vagueness in the terms of sections 91 and 92 is causing a good many difficulties. However, as far as I am concerned, I am rather inclined,-
says Mr. Mercier further,
-to accept the doctrines set forth in this respect by the Hon. T. J. J. Loranger. They are clear and satisfactory. I shall quote them, as they are found on pages XXV and XXVI of the first report of the commission for the revision of provincial statutes:
1.	The confederation of the British provinces was the result of a pact made by the provinces and the imperial parliament, which when enacting the North America Act, only ratified it.
2.	The provinces entered into the federal union with their corporative identity, their former constitutions and all their legislative powers, some of which they agreed to surrender to the federal parliament, to be used in their common interest for general purposes, while keeping the remainder to be exercised by their legislators, acting within their provincial sphere, and according to their former constitution subject to certain changes in form established by the federal pact.
3.	Far from having been granted to them by the federal government, the powers of the provinces which have been withheld from this government are the remainder of their former powers and far from having been set up by this government the federal power proceeds from their association and agreement and has been created by them.
4.	Parliament has no other legislative powers than those which the provinces have vested in it and which are recognized by section 91 of the
The Budget-Mr. Gagnon British North America Act which granted it only the powers outlined therein or those of a similar nature, ejusdem generis.
5.	Apart from the powers conferred under section 91 and section 92, the legislatures have legislative jurisdiction extending to all matters of local or private interest; all cases not included fall under the jurisdiction of the provinces when they concern the local or private interests of a single province or of a few provinces only. Matters which concern all the provinces come within the jurisdiction of parliament.
6.	When it is not clear whether a matter concerns all or only a few of the provinces, that is whether such a matter is of national or local interest, such doubt must be solved in favour of the provinces who kept all the powers not conferred on parliament.
7.	In their respective fields of jurisdiction, there is no superiority of parliament over the provinces, and, although subject to imperial sovereignty, those provinces are sovereign in their own field and are absolutely equal.
That is definitely what the fathers of confederation had in mind, and I quote the words of some of them: Matters of general interest will be under the control of the central or federal parliament, as was established at the Quebec conference, but all matters of local interest, everything which relates to the affairs and rights of the different sections of our confederation will remain under the control of the local legislatures. (Sir Hector Langevin)
Local legislatures will hold control over all local undertakings; that is an important point and one of the main advantages of the existence of a federal union and of local parliaments, because in that way each province will have the power and the means to develop its own resources and to work unfettered towards its individual progress. (Sir John A. Macdonald)
Nobody can hold any doubt as to the fact that our autonomy is guaranteed by the constitution; everybody will admit, however, that our autonomy is threatened by our central government.
One need but look at the present situation to be convinced that systematic efforts are being made in high places to deprive the provinces of their rights.
The province of Quebec has been the cradle of our great country. Will that province, which during a memorable period of our history brought forth those heroes who gave their lives on the scaffold in order to defend our political rights and our national freedom, bear without flinching the shameful spoliations of which it is the victim?
Mr. Alexandre Taschereau, Sir Lamer Gouin's successor-


Pierre Gauthier: A great man!


Paul-Edmond Gagnon: -upheld the same views on autonomy. The federal government was offering subsidies in exchange of rights which it purported to monopolize. Alexandre Taschereau, the new premier, made a very formal declaration of principle when he addressed the Quebec Reform Club on November 15, 1920. Mr. Ernest Lapointe supported him in these words:
As the honourable premier said a few minutes ago, Ottawa is more or less trying to buy us. Many citizens in this province do not seem to protest loudly enough against such a trap. We, in the province of Quebec, must not lose hold of even a small portion of our autonomy and our rights.
2504	HOUSE OF
The Budget-Mr. Gagnon


Mr. Gauthier (Porineuf):: What year was that?


Paul-Edmond Gagnon: November 15, 1920, at the Quebec Reform Club, a club my hon. friend knows well.
Alexandre Taschereau resisted the King government, although it was of the same political colour, but he sided with the Ontario government even though it was Conservative. Ferguson, the premier of Ontario, maintained regulation XVII and was said to be ill-disposed towards French Canadians. Nevertheless, Taschereau found it permissible and even necessary to side with Ferguson and later with Henry, just as Merrier had sided with Mowat and as Gouin had sided with Whitney, for the defence of provincial autonomy.
The premiers who have guided the destinies of my province since confederation were not the only ones to foresee the danger of centralization. The premier of Nova Scotia, Mr. Angus L. Macdonald, made in 1947, before the members of the Halifax junior board of trade, a statement which should be underlined. To appraise fully his statement, it must be recalled that Mr. Macdonald, who is now the Liberal premier of his province, is a former member of the Mackenzie King federal cabinet.
(Text):
Can anyone deny that, if most of the revenues which the provinces are to enjoy are to be paid to them by the dominion, the time may not come- indeed, it is not likely that the time is sure to come-when the dominion will begin to say what use the provinces shall make of these revenues? When that day comes, there will be an end to provincial autonomy. This is not a matter of the provinces endeavouring to magnify their own importance. It is a case of believing that whatever the conditions may be in Canada 50 to 100 years hence, the time has not yet come when it is in the interest of the people of this country to dispense with provincial governments.
If they are to continue, they must be given a certain measure of freedom. They must be given certain taxation fields which are theirs and theirs alone. I disagree here with statements made by dominion authorities to the effect that there is nothing in their proposals to interfere with provincial autonomy.
We are told by them that financial independence for the provinces means provincial autonomy. But is it independence for the provinces when so much of their revenue is to come from Ottawa? Furthermore, is it exclusively for the dominion to say what is or is not genuine provincial autonomy? Are the provinces to have no voice in the matter?
(Translation):
And, on September 9, 1948, at the annual dinner of the Canadian Good Roads Association in Digby, the same Mr. Macdonald said: (Text):
And then we have problems of jurisdiction as between the dominion and the provinces. We live here under a federal system, as they do in the


United States. We are not a unitary state, we are not a single state with a single government, as is the case of Great Britain. We are a federation, and we are that by our own choice, made in 1867. There were people at that time of confederation who would have liked to see the unitary system of government adopted in Canada, one government for all of Canada-one central government. The idea had to be abandoned and what we have in Canada today is not one government but ten governments (now eleven). We have the federal or central government at Ottawa dealing with certain matters that are definitely assigned to it by our constitution-such great matters as defence, railways, postal services, trade and commerce are confined to the central government. But I would like this to be remembered-we have nine provincial governments (now ten) in Canada, also dealing with matters that are assigned to them by the constitution, and some of these are of great importance. They are education, property and civil rights, public welfare and charities, the construction of roads and many other things that touch people intimately and all matters of provincial government concern. It is a mistake to say that this country is governed entirely from Ottawa. It is governed in some respects from there, in others from the provincial capitals.
There are people in Canada today who say that federalism is out of date and that things would be simpler if we had one government for the entire country.
To them I say this-whatever conditions may be 100 years from now in Canada, my judgment is that this country, at this time, is not ready for the unitary system. The provinces were here before the Dominion of Canada. The provinces created the Dominion of Canada, and in a country of this size, with its various races, its differences of language, its varying economic and geographic conditions, it seems to me that only by a true federation can the unity of the country be maintained.
(Translation):
If autonomy is valuable to each of the provinces of our kingdom, to ours it is sacred. We must guard against those whom the magazine Relations called, in its issue of September, 1946, the unrepentant centralizers:
There are unrepentant centralizers, anxious to extend more and more the powers of the federal government over every field, at the expense of the provinces. They miss no opportunity to promote their cause, being well versed in the art of multiplying facts and measures favourable to their objective. They are, on the other hand, in an admirable position to do it. Consequently, the provinces demand that their taxation rights, surrendered to Ottawa for the duration of the war, be handed back to them: the latter refuses, pretexting liabilities assumed with full knowledge of the facts, and which were bound to mobilize all the resources of the country, including those of the provinces. In like manner, the government on two occasions put a motion through to amend the constitution, without asking the consent of the provinces which were parties to the pact of 1867, or without even consulting them.
The very same centralizing spirit leads to the monopoly of the air waves through the agency of the C.B.C. This agency is monopolizing more and more channels and strangling private broadcasting. The government pays no heed to the justified complaints of public opinion and of provincial governments. And how many attempts there have been to interfere even in education, that field which is so particularly reserved to the provinces! Though

there is no open violation of provincial rights, whose interpretation is narrowed down as much as possible, there is a constant attempt to praise the advantage of federal subsidies, the necessity of action from Ottawa so that every Canadian may receive the same advantages as far as education is concerned, to unify and fortify Canadian spirit. There are more and more attempts made all the time to bring the physical training of our youth under federal jurisdiction, to train young people of all ages through cadet corps maintained even after the war, through mass education by the national film board.
Some measures, acceptable intrinsically, carry about them an aura of suspicion because of the centralizing tendencies of the people in Ottawa. For instance the Foreign Exchange Control Act might well become an instrument of political pressure and vexation against the provinces which have to obtain permission from the federal government before negotiating a loan on foreign markets.
Shall we have to repeat it again? What the French Canadians are defending, against the centralizers in particular, is not conquered territories or political or financial ambitions. It is values which belong to them by all rights, religious and cultural values, which make up the precious heritage of French Canada. It is well known that "the strength which gives drive and unity to French Canadian life" is "the Roman Catholic religion", to use the words of a shrewd observer of the French Canadian soul. These values are threatened by enemies from the outside-not to mention the ones inside, who are perhaps even more dangerous-whose plans would benefit from centralization.
Moreover, in defending their rights and heritage, the French Canadians have reason to believe that they are working in the best interests of Canada as a whole. If this is nationalism carried to extremes, we admit our guilt without repentance. History will show some day that the real enemies of a unified and prosperous Canada were not the French Canadians.
The Rural Co-operator on March 8, 1949, wrote:
(Text):
The fear of the people of Quebec that the dominion parliament might become too powerful and rub out the minority rights of French-speaking Canadians is understandable. French language Canadians are in a minority in the dominion parliament, but they are in a majority in the Quebec legislature. Therefore they rely on the provincial legislature to protect their rights of language.
(Translation):
George Brown, Sir John Macdonald, Sir Charles Tupper, in turn, have stated:
-that without the consent of Lower Canada, confederation could not have taken place.
I cannot believe that the authors of the pact of 1867 wanted to deceive us; I maintain that they had no intention of destroying the provincial governments, and that the federal government sets this pact of honour at defiance when it exacts from the people, as it does today, nearly 80 per cent of all taxes.
Not only did the fathers of confederation intend that direct taxation should belong only to the provincial administrations, but they said so and made promises to that effect.
The Budget-Mr. Gagnon Alexander Galt, minister of finance at the time of the Cartier-Macdonald government, noted that the fiscal problem had been solved-
-by transferring to the federal government all major income sources, by placing at its disposal, with only one exception, that of direct taxation, all the means through which the industry of the people can be made to contribute to the needs of the state. As a matter of fact (I quote Le Devoir of May 4, 1946), the parliamentary debates of 1867 show without a shadow of doubt that neither the federal government nor the provinces wanted direct taxation; it was, in effect, extremely unpopular and it was left to the provinces, under the pretence that it would enable them to curb their expenditures wisely.
Let us give back to the provinces the revenue sources arising from direct taxation; Quebec will then no longer need to depend on Ottawa's charities which, in fact, are but mere restitutions.
It is what we are asking for, it is the very thing which is demanded by an overwhelming majority of the people of Quebec. The chamber of commerce recently submitted a brief which shows how dangerous the dominion government's centralizing policy may be; that brief expresses the opinion of the people of my province, and in its issue of November 28, 1952, the Montreal Gazette stated:
(Text):
Anyone who attempts to diminish the fears in this province about centralization would do well to remember this delegation and its memorandum. La Chambre de Commerce de la Province de Quebec was not playing politics. It was expressing, with anxiety, Quebec's point of view.
It has been one of the chief aims of Canadian statesmanship in times past to give that point of view the fullest understanding. Quebec's anxiety on this issue should now be a matter of concern for all Canada, just because it is a matter of such concern for Quebec.
Anyone who attempts to brush the whole matter aside as "mere politics" had best remember that it is the memorandum of the chambre de commerce that says: Never in the history of the Canadian confederation have our rights to provincial autonomy been in such serious danger.
When Premier Duplessis expresses such views he is taking a stand that is, quite evidently, broader than party. He is speaking for Quebec.
(Translation):
This appetite, this lust for centralization on the part of the federal government is nothing new, as I recalled a few moments ago, but it can only grow if we recall also that the Prime Minister has championed, in. this house, the case of the central power, when we know that he was the legal adviser of the Rowell-Sirois commission whose recommendations, too rigorous, in the view of the Minister of Finance himself, implied the renunciation by the provinces of part of their autonomy.
2506	HOUSE OF
The Budget-Mr. Gagnon
Today then, more than ever, we must be alert. For us, particularly, who want no part of a legislative union and who do not want to become the wards of Ottawa, our duty is to be alert. We must do this if we are to pass on without change the religious, cultural and national heritage we have received from our ancestors. The inroads made into provincial autonomy should be sealed off and our rights restored in all their integrity. That is the price of our survival as French Canadians.
The subsidies and grants which we are offered in exchange for privileges given us by the constitution of our country conceal, under attractive guise, traps designed to weld the chains of our servitude and dependence. May Providence help us refuse them always categorically.
(Text):
On motion of Mr. Gauthier (Portneuf) the debate was adjourned.



BUSINESS OF THE HOUSE

Alphonse Fournier: Mr. Speaker, before proceeding with this debate on the budget on Monday we will move the second reading of Bill No. 107, to amend the Post Office Act, so we may refer it to the select committee which has been set up to consider it. There was quite a lengthy debate at the resolution stage and we hope that second reading will be agreed to without too many speeches. We think that when it comes back to the house hon. members will have more details and will thus be in better position to discuss it.
I mentioned this procedure to hon. members of the three opposition parties and although they did not agree because their leaders were not present, the suggestion seemed to appeal to them. We would not want to interrupt the budget debate for too long and we hope we can send this bill to the committee.
On motion of Mr. Fournier (Hull) the house adjourned at 9.55 p.m.

Monday, March 2, 1953