1953-04-28

Right Hon. L. S. St. Laurent (Prime Minister):: Mr. Speaker, as a matter of privilege and in fairness to the hon. member for Kamloops (Mr. Fulton), I wish to refer to an incident that occurred in the discussion of my estimates last night as it appears on page 4437 of Hansard. There was a question as to whether or not the figure "1" was printed on page 379 of the estimates in the lefthand column opposite the line reading:
Deputy head, clerk of the privy council and secretary to the cabinet-
The hon. gentleman said that in his copy no such figure appeared and I said it appeared in mine. After I left the house I looked at my copy more closely and although the figure is there it is apparent that it is not printed there. It is exactly the same colour as the printing and I do not know who put it there; but in fairness to the hon. gentleman I want to admit that it is something that was not printed in the original printing of the estimates. It was inserted in the copy that was prepared for my use. I would like to send my copy over to the hon. gentleman so that he may see how it came about.


Mr. Fulton:: I can assure the Prime Minister that will not be necessary because, by mathematics, he convinced me that even if it was not there it should have been there.


Louis Stephen St-Laurent: It was put in my copy.


Edmund Davie Fulton: I accept the Prime Minister's assurance without the necessity of sending me his copy.



REPORTS OF COMMITTEES

[Stage Direction]
Third report of standing committee on marine and fisheries.

Mr. Ashbourne.
Second and third reports of standing committee on industrial relations.-Mr. Macdonald (Edmonton East).


[Stage Direction]
On the orders of the day:
Mr. J. S. Sinnott (Springfield):: Mr. Speaker, would the Minister of Labour like to answer the question I directed to him yesterday?


Hon. Milton F. Gregg (Minister of Labour):: 
Mr. Angus Maclnnis (Vancouver East):: should like to ask the Minister of Labour a supplementary question. I think he said that the proposals made by the union were forwarded to the head offices in Winnipeg. Have the elevator companies no one in

National Housing Act Vancouver who can deal with these matters without sending them to Winnipeg for a decision?


Milton Fowler Gregg: I should add, Mr. Speaker,
that up to the time this new offer was made by the unions the discussions were held in British Columbia. The unions having made this offer, the discussions by the companies amongst themselves have been held east of the mountains.


Mr. Howard C. Green (Vancouver-Quadra):: Is the transport controller still in Vancouver?


Milton Fowler Gregg: Yes, Mr. Speaker.



FISHERIES


[Stage Direction]
On the orders of the day:
Mr. J. Watson MacNaught (Parliamentary Assistant to the Minister of Fisheries):: Mr. Speaker, on April 2 when the house was in committee of the whole on the North Pacific fisheries convention bill, the hon. member for Vancouver-Quadra (Mr. Green) asked me if I would get for him additional information concerning the amount of crabs caught by United States fishermen in Hecate strait. A letter has just come in from the supervisory statistician in the Seattle office of the United States fish and wildlife service, the relevant paragraph of which is as follows:
Our records show a catch of crabs in Hecate straits by American fishermen for the years 19501952. Apparently no catches were made in 1949 or 1948 as there are no production figures, nor mention made, in the district agent's reports for these years.
in 1952 five vessels operated and the catch was 1,169,062 pounds, whole; in 1951 seven vessels operated and the catch was 960,749 pounds, whole; in 1950 six vessels operated and the catch was 880,292 pounds, whole.



NATIONAL HOUSING ACT


Hon. Robert H. Winters (Minister of Resources and Development) moved: the second reading of Bill No. 339, to amend the National Housing Act, 1944.
He said: Mr. Speaker, as the house leader, the Minister of Public Works (Mr. Fournier), indicated last evening, it was my wish to be in Lunenburg today to attend the funeral of Senator William Duff, whose death followed that of Mrs. Duff by only seven weeks. Having regard to the amount of work which is still remaining, and the obvious desire of hon. members to conclude the business of the house at as early a date as possible, it was considered that I should remain in Ottawa

for this discussion on second reading of the bill to amend the National Housing Act.
All members who knew Senator Duff will appreciate how anxious I was to pay a final tribute to him by being in Lunenburg today. Among the many fine qualities possessed by my late good friend, however, was his great sense of responsibility, and under the circumstances I am sure it would have been his wish that I remain in Ottawa today to enable parliament to adhere to the program of business before it.
Before dealing with the amendments proposed for the National Housing Act I would like to make some remarks of a general nature.
During 1952 the number of housing starts increased steadily. For the year as a whole starts numbered about 84,000, excluding conversions, an increase of 21 per cent over the 68,600 of 1951. There were 93,000 houses started in 1950. In the last quarter of 1952 starts were taking place at a rate higher than the previous record rate of 1950.
Completions on the other hand declined in 1952 to 74,000 units, as compared with 81,000 in 1951. This decline reflects the much smaller carryover into 1952 of dwellings under construction than there were at the beginning of 1951. The carryover has been restored, as a result of the increase in housing starts in 1952, and we entered the year 1953 with 56,000 dwellings under construction. There is already, therefore, an auspicious prospect for completions in 1953. This high rate of building has continued this year. During the first quarter of 1953, dwellings started in centres of 5,000 population and over numbered 10,500. This represents an increase of 69 per cent over the same period in 1951, and as a matter of fact it has been the best first quarter on record from the point of view of the number of dwellings started in Canada.
The large number of houses that were brought under construction in the later part of 1952 may be attributed to a number of favourable factors on both the demand side and the supply side of the market. For one thing the demand for new houses was supported by a continued high level of net family formation. Not only was there a good increase in the number of families in 1952, but the families had more money with which to buy houses. Fortunately, our lending institutions showed an increased interest during 1952 in mortgage loans for new residential construction in general and for National Housing Act loans in particular.
Institutional loans for new residential construction were approved for 46,000 units in

1952, an increase of 19 per cent over 1951. Joint loans under the National Housing Act were approved for 27,488 dwellings in 1952, or 39 per cent more than in 1951. Had it not been for this increased flow of mortgage money, the rise in demand deriving from family formation and higher real incomes could not have been effective to the same extent. Brisk demand in 1952 was accompanied by favourable supply conditions. Except for cement in certain localities and some minor steel items, construction materials were readily available where and when needed. Even in regard to cement and steel, the situation improved towards the end of the year. We reaped the benefits of ample material supplies, not only in terms of a steady flow of production at the site, but also in terms of cost stability. During the course of 1952 the price of building materials for a house was about the same as in 1951. Neither was there any marked shortage of labour in 1952 for the residential work in hand despite an increase in other types of construction. However, wages in the construction field increased during the year by about 9 per cent.
Combined material cost and wage rates in construction were about 3 per cent higher in 1952 than in 1951; the prices of new houses increased even less. This is the smallest rise in construction costs that has occurred from one year to the next since the war. So much for the calendar year just past. What of the cumulative program over the past seven years, from the beginning of 1946 to December 31, 1952? In this period starts in Canada, excluding conversions of existing buildings, totalled 570,000.
I would now like to summarize the accomplishments of the federal government in the field of housing during this period and the extent to which the support and stimulus provided by the National Housing Act has resulted in such a large volume of new housing. During this period 141,294 dwelling units have received financial assistance under the joint loan terms of the National Housing Act. Another 30,000 units were built on direct government account. This included 28,000 units in the veterans' rental housing program and another 1,760 units under the public housing section 35 of the National Housing Act. In addition the rental insurance plan has accounted for about 18,000 units.
Central Mortgage and Housing Corporation, from funds voted by parliament, has built about 12,000 permanent married quarters for the armed services. In addition, a modest number of units have been built for other government departments, including the
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Department of Defence Production. Housing assistance has also been provided by the federal government under the Veterans Land Act, the Canadian Farm Loan Act and the Farm Improvement Loans Act. All these activities, of which hon. members will note that joint loans compose much the largest element, have had the net effect that about two of every five permanent post-war houses in Canada have received stimulus or assistance of one kind or another from the federal government. In making this tally I have not taken into account the 11,000 temporary units made available under the emergency shelter regulations.
I would point out that apart from the direct construction to which I have referred this housing has been produced by supplementing the efforts of those agencies whose ordinary business it is to deal directly in new housing. We have supported the builders with guarantees, we have supported the lending institutions by joint participation in National Housing Act loans; during the immediate post-war years we ensured that materials flowed into the residential field. Generally, the policy was then, as it is now, for the federal government to give secondary help and assistance rather than to assume a primary role.
I would like to discuss for a few moments some of the provisions of the act and to lay emphasis upon those few sections which supplement the basic policy of the government to utilize to the utmost existing private mortgage outlets and other private agencies directly connected with the construction of houses.	.
It will be recalled that apart from the provision for direct government loans to limited dividend companies, the National Housing Act, passed in 1944, relied upon the initiative of private enterprise and old established institutions to use their facilities to provide new housing.
In June, 1947, section 31A was introduced. The difficulty had arisen that the lending institutions were unable or unwilling to make loans in outlying areas. The new section authorized Central Mortgage to make loans on the same terms to the borrowers as joint loans where such loans are not being made by lending institutions.
Since the introduction of section 31A its application has in practice been widened to cover three other types of housing. First, rental insurance projects for which private institutional mortgage loans are not available may qualify for direct corporation loans. Second, the 90 per cent loans available in respect of houses for defence workers are

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made on direct corporation account under this section. And third, since last July loans placed by lending institutions, acting as agents of the corporation, may be made on direct corporation account in centres of from about 5,000 to 50,000 population. Some of these centres were being deprived of mortgage money and the agency arrangement was conceived to prevent the withdrawal of National Housing Act benefits therefrom.
Under section 31A of the act net loans have been approved to the end of 1952 in respect of 16,290 dwellings. Of these, 13,030 were under the rental insurance plan, 1,848 were in areas outside the operations of lending institutions, 1,974 were in connection with 90 per cent loans for defence workers' housing, and 96 were under agency agreements.
Another change in the National Housing Act took place in June of 1948 with the introduction of the rental insurance plan. This was devised to establish incentives to promote the construction of more rental housing by builders. Under the plan the corporation is authorized to make certain guarantees in regard to new rental housing projects, in return for an agreed premium. To builders of approved projects the corporation guarantees a minimum gross annual rental. The amount of guaranteed rental itself is calculated as enough to pay all operating and financial costs and provide to the owner of the project a return of 2 per cent on his equity. As a condition of this guarantee the rental units come under a rental ceiling set by the corporation for a period of three years. By the end of 1952 the number of rental dwellings for which this type of guarantee has been approved was over 18,000.
During the post-war years the only important new supply of low rental housing was provided by the veterans' rental program. This had been achieved by arrangements, with the approval of provincial governments, between the federal government and the municipalities whereby a portion of the land and services was provided by the municipality and the construction was carried out by the federal government. By the middle of 1949 this program had come to a conclusion and at that time, by amendment to the National Housing Act, parliament authorized the government to enter the field of public housing through the medium of section 35. It was felt that a more permanent arrangement for providing housing, and particularly rental housing, was required for those whose needs could not be met by existing facilities of the National Housing Act. It was also considered that some positive action should be taken to assist in the solution of one of the most pressing

problems which had already beset the production of housing-that is, the lack of serviced land. Not only was section 35 designated to deal with these two problems, but it was also fitted into our federal structure of government by leaving initiative with the provincial governments so that arrangements with municipalities could take place through them.
Most provincial governments have responded by enacting legislation which enables them to work with the federal government in partnership, the general basis being that the federal government provides 75 per cent and the provincial governments 25 per cent of the funds required for work undertaken through section 35. The provincial governments are, of course, free to share their part of the costs with municipalities in whatever proportion they may see fit.
In the application of section 35 to low rental housing we have now established some basic principles of administration. The ownership of such low rental projects is vested in the federal-provincial partnership and a local housing authority is set up to manage the property.
It is the firm policy of the federal government that federal subsidies provided under section 35 of the act shall be made available only to families which need such assistance in housing. We believe that it is improper for the taxpayers as a whole to subsidize families who can afford to pay economic rentals or their equivalent in the home ownership field. In this respect our policy is similar to that of the United States.
In addition to the subsidized low rental projects, we have undertaken rental projects which do not involve any subsidy but produce a rent revenue sufficient to recover full costs of amortization, management and local taxes. The tenants eligible for this housing must have incomes not less than four and not more than six times the rent.
The land assembly operations under section 35 are quite distinct from those which involve the construction and ownership of rental projects, though they are based on the same ratio of federal-provincial financing and the same sharing of profits or losses. Here the financial resources of the federal government are available to assist municipalities in the preparing of land for residential use. We have so far undertaken with the provinces to acquire 24 tracts of land ranging in size from 10 acres to 500 acres which will yield 11,900 serviced house lots.
Mr. Speaker, I have reviewed some of the actions taken under the National Housing Act in order to give some background for

the amendments now being proposed. It will be clear to hon. members that the role of the federal government in this field is a complex one. The government must deal on the one hand as a mortgage banker in full co-operation with the financial institutions who have their own proper purposes. On the other hand we must deal in a co-operative spirit with provincial governments who have jurisdiction in the field of housing and who have widely differing traditions and attitudes in the matter of housing. And finally, the construction that results from our efforts is placed in the local community and must complement the present array of buildings there. Now it is a feature of the National Housing Act as originally introduced and frequently improved by parliament that it enables the lending of support by the federal government on behalf of the citizens of Canada to meet a wide variety of needs. I venture to say that in no federal state outside Canada is there found a more comprehensive, flexible and versatile instrument to help the people meet their need for shelter than has been passed by parliament.
I opened my remarks today with some observations on the housing program of 1952. The rising levels of starts and strong demand in 1953 will, I am sure, prove a source of gratification to all of us. But we are still faced with difficulties.
Most important among these I consider the shortage of serviced land. The post-war rate of housing starts has far exceeded the rate of lot development and the growth of municipal services, such as sewer, water, road and school facilities. Therefore the amount of available serviced land has rapidly diminished. In some centres substantial programs of new residential development must wait on the provision of additional serviced land, and in others a similar situation is approaching. An increasing proportion of current housebuilding requires the development of new land.
This problem has two important aspects, that of the municipality, and that of the house buyer. The problem of the municipality is more immediate. For the municipality, residential land development means the extension of pavements and existing utilities and commonly involves the provision of new schools. In some cases further land development may require enlarged central pumping plants and the like. In any case, such land development means heavy municipal expenditures. These expenditures must be financed by municipal borrowings. Because of unwillingness or inability to borrow, the municipalities do not always respond as soon as the
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need for additional serviced land arises. The financing problems are of particular severity in metropolitan environs where the growth associated with a great city is apt to be thrust upon a junior municipality which is predominantly residential, and which lacks those commercial and industrial assessments that bulk so large in the ordinary municipal tax base. It is this non-residential property that has traditionally given some relief to the home owner in paying for expensive urban services.
The development of serviced land under section 35 is providing financial relief to municipalities only in respect to the installation of facilities within the project. The municipality must still meet the costs of school construction, trunk main extensions and the expansion of central municipality plant.
As that problem is solved and serviced land is made ready in greater quantities, it may be necessary to stimulate a corresponding increase in the flow of mortgage money. The introduction of the agency arrangement in 1952, by which the corporation extended the direct loan facilities of section 31A to cities of from 5,000 to 50,000 population, is already a step in that direction.
Life and fire insurance companies, trust and loan companies and fraternal societies are the main source of private mortgage money for new houses in Canada. These institutions have played a most important role in financing house construction. Their participation in the mortgage lending field increased from 1951 to 1952. Commitments in the whole mortgage field in 1951 amounted to $434 million and in 1952 to $497 million, an increase of 15 per cent. The increase of commitment in the residential field is even greater. I mention these figures because I would like to consider them in relation to the whole investment operation carried out by these companies. The level of net mortgage investment by these companies in 1952 absorbed about half of their total increase in assets during the year. Their mortgage holdings at the end of the year represented something more than one-quarter of their total assets. Present levels of institutional mortgage investment indicate that lending institutions wish not just to maintain but to increase the relative importance of their mortgage portfolios.
Now to deal more directly with the terms of the bill before the house:	The first
amendment vests in approved lending institutions the power to act in an agency capacity on behalf of Central Mortgage and Housing Corporation. This is accomplished by adding

National Housing Act
paragraph (c) to subsection X of section 3 of the present statute. That section provides that notwithstanding limitations that may be contained in other legislation, an approved lending institution shall have power to make loans in accord with and in the proportions mentioned in the National Housing Act. In this connection hon. members will recall that the Insurance Act normally limits mortgage lending by insurance companies to 60 per cent of the lending value whereas under the National Housing Act this is increased to 80 per cent by government participation. The section in addition authorizes lending companies to purchase mortgages from Central Mortgage. No change is made in these particulars. The new clause authorizes the agency provisions. It is being included by way of abundant caution. We felt that the present legislation is adequate but while lending institutions believe that they have the power to act as the agent of the corporation, they indicated that they would feel more secure if there was an express empowering provision in the National Housing Act.
As hon. members are aware, under section 31A of the National Housing Act the corporation makes loans on its own account on terms similar to joint loans in communities of about 5,000 and less. Lending institutions have been servicing the larger centres of population. Last year, however, when mortgage money did not appear to be available to give full coverage of all areas in Canada, the corporation was authorized by the government to make an arrangement with lending institutions by which they could make loans in areas up to 50,000, with the funds being provided by Central Mortgage. Under the arrangement the companies administer the loans for the first two years, during which time they have an option under which they can purchase a three-quarters interest in the loan, thus reconstituting it as a joint loan. At the present time five companies have signed the agency agreement, and up to the end of the year ninety-six loans had been approved.
Another provision in the bill empowers the corporation on its own account to make supplementary loans for borrowers' charges. Under the statute, where there is a joint loan in existence the company and the corporation together may make a supplementary loan to a borrower for the purpose of protecting the mortgage security. It would be helpful if the corporation had the same power in respect of direct corporation loans to meet emergency cases that might arise. As an example, there might be a failure of a central heating plant in a large housing development financed by the corporation after

a period of years and the owners might not be in a position to finance the installation of a new plant. This would mean that the project would not be rentable. In order to put the project in a position to operate, the corporation could finance by way of supplementary loan the cost of such installation. While we do not look forward to cases of this kind arising, it is considered that the corporation should have such authority.
Parliament is being asked to amend the section in the National Housing Act that established the integrated housing plan. As hon. members know, under these provisions in the act the corporation is authorized to enter into contracts with builders to encourage the construction of houses for sale to veterans. The existing legislation provides that such contracts shall require the builder to finance the construction of the houses under the provisions of the National Housing Act and to offer the houses so built for sale at a price not exceeding the price fixed in the contract with Central Mortgage. The section further provides that the corporation shall agree to purchase from the builder any house that he is unable to sell on the market. It is now proposed that in return for the corporation's undertaking to repurchase a house, the builder should pay a premium at a rate to be established by the governor in council. It is proposed further to amend the integrated housing section by enlarging the class of persons to whom houses can be offered in the first instance by builders to include defence workers as well as veterans.
The arrangement is that for a certain period after the completion of the house the builder cannot consider any applications other than those of veterans and defence workers. After the expiration of this specified period the house may be offered on the market at or below the fixed price. If he is unable to sell it within a certain period the builder may then require the corporation to take the house off his hands.
Then, too, there are revisions of the sections which provide for the cumulative statutory votes. For home ownership loans and losses under the previous housing acts and the existing act an increase is sought from $300 million to $500 million, while the cumulative total requested for rental housing loans is $250 million, instead of the present $150 million.
The rent control period for rental insurance projects in the present legislation is being dealt with. The amount of rent that may be charged by a borrower in respect of each unit of a project financed under the rental

insurance plan is limited by an agreement between the corporation and the borrower.
Under the present legislation the period of control, which is three years, runs from the date of completion of the entire project. The provision has worked a hardship in the case of very large projects in which the completion dates for the various units may extend over a period of years. The new legislation would permit the rent control period to be on a unit basis. Administratively, it will be dealt with by groups of units.
The bill contains a revision of the rehousing, sometimes referred to as slum clearance, provisions of the National Housing Act. Section 12 of the act provides for federal grants to a municipality to assist in clearing, replanning, rehabilitating and modernizing slum areas or blighted or substandard areas.
As it presently reads, section 12 authorizes the minister, with the approval of the governor in council, to make a grant to a municipality to assist it to acquire and clear a slum area. It is a condition of the grant under the present legislation that the area which is acquired and cleared be sold to a limited-dividend housing company for the construction of a housing project under section 9 of the act, or to a life insurance company for the construction of a housing project under section 11. As hon. members know, section 9 provides for loans for low rent housing, and section 11 authorizes lending companies to proceed with the construction and operation of low and moderate rental housing.
At present the amount of the grant must not exceed one-half the difference between the cost of the acquisition and clearance of the land and the price at which it is sold to a limited-dividend company or a life insurance company. The remainder of the excess costs must be borne by the municipality or by the province and the municipality jointly. The proposed amendment provides that in addition to the possible Sale of the land to a limited-dividend company or a life insurance company it may also be sold to a province and Central Mortgage and Housing Corporation jointly for a housing development under section 35 of the National Housing Act. This is in accordance with the recommendation of the standing committee on banking and commerce after it completed its study of the annual report of Central Mortgage and Housing Corporation last year. The basis of sharing the costs of acquisition and clearance will remain unchanged. The cost of the future development under section 35 will be borne 25 per cent by the province and 75 per cent by the federal government. The present legislation requires that the cleared
National Housing Act
area be redeveloped for housing purposes. The proposed amendments will permit the cleared area to be used either for housing purposes or for a municipal, provincial or federal public purpose, provided that the municipality makes available for a housing development an alternative area of a size sufficient to house at least the same number of persons as were living in the cleared area. The provision relating to the use of an alternative area will apply only where the slum area to be cleared is designated on the municipal plan for use ultimately for public purposes.
In conclusion, Mr. Speaker, I would like to explain that part II of the bill comprising sections 8 to 15 constitutes a rewrite of sections 1 to 7. As hon. members know, the Revised1 Statutes of Canada, 1952, are presently on the press. Part II has reference to the revised National Housing Act.


Mr. Donald M. Fleming (Eglinion):: Mr. Speaker, it is evident, both from the terms of Bill 339, and from the interesting statement just made to the house by the minister, that we are dealing with a bill of limited objectives and limited extent. Indeed, contrary to the expectations of some hon. members, the bill does not seem to go much beyond the terms of the resolution debated in the house on April 21.
Sir, I am sure there will be no question as to the desire of the house to give full support to the bill, limited as its objectives may be. Indeed, it may be said that at no time has parliament hesitated when called upon to enact housing legislation in any form which would be of assistance in meeting this great and still pressing problem.
Similarly, when questions have arisen-and I refer to the entire post-war period-as to making greater sums of money available from the consolidated revenue fund for the assistance of housing, and to implement sound schemes, there has never been any hesitation on the part of parliament to provide what was required. Therefore it may be assumed that while the bill may not go as far in its objectives as some may have hoped, nevertheless to the extent that it does attempt to improve our housing legislation it will, I am sure, have the support of hon. members.
The minister said less than I had hoped he would say concerning the need for housing in Canada. There are some arresting figures on this subject which I suggest should be considered by the house. Speaking in the debate on the resolution last Tuesday, as reported at page 4153 of Hansard, I drew attention to definite figures which had been

National Housing Act
placed a year ago before the standing committee on banking and commerce in its very extensive and, I think, helpful review of the housing problem, and the administration of Central Mortgage and Housing Corporation.
The figures for the first complete six postwar years, namely the years 1946 to 1951, inclusive, showed that in that period new housing units completed in all Canada numbered 495,887, whereas during the same period net family formations totalled 513,000. Therefore in that six-year period family formations in Canada had exceeded the number of housing units constructed in this country to the extent of 17,113 units. We have not been furnished with the complete figures for 1952.
However, on reference to the last quarterly report issued by Central Mortgage and Housing Corporation, in the publication entitled "Housing in Canada" we read in the opening paragraph, dealing with the fourth quarter of 1952:
Net family formation in Canada during the first three-quarters of 1952, at 67,000, continued close to the 1951 rate. Slightly more than one-quarter of this was attributable to immigration, as indicated by net migration of married females into Canada.
Well, if the rate of family formations in the last three months of the year 1952 even approximates the rate for the first nine months of that year, then it is quite evident that the number of family formations in Canada in 1952 must have come very close to the figure of 85,000 or 90,000.
Now, what was our record in house construction in Canada in 1952? The minister has said this morning that the number of completions in Canada in 1952 was 74,000. It is evident therefore that, even with what the minister has said about the accomplishments in that year, again in our rate of housing construction we have fallen behind the rate of net family formations in Canada; and instead of making any dent in the backlog of housing needs in Canada it is evident, on the contrary, that the backlog did actually increase in 1952.
We will all be gratified to find that there were at least 74,000 houses built in Canada, and that in the first three months of 1953 the number of starts has shown an encouraging rate. We will all be pleased at that. But let us not close our eyes to the other side of the problem. Let us not put on blinkers and simply consider the rate of construction. Let us see the problem as a whole and in doing so realize that even in the face of these figures house construction in Canada in 1952 once again fell behind the rate of net family formations and now for a period of seven years from 1946 to 1952 inclusive we

have added to the backlog of housing needs in Canada instead of reducing it.
While Canadians are increasing in numbers and marrying at continued high rates, immigration in 1952 added a total of 164,498 persons to the population. While this figure represents a reduction of 30,000 when compared with the number of immigrants coming into the country in 1951, nevertheless it is a substantial number of people for whom to find homes. Therefore we cannot sit back and view with any degree of satisfaction the housing picture in Canada today or the efforts that are being made to meet the needs.
The fact of the matter is that the problem is very great and very critical. One looked with disappointment this morning at the statement of government housing policy for some clear recognition of the still critical nature of the housing problem in Canada. Emphasis was on accomplishment. Whatever may be said for accomplishment, the fact is that it was not enough to meet current needs. There must be a much more realistic approach to this problem. There must be a greater sense of urgency in our approach to it.
An eminent businessman in Toronto, Mr. C. L. Burton, reviewing a long and active life, wrote a book last year entitled "A Sense of Urgency". If I could sum up the shortcomings in tne government's position with respect to housing in Canada it would be this:	There is on the part of the government a lack of a sense of urgency with respect to the problem.
When the minister draws attention to the completion last year of 74,000 housing units in Canada, a reduction of 7,000 as compared with 1951, but marked, it is true, toy an increase in the rate of construction in the later months of 1952 which was carried forward into the earlier months of 1953 as compared with the previous year, let us be frank in recognizing that the decline in housing construction that set in in the late spring of 1951 and continued at quite an alarming rate throughout the balance of 1951 and into 1952 was in large measure the result of deliberate government policy. The curbs which the government placed on housing construction in 1951 had their inevitable effect in reducing the rate of construction of needed homes in Canada and the effects were felt for at least a year. When we see house construction in Canada reversing its trend in the latter part of 1952 we are seeing the house-building industry overcoming those barriers which were created by deliberate government policy in the spring of 1951.

There are some trends that are becoming evident in Canada in relation to the housing problem which should be taken into account by those who are devising housing policy in Canada. I draw attention to several recent government reports which I think will command high interest on the part of the house.
The dominion bureau of statistics daily bulletin of March 17, 1953, draws attention to a substantial increase in the decade 1941-51 in the percentage of Canadian dwellings occupied by owners. The note reads:
Home ownership made a big advance in Canada during the ten years from 1941 to 1951, according to a census bulletin on housing by tenure and type of dwelling published by the dominion bureau of statistics.
Of the 3,409,295 occupied dwellings in Canada's 10 provinces in 1951, 2,236,955 or 65-6 per cent were occupied by owners and the remaining 1,172,340 or 34-4 per cent by tenants. This represents a substantial jump in both the number and percentage of owner-occupied dwellings over 1941.
The report then proceeds to give figures with respect to the various provinces.
The next trend to which attention is drawn is indicated in the daily bulletin of the dominion bureau of statistics of March 19. Reference is made here to the trend toward three to five-room dwellings as indicated by the 1951 census results. The note reads:
A trend towards three to five room dwellings in preference to dwellings of larger or smaller sizes is indicated in a 1951 census bulletin on dwelling size published by the dominion bureau of statistics. Comparison of 1941 and 1951 figures for the nine older provinces reveals that in the decade three to five rooms supplanted six or more rooms as the predominant size range, and accounted for 49-6 per cent of all dwellings at the time of the last census as compared with 43-3 per cent in 1941. At the same time, the proportion of dwellings with six or more rooms dropped to 43-6 per cent from 48-3 per cent, while dwellings with one or two rooms represented only 6-8 per cent of the total in 1951 against 8-4 per cent ten years earlier.
The third trend to which attention is drawn may in part be the natural consequence of the first trend which I mentioned, namely, the trend toward an increase in the percentage of owner-occupied homes in Canada. This trend is referred to in the daily bulletin of the dominion bureau of statistics of April 16. It is headed "Larger Percentage of Owned Dwellings with Both First and Second Mortgages" and reads:
A larger proportion of Canada's owner-occupied homes had both first and second mortgages in 1951 than in 1941, but a smaller percentage had only a first mortgage, according to a 1951 census bulletin on rents and mortgages published by the dominion bureau of statistics.
Of the 1,654,045 owner-occupied non-farm dwellings in the 10 provinces in 1951, 1,137,040 or 68-7 per cent reported no mortgage, 478,740 or 29 per cent reported a first mortgage only, and 38,265 or 2-3 per cent reported both first and second mortgages. In 1941, 607,669 or 68-8 per cent of the 883,294
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dwellings in the nine provinces had no mortgage, 263,390 or 29-8 per cent had a first mortgage only, and 12,233 or 1-4 per cent had both first and second mortgages.
These trends no doubt have been evident in some degree or other to all hon. members, although the trends are by no means uniform in the different parts of Canada. But it is evident that serious account must be taken of trends in this post-war period as reported in the 1951 census figures and as compared with 1941. We have made some headway in the direction of increasing the proportion of owner-occupied houses in Canada and to the extent to which part I of the National Housing Act has assisted in that direction it certainly deserves the continued support of all parties in this house-and it has received the support of all parties from the outset.
Mr. Speaker, I do not propose to review all of the factors that are evident today and which have a direct bearing on what we may fairly expect by way of house construction in Canada. I reviewed those in my remarks in the house on April 21 in the debate at the resolution stage. I do not propose to repeat them, but the minister in his statement this morning mentioned, as I think I did in my remarks a week ago, that no longer is there a shortage of labour retarding house construction in Canada. Happily, house construction is not being retarded today by any shortage of labour; and, in the second place, house construction in Canada today is not being retarded by any shortage of building materials. In the third place, it is evident that prices at the moment at any rate show some indication of stability, as Mr. Mansur described in a recent speech.
Houses that might have been built in 1951, and which were not built because of the errors in government policy at that time, could have been built at lower cost than houses can be built today. In July last the economic research department of Central Mortgage and Housing Corporation, in its annual review of mortgage lending in Canada, drew attention to the fact that in 1951 it cost Canadians $10,211 to buy a house and that a down payment of $3,188 was required. Those figures immediately invite comparison with the year 1950. The average dwelling cost that I have mentioned represented an increase of 16 per cent over the 1950 average cost of a dwelling, which was $8,805. The down payments also greatly increased. The 1951 requirement, as I have mentioned, was $3,188. The figure for down payments in 1950, as disclosed in this survey, was $1,928. The increase in the down payment required on the part of Canadians purchasing homes in 1951 over that

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required by those purchasing them in 1950 was 65 per cent. Now, Mr. Speaker, no one can overlook the significance of those figures. They do emphasize the responsibility that the government must bear for policies which they applied and which had the effect of retarding house construction two years ago when construction costs were substantially lower than they are now, and' when houses could be purchased with an average down payment very substantially lower than the down payment required today.
In my remarks a week ago I drew attention to the fact that we have entered a period now when we must distinguish, as Mr. Mansur very fairly pointed out in his testimony before the banking and commerce committee last June, between housing demand and housing need. When speaking of housing demand we are referring to the effective housing demand on the part of those who have the economic means to acquire the needed housing where housing is physically available. Housing need must be measured in wider terms to include housing needs of many who have not the economic resources to satisfy their housing needs today. This problem becomes more acute as the need for larger down payments increases and as the cost of house construction rises.
Now, sir, the bill that the minister has introduced has as one of its more conspicuous features amendments to section 12 of the act, directly related to section 35, designed in effect, as it has been described, to "marry" more closely the operations of section 12 and 35. As the minister has said, these amendments were proposed in the report of the banking and commerce committee to the house around July 1 last year, and I am glad that the minister has seen fit to bring forward legislation to carry those proposals into effect. Section 35 was enacted by parliament in November, 1949, with very high hopes. The government was not at all diffident in the claims it then put forward for the accomplishments that might be expected from this legislative child of the government. They conjured up pictures of great steps being taken to build development schemes and housing projects which were going to have the effect of meeting the housing needs of those who were not in a position to supply their own immediate housing requirements. Well, Mr. Speaker, after three and a half years of experience with section 35 the fact of the matter is-whether because of the nature of the scheme embodied in section 35 or because the government has not put sufficient energy and drive behind the scheme-

the accomplishments to date have been disappointing.
If one turns to page 53 of the publication to which I made reference earlier, the "Housing in Canada" publication of Central Mortgage and Housing Corporation for the fourth quarter of 1952, one will see that up to the end of September, 1952, the number of projects approved under section 35 for which contracts had been awarded totalled only 20. There was one in 1950; three in 1951; and the balance, namely 16, were in the first nine months of 1952. The total after almost three years of operation is 20 projects for which contracts have been awarded.
Let us also examine the figures for the number of dwellings involved. Up to September 30, 1952, the number of dwellings for which contracts have been awarded was 1,737; the number started was 1,322; and the number completed 371. It is not a record that will fill any hon. member or anyone who knows the housing needs of this country- particularly in and around the great metropolitan areas where today growth is so rapid- with any degree of satisfaction. They are very disappointing figures. One may express the hope, Mr. Speaker, that the amendments in this particular bill by which an attempt is made to marry the legislative effect of sections 12 and 35 will be more efficacious for the intended purpose than section 35 has been thus far. The scheme of section 35, let us admit it, is clumsy. It is clumsy because it involves the three levels of government. There may be some improvement in that regard in the amendment in the bill now before the house. There will be an opportunity to make further comment on that, Mr. Speaker, when we are in committee of the whole on the bill. It is a departure now to have provision being made by statute for contracts between the federal and municipal governments directly. It is true that the approval of the provincial government is required, but nevertheless it is evident that we are entering a period during which contracts may be entered into directly for, it is true, limited purposes between the federal and municipal governments. This may help to short-circuit some of the procedures and eliminate some of the delays, some of the cumbersome machinery which have deprived section 35 of the effect parliament intended it should have when it legislated that section in 1935.
There was not a word in the minister's statement today to indicate recognition of the necessity of some major step to meet the financial needs of the municipalities if we are to grapple effectively with the housing problem. In his statement the minister did

recognize that a major factor retarding house construction in Canada today is the shortage of serviced land, particularly in those areas immediately adjacent to the great metropolitan centres where the growth of population has been so very rapid. But how are we to cope with the problem confronting such municipalities? It is going to take a great deal more than enabling legislation of the kind we have before us to equip municipal governments to render effective assistance for this housing problem in the areas where the problem is so acute. These municipalities, Mr. Speaker, simply have not the means today to provide serviced land. Many of them are taking open steps to discourage house construction within their borders because they are unable to cope with the problems created by house construction and the extension of the burden upon the already heavily-laden taxpayer as the result of providing the needed services which the municipalities are required to provide. The cost of these services has risen by leaps and bounds. Look at the increases in the costs of construction of schools. They have simply skyrocketed. These are problems that are weighing upon the shoulders of the municipalities today with a greater burden than ever before in our history.
These municipalities are carrying on with the same limited tax base that they were given over 80 years ago. This limited tax base is completely unequal to the task of meeting the needs that are being placed upon municipalities today, particularly in areas of the type I have mentioned, as a result of the acute housing shortages. Not a word has been forthcoming from the government as to any policy of seeking the solution that must be found to a problem of that kind. We in this quarter of the house, Mr. Speaker, have said we are prepared to offer a policy in that regard. We propose that the dominion and the provinces sit down together to study the whole field of tax resources and work out an agreement by which there will be assured to the provincial governments, and through them to the municipal governments, adequate sources of tax revenue to meet the needs that are being placed upon the shoulders of the municipalities today. You will not cope effectively with the housing problem in Canada today, particularly in the areas where it is being most acutely felt, unless you take steps of the kind I have advocated to provide the municipalities with means adequate to discharge their responsibilities in relation to housing and the other needs.
I say to the minister, with all candour, that I think he is the best minister whom the government has placed in charge of the
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housing problem. In this post-war period we have had a succession of ministers to deal with it. I am going to say to the house that I think the present minister is the best of them. He has approached his duties in this house with a greater degree of frankness and candour, and I think conscientiousness also, than his predecessors. But as I have sought to point out, Mr. Speaker, there still is lacking on the part of the government that recognition of the urgency of this problem which must be the beginning of any serious attempt to meet it in all its harsh realities. In the second place, there is still manifest on the part of the government a lack of drive behind the efforts being made to meet the housing needs. There is too clear evidence of the fact that the government is content to count up the number of houses which have been built and to take satisfaction out of it; to stop there, without examining the rate at which the need has been outrunning our rate of house construction in Canada.
Finally, Mr. Speaker, there has not been on the part of the government that recognition of the necessity of assisting the municipalities, without which there will be no effective solution of the urgent housing problem in Canada.


Mr. J. W. Noseworthy (York South):: My
criticism of the bill before us, Mr. Speaker, is that, as a bit of patchwork of tinkering with the National Housing Act, it has some merit. But it does not touch the root of our housing problem. When speaking during the resolution stage of this matter on April 24, I pointed out that, although the government has been negotiating with the finance companies and the real estate companies ever since the war, it has not yet evolved a housing policy that has met the situation.
The facts, as I pointed out, are that the backlog of housing that existed at the end of the war still exists and has increased. Competent authorities today assure us that there is a backlog of approximately 700,000 houses needed in Canada. We have been building at the rate of some 80,000 houses a year, which rate has fallen short of the number of newly-formed families in Canada so that we have not met the new need for houses each year. We have not touched the backlog that existed at the end of the war. If we are to catch up with that backlog within the next ten years-I would say that in a period of prosperity such as we have in Canada at the present time we should make every effort to catch up on that backlog- it would seem to me that we should plan our housing policy to catch up on that backlog within at least the next ten years. At that rate we must build at least 70,000 houses a year more than is required to fill the current

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need; in other words, to meet the need created by newly-formed families, provided they do not increase in future years but remain as they have been during the past two years. To catch up with that backlog, we should have a housing program that calls for at least 150,000 houses a year; that is,
70,000	if we are to catch up on that backlog within the next ten years and another 80,000 to take care of the increase required year by year by reason of the newly-formed families.
In this bill there is nothing to indicate that the present policy of the government will achieve that result. There is nothing to indicate that it will achieve it in the coming years any more than it has achieved it in the years immediately behind us. There are certain problems which have to be faced. The first of these is that the cost of building today-the cost of homes-has passed beyond the reach of tens of thousands of people who need homes. I think that is the first fact we must face. No matter how much money you put into the pool for finance companies to lend, tens of thousands of people who need homes today cannot afford to buy them or to rent them at today's prices. There is today a shortage of rental houses at prices at which tens of thousands of people, whose means will not allow them to buy homes, can rent; and there is nothing in this legislation which, to my mind, will adequately meet that difficulty.
Today other tens of thousands of people who have purchased homes in the past are over-burdened with mortgages which they have assumed. They are carrying these mortgages on a dangerously close margin. With any change in our present prosperity rate, with the slightest recession, thousands of these people are going to find themselves in difficulty in making the payments of principal and paying the interest on these mortgages which they have assumed. If we are to continue expecting people to buy homes at today's prices and to assume mortgages which probably it will be beyond their capacity to carry, we are not touching the root of the housing problem.
It is all very well to call a dominion-provincial conference, to get together with governments at other levels and to find out to what extent the federal government can come to the assistance of these municipalities or the provinces. But unless that conference meets for the express purpose of doing something about reducing the cost of housing and the carrying charges on housing, we shall not meet the situation.
First of all, we must give some consideration to a reduction in the interest rate that is being charged in connection with houses.

The minister tells us that this new amendment to the National Housing Act will make lending companies agents of Central Mortgage and Housing Corporation. Again and again in this house within the past few years I have stated that Central Mortgage and Housing Corporation is nothing more or less than an agent of the lending companies. The basic difficulty in connection with the housing problem in the past has been that the government-in its anxiety to bolster capitalist enterprise, to maintain the position of the lending companies, and to look after the interests of the real estate companies- has been overlooking the needs of the common people of this country and has been placing the interests of these lending companies and corporations ahead of those of the people.
It is not a question of making these lending companies the agents of Central Mortgage and Housing Corporation. Central Mortgage and Housing Corporation already is-and has been since its inception-the agent of the lending companies in this country. Every move that Central Mortgage and Housing Corporation has made down through the years has been made with the interests of these lending companies in mind and has been made in order to bolster the position of these companies and to see that their security is maintained. The fact that the cost of housing has passed beyond the reach of tens of thousands of Canadian citizens who need homes has not influenced the government's policy.
Today one of the first problems we must seek to tackle is that of a reduction in that interest rate of 5J per cent which these corporations today collect on their mortgages, subsidized as they are by the government; and that 5| per cent is too high for ordinary working-class people to carry. Today this government is subsidizing the steel industry and the gold industry. It is handing out subsidies right and left to capitalist enterprise. It is time that this government gave more consideration to subsidizing the needs of the people of Canada. We can subsidize housing just as well as we can subsidize the steel industry, the mining industry or other industries of a like nature in this country. In our opinion the government, through the Bank of Canada, should make loans directly to the builders at an interest rate of not more than 2 per cent. Until you can bring that interest rate down to that figure, tens of thousands of people in this country will not be able to buy homes.
In my speech on April 21 I pointed out that, in reducing the carrying charges on a home, a reduction in the interest rate can be

much more effective than a reduction in either material or labour costs. The great burden that rests upon the people of this country in the matter of housing is there in that 5J per cent interest rate that they have to pay. I submit, Mr. Speaker, that any government policy that aims to meet the needs of the people will use the facilities of the Bank of Canada to provide builders with loans at an interest rate of 2 per cent. Do that, and you will have solved most of the difficulties in the way of providing housing.
I have said that the government of today subsidizes a great many interests in this country. I am convinced, as is this group, that if those who cannot afford to buy houses but must rent are to have houses available, then the government must subsidize public housing authorities in order that rents may be brought more in line with the financial means of those low income dwellers.
Section 35 of the National Housing Act has not been working very effectively, and the present amendment seeks to bring section 12 and section 35 together to see if we cannot get more action through these public housing authorities. Not until the federal government assumes the responsibility of lending money directly to these public housing authorities will you find section 35 working satisfactorily. Do that, get away from the shackles of the finance companies, and use the facilities of this country to benefit the people of the country, and you will solve the housing problem.
Another basic shortcoming of the present policy is again the fact that this government, in their anxiety to boast of private, capitalist enterprise, are reluctant to go directly into the construction of houses. If you want to solve the housing problem, lend directly to the builders at interest rates of not more than 2 per cent, and use the facilities of the Bank of Canada to do that. Subsidize public housing authorities.
Some provision will have to be made whereby municipalities will get assistance from the federal government for the provision of schools and other facilities required by new housing developments.
In the third place, I submit that Central Mortgage and Housing Corporation must go directly into the construction of low rental housing. It must build these houses and sell them or rent them at cost to the people who need them. Therefore, Mr. Speaker, inasmuch as this amendment to the National Housing Act, in my opinion, falls far short of what is necessary to meet our housing situation, I move, seconded by the hon. member for Saskatoon (Mr. Knight):
That the said bill be not now read the second time but that it be resolved that in the opinion of
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this house consideration should be given to the introducing of legislation to amend the National Housing Act, 1944, to permit:
(1)	Central Mortgage and Housing Corporation to issue loans directly to the builder at an interest rate of 2 per cent;
(2)	Central Mortgage and Housing Corporation to subsidize public housing authorities in order that rents may be brought into line with the financial means of low-income dwellers;
(3)	Central Mortgage and Housing Corporation to enter the field of housing construction to build low-rental housing projects where such projects are needed but are not being constructed.
I am satisfied that if the government is prepared completely to overhaul their policy and the National Housing Act, as I have suggested, we shall meet our housing problem and we shall have no difficulty in overcoming the backlog of 700,000 houses within the next ten years and building enough houses to provide homes for the new-formed families of Canada. In other words, to build the
150,000	houses each year within the next ten years we shall have to overhaul drastically the National Housing Act.


Mr. E. G. Hansell (Macleod):: I had intended to say something on this measure when it was in the resolution stage, but we were urged to wait until the bill came down so that we could examine it and know its details.
There are a number of questions that should be asked in respect of the general situation existing with the home owners of Canada. I have reference to the tremendous amount of debt which must exist in respect of housing if we look at it as a whole. I do believe of course that we would not have the houses that we have today, even if there still is a shortage, had it not been for the fact that our people have been able to borrow money in order to build. I suppose that a great majority of home owners today would never have been able to own their homes had they not been able to secure some financial assistance somewhere, and when they first bought their homes undoubtedly they were mortgaged.
I do believe it would be rather an alarming picture if we were to get the entire scene as it relates to the total housing debt. I do not mean simply by the Central Mortgage and Housing Corporation; I mean if we could get something from the bureau of statistics relating to the amount of total debt that is actually owed today by those who are buying their homes.
I believe that the Central Mortgage and Housing Corporation have in a measure been able to assist people to acquire their homes. But I am in agreement with the previous speaker that Central Mortgage and Housing Corporation to a great extent has been a

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government agency acting as a sort of watchdog for the security of the lending institutions. I am not saying that in a spirit of undue or harsh criticism. However, I think all hon. members will agree that what is needed is some action which will enable those of low income to purchase their own homes. That can be done only by offering them low initial payments, in the first instance. I am not opposed to the procedure of borrowing on homes. As I have said before, most people would not own their homes if they had not had the opportunity of borrowing money in the first instance. However, there are vast numbers of young married people who are now starting out in life-and perhaps some older people, too-who are in the lower income brackets, who are paying rent, sometimes high rent which takes up a great proportion of their income. These are people in the lower income brackets who could not possibly begin to build houses because they have not sufficient money to make the initial payments.
Let us analyse this matter from the personal point of view. Let us suppose for the moment that hon. members are in the low income bracket. Let us suppose that we are receiving only a couple of hundred dollars each month. Today that is considered a low income. We will suppose that we have no insurance on which we can borrow and no friends who will come to our assistance. Perhaps our friends, too, are in the low income brackets. How is a person in that position going to get $2,000 or $3,000 as a first payment on a home? How are we going to acquire enough money even to buy a lot? It is almost an impossibility.
It does seem to me that something should be done to enable people in the lower income brackets to commence buying their homes. I agree with the hon. member who preceded me in the statement that there could be a national housing act that would enable home owners to borrow money at a very low rate of interest. After all, I fancy the bulk of mortgage money comes from the lending institutions. If there is any expansion of credit going on at all, that expansion is brought about by the process of creating money out of nothing. That is still the position we take, a position that cannot be denied. And if an interest rate of more than 5 or 5J per cent is demanded it creates a tremendous burden of interest debt. In my view the interest should be only a fraction more than the small amount required for the administration of the lending institutions.
I should like to ask the minister four questions on the general subject of housing. I do not ask these questions with particular

reference to Central Mortgage and Housing Corporation. They are directed, rather, to the entire housing situation in Canada, whether the building of a home is through Central Mortgage and Housing Corporation or through some other method of borrowing.
My first question is this: How many home owners in Canada today have clear titles to their homes?
My second question is this: How many people in Canada have bought homes and are still paying for them?
My third question is this: What is the total amount of mortgages or debts held against the total number of home owners?
My fourth question is this: What is the average debt on each home?
The answers to these questions would be most helpful and revealing. I cannot help believing that, should there be a business recession or slump, or a period of unemployment, houses would be available for a song. People would lose their equities in their homes. A home owner wants to hang on to his home as long as possible. However, we know what happens in a time of depression: When the depression strikes, people begin to move around the country. They say, "Well, there may be an opportunity for us somewhere else. Let us sell, and move." No one knows where they go. The recession is on, there is a deflation in prices, and the people lose their equities in their homes.
I hate to think what would happen if we had another recession. It would be alarming even to imagine what would happen to the home owners of Canada if a business recession should take place. It is understood that those of us in this part of the house believe in private enterprise. We believe that people should be free to build or to buy their own home as they choose. We believe that, if there is any government agency at all, it should be designed to assist citizens in the building of their homes.
Then, there is another matter connected with the bill to which I would direct the attention of the house. Whether others have detected it or not, I cannot say, but in the bill there is a somewhat modified provision for slum clearance. I am sure all would say that that is a good feature, and I would agree. But the principle I would bring before the house is this: Why should there ever have been any slums? What creates slum conditions? As I have been pausing and musing in consideration of this matter I have thought it wise to consult the dictionary to find out the exact meaning of the word "slum".

The Concise Oxford Dictionary gives the following definition:
Dirty back street or court or alley in city. To go about the slums, to visit or examine conditions of inhabitants; hence slummer.
Unless we get down to brass tacks we are always going to have these problems before us. Does it not occur to the minister and to the government that the reason we have to talk about slum clearance is not simply that certain sections of the city have become old and should be brought up to date or that certain buildings should be pulled down? It goes deeper than that. Everything grows old; we grow old; buildings grow old; railroads grows old.


Mr. Knowles:: Governments grow old.


Ernest George Hansell: Governments grow old, that goes without saying. But it goes deeper than that. The reason there are slums, the reason there are dirty back streets, the reason we have to examine into the condition of the inhabitants of certain areas is that governments in the past have not adopted policies that would give the people a proper income so they could live decently. That is the deeper aspect of this situation.
All we have to do is to ask ourselves what is the reason that we have slums. Have we building materials to build extensively in order to give people decent places in which to live? Of course we have building materials. Is there a lack of timber? We have forests galore in Canada. Is there a lack of cement? We have all the cement in Canada or materials to make it that is required. Have we unskilled labour? I think we have plenty of labour. What is wrong then? We have all the materials, we have the ability to do it, but the people just have not enough money.


An hon. Member:: Everybody's fault but yours.
Nlr. Hansell: I think that one almost has to assume that attitude when he is debating in this house. We all think we are right, we all think we have an argument, we all want to solve the problems of the day. We are now discussing housing problems. I say that it goes far deeper than just meets the eye. Governments have been in power and slum conditions have developed in this country.


An hon. Member:: And right in Alberta.


Ernest George Hansell: Of course they are right in Alberta because there are people with low incomes there as well as in other parts of the country.


Mr. Blackmore:: And lots of federal taxation.
68108-282i
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Ernest George Hansell: The whole financial policy of this country, which is the responsibility of this government, is what keeps people on low income no matter where they live. There is no question about that; there is no argument about that. It is really a shame that governments have to talk about slum clearance. For a government to have to put that in a bill is just an indictment that they have failed in their policies. There is no argument about that. You have to look deeper for the reason.
The reason is that the financial policy pursued, which is built upon debt and taxation, is one that will strangle the economic life out of our people. It is all right for us to say that we are living in a period of prosperity, but anyone who knows anything about busts and booms knows full well that when we are living in a period that people call prosperous, it is a false prosperity because it is built on debt. That is the responsibility of this government because it is this government that has the responsibility for currency, credit and banking.
I notice it is nearly one o'clock but perhaps I might say just a few words in closing. I have a number of other things that I should like to discuss, but perhaps I can do that when we are in committee. We may be entering a period of nominal peace. In his speech the other day President Eisenhower said that if the soviet were sincere in their shift of policy a good deal of the money now spent on defence could be diverted to other purposes. He gave a number of illustrations which were rather alarming to me. One was that the cost of one modern bomber would house 80,000 people.
That is an alarming thing. We should have a citizenry in Canada with incomes sufficiently high so that they can provide themselves with homes, with nice grounds and everything well painted. Then we shall be a respectable nation. I am not blaming the minister, because the minister is himself a victim of the financial policy which the government is pursuing.
At one o'clock the house took recess.
The house resumed at 2.30 p.m.


Mr. Speaker:: On the motion for second reading of this bill there has been an amendment moved, and I am somewhat concerned about the regularity of the amendment. No doubt it is based on citation 657 of Beau-chesne's third edition. The amendment proposes:
That the said bill be not now read the second time but that . . . consideration should be given to the introducing of legislation to amend the National Housing Act, 1944, to permit:

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(1)	Central Mortgage and Housing Corporation to issue loans directly to the builder at an interest rate of 2 per cent;
Does not that proposal go beyond the scope of the present bill? The rule of relativity must always prevail. The second part of the amendment reads;
(2)	Central Mortgage and Housing Corporation to subsidize public housing authorities in order that rents may be brought into line with the financial means of low-income dwellers;
It seems to me that there is a similar clause in the National Housing Act which the bill purports to amend.
The third part of the amendment reads:
(3)	Central Mortgage and Housing Corporation to enter the field of housing construction to build low-rental housing projects where such projects are needed but are not being constructed.
After reading the National Housing Act, it seems to me that the power is contained in the act at the present time. I would be glad to hear any representations which hon. members would like to make in respect of the amendment, but I thought I should mention those three features.


Stanley Howard Knowles: Mr. Speaker, as Your Honour has pointed out, this amendment was drafted in the light of the right that is set out in citation 657 of Beauchesne's third edition. As has been indicated frequently, there seems to be some ambiguity as to what the citation means, but it does seem to me that it provides for just such a proposition as is contained in the amendment moved by the hon. member for York South (Mr. Noseworthy). Let me read citation 657:
It is also competent to a member who desires to place on record any special reasons for not agreeing to the second reading of a bill, to move as an amendment to the question, a resolution declaratory of some principle adverse to, or differing from, the principles, policy or provisions of the bill-
Perhaps I might interject at that point that is exactly what my colleague has done. He has indicated opposition to the progress of the present act for the reasons he points out and has suggested in his view that the house consider a resolution-
-declaratory of some principle adverse to, or differing from, the principle, policy, or provisions of the bill-


Mr. Speaker:: I do not see that there is in the amendment a declaration of a principle adverse to the principle of the bill before the house. The amendment adds to the provisions of the amending bill but I do not think it sets forth a new principle.


Stanley Howard Knowles: May I point out that the wording of citation 657 is:
-a resolution declaratory of some principle adverse to, or differing from . . .

I would point out that the resolution which we have put before the house in the terms of this amendment certainly differs from the principles, policy and provisions of the bill in that it asks for a 2 per cent interest rate on money for building homes; and also it differs because it asks for the subsidizing of public housing authorities and that Central Mortgage and Housing Corporation go directly into the field of building homes.


Mr. Speaker:: May I interrupt the hon. member again, and I hope he does not mind my interrupting him. It seems to me that the first clause of the amendment which proposes that Central Mortgage and Housing Corporation issue loans directly to builders at an interest rate of 2 per cent does not differ from any principle in the bill-nor is it adverse to any principle in the bill. It is a different matter entirely.


Stanley Howard Knowles: Yes.


Mr. Speaker:: It may foe a different matter but it does not differ from the principle of the bill before the house; it is not adverse to that principle.


Stanley Howard Knowles: Is there not a considerable difference in principle between underwriting the loans by insurance companies at a rate something over 5 per cent and the lending of money directly to builders by Central Mortgage and Housing Corporation at a rate of 2 per cent? It is because my colleague feels that this proposition should be laid before the house that he believes he comes within the framework of the latter part of the citation which says that he has the right to move a resolution declaratory of some principle adverse to the bill. In other words he has the right to ask the house to express itself with regard to the different viewpoint with respect to housing set out in this amendment.
I could recall to Your Honour many occasions on which amendments under citation 657 have been before the house. They cover quite a wide variety of subjects. There have been amendments with respect to a different way of handling redistribution. There have been amendments with respect to a different way of handling the auditing of the Canadian National Railways. There have been amendments with regard to pipe lines, as to whether they should go outside of Canada or stay inside Canada. There have been amendments dealing with the initial price of wheat. There have been amendments dealing *with a different way of handling prairie farm assistance. All of those involved some difference from the proposal in the bill before the house at the time or naturally they would not have been made. It seems to me that the

whole spirit of 657 is that it gives the opposition, when it is not satisfied with a government bill, the right-on second reading-to suggest that the second reading be not now entertained but that a resolution presenting some different principle with respect to the same matter might be considered by the house.


Robert Henry Winters: On the point of order, Mr. Speaker, I think you have summed up very well what is implied in this amendment. In the first place, part 1 of the amendment says that the National Housing Act should be amended to permit Central Mortgage and Housing Corporation to issue loans directly to the builder at an interest rate of 2 per cent. This provision is beyond the scope of the bill before the house at the moment. In the second place, it is a matter of government policy which, if it were to be implemented, would of necessity have to be preceded by a resolution because it involves the expenditure of money. In my opinion, therefore, it is clearly out of order.


Stanley Howard Knowles: That is covered by the word "consideration" in the preamble.


Robert Henry Winters: Section 2 of the amendment calls for authority to permit Central Mortgage and Housing Corporation to subsidize public housing authorities in order that rents may be brought into line with the financial means of low income dwellers. Section 35 of the National Housing Act already makes adequate provision for subsidization to apply to low rental housing. Section 3 of the amendment is designed to permit Central Mortgage and Housing Corporation to enter the field of housing construction to build low rental housing projects where such projects are needed but are not being constructed. There is adequate provision in section 34 of the National Housing Act which has, in fact, already been used for the building of war workers' houses, and more recently rental accommodation for veterans. There is, therefore, adequate provision in the existing legislation to cover sections 2 and 3 of the amendment. I submit, Mr. Speaker, the amendment is therefore out of order.


Mr. Speaker:: It seems to be agreed by all members, I think, that sections 2 and 3 of the proposed amendment would be out of order. In any event, I would rule that those two sections are out of order. This, of course, would make the amendment itself out of order because it cannot be partly in order and partly out of order. However, that would leave section 1 of the amendment, and a new amendment with section 1 in it might be submitted. I would be forced to rule that out of order, and I would refer hon. members to
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May's fifteenth edition at page 508 where it is stated:
The principle of relevancy In an amendment governs every such motion.
(1) The amendment must "strictly relate to the bill which the house, by its order, has resolved upon considering" . . .
It seems to me that section 1 of the amendment before the house relates, not to the amending bill which is before the house but to the National Housing Act, 1944. I must rule the amendment out of order.


Mr. George H. Hees (Broadview):: I believe, Mr. Speaker, that of all the situations which this government has mishandled, it has mishandled the housing situation to a far greater extent than any other. The government has simply refused to face up to the fact that today we have a shortage of half a million houses, and that last year alone that shortage was increased by a further 33,500 much-needed and unbuilt houses. I believe that to try to cure this situation by means of the present legislation is about as effective as trying to cure pneumonia by taking an aspirin tablet.
Because of this government's obsolete and reactionary housing policy, last year we built 20 per cent fewer houses than we built two years ago. Last year, by the government's own admission, there was absolutely no shortage of construction labour or material. The building industry is capable of building
125,000	houses a year, as has been stated on numerous occasions by leaders in the industry. Why then are we building, as we did last year, 70 per cent fewer houses than the construction industry is capable of building, especially in view of the fact that we have an accumulating shortage which today amounts to half a million houses?
I believe there are three reasons for this very disturbing state of affairs. First of all, there is the matter of serviced land. Second, there is the high down payment of 20 per cent demanded on National Housing Act housing, which makes it impossible for a man with an income of less than $5,000 a year to buy a house. Third, the high interest rate and short amortization period under the National Housing Act makes it impossible for a man with a moderate income to carry the charges on a new house.
First of all, I should like to deal with the question of serviced land. Today most municipalities have not got the revenue to pays for schools, roads, water mains, sewers and other local improvements which are necessary to service a housing development. It is obvious, I think, that a builder cannot build houses unless the municipality will allow him to build those houses within the municipal area. I believe, Mr. Speaker, that

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the Leader of the Opposition (Mr. Drew) made a very sensible suggestion to overcome this difficulty when he was speaking in this house on November 24 last, as reported at page 33 of Hansard for that date. On that occasion he strongly urged the government, and I quote his words:
To reach agreement with the provincial governments in regard to a clearly defined reallocation of taxing powers so that the provincial governments and municipal councils may have adequate financial resources, to carry out their rapidly increasing responsibilities.
That is the end of his suggestion. I believe if that suggestion is followed by this government, it will overcome the difficulty which municipalities are having today in financing the building of local improvements needed to service new housing developments.
Now I should like to deal very briefly with the second obstacle to the building of houses, and that is the high down payment demanded by Central Mortgage and Housing Corporation. The cheapest house that you can buy today through Central Mortgage and Housing Corporation costs $10,000. You are required to make a 20 per cent down payment which, of course, amounts to $2,000. That virtually excludes any man earning less than $5,000 a year, because in order to put aside that $2,000, you must set aside a minimum of 10 per cent of the $5,000 a year income for a minimum of four years. All of us who have tried to save at one time or another know that it is extremely difficult to set aside 10 per cent of your income for four years in a row. Hence, people earning under $5,000 a year have, for all practical purposes, been excluded from the housing market.
I think it is interesting to examine what has been done in the United States to meet this situation. Under their national housing authority, their down payments are set on a sliding scale. If you buy a house for $7,000, you make a 5 per cent down payment which amounts to $350. When the value of the house increases to $10,000, the down payment is increased to 12 J per cent which amounts to $1,250. I believe that a flat down payment of 10 per cent on a house of $10,000 value or less would serve the purpose more adequately. I believe that this provision would make it possible for people earning a modest income to buy the houses which they so desperately need. The government is following this policy with regard to workers living in defence areas, and I see no reason at all why it should not follow the same policy with respect to workers in non-defence industries.
In the third place, I should like to deal with the question of the interest rate and
TMr. Hees.]
the amortization period. On National Housing Act loans it is necessary to pay 5i per cent interest, and to pay the loan off over a twenty-year period. This requirement makes it extremely difficult indeed for a person earning a modest income to carry the charges on a new house. I should like once again to cite what has been done to meet this situation in the United States. There, loans are made at rates as low as 4 per cent, and the amortization extends over a period as long as thirty years. This provision has made it possible for people earning a modest income to carry the charges on a new house.
Mr. Speaker, I believe that consideration should be given to these policies which have worked out so successfully in the United States, where a greater volume of housing per thousand of population is being built than here in Canada, despite the fact that they are much involved in heavy defence expenditures.
I believe that we should give careful consideration to the policies which have been tried and which have worked out so successfully in the United States. If the kind of policies which I have mentioned were put into force by this government, I believe the building industry would be enabled to build
125,000	houses a year and that those who desperately need houses would find it possible to enter the housing market, and to buy the houses which they so desperately need.


Mr. H. W. Herridge (Kootenay West):: Mr. Speaker, I think this bill is an admission on the part of the government that the present housing act is unsatisfactory, that the money is not available, and that the terms with respect to interest and down payment have been such that people have not been able to build houses as required in this country.
I do not intend to speak at length-and I notice that statement seems to satisfy and to please the hon. member for Fraser Valley (Mr. Cruickshank)-because the hon member for York South (Mr. Noseworthy) presented the views of this group in what I thought was an excellently documented speech. I was extremely sorry that his excellent speech did not receive the press coverage it deserved. We find sometimes that someone who comes into the house, makes a few dramatic statements and then walks out again, gets press coverage from one end of Canada to the other. But here the hon. member for York South who speaks with knowledge-who has paid a great deal of attention to the subject in his own constituency, who has studied

it carefully and who knows the situation in his own constituency-and who makes an excellent speech is reported in only a few lines by the press. I think that the press could give more consideration to some of the worth-while speeches we hear in this house rather than, shall I say, to the highlights, the accidental, the incidental and the unusual.
Without a doubt, Mr. Speaker, the speeches that have been made in this house by members on the government side and by many members in the opposition on the question of housing indicate that it is the number one problem facing the Canadian people at the present time. It is one that is close to the Canadian people and they are conscious of it. They are conscious of the need in this respect. I am sure that all hon. members, like myself, have been kept well informed of the shortage of housing in their constituencies, and particularly in the urban sections. I am sure that they also recognize the problem because of an increasing interest on the part of an increasing number of organizations in the housing deficiency at the present time. In my own constituency, Mr. Speaker, I find that the municipalities are becoming concerned. They have had meetings to deal with this question. The Canadian Legion has been concerned about the matter for some years. The trade unions are concerned as also are the women's organizations. Why are they concerned? They become concerned over a situation only when, over a long period of time, there is a definite problem that has not been solved or a definite need that has not been met. It strikes me that at this date, some seven years after the conclusion of the second world war, having regard to our resources and our capacity to produce, we have made little headway in this basically fundamental problem in this country. I know of numbers of young married couples-people who were married two and three years ago -who are still making plans with a view to building a home and have not been able to do so because of the present terms of the National Housing Act, the cost of money, the cost of materials and so on.
Then there is the question of industrial workers who want subsidized low-rental housing, particularly those in the construction industry who move from one point to another. In my constituency there are numbers of these people living in temporary accommodation that could not be considered housing at all. Then we also find that situation with regard to our old age pensioners, our aged people. I will guarantee that in most constituencies in Canada there are still a large number of old age pensioners
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who have not satisfactory accommodation. I know that in my own constituency the problem is so acute that it is being considered by various groups.
Then, as I said the other day, when it comes to the question of immigration, there are two aspects to it. There is the question of placing a man in a job and, second, there is the question of providing him with an opportunity to have a rented home or to build a home under reasonable terms. On that account, Mr. Speaker, this is an increasing and developing problem. Not only do we find it from letters we receive from our constituents, from our personal contacts, and from resolutions by organizations, but the press realize it. This is one problem that I will give the press credit for reporting fairly thoroughly across this country. When meetings are called in connection with housing by various organizations and in various districts, I notice that there is fairly good coverage of the meetings concerned. I think that is because the newspapers realize that this is news to the Canadian people.
I have here a number of clippings taken in recent months from newspapers. Here is one from the Nelson Daily News of January 20, 1953. It is headed:
Housing Canada's Top Social Poser
75,000 homes built in 1952; down payments, interest rates deciding factors in possibility of building.
Then it goes on to explain the difficulties that people are facing in providing themselves with housing. Then I have another one here taken from the Nelson Daily News of October 6, reporting a meeting of the zone conference of the Canadian Legion. The major part of their discussion was over the difficulty encountered by veterans either in building homes or in obtaining satisfactory rental houses. Their conclusions were right along the lines of the amendment moved by the hon. member for York South (Mr. Noseworthy), that the only solution to the question was low cost government housing loans.
Then again, Mr. Speaker, we have the Kootenay Free Press in the city of Trail with an editorial on this question, because it is an acute question there. The conclusion of the editorial is as follows:
A poorly housed, or debt-ridden people, cannot hope to be as productive as those in other lands whose social organization provides a better deal. A recent McLeans survey showed that Canada is behind Britain, Sweden, Australia and the U.S. in provision of adequate housing for people who need it and are willing to pay a reasonable price for it.
Then in the Ottawa Journal of February 24, 1953, there appears an article under the headline: "Aid to the Small Home Buyer urged in Ontario Legislature."

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That is the story from the Atlantic to the Pacific, in all our urban communities. People living in a land of wealth are seeking houses and are unable to obtain them. What is most important is this. Since the conclusion of the war we have had a tremendous industrial expansion in this country, and we welcome it. In my own constituency immense sums of money have been spent in the building of dams. The sum of $33 million was spent in the building of one dam, $20 million for another smelter, and millions in the development of the saw mill industry. It is proposed to invest $75 million in a pulp mill. That picture is reflected all across the country. While we can build these huge industrial enterprises, we do not seem to be able to build houses for the people to live in who are going to produce and use these industrial tools that have been manufactured in such quantities. I am not blaming any individual. It is not a question of individuals. I know the minister does all he can under the terms of the legislation. I know he is most concerned and most active in regard to this question. It is therefore not a question of individuals; but our whole economy is based on the principle of profits first. Because there is not the same profit in house building we consider profits first and people's welfare second. That is not our intention, but that is the way the system works. In my opinion, Mr. Speaker, we have to do something in this parliament to remedy that situation, and I am sure we can do something if we have the will and the understanding of the situation.
This group has been particularly concerned over this question for many years. In fact, this was the only group in the house during the depression period that suggested that the unemployed could very well be kept employed by building houses across the country. If the advice of the C.C.F. group in the house during the depression had been taken we would not have the shortage of houses that exists at the present time.
We are interested in this because we believe in the sacredness of human personality, and you cannot develop human personality to its ultimate unless you have people living in good houses and give them the opportunity to develop a sound and proper home life.
There is no question about the orthodox methods having failed to build the required number of houses or to provide the required number of houses in Canada at this time. We have been nibbling at this question since 1945 and we have not advanced very far along the road. We have not been able today to take up the lag, and the new family ranks are greater each year than the new houses that are being built. That is why we in

this group proposed the amendment that you recently ruled out of order, Mr. Speaker. We believe that if this problem is to be met we must use the national credit; we must take what I presume are, from the point of view of the government and possibly from the point of view of the Conservative party, unusual measures. But we have the Bank of Canada; we have the collective credit of the people of Canada. We believe that that institution should be used so that the Central Mortgage and Housing Corporation could issue loans directly to builders at an interest rate of 2 per cent. We think that is urgently necessary if we are to build the houses that the people need.
I was interested in reading a memorandum presented to the dominion government by the Trades and Labour Congress of Canada on Thursday, March 24, 1949. There is a paragraph in this brief on housing which I shall read:
The shortage of homes in most sections of the country is still critical. Many resolutions and reports dealing with the housing shortage came before our recent convention. The consensus of opinion was that the housing crisis continues to become more acute.
That is quite correct. I continue:
The guaranteeing of credits offers little remedy and the position previously taken by this congress was reaffirmed.
We therefore request the dominion government to undertake, in co-operation with provincial and municipal governments, a nation-wide low rental home building program financed by national credit and designed to house, under decent conditions, ex-service personnel and those in low income brackets who cannot afford the high building costs of today.
We agree absolutely with that resolution. The situation is more serious today than it was when this brief was brought before the dominion government in 1945 by the representatives of the Trades and Labour Congress of Canada. It is a sound proposition. I am not one to suggest the use of credit on an unsound basis. This is a capital investment which is self-liquidating and which will return not only the capital and the 2 per cent interest but huge dividends in human happiness and in increased productivity at this time. That is why we suggest the Central Mortgage and Housing Corporation should subsidize public housing in order that rents may be brought in line with the financial means and the income of low income dwellers.
The hon. member for York South dealt with this matter, as did the previous speaker. I refer to the municipalities and the importance of enabling them to carry the cost of refinancing loans and so on that are required for the extension of housing in the various communities. In addition to that we urge that the Central Mortgage and Housing Corporation

enter the field of housing construction and build low-rental housing projects where such projects are now not being constructed. We believe that some policy along the lines that we have suggested is the only policy that will meet the situation. The need is so great that even this government, with all its reluctance to use the national credit in the way we suggest, should take that step and take it immediately.
To see the value of subsidized housing, just look at the success we have had with the building of houses under the small holdings provision of the Veterans Land Act. The Department of Veterans Affairs has done an excellent job in that respect. There are some improvements that we should like to see in the regulations and in the act, but on the whole they have done an excellent job. Why? Because the government in that legislation recognized that the pressing need of a veteran on returning home was a house. They have subsidized the building of the houses to the extent of something over $2,100 on a $6,000 house. That has proved very successful. In my own constituency I know of dozens and dozens of veterans, who are now industrial workers, who have taken advantage of the terms of the small holding section of the Veterans Land Act and have had the opportunity to enjoy the subsidy. As a result of that you will see dozens and dozens of neat cottages placed on a half acre of ground with lawns and gardens around them. What have you got? You have contented workers and happy families and improved working conditions, and these workers are taking a most active and increasing interest in the communities in which they live. You have happiness; you have progress and you have production as a result of that investment of government funds in the subsidies given to these men. That is a good illustration of what could be done by the subsidization of the building of houses generally in Canada at this time.
The principle has been proven sound. If we can subsidize gold mines to carry on, if we can subsidize other industries in this country, surely we should subsidize the building of houses. For what does industry mean in Canada today, what does wealth mean, what do profits mean unless the people are able to live in houses, to erect houses and build a satisfactory home life?
I do urge the minister to give some consideration to the representations of this group. We do not make them on a partisan basis; we make them in all sincerity because we are in very close touch with the need. I know the minister has a warm and generous heart, and I would hope that before the bill 68108-283
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is given second reading, and goes through committee stage, he would introduce some amendments which would indicate that he has listened favourably to the pleas of members of this group, and other members in the house.
I had not intended to speak at length, but I shall deal briefly with one or two matters of particular interest to my own constituency. Central Mortgage and Housing Corporation has built a very excellent group of houses at Sunningdale, a suburb of Trail. There are veteran tenants in these houses. It is a delightful community, one of the most pleasing in that area. The occupants have taken great care of their houses by improving the interiors and the exteriors, as well as the grounds.
Quite recently 175 of these veterans sent a petition and brief to the Central Mortgage and Housing Corporation urging that they be given the opportunity to buy these houses. The brief received the support of the corporation of Trail, and I would ask the minister and his officials to give serious consideration to their requests. These men are workers for the Consolidated Mining and Smelting Company. The occupants of these homes are proud of them and they want to have ownership. They have been tenants for a number of years and would now like to change their status. I do hope the minister and the officials in his department will receive these representations favourably. It would mean an increase in revenue for Trail and help the city out considerably. Title to these houses would be another incentive to the men to develop the properties.
One other matter has been brought to my attention, and that is the classification of defence workers. Those who have been employed in the plant of Consolidated Mining and Smelting Company have been classified as defence workers, because it is a defence plant. That has been of some advantage to the workers. However, I have here correspondence with a group of which has not been able to take advantage of this classification. The plant of Consolidated Mining and Smelting Company is within the municipality of Tadanac. The fire brigade of that municipality is occupied principally with the prevention of fires in the plant of the Consolidated Mining and Smelting Company. I would suppose that 99-999 per cent of their duties would be those of protecting the plant of the company from the ravages of fire.
These men have written to me and to other groups suggesting that those who are connected with the fire brigade are taking an essential part in defence production and should be classified as defence workers. My understanding is that at the present time the act and regulations do not permit this. I

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would ask the minister to give consideration to an amendment which would make provision tor these men who are giving an essential service to a defence industry, so that they might be classified as defence workers, and be placed in the same position as the actual workers in the plant.
Hon. members in this group do not intend to take a great deal of time in this debate, but we are greatly concerned with this problem. We do urge the minister and his officials to give consideration to our representations; because we know that houses mean happiness and health, and health and happiness mean production, and the whole means stability. And all these will be needed to build our future progress.


Mr. John Hunter (Parkdale):: Mr. Speaker, it was interesting to hear the speeches today about the subject of housing, some of which were thought-provoking, and others simply provoking. It can never be assessed properly unless one is willing to do it in a dispassionate fashion.
Housing is a subject which has aroused considerable emotion in the breasts of some previous speakers. Obviously it is also a very important subject. Unless hon. members are willing to get at the facts and unless they are willing to be dispassionate about it, they cannot solve the problem or find a solution for it.
I have heard today various figures about the backlog and the shortage of housing. The hon. member for York South (Mr. Noseworthy) has said the backlog amounted to
700,000	houses. The hon. member for Broadview (Mr. Hees) has said it is 500,000 houses; and various other figures have been given. It is very easy, through the bureau of vital statistics, to determine how many families are in Canada at a given time and how many houses there are, and it is easy to see the discrepancy between the two figures.
But the backlog is an entirely different problem. A great many of those who have not houses are not in a position to buy houses, and will never be in a position to buy houses, and some do not even want to buy them. And these figures indicating the backlog or the shortage of housing are not conclusive. I have never seen a figure yet as to the backlog of housing which has been on an actuarially sound basis, or a basis which could be mathematically determined. They take all kinds of bases for these figures, and they certainly are not sound.
But let us assume that there is some backlog and some shortage of houses. Not long ago I wrote a letter to the dominion bureau of statistics asking for some information about the greater Toronto area. I asked them how 
many families were there in 1951, and how many housing units in that year. At that time in the greater metropolitan area of Toronto they showed that there were 302,381 families in the census. They also showed that at that time there were 273,200 housing units in the area, which indicates a discrepancy between the two figures of about
27.000.	And when one considers how many of those 27,000 are perhaps newly married people, or people with small incomes and would not be in a position to buy houses, and how many may never want to buy houses, and when you consider the percentage who are not in a position to take houses, and who perhaps do not want them, the discrepancy is impossible to estimate. But obviously it is not as great as this figure of
27.000.
Let us assume it is only half that figure, which leaves us with, roughly, 13,500 families requiring housing. That is not a very large percentage of units out of the
300.000.	So that the discrepancy or the backlog is not as great as has been indicated. I am not saying there is no shortage, but certainly it is not as great as has been indicated by previous speakers.
The hon. member for Eglinton (Mr. Fleming), in his usual scolding manner, was rather abusive of the efforts of the government. But, frankly, I expect that from him, because I never have heard him any other way-never. However, I do agree with his concluding remarks in which he congratulated the minister upon his ability and upon the satisfactory administration of his department.
Then the hon. member says that for the six post-war years we have had 495,000 houses and that we have 513,000 family formations. I would point out that that figure of family formations is difficult to determine. It is easy to determine the number of families who come in through immigration. That can be done through the immigration office, because that is where they have to go. But when they come separately it is hard to tie it up-that is, when husbands, wives and children come at different times.
Then, it is easy to tell by the number of marriages how many new families we have, but it is difficult to determine how many old families, through deaths, are broken up. So I say that the figure of net family formations is a nebulous one, and that it is most inconclusive. I believe anyone who has studied the problem will recognize that it is a very unsound figure, or that at best it is a "guesstimate". So that when the hon. member says that there is a discrepancy between houses and family formations of just over
17.000.	I suggest to him that that may not be

so at all. It may not be half of that, it may not be quarter of that. It is just a figure you cannot arrive at or determine accurately.


Mr. Fraser:: It may be double that.


John William Gordon Hunter: National Housing Act
builder comes to them with a plan for a hundred acres, or whatever it is, they say they will approve it if he will put in the roads, guarantee the school debentures, put in the storm sewers, the water mains, the gutters and so on. All these items of service drive up the cost of the houses because they all cost money.
This serviced land problem is not an easy one to solve. It can be determined only over a period of years. Possibly because of the thoughtlessness or possibly the ignorance of municipal councils in the past, builders were permitted to put up houses wherever they wanted to. They did not recognize the difficulty they were getting into. They did not appreciate the type of schools that were going to be built.
The schools being built today are of a much more expensive architecture. The one-floor, ranch-type school is beautiful, but it is too expensive. This problem is not going to be solved for a number of years. But it will be solved because gradually the urban municipalities will get the required 35 per cent or more of industry and gradually they will have more land available for housing. It is not a problem that can be solved quickly. People who say that you can solve this housing problem overnight are just not facing the facts of our constitutional and financial set-up. They suggest that we should change all these things, but that would make only for greater confusion.
Another suggestion was that the down payment should be much less, possibly no more than 10 per cent. But does that solve the problem? With a down payment of 10 per cent you immediately require a loan of $9,000 instead of $8,000, and that increases the monthly amortization payments. Under the regulations of Central Mortgage and Housing Corporation the monthly payment, including interest, principal and taxes, should not be more than 23 per cent of the person's salary. You would be surprised at how many people would be brought outside that provision of 23 per cent if an extra $1,000 were added to their loans. Most purchasers of these low-cost $10,000 homes are buying them within a very few dollars of the 23 per cent provision. As soon as you add another $1,000 to the loan you defeat your purpose-you would then have houses but you would have no purchasers.
The hon. member, along with others, suggests that the interest rate is too high and the amortization period too short. As I have said already, if we are going to get the lending institutions to put their money into the mortgage field the mortgage interest rate must be at a level which will attract them away
(Mr. Hunter.]
from other investments. It is all very well for the members of the socialist party down there to say that we do not need these financial institutions, that we can get the money through taxes so that the government can put out its own funds. But I do not want to pay any more taxes and I do not think most people in Canada want to pay any more taxes. I think they are quite content to leave the lending institutions in the field. They realize that the lending institutions, being trustees for the policyholders' money, cannot lend out their money at any unduly low rate of interest.
I must say in fairness to the lending institutions that most of them have been very appreciative of this critical period in housing. I think you will find that most of the lending institutions of this country are putting out a much greater percentage of the current money they have available, in the form of mortgage loans, than they would normally have done. These companies have very attractive investments open in other fields; yet most of them, with some humanitarian feeling, have put out a very much greater percentage of money available, for mortgage loans, than they would otherwise have done. I know that is true and I think that most members of the house know that it is true. They have been very co-operative but, naturally, they cannot go to the point of losing money which belongs to their policyholders.
As a holder of insurance in this house- and I presume everyone else here holds insurance-I do not think we want the lending institutions to endanger the money that is being invested on their behalf.
The hon. member for Eglinton (Mr. Fleming) suggested that the housing problem was very great and very critical. Well, if he had said that five years ago he would have been right. I do not say that there is no problem but it cannot be considered to be as great a problem or as critical a problem as it was five years ago. There is getting to be a very close approach to the necessary housing. You only have to look at the figures in a city like my own-Toronto-which is considered to have a very critical shortage of housing. It is one of the few hot spots for lack of housing in Canada. You will find that where houses were once sold before completion, now the period between completion and sale is steadily lengthening, even for cheaper housing. That, I think, indicates that the shortage is being met. It is completely unrealistic for people like the hon. member for York South to get up and say that costs have passed beyond the reach of tens of thousands of people in Canada, as if it were something that had just walked in, something

that had happened under this government. Where in any country in the world has everybody always had a house? There is no country in the world that has a housing supply as close to family formations as Canada has-with perhaps the exception of the United States. I have seen figures in magazines which say that the construction of housing in Canada is falling behind compared with the United States, England, Australia and so on. Well, in Australia they do not even put in any heating. They build prefabricated boxes and call their effort a housing program. In England what are they building? Not what we would call houses- and to compare the two situations is not fair at all. In fact, the record of this parliament, this government and this- administration with respect to housing is second to none in the world.
I hear laughter and I think it probably comes from the socialists, who feel that everybody must have a house. Well, I think that is a beautiful ideal; I think it is a lofty ideal and I think we should strive for it; but I do not think we are going to have that millennium tomorrow. I think the theories of the socialists are delightful because they remind me of the fairy stories I used to read as a little lad. They make delightful reading but they are completely crazy.
Now let us get to the matter of availability of mortgage money. Where is this mortgage money coming from, and how much do we need? I think that last year there was something around $700 million-and how much mortgage money do we need to completely meet the housing shortage that everyone feels is so clearly indicated in Canada? Well, I do not think that anyone knows. I do not see how anyone can know because no one knows what the shortage is. All we know is that we can only govern the number of houses built by the demand. How else can we know? It is all very well to pull these figures out of the sky and say that there is a backlog of 500,000, which was the figure given by one hon. member, and to say that there is a backlog of 700,000-the figure given by another hon. member. There is just a small discrepancy of 200,000 units. That shows you how completely nebulous and inaccurate the figures are. There is only one way to determine the shortage of housing and that is from the demand for them. It is the same as it is for shirts. If there is a shortage of shirts they sell rapidly but if there are plenty of shirts they stay on the shelves. The same situation applies to everything in a free enterprise country, and as soon as you get away from a free enterprise system you might as well fold up, because you have entered
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into the deadest thing that has ever happened-socialism.
I have gone into these things because I do not think they have had fair treatment. I do not think that people have been facing the facts in the world-that we have a free enterprise system. I do not think they have been facing the importance, or the value and the strength of our free enterprise system. It is a system which is stronger than anything else and so much better that these other things are just not comparable. No one thinks that the free enterprise system is perfect. Why should it be perfect? How can it be perfect-when human beings are running it? It is just silly to think it should be. That is why socialism is so stupid, because it assumes that human beings are perfect. The socialists take the latter as being a very lofty assumption and I can only hope that they are examples of what we are going to have in that perfect society. I think that occasionally even they have their human weaknesses, and those human weaknesses will tear down anything.
One socialist says that we must get rid of that profit motive. That is just about the silliest thing I have heard. What other motive is there? What is going to motivate people to get out and do something? There is just the profit motive. I do wish that every person in this country were Christian enough not to require the profit motive to do things for their fellow men, but I do not think that even the hon. member who made the statement would really agree that such is the case. There are quite a few people who are not entirely motivated by Christian love. It is foolish and it is the fallacy of the whole socialist system-and it always will be. I do not think that in our time human beings are going to be perfect.
I would like to congratulate the minister on the job that he has done. He has dealt with these matters with tolerance, understanding, energy, and a great deal of determination. I do not always agree with him and I think that we have had a few words from time to time. I have sometimes felt afterwards that I was right, but even though I may not always agree with him I think that on the whole his attitude toward the question of housing has been one of deep interest, deep penetration, and I think that this government has been very lucky to have him handling this subject.
I would also like to say a word for the officials who are running Central Mortgage and Housing Corporation. While I have had differences with them I have found them a singularly intelligent bunch. I have found them hard-working, very interested in their subject and co-operative within their terms

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of reference. I have formed a very high regard for the administration of the corporation. Although it is perhaps not nice to mention names, I would also like to say a few words about Angus McClaskey whose head office for Ontario is in Toronto. He is a very hard-headed Scot, a man completely interested in housing and for whom I have the highest regard. He is a man who I think has done a splendid job.


Some hon. Members:: Hear, hear.


Mr. C. E. Johnston (Bow River):: Mr. Speaker, I did not intend to speak again on this subject because it was only last Tuesday, April 21, that I did speak at quite some length upon it. At that time I put forward a proposal which I thought would be of assistance to the government and the people of Canada, and of particular assistance to those people who are in dire need of housing. I was amazed, however, at the remarks of the hon. member for Parkdale (Mr. Hunter), who has just taken his seat. I cannot recall exactly what he said when he referred to the number of houses in Canada but I think he said that the need expressed by some hon. members was greatly exaggerated. In fact, he added that there were very few people in Canada who needed a house. He said it might be a matter of a few thousand.


John William Gordon Hunter: Mr. Speaker, I want to object ;o that kind of interpretation being put upon my words. I was speaking strictly of Toronto where I said there was a shortage of 27,000. I do not want to be misinterpreted.


Charles Edward Johnston: I was not misinterpreting you. If I heard you correctly you have just now said 20,000-


John William Gordon Hunter: Twenty-seven thousand.


Charles Edward Johnston: I will not argue over whether it is 20,000 or 27,000 but I cannot help but recall the remarks which the hon. member has just made about standing behind the minister, that the minister has done a wonderful job, and that anything the minister has said has been perfectly correct. I am not disputing that but I want to make perfectly clear just what the minister did say about the shortage of housing. I mentioned it in Hansard for Tuesday, April 21. The Minister of Resources and Development (Mr. Winters) was speaking to the Appraisal Institute of Canada, I think it was, on Thursday April 2, 1953, when he had something to say about the shortage of housing. I am sure the member for Parkdale (Mr. Hunter) would not contradict the Minister of Resources and Development. Now, you just listen to what he said there, and then compare that with
rMr. Hunter.]
your statement. He is speaking of low rental housing, and this is what the article said:
Mr. Winters said that not more than one-third of Canada's families could afford new houses- either to rent or to own.
Do you mean to tell me that there are only
27,000	people in Canada who need houses, when the minister himself says that at least one-third


John William Gordon Hunter: The hon. member obviously does not understand what I said. I spoke of the Toronto and York area, and said there was a discrepancy of 27,000 between the actual family units and the housing accommodation. At no time did I say that was all in Canada or anywhere else.


Charles Edward Johnston: It is very fine now for the
hon. member for Parkdale to get up and make a correction in what he said. If this same relationship which applies to Toronto were to be applied to the rest of Canada, then the hon. member's estimate of the Toronto area is away out, too. Then, this article goes on to say:
But if enough new houses weren't found, he stated, it would affect the people at the bottom of the scale-the people who were living in dilapidated and obsolescent houses.
Anyone who gets up and tells us there is no great need for housing in Canada, when the minister himself has been honest in showing the great need for it, obviously does not know what the situation is. I think it would have been much more appropriate if the hon. member for Parkdale had been speaking of trying to maintain the loan companies and insurance companies in this country rather than maintaining housing. The whole of his argument was that we could not expect them to lend money at 2 per cent to build houses, but rather that they should lend it at 5J per cent, not for the purpose of building houses but in order to keep the financial institutions and mortgage people in a sound financial position. I may tell him that the whole housing program was started, not to build houses but to keep the mortgage and loan companies in a solvent position.
We started out by granting moneys through the loan companies at 4 per cent. As soon as the field got to a point where these companies could lend money on other enterprises at greater amounts of interest they did not lend money to build houses. They came to the government and said: Unless you give us a greater increase in our interest rates we cannot afford to lend money to build houses; we will lend it out in places where we can get a greater return. From a business point of view I am not arguing against that. I am saying that is not the way to build houses.

Our experience has shown that when the loan companies take that attitude, then we do not get houses built. My concern, Mr. Speaker, is to see that we build some houses for these people to whom the minister was referring, the two-thirds of the families in Canada who cannot afford to own or rent houses.
Now, the members of the C.C.F. party proposed an amendment a while ago which was ruled out of order. I want to say that so far as the proposition was concerned I did not think it was so very far out of line. I thought some of the clauses needed polishing a bit and brought more into line with good business practice, but in general I thought the proposition was fairly good. I would not want the hon. member for Kootenay West (Mr. Herridge) to get away with the statement he made a while ago. He said that during the depression the C.C.F. party was the only party which advocated the issuance of national credit. He was so wrong in that statement that he did not know what he was talking about. If he will go back and examine the record, he will find that what I am saying is true. The Social Credit party has always advocated the issuance of national credit. I could say some more about that, but I just wanted to draw that to his attention.
What I want to say today, Mr. Speaker, is related to what the minister referred to in his speech on April 21. I do not intend to repeat what I said the other day concerning the National Housing Act. As I indicated a while ago, I spoke then at some length. The minister was speaking about the necessity for housing, but in his speech this afternoon he did not indicate any way in which we were going to change this present plan of house building in order to meet the situation of those people who, under the present set-up, cannot afford to build these homes. When I was speaking the other day I offered a proposal. I do not know whether or not the government will take it. I would have introduced it in the form of an amendment, except that I am sure the Speaker would have found some ruling whereby it could have been declared out of order. I did not, therefore, submit it as an amendment.
I am quite sure that the plan which I proposed would assist us in the building of houses. The minister had something to say about that, and I want to refer to it because he made mention of the province of Alberta. I had said that the province set up a revolving fund to take care of serviced land for self-liquidating projects. I was fully aware of the fact that that project was not for the purpose of assisting under section 35 of the National Housing Act. What I was pointing
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out to the minister was that if they did set up a plan for a revolving fund, then the provinces would be able to co-operate under that plan and extend their present system for self-liquidating projects to be included under section 35. At page 4169 of Hansard lor April 21, 1953, the minister said:
Now, the Alberta government has a revolving fund. One of the techniques the federal government has at its disposal is co-operation with the provincial governments, and we do that under section 35. As I understand it the Alberta legislation was amended this year to discontinue having money from that revolving fund flow into municipal works through section 35. If a municipality wishes to benefit by the co-operative plan under section 35 it must now go into the open market to get its money. The Alberta revolving fund is no longer available. I do not wish to be critical of the government on that point. They probably did that because they felt it was in the best interests of the people they served. I merely cite that as a matter of fact.
I want to speak about that for a moment. Under the proposal which I offered the other day I suggested that, if the government would set up this revolving fund, then the provinces, not only Alberta but the other provinces, would be able to put in a plan similar to that which Alberta has for the self-liquidating project, thus enabling them to supply serviced land. There is no sense in the provincial government setting up a revolving fund and lending that money at 2 per cent for the loan companies or mortgage companies to come in and build houses on that serviced land for which they are charging the people 51 per cent. The only thing that would accomplish would be to give greater security to the loan companies. What sense is there in that? That is not going to solve our problem. What you would be doing, in effect, would be subsidizing the loan companies. I would not advocate a thing like that, and I would be surprised if the provinces would tolerate such a condition. If the federal government sets up a revolving fund to build homes at 2 per cent, then I am sure the provinces will co-operate by lending money to the municipalities at 2 per cent for self-liquidating projects in order to provide serviced land. I do not want anybody here to get the impression that the lending companies are going to be so benevolent as the hon. member for Parkdale said, and will break their necks trying to build homes regardless of profit.


Mr. Fair:: The revolving fund is still there.


Charles Edward Johnston: Yes. As the hon. member for Battle River (Mr. Fair) points out, the revolving fund is still available in the province of Alberta for the purpose for which it was set up.


Robert Henry Winters: Not under section 35.

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Charles Edward Johnston: No; and you could not blame them. Why would they lend money out at 2 per cent for servicing land and then have the Central Mortgage and Housing Corporation and the loan companies come in and build their houses on that already serviced land at 2 per cent, and charge 5J per cent to the people who are going to build houses? Then they would have the serviced land already there which increases the value of the property of the mortgage company, with better security than they had before. Rather than spending our money to finance the loan companies at 2 per cent, we might better buy Ontario bonds and get 3 j per cent or 4 per cent, if you are going to be cold-blooded about the thing. I never saw an instance where the mortgage companies went out of their way to assist the home builders, but I can indicate many places where they went out of their way to gyp the home owner; and I could refer to a court record in proving my argument. When anybody stands up here and tells me how benevolent the loan companies have been in even seeing that the loans made to these prospective owners are properly administered, he has to prove it to me because my experience does not bear that out.
There may be some grounds for the subsidizing of low-rental projects. The C.C.F. members had that provision in one of the clauses of their amendment, but it was declared to be out of order. There probably is a group which-and I am sure there is- no matter how low the down payment was, still could not afford to buy homes. Under those circumstances it may be necessary to have some type of subsidization by the federal government whereby those houses can be built; then they will have to be rented having in mind the ability of the individual to pay.
When I was down in the United States a year ago-just about a year ago now-I saw some of the projects there in New York; they were beautiful apartment houses and they were rented at low monthly rates. The rents being received were based entirely upon the ability of the individual to pay, and they were about $25, $26 and $27 a month. You could not hope to build such a structure as that and have the cost of building paid back through the rent received. Hence in this case it would be necessary for some type of subsidization to house those people who, no matter how low the down payment was, would never be able to own a house. But if the government would enter into some new plan that would definitely show results in building houses so that people might own them-such as the plan I suggested, or some other similar one-I am quite convinced that we would find the province to be extremely

co-operative; because it is the desire of the provinces as well as that of the Minister of Resources and Development (Mr. Winters) to see our people properly housed. I am sure that Alberta would be one of the first to co-operate. But I would not expect them to co-operate in servicing land, thereby further enhancing the security of mortgage and the loan companies. In my opinion that is not the purpose of the national housing program. Its purpose should be to build houses at prices at which our people can afford to buy them. You cannot have better security; and you cannot have more contented people than those who live in their own homes. I trust that the minister will give this idea some further consideration.


Mr. J. G. Diefenbaker (Lake Centre):: Mr. Speaker, there are just one or two observations I wish to make in connection with this bill to amend the National Housing Act. They cover my own province of Saskatchewan in general and Saskatoon in particular. I refer to a matter that was drawn to the attention of the minister on March 30 last as reported at page 3403 of Hansard when a question was asked by the hon. member for Saskatoon (Mr. Knight) with regard to the situation that prevailed there and the difficulty in the province of Saskatchewan of securing loans from loan companies in order to permit the building of houses by builders.
First, may I say that I was greatly interested in the remarks made by the hon. member for Parkdale (Mr. Hunter) when he eulogized in such fulsome measure the benefits of free enterprise and received from the members supporting the government that warm applause which is indicative of the fact that, as they applauded, they did not realize that no government in history-even the socialist government of Saskatchewan-has so far embarked on so many measures of a socialistic nature and a denial of free enterprise as has this government. Having said that, I want to refer particularly to the situation in Saskatoon which has already been brought to the attention of the minister. It has to do with the housing situation there, and it also indirectly has to do with the housing situation generally in Saskatchewan. I think I can follow no better course than simply to refer to the resolution which was presented to the city council by the Saskatoon home builders' association some two weeks after the minister on March 30 set out something of the house building that has taken place in Saskatoon, and the increase in building there during the year 1952, as an answer to or a denial of the request that was made on that day by the hon. member for Saskatoon.

This brief sets forth particularly a situation, as I said, that prevails in Saskatoon and one that also requires attention in other cities in the province. It is becoming more difficult in Saskatchewan, as time goes on, to get mortgage loans under the National Housing Act. There are authorized companies that will not lend in Saskatchewan, although they lend in other western provinces. In Saskatoon it has been found that these loan companies have been drastically reducing the amount of money they will lend here. The result is that the financial handicaps that are imposed by the companies, when they do make loans, make it increasingly difficult for deserving people in Saskatoon in particular and in Saskatchewan generally to own their own homes. The portion of the brief that is material reads as follows:
And whereas the majority of the builders operating in other cities in Canada have been granted selling prices which did permit them during 1952 to build and obtain 80 per cent loans, few of the builders in Saskatoon have been granted selling prices under which they can work and permit their purchasers to obtain these larger loans . . . The mortgage companies as well as Central Mortgage and Housing Corporation have appeared unwilling to increase their lending values in Saskatoon over the amount set three years ago while in the meantime building costs have greatly increased because of higher wages demanded by labour and increases in freight rates on lumber, cement, plaster, plaster board, brick, flue lining, hardware, furnaces, plumbing fixtures . . .
-and the like. I point out that there is a problem there because many of these requirements, as the minister knows, must necessarily come from a considerable distance. As to building materials in Saskatchewan, there is no shortage in so far as lumber and the like are concerned. Those materials are readily procurable there; but in the main we are faced with the very serious increase in freight rates. Even though those rates are applicable to all parts of Canada, they do particularly affect that province because of the need to import building materials from the other provinces. The brief goes on:
It is further apparent that Saskatchewan builders have not been allowed as part of their cost the 3 per cent education and hospitalization tax which they must pay on the cost of all material being used, which amounts to from $209 to $300 per house.
Consideration should be given in that regard. Certainly there are three provinces -and I am speaking from memory

that have these direct taxes, and some consideration should be given, as requested in this brief, to builders in these provinces. I understand that New Brunswick, Quebec and of course Saskatchewan impose this tax. The brief goes on:
And whereas this shortage of mortgage money has drastically reduced the number of homes which the builders could have built, and in addition has increased the cost of building because of the
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limited operations. The result is that the builders have been unable to erect sufficient homes to satisfy the popular demand and consequently there has been a continual agitation to have more publicly financed homes built in the city.
And whereas some of the companies which had been loaning here and which until very recently said they had little or no money for Saskatoon this year, have now intimated they will make some money available-
There is an improvement in the situation.
Nevertheless the mortgage money outlook for Saskatoon, for 1953, is greatly restricted compared with past years, is very disappointing, and greatly handicaps the builders in their ability and willingness to provide homes for those who wish to own their own.
And finally the request is that consideration be given to the improvement of the situation there. The brief goes on to say:
While these are the same regulations that apply in other Canadian cities, they create a much more serious problem in Saskatoon than elsewhere because the builders in other cities are being granted enough speculative loans to proceed with normal construction. In Saskatoon where the majority of loans are home-owner applications, these numerous obstructions and handicaps prevent the builders from proceeding with the erection of homes in any large number.
The request that is finally made is that:
If the mortgage companies are unable or unwilling to make it (the National Housing Act) fully operative here, we request that Central Mortgage and Housing Corporation apply to Saskatoon their agency agreement which has been extended to communities of less than 50,000 population.
That applies not only to Saskatoon but to a lesser extent to the city of Regina. It is something that is very necessary, and if granted by the minister through amendment of the regulations it would achieve a considerable increase in housing accommodation in Saskatchewan, in the cities of Saskatoon and Regina.
I know that in the operation of the act changes must be made from time to time to meet the exigencies of changing conditions. This act represents an endeavour to meet a situation that challenges the initiative of this or any other government that might be in power, and the act must necessarily be subject to periodical changes in order to meet the changes in circumstances as they arise. While the act as it was and the regulations as they were did meet the situation to a degree, nevertheless the changes asked for in this brief-and I think they are generally supported in Saskatoon and Regina; I have just returned from a couple of days in northern Saskatchewan-if made would go a long way toward rectifying the situation.
Certainly no one wants the government embarking on an expenditure orgy such as was contemplated in such horrendous terms by the hon. member for Parkdale (Mr. Hunter); but on the other hand the govern-

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ment, having embarked on a policy of endeavouring to provide housing accommodation for so large a portion of the population as is possible, should endeavour to remove those anomalies which exist in the law or the regulations, and which in any way tend to reduce that maximum production of building units which is the avowed purpose of the legislation. In other words, as I see the picture what Central Mortgage and Housing Corporation is in effect doing is operating a partnership as between socialism on the one hand and free enterprise on the other, with the end in view of securing the greatest good for the greatest number. The minister nods his head in agreement with that general summary.
I know there is pronounced criticism of the failure of the corporation to achieve that degree of perfection which would provide houses for everyone. That is an ideal which will always remain an ideal. But when a situation prevails such as that in Saskatchewan, with the provincial problem incident to the education tax and the fact which cannot be denied that loan companies have greatly restricted the field of their lending operations for housing, there is a need, and a very challenging one, for a change in the regulations in order to meet the request of the builders' association, which is reinforced by a general public demand for a change in the regulations.
I make this in the form of an appeal to the minister, that he give further consideration to the rather abrupt refusal he uttered on March 30 to the hon. member for Saskatoon (Mr. Knight), and that the situation be canvassed and reconsidered to the end that this legislation shall be made effective everywhere in Canada; so that one or two provinces will not enjoy the benefits of the legislation to an extent beyond that which, in proportion to the population, all provinces should enjoy.
On that basis I feel that Saskatchewan has legitimate grounds for complaint. While the minister may be able to point out that there has been an increase in units, that increase is infinitesimal as compared with the demand for increased housing this year, which will not be met in the cities of Saskatchewan that I mentioned unless these and possibly other changes are made, and which from experience the minister will know have to be made to meet a situation that requires immediate attention.


Mr. David A. Croll (Spadina):: Mr. Speaker, I am not going to take very long in this debate, because I have already spoken about housing in the debate which took place in

February. It was a year ago that I brought to the attention of the house the fact that the lending institutions were withdrawing to more profitable fields, and vacating the field that was historically theirs. I am glad to see that now I have allies in other parts of the house who have come to the same conclusion; perhaps if we join together we shall be effective.


Stanley Howard Knowles: Come on over.


David Arnold Croll: There is more room over on my side. The minister told us today that the most pressing problem in the production of housing was the need for serviced land. I think it is the conclusion of hon. members, from what has already been said, that the most pressing problem is the shortage of mortgage money. The minister indicated that life and fire insurance, trust and loan companies were the main sources of private mortgage money. He told us today that their mortgage holdings represent a quarter of their total assets. I have no doubt his figures are correct; but it is not enough.
Mr. Fortin, secretary-treasurer of the dominion mortgage and investment association, said, in response to a request for mortgage money, "But there is not enough money to go around". He said that some projects must be postponed, and that house-building mortgages must take their share of the postponement. His words appear in the Globe and Mail of March 25, 1953.
Last year Mr. Mansur, giving evidence before the standing committee on banking and commerce, said that 10,000 additional starts would have been made if mortgage money had been available in 1952. This means that we lost the use of some 10,000 houses during 1952 because we did not have enough mortgage money. That is a very serious matter.
Since 1947, under section 31A of the National Housing Act, there is authority to the corporation to make loans on its own account when joint loans are not available from lending institutions. To meet the shortage of mortgage money, direct loans have been made available in municipalities under 5,000. In August of 1952 that was extended to communities under 50,000, such as Oshawa, Barrie, Brampton, Orillia and similar municipalities. Then today the minister said in his statement:
The introduction of the agency arrangement in 1952 by which the corporation extended the direct loan facilities of section 31A to cities of from 5,000 to 50,000 population is already a step in that direction.
Up to the present time 96 loans have been made under that section of the act. The minister knows how disappointing that is, in

my view; because we are not coming to grips with the problem. I think that in the main the minister and the government are doing an excellent job on housing; but a new problem has arisen, and we are not facing up to it. Financing today, above all things, is limiting our ability to build houses. There just is not enough money now available to build homes. Therefore credit-worthy Canadians cannot obtain the money which ought to be available to them.
I recall very well when the occasion arose in the house to increase interest rates. It was then said-I do not suggest it was said by the minister but certainly it was said outside the house-that if we wanted to make it attractive to the mortgage companies we had to increase the interest rates. Well, we did that; and almost immediately more money came on the scene. Now we find we are getting another squeeze. I am suggesting to the house that this is another attempt being made to increase interest rates once again.
If there is no inclination on the part of the government to expand the loan program, surely there is an opportunity to increase the joint loan. At the present time we are participants to the extent of 25 per cent. We could participate to the extent of 50 per cent, which would make 25 per cent more money available to the public generally by way of conventional or direct loans from the mortgage companies. This would help the mortgage companies to provide available funds in order to provide more housing.
I think it would do more than that. What I am saying to the house is that if we participated to the extent of 50 per cent instead of 25 per cent it would also decrease the fear of the lending institutions against a lower down payment, or a longer amortization period. Consequently it would make it easier for people in Canada who need houses to obtain them.
If more mortgage money was available at the present time it would have an effect upon construction costs. If builders were able to plan so that they could use mass-production methods and undertake large-scale building projects, they could bring down the cost of housing. But they are unable to do that at the present time, because they cannot obtain forward commitments for mortgages.
I am considerably disappointed to find that it is necessary for us to beg money from lending institutions, on their terms; still it is not available to a great many Canadians who do not want it for speculation purposes, but merely to build homes. In the House of Commons we talk about encouraging people to live in their own homes. That is the way it should be. But on the other hand we are
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not doing too much to make that possible. I think the time has come when a creditworthy Canadian ought to be able to obtain whatever funds he requires to build a home for himself and his family. If mortgage and lending institutions in this country are not prepared to make the funds available, then it is the duty of the government to make them available. I am not talking about 1 per cent money; I am not talking about 2 per cent money. If it costs the government 3 per cent then we will charge 3 per cent, and one quarter per cent to cover the overhead. I am not asking for a subsidy from the government or from anyone else. All I suggest is that there is a real and vital problem which concerns all of us, and which is not receiving the attention it deserves.
I think the government will hear a great deal more about housing in the days ahead. Up to the present time they have done about as well as could be expected, and a great deal when measured by any yardstick. As I have suggested, I think the mortgage and trust companies are making this an opportunity to increase their mortgage rates. I am asking the minister now, as I asked him a year ago and as I have repeated since then, to see that mortgage money is made available to credit-worthy Canadians. I am glad there are members on the other side now joining me in that appeal; I hope that we shall have some success.


Mr. M. J. Coldwell (Roseiown-Biggar):: Mr. Speaker, we have heard this afternoon speeches by two Toronto members, both Liberals, and two speeches more dissimilar could scarcely be heard in this house on a single afternoon. I want to say that I agree in the main with the hon. member for Spadina (Mr. Croll) rather than with the hon. member for Parkdale (Mr. Hunter). Indeed I think the hon. member for Spadina sits in the wrong place in the house. As a matter of fact I think he should be sitting with us, because so often his ideas are in tune with what we are thinking in this corner of the house.
Be that as it may, I want to say that I agree. As a matter of fact the hon. member for Vancouver East (Mr. Maclnnis), who intended to speak on this matter this afternoon, left me a few clippings on his desk when he went out which confirm what the hon. member for Spadina said. This clipping is from the Ottawa Journal of May 23, 1952, and reports what Mr. Mansur had said before the banking and commerce committee the day previous. This reads:
Dealing with another aspect of construction financing, Mr. Mansur indicated that the CMHC and

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Canada's commercial lending institutions do not see eye to eye on mortgage-loan policy.
He said the short amortization period is the "holy cow" of the lending institution. They were more interested in protecting their loans than in maintaining a "flexible and progressive policy.''
Lending institutions did not want to make mortgage loans running for more than 20 years. The CMHC made loans up to 30 years depending on the borrower's ability to repay.
But there was a limit on the amount of money the CMHC had available for lending purposes. If lending institutions would broaden their policies, he added in an interview, the amount of housebuilding in Canada might increase.
That is exactly what my hon. friend has in mind, as well as the pressure to increase mortgage rates.
There is another aspect of this matter about which I should like to talk briefly this afternoon because I think it is an important one. I agree with what was said earlier as to the necessity of building homes on serviced land. The hon. member for Parkdale did not approve of the kind of housing that is under way in Great Britain. As a matter of fact, the stress in the early days after the war was on the building of permanent rather than temporary dwellings; but there is one thing about the houses being built in that country and that is that they insist on them being built on serviced land. There must be water, there must be sewer facilities, there must be drainage and so on. Here that is not demanded, either by Central Mortgage and Housing or the municipalities in which the buildings are to be built.
The hon. member for Parkdale indicated this afternoon what private enterprise could do in this regard. I have on my desk a letter which was sent out by the national house builders' association, with headquarters at 21 King street east, Toronto. This letter was provoked by a news release dated November 26 by the Department of Resources and Development announcing Canada's largest subsidized housing project to date at Saint John, New Brunswick, which is to contain 200 family units and cost about $1,900,000. This letter then goes on to say:
Why is the Canadian government so vigorously promoting subsidized housing?
And again:
Public housing kills individual incentive.
And further down:
Private enterprise has made Canada great and has done a job second to none in the field of housing. Are you for socialistic subsidized housing or private enterprise? Give us legislation designed for home owners on a basis which rewards initiative and pride of ownership.
What is to prevent them exercising their initiative now? There is no law against the building of homes under free enterprise. It is because free enterprise has failed to
rMr. Coldwell.l
produce the homes that are needed that we have had to have a housing act and have had to consider legislation of this description over the last several years. There is nothing to prevent them if they want to engage in building houses under private enterprise. They can go ahead, and I think everybody will be pleased to see more houses being built. There was a quotation which I saw the other day in a popular magazine reading as follows:
Many people consider things a government does for them to be social progress but they regard the things government does for others as socialism.
That is precisely the tenor of this letter sent out by the house builders' association. One of the factors militating against the purchase of homes in this country was referred to by Mr. Mansur on the date I have already given and is reported in the same article, and I quote:
Turning to the question of builders' loans. Mr. Mansur said at one point, ''there are exceptions but most builders are interested in obtaining as large a profit on each house as possible.
''For example, one builder told me recently that our lending value pattern was not suitable to his building program, as he preferred to build only four or five modest houses a year with a profit of $2,800 on each.
"Our lending values do not envision such a large profit."
I have great respect for many builders in this country who have tried to do a decent job at a decent price, but there are some organizations, there are some builders and there are some large contractors who are out to make a killing as far as housing is concerned. They know what is perfectly true, that there is a shortage of houses in Canada. I am not going to enter into an argument with the hon. member for Parkdale as to whether there is a backlog of 750,000, 500,000, 200,000 or, in his district, 27,000 houses; I am not talking about that as I do not know what the figures really are, but I do know that rents have skyrocketed because of the demand for housing.
I do know that there is a great deal of overcrowding in many of our towns and cities from Vancouver to Halifax. I do know that a great many people are occupying crowded rooms in obsolescent buildings and living under conditions that do not reflect much credit on this country or, may I say, on the various governments of this country.
I mentioned a year ago that I had had some personal knowledge of the building of a home in this city by one of these contractors. Ever since this particular house has been occupied it has been found that things were scamped, things were improperly done and considerable money has had to be spent doing things that the contractor should have done in the

first instance. When they came to look at the drainage around the foundation they found that it had not been drained. They had to get another contractor to put in the drainage pipes. This particular contractor built a lot of houses in this city. On the first evening that one young couple inhabited one of these homes the man decided to have a bath. He filled the tub, had his bath and pulled out the plug-and the water went into the living room below. Yet that was the contractor who was awarded or was going to be awarded a contract last fall to build housing for the government to the tune of $1,500,000.
I think one of the matters the government should carefully review is that of inspection. It is left to the lending institutions, and I happen to know that one of the lending institutions in that very area, when they were asked about the manner in which the houses had been built, wrote and said that was no concern of theirs; that all they were concerned about was the mortgage and the payment of the mortgage.
If that is the attitude of some of the lending institutions then I think it is high time we said to the minister that we should have our own inspection service and inspect the homes with people who are qualified, people who can do a job and make an inspection. At the same time I think we should see to it that these inspectors who are put on the job are not given any special concession by the contractor on the houses they themselves buy or inhabit. I believe that happens in some cases.
I think the time at least has come when we, as members of parliament, should try to protect the people who are trying to build homes in this country in which to live. As far as I know, no satisfactory disposition has been made of the complaints. The down payment has been made, the mortgage is on, and in each case the people who occupy these homes have an obligation to pay and I do not know what their remedy is. I know that in one particular case where people went into a home, after watching it being built, they had to pay over $300 to fix the foundation and do various things that the contractor did not do. He was one of the big contractors in this city and I feel inclined to put his name on Hansard.


Mr. Cruickshank:: Name him.


Major James William Coldwell: The Campeau Construction Company of this city, a firm which is doing quite a lot of building here, and jerry-building at that. I say to the minister that if we are going to encourage people to buy homes then we should see to it that they are protected by proper inspection. The builders may say that is an interference with private enterprise, but I say it is not. They can build all the houses
National Housing Act
they wish. We are doing a great deal for the builders and for the lending institutions in giving these guarantees to them, and I think it is only fair to ask the lending institutions and the building organization to give a square deal to the people of Canada and to those who must obtain homes at this time in this city.


Mr. Rodney Adamson (York West):: Mr. Speaker, I am just going to speak briefly on this subject and on three or four points which have not, in my opinion, been adequately covered by the act. There is first of all the problem of providing serviced land in large and small municipalities. Second, there is the question of municipal taxation which so seriously affects the construction of houses. Third, there is the insecurity of the people who already have houses and are paying for them.
The problem of serviced land is one of the most vital and one of the most serious questions we face today. In the municipality in which I live, and in the five municipalities which constitute the riding which I represent, the preparation of an acre of land costs in the neighbourhood of $10,000, that is to provide all the physical services and the schools. The figure covers the process of bringing raw land to the point where it is properly serviced land with school facilities. If you build houses at the density of five per acre, it means you have a capital cost of approximately $2,000 per lot before the first shovelful of earth is taken out and construction begins.
This is a problem, Mr. Speaker, which I believe the federal government is doing nothing to solve. The government realize the problem and Central Mortgage and Housing Corporation realize the problem, but they do not realize the immensity of the problem. They are just toying with its solution.
Around Toronto there is an extremely dense population and very rapid growth. The question of providing serviced land is almost driving the municipalities into-I will not say receivership, but it is certainly driving them into straitened circumstances; and the municipality in which I live must put a prohibition on any further housing development because that municipality cannot afford to provide serviced land. It cannot afford to provide schools, sewers, streets and other things without imposing a municipal tax burden on the people already living there which would make home owning so expensive that it would destroy the security and equity in the homes already built. It is a situation which is fairly general in or around Toronto, and I imagine it is fairly general around all the major metropolitan districts in Canada today.
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The solution of the provision of serviced land must receive more attention than it has under this bill. I have a suggestion-made on my own account, and I am not speaking for the party-and I would like to hear some discussion or criticism of it. My suggestion is that municipalities should be allowed to issue tax-free bonds. I realize that is heresy, but there must be some method by which municipalities can obtain more funds to provide serviced land and schools. I do not agree that municipalities should have their own taxing powers enlarged or that they should be allowed to go back into the income tax field or anything of that nature. In my opinion that would be a retrogressive step; but the municipalities must be able to provide this serviced land, without penalizing the people already living within their boundaries.
In rapid growth areas there is an unbalance of industry as compared with domestic construction. The higher the percentage of domestic construction and the lower the percentage of industry, the more likely you are to have a municipality in financial difficulties. That is something, of course, which the provinces must consider when more money is borrowed by municipalities. What the proper percentage is, I do not know. Certainly in the dormitory suburbs which have been created around many of our metropolitan areas, the percentage of domestic construction to industry is away out of line. All this means that a man who already has a house, who can meet the mortgage payments, finds that with the ever-increasing burden of municipal taxation his cost of home ownership is constantly increasing, and as his annual cost of home ownership increases his security in his home decreases.
I consider that one of the most dangerous situations which we have to face in Canada today, particularly in industrial centres. If there should be a temporary period of unemployment in these centres, if industry were to lay off the men for a few months, you would find that with these tremendous annual costs of home ownership a man would be deprived of his interest in his home. Fortunately that is something which we have not had to face as yet. However, should there be a slight recession in industry, should there be even a 10 or 15 per cent recession, we are going to find that a large number of people, who are today just getting by, will be in extremely difficult circumstances. It is on behalf of those people that I wish to appeal to the government in connection with this question of municipal taxation which is, in turn, based partially upon the provision of serviced land.


There is one other problem with which I should like to deal very briefly. I have mentioned it in this house before. It is the question of providing mortgage money for homes built in areas which are not strictly covered by the act. Today a lot of men are building their own homes, particularly in the industrial areas, or they are assisting in the construction of their own homes. They are working on the week ends and at nights, and a great deal of work is being done by these people or their friends. Frequently they build houses which are not included in any major plan or housing development, although they are within areas earmarked for residential construction.
What happens to these men is that they find themselves outside the scope of this act. Instead of being able to borrow money through the provisions of the act or through a regular lending institution, they have to go to private sources for their mortgages. Here they are penalized. There have been numerous cases brought to me where a man has asked for a mortgage of, shall we say, $5,000 or $6,000, and has been forced to sign a mortgage for $500 to $1,500 more in order to obtain the mortgage he desired. This is quite legal, but it seems to me that the provisions of this act should be broadened in such a way as to stop this practice, as it is evil and pernicious.
I want to say one further word about planning. The municipality which is properly planned will prevent uneconomic housing developments. There are many municipalities which are just allowed to grow like Topsy, and in those municipalities there is a vicious type of development known as the "ribbon development". In other words, a farmer will sell off the front 100 or 150 feet along the highway. A strip of houses is built, but the farmer maintains his farm. These houses immediately require services. They may get by for three or four years, but eventually they require schools because the school population goes up by leaps and bounds. Sewers and all the other services are required before very long. This ribbon type of development is the most uneconomical type possible, because instead of having a compact housing development easily serviced you have a long ribbon of houses which require lengthy and very costly services.
What happens then? Taxation on the farms and on the buildings in this municipality increases astronomically, destroying the value of the land which has been so developed. So far as I can see nothing has been said in this act about town planning. I should like to see the money provided only in municipalities which are adequately planned. With the present type of ribbon development, not only

are we destroying the value of the land so developed but we are increasing the cost of highways. We are making the whole highway problem much more acute, and we are not producing economically the houses which are needed. So long as things of this sort continue we are going to have housing uneconomically produced, and we are going to have an increasingly difficult problem of municipal financing.
I have mentioned the three points that I felt might be considered. I have suggested municipal taxation being allowed as a deduction from income for tax purposes, and mortgage payments also being allowed as a deduction from income. I do so again. I believe all these things should be studied. The reason for our housing problem is that we are building uneconomically, and we are placing on the people least able to bear it the burden of maintaining domestic structures. Not only that, but because of our high incidence of municipal taxation we are increasing the burden today on people whose security depends on an hourly wage. If for any reason that hourly wage is suspended, if there is a slight recession or if there is any degree of unemployment, we are going to find that there will be an avalanche of defalcations on mortgage payments, and a staggering growth of tax arrears.
I lived through the years of the thirties when municipalities found it extremely difficult to pay their way and when many went into receivership and had to make arrangements for their funded debt. I lived through that period and saw what it meant to people whose homes were virtually taken away from them because they were unable to meet the payments. Having seen that, I feel that unless something is done to ease municipal taxation on the home owner, we are likely to create with respect to the home owner a debt structure which will result in a desperate situation similar to that which was created during the period of unemployment in the early thirties.


Mr. Clarence Gillis (Cape Breton South):: Mr. Speaker, I have listened with a great deal of interest to this debate. If anyone had said what I am going to say, I would not have stood up. I agree with many others that if there was any possibility of solving the housing problem under the present mechanics, the present minister would have done so. But I am convinced that, with the machinery with which he has to work, he is not going to solve that problem.
In listening to this debate what I am concerned about is this. What is the policy of the different groups in the house with regard to getting homes for the Canadian people?
National Housing Act
Everybody makes a speech, goes over the disability and diagnoses the disease, but does not prescribe anything to effect a cure, with the exception of the hon. member for York South (Mr. Noseworthy).


Robert Fair: Don't forget the hon. member for Bow River (Mr. Johnston).


Clarence Gillis: I was not in the chamber when he spoke, but if he prescribed anything I will have to read his speech to find out what it was.


Robert Fair: Yes. He laid down part of our policy; and it was a good one, too.


Clarence Gillis: The hon. member for York South made a criticism of the present government's policy. But in addition to that he moved an amendment. In that amendment he made three suggestions, one with regard to making money more readily available, one with regard to providing a lower interest rate and providing a subsidy, and he also suggested that the government's agency, Central Mortgage and Housing Corporation, should go into a low-rental program in order to provide homes for those who perhaps will never be able to buy them.
As far as the C.C.F. are concerned, that is our policy. That is the thing we would do- and it is the thing the government is not doing-if we had the responsibility of solving the problem. On the other hand, I listened with a great deal of interest to the spokesmen for the Progressive Conservative party. They diagnosed the disability and they criticized the government; but if I heard them aright, the hon. member for Broadview (Mr. Hees) particularly, they put on the record part of a statement by the Leader of the Opposition (Mr. Drew), which was to the effect that he would call a dominion-provincial conference and find out what could be done in order to solve the problem. That is their policy: call a dominion-provincial conference.
As I understand it, the government's policy is to farm out money to the lending agencies at 2 or 2J per cent and they in turn-


Robert Henry Winters: 3J per cent.


Clarence Gillis: All right, 3f per cent; and the lending agency farms it out to those who wish to purchase a home, at 5i per cent.


Robert Henry Winters: Under that arrangement the interest rate would be close to 5J per cent.


Clarence Gillis: That is what I said. That is the government policy. In that way they think they are going to get homes built. We have had that system operating since the end of the war, improving it a little bit as we went along but at the same time stepping up interest rates. However, it has not provided a solution.
448:

National Housing Act
In this debate the hon. member for Park-dale (Mr. Hunter) mentioned this backlog of housing. Figures of that kind are only an estimate, anyway. The figures that were put on record by the hon. member for York South were an estimate that was made by a government committee-the Curtis committee-at the end of 1952. These things are only estimates; there is nothing firm about them.
The second criticism the hon. member for Parkdale had to make of what the hon. member for York South said was "Oh, it is socialist thinking". That is an old story. Nobody pays much attention to that sort of thing any more because it is worn out. I think most of the members of the C.C.F. across the country -including those in the one province in which there is a C.C.F. government-have demonstrated to the Canadian people that, regardless of the tags the chamber of commerce wants to hang on them in order to scare the Canadian people, they are fair and reasonable people and good Canadians. Hence that particular angle is not productive of much good at this time.
He stated that if the government were to provide subsidies and low-rental housing in the manner suggested by the hon. member for York South, it would mean a great increase in taxation. That is another bogeyman they are throwing around. The fact of the matter is that what the hon. member for York South suggested was not the government going out and borrowing money from the banks, the trust companies or the insurance companies, but using the agency that was created by the government for the purpose of providing money of this kind for capital expenditures on projects that are or will be self-liquidating. The hon. member for York South suggested the use of the Bank of Canada to make that money directly available to the people who would use it to provide houses. If you want to charge 2 per cent, all right; but you could actually do it through the Bank of Canada without charging any interest or imposing any new taxation on the Canadian people.
The fact of the matter is that the arrangement that is supported by the hon. member for Parkdale would add to the burden of the Canadian taxpayer, because if you farmed the money out to the lending institutions at 3J per cent they would in turn sell it to the home buyer at 5J per cent, which would be a subsidy to the insurance companies in that field, and it is paid by the Canadian taxpayers.


An hon. Member:: Five o'clock.


Clarence Gillis: Mr. Speaker calls order in this house. The hon. member for Parkdale is away off base on this question. Actually he opposes what would relieve the taxpayers of Canada
l Mr. Gillis.]
of the subsidy now paid to the lending institutions, and supports a device used now to try to provide housing that actually means a burden to the Canadian taxpayers. Therefore I suggest that he take another look at the proposition.
In the matter of a subsidy generally, the Canadian government is pretty well committed to the principle. Are you getting uneasy, Mr. Speaker?


Mr. Speaker:: It is five o'clock. Has the hon. member almost completed his remarks?


Clarence Gillis: No.


Mr. Speaker:: Well, it will be necessary for me to call it five o'clock.



PRIVATE BILL


[Stage Direction]
Bill No. 361, for the relief of Mildred Hannah Earle.-Mr. Winkler.


[Stage Direction]
The house resumed, from Friday, March 27, consideration of the motion of Mr. Adamson for the second reading of Bill No. 224, to amend the Canada Elections Act.
Hon. W. E. Harris (Minister of Citizenship and Immigration):: This bill was debated by the mover on the last occasion that it came before the house and I moved the adjournment of the debate, promising at that time to give consideration to the three propositions contained in the bill. I have consulted with the chief electoral officer and he has reminded me that what I said on that occasion was slightly incorrect.
The proposals contained in the bill have been discussed on two previous occasions by committees of this house, and on each occasion the committee decided that they ought not to adopt the proposal made by my hon. friend.
Then, as to the other point, namely the question of the town of Atikokan being provided with an advance poll, I am informed that that was done in 1949, though it does not appear in the list as shown at the back of the Dominion Elections Act.
Then, finally, as to the suggestion that advance polls could be established in townships in addition to incorporated cities and towns, that matter was considered by the committees studying this act two and three years ago. The general feeling was not to have very many advance polls, but to restrict them as much as could be done within the limits of the act, which required that the

opinion of the chief electoral officer be obtained on whether there was likely to be a certain number of votes cast, or there had been on previous occasions.
For all these reasons, Mr. Speaker, we feel that at least for the time being we should not agree to this bill, but we will assure the hon. member that the elections act committee will, after the forthcoming election, do what it always does, namely review the act in the light of the experience gained on that occasion, and all these questions can be discussed then.


Agar Rodney Adamson: Mr. Speaker-


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


Agar Rodney Adamson: The reason I introduced this bill was to bring to the attention of the house a system under which on election day a great number of persons are employed whose usefulness is perhaps questionable. I refer to the candidates' agents at the polls. No candidate will wish to allow a poll-at least that has been my experience and the experience of all candidates to whom I have talked-to go without having an agent there to observe the conduct of the operation of the poll on polling day. Both the deputy returning officer and the poll clerk are representatives of the government in power, appointed by the government in power and on a political basis. Therefore a member of any opposition party who wishes to see that his party's interests are properly served will have to provide at each poll persons who are known as outside and inside scrutineers. My purpose in bringing this amendment to the house was to see if we could not get around this business of providing scrutineers on election day.
In an average riding there will be probably 125 to 150 polls, and sometimes more. The cost involved in providing scrutineers may run as high as $1,000 or even more on election today. It seemed to me that was an unnecessary and unfair cost to be borne by the candidate of an opposition party. For that reason I introduced the bill. It has been debated, and I have the debates here. Mr. MacNicol, chairman of the opposition group considering the elections act, introduced it twice in committee. It was actually debated once and the debates are printed in the transcripts of proceedings of that committee for 1938. It had also been debated before that.
I have read carefully the debates on this question. There is nothing in them which persuades me in any way that the move would not be a good one. The amendment was voted down twice before on a strictly
Canada Elections Act
party division in committee, the three opposition members voting in favour and the seven government members voting against.
I think the amendment is desirable, and that it would save a large sum of money to all candidates, particularly those in urban constituencies. It follows the practice of having urban enumerators chosen by the parties obtaining the highest and second highest number of votes at the last preceding election. The principle has been admitted in another part of the act. The fact that the government does not see fit to consider it now is just one further indication that the matter is being considered on a party basis. I very much regret the government's decision.
We come now to the question of the revised statutes, and the insertion of the word "township". Canada has developed to the point today where townships have become major municipalities. Of the two townships in the constituency of York West, one has something over 75,000 people and the other has 110,000 or 120,000. Both are major cities, and would be so considered. Because they are not mentioned specifically in the act there cannot be an advance poll, except in respect of those townships so specifically mentioned. This includes the townships of North York, York and, I believe, Scarboro. Other townships do not have the benefit of this provision. For example the township of Etobicoke, with a population of more than 75,000 at the present time, has no provision whatsoever for an advance poll. It means that any resident in this community would have to go elsewhere to vote, if he was going to be absent on election day.
The reason for having advance polls was to provide certain people engaged in travelling, including commercial travellers, railway workers and others whose duties kept them away from their ridings on election day, with an opportunity to cast their ballots during the three or four preceding days. I believe this was a wise provision.
However, particularly if there is a summer election, there will be thousands of people, including travellers as well as others whose work would take them out of their home constituencies, who will be away from their homes on any particular day. Their business will take them away. The fact that in many cases they will have moved their families to summer cottages will remove them from the areas in which they would poll their votes. To deny them an advance poll will cause great hardship to a large number of constituents. It would have been at least a gesture if the government had seen its way clear to accept this one small amendment.
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National Housing Act
It would not have caused any difficulty whatsoever in the operation of the legislation if the word "township" were included in the act as it now stands.
If there is to be a summer election thousands of people will be deliberately disfranchised because they will be travelling or, for other reasons, will be away. If there is no provision for an advance poll in a township such as Etobicoke there will be a very serious dislocation of polling, and many thousands of people in my opinion will be disfranchised. The thing is pernicious and indefensible, and I believe deliberate. I very much regret the government's intractable attitude.


Mr. Speaker:: Is the hon. member withdrawing the bill?


Agar Rodney Adamson: No; I am asking for a decision by the house.


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


Some hon. Members:: Yea.


Some hon. Members:: Nay.


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


Agar Rodney Adamson: On division, Mr. Speaker.


Mr. Speaker:: I declare the motion lost.
Motion negatived on division.


Mr. Speaker:: The hour for private and public bills having expired, the house will resume the business interrupted at five o'clock.



NATIONAL HOUSING ACT


[Stage Direction]
The house resumed consideration of the motion of Mr. Winters for the second reading of Bill No. 339, to amend the National Housing Act, 1944.
Clarence Gillis: Mr. Speaker, when you called it five o'clock I was making some comments on the matter of housing, and saying that the hon. member for Parkdale (Mr. Hunter) was considerably astray in his assertion that what had been recommended in an amendment by the hon. member for York South (Mr. Noseworthy), which was subsequently ruled out of order, would have added a burden to the taxpayers of Canada. No one has any objection to the insurance companies or the lending institutions investing the policyholders' money. That was one criticism made by the hon. member for Parkdale. They are entirely free to do that regardless of what the government may be doing in the way of providing housing. What we do object to is that at the present time the government is
[Mr. Adamson.)

subsidizing the insurance companies and in addition is guaranteeing them against any losses they may encounter in this field.
Another thing I object to particularly is that the insurance companies are not providing housing where it is needed. Their policy is to make an economic survey, and they are prepared to allocate a certain amount of money for the building of homes in those sections which show a bright future. The hon. member for Parkdale and others referred to this matter of serviced land, and in my opinion that problem arises out of the policy pursued by the lending institutions and by industrial corporations across this country in the centralization of industry in a couple of provinces. That means that the lending institutions are centralizing their building programs around the industries in Ontario and Quebec, with the result that they are running out of serviced land.
Not long ago I read a speech made by the mayor of Toronto at a convention, in which he pointed out that the burden upon the municipalities of this province was becoming unbearable because of the influx of people. The providing of schools and other services for these additional people was becoming such a problem that the governments would have to take a look at it very soon. I agree with him. The criticism that serviced land is not available arises out of the policy pursued in the centralization of industry and the building of cities around that centralized empire.
I am also concerned about the policies of the contending parties. I understand the hon. member for Bow River (Mr. Johnston) made some constructive suggestions, and I am sorry I did not hear him. We have recommended procedures that would be workable if the government would adopt them. In my opinion the hon. member for Broadview (Mr. Hees) stated the official position of the Conservative party. He read into the record a statement made by the Leader of the Opposition (Mr. Drew) that they would call a dominion-provincial conference. The hon. member was very emphatic about this business of free enterprise. As far as I am concerned there is no such thing on this North American continent. It is neither free nor is it enterprise. At one time a man would go out and risk his money. He would build an industry and take his chance. But there is no risk capital any longer; it has to be guaranteed certain rates of interest, and against loss.


Mr. Gibson:: Did you ever buy any oil
stocks?


Clarence Gillis: You had better be careful. If the war in Korea ends, away go your stocks. The hon. member for Broadview was down in Saint John, New Brunswick, recently and had something to say about housing. I have in my hand a clipping from the Saint John Loyalist of April 25, 1953, so it is right up to date.


Mr. Stuart (Charlotte):: Everything down there is up to date.


Clarence Gillis: The heading of this article is "Rental Scheme 'Cockeyed'; Urge Change on Commission." Apparently they are setting up some kind of commission to provide low rental housing and the hon. member was quite critical of it. I had better put his own words on the record. I am doing this because I come from the maritimes and when they see this description of the low rental housing available in Ottawa as set out in this article I will have to answer some questions when I go back. The article reads:
Private enterprise in Ottawa is building multiple-unit housing to rent at $50 per month, without subsidy, George Hees, M.P., said while in Saint John. He discussed housing programs after hearing representations of Mr. Leo McNulty and Mrs. Vera Dorey.
Then he went on further:
According to the Toronto M.P. the present plan "sounds cockeyed" and is evidently an "unsound proposition."
He offered to forward plans of the Ottawa private enterprise plan, and said that the builders would invite inspection by a delegation from Saint John.
The article continues:
Mr. Hees said that the Ottawa project is brickfaced apartments, sound-resistant, with three bedrooms, kitchen, dining room, staircase and cellar. During the first year, he said, each head of a household agrees to work one hour per week about the grounds.
When I read that I said to myself, "Where do you get that kind of accommodation in Ottawa for $50 a month?" I have been coming to this city for the last 13 years, and I began to think that perhaps I had not been checking up closely. So I called some friends of mine who live in the city, one just down here on Metcalfe street. He has a little kitchen, a bathroom and sitting room with a pull-out couch. I asked him what he paid for that accommodation and he told me he paid $80 a month. I said, "You do not know about the sanctuary described by the hon. member for Broadview."
So I called another party who I thought was living in accommodation more like that described by the hon. member for Broadview. This party told me that he was living in an old house and that they had had to do one-half of the decorating themselves. They had two bedrooms, a sitting
National Housing Act
room and kitchen, yet were paying $150 a month for that accommodation in an old house.


George Harris Hees: I wonder if I could set the hon. member for Cape Breton South right and say a few words here as to what I actually said?


Clarence Gillis: Will you wait until I am
finished, and then you can make another speech.


George Harris Hees: I just wanted to set you right on what I said.


Clarence Gillis: I am not saying that the report in the paper is right.


George Harris Hees: I just want to set the record right.


Clarence Gillis: You can do that later. When I go back to my riding and meet the people there they will say, "What is the idea? We are paying terrible rents down here and yet you fellows in Ottawa can get this accommodation for $50 a month. How is it that you can provide that kind of accommodation in Ottawa for $50 a month?" I can reply that it is not correct but they will tell me that they read the statement by the hon. member from Toronto and I should have straightened it out before I came home. That is exactly what I am doing. I am trying to save myself a lot of questions when I get back home.
This party was paying $150 a month. The accommodation is not as good as the member for Broadview (Mr. Hees) describes. It is not brick-faced, with three bedrooms, kitchen, staircase and so on, for $50 a month. I trust that when the hon. member for Broadview gets a chance he will put on the record where in this city one can find that kind of accommodation provided now by private enterprise.
You know, Mr. Speaker, "private enterprise" is a slogan that has become badly overworked. Chambers of commerce, boards of trade and all agencies of that kind who are a bit afraid that someone may be getting around to doing a little planning in the economy, have built up a lot of fears and apprehensions in the minds of many people. That slogan has become overworked in the minds of people; and if it could have solved the problems of the world there has been ample of time over the centuries. We have been following that kind of system and we have developed wars, devastation, misery and poverty and have not learned to do very much about them.
When I look at plants like the one at Chalk River, and the development of science

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today, I think how wonderful the brain of man is with respect to the things he can devise. However, he has never learned how to distribute bread and to provide a place for people to sleep. It is rather shocking to think about the matter in that way because it adds up to the fact that slogans do not solve anything, and that you must have people who really want	to	do	something.
We are all striving to obtain houses for the average person in this country.


George Harris Hees: As I have already spoken, could I set	the record straight	at	this	point? Iknow	I am not allowed	to	make another
speech.


George Alexander Cruickshank: Hear, hear.


George Harris Hees: But I want to correct the points.


Clarence Gillis: We will	be	in	committee
shortly.


Robert Henry Winters: I would suggest that the hon. member wait until we do get into committee because there may be some things I would like to say on the point and I too am debarred from speaking until I close the debate.


Clarence Gillis: I do not want to be discourteous to the hon. member, but I want to finish what I have to say. I shall boil it down because I know every member of the house could give a long talk on the subject before us.
I wish to say a word about the remarks of the hon. member for Parkdale regarding the backlog of houses and the difference in figures. As I said before, the figures are only estimates. The Canadian Congress of Labour met the government on March 6, 1953, and presented a brief. The Canadian Congress of Labour represents a large group of people in this country; they meet year by year and hammer out a program that is to be presented to the government. That program is developed in all parts of the country by workingmen in their local units which come under the congress for legislative purposes. There is no guessing about, their presentation to the government on the matter because they maintain an excellent research department that works in that field, and they gather figures. I am going to quote a paragraph of their presentation because I think it answers the criticisms of the hon. member for Parkdale:
The congress has urged year after year that greater attention he given to the question of low rental housing. Official figures indicate that, by ;he end of the current year, there will be a backlog of 735,000 dwellings. For the most part, the houses which have been built since the war are far beyond the reach of the vast majority of Canadian families. The 1951 census showed that well over half of Canada's wage and salary earning families

were getting $2,500 per year or less. These people cannot afford even the kind of housing which is being built by limited-dividend companies under the National Housing Act. Section 35 of that act provides for subsidized low rental housing, but very little building has been done under this section. The initiative is left to local communities, but the government could and should do a great deal to stimulate local initiative and provincial co-operation in this field.
The shortage of materials is no longer an obstacle. The defence program will soon be tapering off to some extent, and a housing program on a large scale will be an excellent way to take up any slack in employment. Furthermore, the government's immigration program will make a bad situation worse, unless prompt and effective action is taken to provide subsidized low rental housing.
That is the position of the Canadian Congress of Labour, and that is the number of family units we are going to require by the end of 1953. I would just like to point out to the minister that all the juggling and patching we can do with the National Housing Act, with our present mechanics, is not going to give homes to a large section of the Canadian people.
When the Minister of Finance (Mr. Abbott) made his budget speech he pointed out that there were 137,000 families in this country whose income levels were below taxable brackets. The National Housing Act fixes what is called an economic unit, that is a home costing over $10,000, with a $3,000 down payment. The 137,000 families whose incomes are below taxable level will never be able to provide homes for themselves under present methods of financing and present costs. No one can dispute that. The average Canadian family numbers four, so you can multiply 137,000 by four to get the number of people who are "out" under any circumstances at present.
What is the answer? The answer is low rental housing. Those people cannot find places to live with the rents that are asked today, in the light of their incomes. That figure is not a guess; it is the figure given by the Minister of Finance when he made his budget speech. Low rental housing is the answer. Even if the minister's department wants to carry on building $10,000 units financed by insurance companies, subsidized by the taxpayers of Canada-and the profits of the organization are subsidized to the extent of about 2 per cent-I think the minister should consider putting Central Mortgage and Housing Corporation directly into low rental housing across the country in order to provide homes on a subsidized basis, because they will have to be subsidized. With incomes such as I have described these people cannot pay rent for any kind of accommodation that is half decent and, in

the final analysis, they are the people who produce the wealth of this country.
I could go on and on and on, but I shall leave it for the minister. If he is not prepared to accept all of the amendment proposed by the hon. member for York South (Mr. Noseworthy), I believe that serious consideration should be given to the matter of low rental housing.


George Alexander Cruickshank: Mr. Speaker, I would just like to say one word before the minister speaks. I know he wants to get the bill through, but he will have to be patient. I want to say a word, and I am not like the member for Broadview who says something in some other province where it may catch up with him only by mistake. The houses in British Columbia all have blinds on them now, so we have no worries in that connection.
The main objection, Mr. Speaker-and I have had very little experience with housing in my particular riding-is that we are unable to get loans on homes adjacent to small towns or villages. I do not think it is fair, and I do not think that it is the intention of the act that such should be the case. The minister may shake his head but I happen to know that it is a fact.
Possibly the reason for it is some inefficiency in his staff, and I can quite understand that if all of his staff carries on in the same manner as his head man. I can assure him that I can give him plenty of real estate men from my riding who will work for one-third the salary and do a far more efficient job than the present head of this staff, though I appreciate that possibly the present head is not able to give his best efforts to the position because of his health.
I understand that the staff has a spring floor on which to dance. I want to register my objection to this spring floor. I want to register my objection to what, in my opinion, is a great extravagance in constructing this building in which to conduct this business, while the government cannot find money to build homes for people. They can find money, however, to construct beautiful oak floors with springs under them for this hardworking staff to dance upon. It does not go down with me.
I want the minister to explain to me why it is that in the village of Abbotsford a man with a secure income is unable to secure a loan. The references are on file in the minister's department, just as they are in my office. I presume the only reason is that the gentleman in charge, who draws this big salary, stumbled over the spring floor in the dance hall and could not answer the question.
National Housing Act
I want the minister to tell me why these loans are not available in areas adjacent to villages or small towns.


Stanley Howard Knowles: Earlier today the proposals put forward by the C.C.F. with respect to housing were described by the hon. member for Parkdale as thought-provoking. Indeed, Mr. Speaker, that is what we have been trying to do for a great many years, namely to provoke the thinking of the government and of the people of Canada with respect to the social importance of this question of housing. It was obvious from the remarks made by the hon. member for Parkdale that he is one of those in whose thinking we have not made much of a dent, but it is to be noted that we have made some progress across the years.
We have reached the point in this country where it is recognized that even though those in other parties in this house may talk about this being a private enterprise country, nevertheless this is a field in which the community has had to accept some responsibility. This fact is attested by legislation such as the National Housing Act, which is being amended at the present time, and by the provisions for building homes for service personnel, as well as other steps which have been taken by various levels of government.
However, the plain fact of the matter is that when one looks at housing, particularly in many of the large cities in this country, and also in the small towns and rural areas, we find we have not yet begun to provide for the people of Canada as a whole the kind of housing to which they are entitled or the kind of housing which we are capable of producing at the present time.
We believe that private enterprise will not do that, and that the time has come when we must move in the direction suggested in the proposals contained in the amendment which was moved earlier today by my colleague the hon. member for York South. We believe that the necessary money to finance the building of homes should be lent directly by government institutions, such as the Central Mortgage and Housing Corporation, to the builder at a nominal rate of interest such as 2 per cent. We believe, furthermore, that with respect to the important question of low rental housing for those in the lower and middle income brackets, and for those who have to move about in connection with their work, subsidies should be made available directly to public housing authorities. We believe the time has come when public authorities, such as the Central Mortgage and

National Housing Act
Housing Corporation, must go directly into the construction of houses.
I would point out to you, Mr. Speaker, that perhaps the strongest indictment of so-called private enterprise in the debate today was made by a member on the Liberal side of the house. We have pointed out-and the hon. member for Bow River (Mr. Johnston) joined us in expressing the same view-that to a large extent the present legislation seems to be designed not for the purpose of getting houses built but rather for the purpose of subsidizing the lending institutions and enabling them to make profit out of this business of building houses. Today the hon. member for Spadina (Mr. Croll) reminded us that these same lending institutions, which have enjoyed great benefit from this legislation, on at least one previous occasion staged what amounted to a strike. They made it known that they would not continue to cooperate under the provisions of the National Housing Act unless they were permitted to charge a higher rate of interest. It was because of that strike on the part of the lending institutions that the rate of interest on joint loans was increased some time ago to approximately 54 per cent.
Today that indictment has been levelled again at the same institutions by the hon. member for Spadina, who points out that these same institutions are again saying that there is only so much mortgage money to go around, that many projects will have to be postponed and that housing will have to share in that postponement. What are they doing but threatening once again to stage a sit-down strike unless they get another increase in the rate of interest?
That being the case, Mr. Speaker, I submit that the answer will have to be a little stronger than the suggestion made by the hon. member for Spadina. I sense that he is still hopeful that if the government takes a strong enough position, the lending institutions will co-operate with the government. I suggest we have to go further than that. The time has come when this government will have to consider the proposals put before this house by the members of this group, particularly as set out in the amendment suggested earlier today by the hon. member for York South. I suggest that the time has come when, for the building of homes, the necessary money has to be lent directly to the builders by Central Mortgage and Housing Corporation at an interest rate such as 2 per cent. I suggest, likewise, that for the construction of the large number of homes that we need for low rental projects, subsidies will have to be made directly to

local public housing authorities and Central Mortgage and Housing Corporation will itself have to go into the construction of houses.
I realize that ideas such as these are strange to the ears of a member like the hon. member for Parkdale. He stands up and says that is socialism; he says it is the sort of thing he would expect from the socialist members down in this part of the house. Since he has referred to us as a socialist group-a correct reference, may I say-I would just refer him to what I thought was an interesting though brief definition of socialism given not long ago by one who knows what it is all about, Right Hon. Herbert Morrison. He defined British socialism as "the assertion of the principle of social responsibility for matters which are properly of social concern". It is that principle which this group has been asserting in this House of Commons and in this country from the time it was organized.
We have made progress. We have been able to bring the thinking of the Canadian people along to a certain extent. There are many things that are recognized in Canada as being properly of social concern. Some of them are taken care of at the municipal level. Some of them, like the education of our children, are taken care of at the provincial level. But there are others-matters other than those which are already recognized-which we feel are of social concern; and housing, we contend, is one of them. We believe that the day will come, if mankind continues to make progress as we believe it to be our destiny, when the right to adequate housing, the right to a decent home for every child born in a country like Canada will be recognized just as clearly as is the right to education and the right of the people as a whole to the many services which we provide on a common basis.
Therefore, Mr. Speaker, I want to say that we are not set back at all by the arguments made by the hon. member for Parkdale but rather we are encouraged to keep proclaiming that principle that there are certain things which are properly of social concern and which should be matters of social responsibility. It is our contention that one of the most important matters of social concern in Canada is that of providing adequate housing. Private enterprise has demonstrated that it cannot measure up to that responsibility. Private enterprise has been given another indictment today by the hon. member for Spadina in the statement he made earlier. We are not surprised at that. Their interest in the National Housing Act is simply in getting what they can out of it.

I submit that there is no longer any point in trying to bring the lending institutions along or in trying to get them to co-operate. The time has come for the people of Canada as a whole, through their government-that body through which they can exercise social responsibility-to go more thoroughly and more directly into the field of housing. This is something that is extremely important to our people. If we want to make our way of life mean and continue to mean that glorious experience that we believe it to be, one of the most important matters for us to give attention to is the need for and the right to adequate, proper and decent housing for every Canadian family.


Mr. G. F. Higgins (St. John's East):: Mr. Speaker, I have listened with attention to the hon. member for Winnipeg North Centre (Mr. Knowles), and I found his arguments to be extremely persuasive indeed. In fact, if I were not watching myself I would feel almost like the Irishman and say, "If I were not a Conservative, I should like to be a socialist"; but I dare not go as far as that.
We must realize that, in the world in which we live today, the greatest threat confronting us in the western world is communism. Frankly, I think one of the best ways to keep communism from the western world as we know it is to provide proper housing accommodation for the people who live in the western world. If one were to go not too far from here, namely to the great city of Montreal, I have been told by a reliable person, in whom I have implicit trust, that one would find 2,000 families each living in what I will not call it a house but will call one room. If 2,000 families are each living in one room, how many more people are living in little better accommodation in that great city?
The obvious thing that happens to families living in such accommodation as this. They constitute a fertile field for the promulgation of communist doctrine. I feel that the greatest indictment which can be levelled against this government-I am not talking of the minister himself but of this government-is that they have not faced up to this issue which has been confronting the people of Canada for some years past.
There is a good deal to be said for the motion-which I understand was ruled out of order-to provide cheaper money for the building of houses. I am not saying that it is necessary to have money as cheap as 2 per cent. But if it is necessary and money at 2 per cent is required-and apparently a study has been made of the matter-then the government should make provision for
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such money to be supplied. Money at that rate cannot be supplied by private industry at the present time. It is just as well for us to realize that fact. The last issue of government bonds was placed on the market at 3J per cent, if I am not mistaken. Having that fact in mind, how can we possibly ask private industry to subscribe to a housing program at 2 per cent?
Mr. Speaker, the matter gets back again to the question of whose job this is. Is it the government's job? Is it the province's job? Is it the municipality's job? Is it the people's job?


Mr. Byrne:: The individual.


Gordon Francis Higgins: The individual is right; and the individual is the government. I therefore think the buck is passed right back to this government, and that the government has fallen down on the job. Unless the government gives proper leadership in providing homes-decent homes that can be lived in; homes that can be paid for by the class of people who will use those homes, and who are earning the amount of money that it will make it possible for them to pay for them-then you will have a country that is going to be absolutely ready for the communist doctrine, or one in which the people are going to be receptive to this communist doctrine. We can talk all we like about outlawing communism in this country but unless we give people decent houses over their heads it will do no good.
For that reason-and I am not going against any statement that has been made by any member of our party-I see a great deal in the amendment that was not accepted in this house, but which was presented by the hon. member for York South (Mr. Noseworthy). I must say that I am greatly in favour of providing housing for the people of this country, and I am sure that all the members of this house feel the same way. It is merely a question of deciding what is the proper way. In this particular case the government should and must give the lead.


The Acting Speaker (Mr. Robinson):: If
the minister speaks now, he will close the debate.


Robert Henry Winters: Mr. Speaker, may I move
the adjournment of the debate?
At six o'clock the house took recess.


[Stage Direction]
AFTER RECESS

The house resumed at eight o'clock.
Robert Henry Winters: Mr. Speaker,

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I shall be brief in winding up this very interesting debate on housing. I wish to thank all hon. members who participated for the contributions they made. It must be clear to all hon. members, judging by the varying approaches to the problem that have been expressed, just how complex housing is and how difficult it is to evolve a formula that would be satisfactory to everybody.
In opening the debate this morning for the official opposition the hon. member for Eglin-ton (Mr. Fleming) said, among other things, that in 1951 the government made an error, and that as a result of that error there was a great decrease in house building. He also added the strange reasoning that had we built more houses at that time rather than now, the cost to the home owners would be considerably less. He completely overlooked the fact that there was a Korean war on at that time and that parliament specifically expressed itself as being in favour of assigning top priority to the defence construction program and endorsed the government's policy that housing should take second place only to the defence construction program itself. It therefore became necessary to put both housing and defence construction into proper perspective. It was only because of certain action the government did take that there was not even keener competition for labour and materials in 1951, and that costs remained at the relatively low level to which my hon. friend referred.
Had the government not exercised a measure of control through its policies, as it did at that time, there would have been a great deal of confusion and perhaps the fears which were expressed at that time would have been realized. If we had not taken the measures we did a great many houses that were started would then not have been finished. We were anxious to see that the houses started were completed so the maximum possible number of Canadians would have roofs over their heads.
Dealing with housing is almost analogous to walking a tightrope, Mr. Speaker. One must maintain a proper balance. It is as though an engineer were working with an equation in which there were many variables, the main variables being materials, labour and mortgage money with its interest rate, amortization period and down payment, and the problem of serviced land. On the other hand, when thinking of a loan on a house it becomes necessary for the borrower and the lender alike to consider both the amount of the down payment on the one hand and the amount of the debt burden on the other.
Hon. members of the opposition today expressed the wish that the government

decrease the down payment. At the same time other hon. members expressed concern about the amount of the debt burden. Both show their concern for various aspects of the problem, and the difficulty is to find a middle course which will be satisfactory to the majority of Canadians. It was indicated by one member of the opposition that it would be desirable for the government to reduce the down payment to as low as 5 per cent.
I had a computation made of housing across Canada, and I found that as of September, 1952, the average estimated cost of a house in Canada, the whole of Canada, was $11,358. The lending value of the house was $10,695; the actual loan, $8,123; the down payment $3,235, which under a 20-year amortization period involves principal and interest of $654, with total gross debt service of $850. And assuming that gross debt service should not exceed 23 per cent of income, that debt service would require an income of $3,696. If the down payment were reduced to 5 per cent instead of 20 per cent as it is, the required income would increase from $3,696 to $4,409, the gross debt service would increase from $850 to $1,014.
The hon. members who expressed concern lest the gross debt service would be too high would certainly have ample evidence there to support their case. Therefore the problem is to maintain a reasonably low down payment on the one hand without increasing the debt service so as to become too great a burden for too many Canadians. On the other hand, it is a fact that most of the mortgage money available now is being taken upland if the down payment were decreased and more mortgage money put into each loan there would be a lesser number of houses built with the available money.
It has been suggested that government action should be taken to enable existing mortgage money to be lent at a lower rate of interest over a longer amortization period and with a lower down payment than would otherwise be the case. That is exactly what the government has done, Mr. Speaker, through the facilities of the National Housing Act. As hon. members know, were it not for the National Housing Act the interest rate would be, I am sure, at least 6 per cent through the conventional lending channels. With the guarantees of the National Housing Act, lending institutions lend their money on the joint arrangement at 5| per cent. The federal government advances its 25 per cent of the loan at 3f- per cent, with the result that the cost of the loan to the borrower is now at 51 per cent. The amortization, which would probably be of the order of ten years were it not for the federal

government's participation, under the terms of the National Housing Act on joint loans could be up to 30 years, most of them now being of the order of 20 years. Under the Insurance Act lending institutions are limited to mortgages of not more than 60 per cent of the lending value of the house; whereas with the federal government participation through the National Housing Act it is 80 per cent of the agreed sale price.
The hon. member for Broadview (Mr. Hees) made quite a case today, as he has done before, in trying to persuade the government of the wisdom of having the interest rate reduced to 4 per cent or less. That is the figure he usually uses. Well, certainly the government wishes that it were possible to make money available at 4 per cent or even less. But the fact is that the only way money could be made available at 4 per cent would be for the government to take the money from the people of Canada and make it available at that figure. Any such approach as this would have the effect of driving out of the market at once the money being loaned by the lending institutions conventionally and through the facilities of the National Housing Act joint loan technique. That money last year amounted to $494 million.
Hon. members said here today that lending institutions are not interested in housing loans, and are diminishing their operations. In 1951 the amount of money lent on residential mortgages was $474 million. Last year it increased to $494 million. Lending institutions I think are doing a good job in meeting their obligation of making mortgage money available for residential construction. I think it is important as a matter of policy that the federal government should neither be the landlord of too many Canadians nor should it hold the mortgages for too many Canadian homes. And I would suggest to my hon. friend from Broadview that if he harbours any remote hope of ever sitting on this side of the house, he would regard it as a pretty poor legacy if this government were to leave any incoming government in the position of being the landlord of large numbers of Canadians, and holding the mortgages of a great many Canadian home owners.
This is a young country. It is a growing country. The bulk of its growth is ahead of it; and1 it would be a pretty poor policy at this time if the government were to step in and take the primary position in housing to the extent that most housing hereafter would be built in a direct way by the federal government.
A great deal was said today about the backlog in housing. It was estimated by the hon.
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member for York South (Mr. Noseworthy) at
700.000	units and by the hon. member for Broadview (Mr. Hees) to be of the order of 500,000. It was said by the hon. member for Parkdale (Mr. Hunter), in what I considered to be an excellent speech today, that the size of the backlog in housing in this country is very difficult indeed to evaluate. I think it might be pretty rash to attempt to establish it with any degree of exactitude at all. But I have looked into this problem with some care, and I find the arithmetic being employed by those who discuss the quantitative aspect of the backlog today to be related to the Curtis report, and to be arrived at by adding net family formations and subtracting the number of new housing units completed.
It seems to me that the 1951 census figures give a more accurate picture of the present situation. That census figure as in June, 1951, showed that there were 3,287,000 families in Canada and that there were 3,423,000 occupied dwellings. In addition there were 456,000 non-family households. These figures indicate that some 320,000 families and households share accommodation, or about 9 per cent. Any calculation of a backlog of housing need, if it is to be a valid figure, would have to be adjusted upward by some proportion of the
169.000	dwellings lacking either toilet or bathing facilities.
A large number of these houses-and they are houses, by the census definition-lie in the outlying areas and on the fringes of our urban communities. However, I do not believe that each of these units would be immediately vacated were more modern units available. Nor do I believe that the apparent excess of
320.000	family and household groups in relation to the number of occupied dwellings are indeed all potential occupiers of new housing units. From time to time an effort has been made to determine the extent of what might be called voluntary, as against involuntary, multiple occupancy. No satisfactory figures have ever been developed, but it is the opinion of those who have worked on this problem that at least two-thirds of the multiple occupancy is voluntary, for social or economic reasons. There is the case of the mother and father who live with their children or vice versa. For census purposes they would be considered two separate families. Indeed, if either the mother or father lived with a son's family, these also would be considered families for census purposes.
Likewise, in the non-family household the sharing of a single unit by two people of no blood relation would be considered a multiple occupancy. I mention these instances to indicate that gross figures taken either from
4492	HOUSE OF
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census returns or from projections of the figures suggested in the Curtis report are likely to give an impression of greater housing needs measured by multiple occupancy than is really the case.
I would like to be able to give the house a reasonable estimate of the multiple occupancy reflecting housing need which presently exists in Canada, but I do not think it is possible to produce such a figure. Most of its components contain a large measure of estimate. On a national scale the problem is in better balance than it is in the large urban centres, where we would all agree there is housing congestion and more housing units are required. On the other hand, taking the number of families and nonfamily household groups and comparing them with the number of existing dwellings, having subtracted the dwellings without modern facilities, bears little relation to the real backlog of housing needs. Based on the figures I have given and assuming that somewhat more than two-thirds of all multiple occupancy is voluntary, the backlog of housing needs would work out arithmetically at less than 100,000 units.
Hon. members might quite correctly say that this calculation has no regard for obsolescence and substandard housing. I readily agree that this is a factor, and that unfortunately some housing is so bad as to be almost uninhabitable. To the extent that this is the case corrective steps should be taken, and the bill is designed to help. But hon. members know, too, that nothing tends to be as permanent as temporary or substandard housing; and having full regard to the varying degrees of adequacy of existing accommodation it is a fact that there are few Canadians indeed who do not have a roof over their heads.
There is one point, however, which I think is worth making. The retirement of any backlog of housing is in large measure dependent upon the price at which such housing can be made available. The hon. member for York South made this point very clearly in his remarks at the time the resolution was being debated. If a large number of units were made available at $15 a month, then I believe they would attract families out of multiple occupancy in much greater degree than if units were being made available at $95 a month. I would agree with hon. members that there is a backlog of housing need, but probably only a fraction of the 500,000 to
700,000	units suggested in the debate on the resolution.
Before leaving the question of the need for housing by existing families and other household groups, I would like to remind hon.


members that the amount of housing built in any year to look after not only the backlog but current needs is largely dependent upon the amount of money which the Canadian family or household is willing to spend upon housing. The dominion bureau of statistics has produced a number of figures in recent years, and indeed the weighting for rent or equivalent in the new consumer price index as compared with the cost of living index shows that the Canadian families and households on the average are spending a much lesser percentage of their disposable income for housing than in the years prior to the war. It will be recalled that in the cost of living index the weighting for rental or its equivalent was 19 per cent, whereas in the new consumer price index the weighting is 15 per cent. Whether those changes result from a preference for consumer durables such as automobiles, television sets and so on, I do not know. Nevertheless it is the case that lesser amounts, as a proportion of the disposable income, are being spent for housing. This has and will continue to have an effect upon the volume of new housing which is built.
This afternoon various hon. members asked what could be done to meet this housing problem, and suggested that the government face up to it. I suggest that the government has faced up to the housing problem and I expressed the doubt this afternoon, which I restate tonight, that there is in any country housing legislation designed better to meet the needs of the people than is the National Housing Act. In a sense hon. members can have it just about any way they wish under the terms of that act. There is ample scope for private enterprise; there is ample opportunity for those with initiative to do something to house people who otherwise could not afford to house themselves.
It has been suggested that more vigour should go into publicizing section 35 of the National Housing Act and inducing municipalities to take advantage of it. I have literally gone up and down this country explaining to provincial governments, to municipal governments and to anyone who would listen that section 35 was on the statute books for those who wished to use it. Neither the federal government nor I can go to a municipality and tell them what they must or can do with respect to housing, but I repeat that section 35 is available to those Canadian municipalities and provincial governments who wish to use it. They will find us most receptive.
Real results are being achieved in attacking the problem of housing. I mentioned at the start of this debate that housing starts this year so far have been at a level surpassing even the high production figures of 1950.

New construction in Canada as of March 31, 1952 amounted to 23,445 housing units; as of March 31, 1953, there were 32,651 housing units under construction. I submit that there has been a substantial achievement on the part of all those in Canada who are contributing to the solution of a problem which obviously everybody in this house, and certainly the government, deems to be one of the most important in Canada.


Donald Methuen Fleming: I wonder if the minister would answer one question. I did not wish to interrupt him-


Mr. Deputy Speaker:: The minister has closed the debate and perhaps the hon. member could ask his question when we are in committee of the whole.


[Stage Direction]
Motion agreed to, bill read the second time and the house went into committee thereon, Mr. Beaudoin in the chair.
On section 1-Part I.
Howard Charles Green: There are two questions I should like to place before the minister. I listened with a great deal of interest to the debate which has taken place today and which I think has been both instructive and helpful. We are all agreed that the problem is a most difficult one. When the minister was closing the debate he stated that the government advances 25 per cent of the amount loaned for an ordinary home under the National Housing Act. Would he tell the committee why that could not be increased, say to 50 per cent, and what would be the effect of the government making a change of that kind in its policy. It seems to me that if the government were to provide 50 instead of 25 per cent as at present, that change would alter the whole picture.
After hearing the speeches made today I am of the opinion that one of the great difficulties about this problem is that the Canadian lending companies do not have sufficient money available to meet the requirements. I was very much struck by the speech of the hon. member for Spadina this afternoon, and I thought he spoke with great common sense and realism. It seems to me that is one of the big problems, that the lending companies do not have the money available to finance the building of the houses that the Canadian people need.
If that is the case then the government will certainly have to step in further. The building of homes in Canada should not be tied down to what money the lending companies can or will advance. Yet I think the minister's answer was based on that premise, that he could go no further than the lending companies were prepared to go.
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I suggest to him that if the government advanced 50 per cent instead of 25 per cent it would then be possible to call for a lower down payment, perhaps 10 per cent, and for a longer time in which to repay the loan. It is all very well to say that people can get money for houses, but take the case of a young couple who wish to buy a home. In many cases they simply cannot find the down payment of 20 per cent. I think the minister said tonight that the average down payment in Canada was $3,300. That amount of money simply cannot be found by the average young couple trying to buy a home. It cannot be found, either, by the older family of modest means who have decided to stop renting and build their own home. I am quite certain that there will have to be some provision for reducing the down payment required from people in that category. I am not worried at all about those people who have the money to finance a house. In most cases they do not need the National Housing Act. But these young couples and older people of modest: means need additional help provided under the laws of Canada.
There is a further difficulty in that lending companies are most reluctant to lend money on houses in districts which are not just as wealthy as the best districts in the community. A young couple might want to build in the type of district where the standards were not the highest, but the lending companies hesitate to grant a loan in that type of district. It seems to me that is one serious defect in the present legislation.
We are finding in Vancouver that where people are required to make a 20 per cent down payment and are unable to provide the cash themselves, they go to a real estate firm or a broker and arrange for a second mortgage. They have to pay a high rate of interest on this and probably have to take a discount; they may have to give the broker a reduction of $1,000 or $1,500 in the amount he pays. In other words, the mortgage may call for $3,000 but he would actually pay only $2,000. That sort of thing happens when people are unable to find the down payment.
The minister has said today that building supplies are plentiful in Canada, and this statement is confirmed by the booklet published by the Minister of Trade and Commerce entitled "Supply of building materials in Canada-Outlook 1953." In the introduction I find this sentence:
On the basis of the surveys made, it appears that the supplies of building materials in 1953 will be sufficient to permit completion of all the construction known to be planned for the year.
So there is no shortage of any supplies. The minister also said that labour would be plentiful for house building in 1953, and he

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intimated that cost of construction would be up about 3 per cent. In my opinion one of the main difficulties to be met is that of the large down payment. I would ask the minister why the government is unwilling, or whether the government is unwilling, to provide more than 25 per cent of the joint loans. If that change were made, what would the effect be in so far as reducing down payments is concerned? Also, what would be the effect in extending the time in which the money must be repaid?
I have two other questions but the minister might answer these questions first.


Louis-René Beaudoin: I do not want to curtail the discussion, and a general discussion of the amending bill is allowed on section 1; but I would not want a repetition of the debate which took place on second reading.


Howard Charles Green: As a matter of fact, Mr. Chairman, that question is right on section 1.


Louis-René Beaudoin: When I rose I indicated my doubt that it would come within any clause of the amending bill. I was looking at the minister who is piloting the bill, and he seemed to agree with me. I do not want to enter into a procedural argument, but I would ask Iron, members for their co-operation. As hon. members know, on second reading only the amendments contained in the bill are to be discussed and the principle is to be adopted. However, there was a general discussion on housing, and there was no curtailment of that discussion. Now that we are in committee on the bill I would ask hon. members to keep in mind the fact that if there is to be a general discussion on section 1 it must be with respect to the amendments contained in the bill. It would be helpful, therefore, if those who know the bill better than I do would remain within its limits.


Robert Henry Winters: Mr. Chairman, I think what you have said is quite correct. There is nothing in the bill which would alter the relationship between the government's portion of the joint loans and the portion put up by the lending institutions. In this particular case, if it will not broaden the discussion, I might attempt to answer the question by saying that at the present moment construction of housing is in a pretty good state of balance when one has regard to the availability of serviced land on the one hand and the availability of mortgage money on the other, having in mind as well supplies of material and labour.
The situation could very easily get out of bounds. Inflationary tendencies have been contained with the result that although the cost of labour and material did increase somewhat last year, the prices of houses
[Mr. Green.l
remained substantially stable. If it should develop for example that more mortgage money was available than could be absorbed with construction as it is, still at a high level, inflationary pressures would be quickly felt and the price of houses would go up again. However, there are other considerations, and I might say that this is one of the things we have considered very carefully. It is something with respect to which anyone could venture an opinion and perhaps come up with an answer that would meet with his entire satisfaction and perhaps the satisfaction of other people.
If the government were to increase its contributions to joint loans by putting up another 25 per cent Central Mortgage and Housing Corporation would first have to get some $150 million additional. It could only be obtained by taxation at a time when the people of Canada have shown that they are not too anxious to have an additional burden of taxation put on them.


Howard Charles Green: It might save that.


Mr. Abbott:: Where? Not on your suggestions.


Robert Henry Winters: Another point has to do with administration. When a lending institution comes to the conclusion that it should invest mortgage money in a property it usually likes to invest a relatively large amount in that property and, thereby, cut down the amount of administration, rather than scattering their effort over a large number of properties. They prefer to concentrate for administrative purposes. One might say that desire was not an important factor, but it is a factor to the lending institutions and they prefer to operate that way.
There is another feature, which is that the bulk of loans in this country are still made outside the facilities of the National Housing Act. The government is not anxious to do anything which will discourage loans outside the National Housing Act because we desire to develop the greatest contribution to housing in this country. If operations through the National Housing Act were made too attractive in comparison with normal channels outside the housing act, it would simply impose burdens on the government and on the National Housing Act, and I feel that we would not achieve the desired results. We would simply be changing the weight of the effort from channels which are well established now to the channels under the National Housing Act.
Those are some of the factors which we have had to consider in arriving at the decision to leave the situation as it is now; and it is working very satisfactorily.


Howard Charles Green: I am afraid the minister's answer is not very helpful. However, if that is the best he can do I guess we will have to be satisfied for the moment.
One other question has to do with the problem of the services to be provided by municipalities. Has the government given any thought to making use of the Municipal Improvements Assistance Act, which was passed in 1938? It is chapter 33 of the statutes of that year, and provides for allowances to municipalities for municipal improvements which are self-liquidating. The interest charged is 2 per cent. While that act was not drawn to meet the exact situation which we face today, I would like to know if it could not be used to help solve the problem. Probably there would have to be amendments to the act, but there you have the precedent of the dominion government making loans to the municipalities at the very low rate of 2 per cent. I understand that the act has not been used to any great extent. Some loans have been made, some millions of dollars advanced under the act; but it does seem to me that the act could be very helpful in solving this question of getting services installed by municipalities so that more homes could be built.
I should like to have the minister's reaction to that suggestion, and also to the suggestion that the municipalities should be freed of any sales tax, at least on materials that are used for installing water mains, sewage systems and public services of that kind. As I read the Excise Tax Act, it does not exempt most of these articles, and I should think it would be a great help to the municipalities in providing the necessary services for homes if some relief of that kind were given. I should like also to have an expression of opinion from the minister with regard to that suggestion.


Louis-René Beaudoin: Before the minister replies, and because of the wide debate which these two questions might suggest, I should like to ask hon. members if they give unanimous consent to have these two matters discussed at this time. If we go into the first matter of the Municipal Improvements Assistance Act, and the second matter of the remission of sales tax for the purpose of buying materials, I think we will be extending the debate. It is not that I want to curtail discussion, but if I allow these questions to be answered, further questions might be suggested to hon. members and we would have a debate on something other than the amendments that are provided in this bill.
I am in the hands of the committee, but I have asked for the co-operation of hon. members to stay within the limits of the dis-
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cussion offered by these amendments. Unless unanimous consent is given, I am afraid I shall have to declare that these questions should not be answered because the debate would be out of order.


Howard Charles Green: I shall not press the question concerning the sales tax, but in so far as the other matter is concerned we have had today a discussion which has largely centred around two or three issues. One of these issues has been how the municipalities are going to provide water, sewage services and a lot of other services of that kind. At least some of the amendments in the bill are directed toward meeting that problem. I submit that my question concerning the use of the Municipal Improvements Assistance Act is quite in order.


Louis-René Beaudoin: The hon. member argues that there was a wide discussion on second reading of the bill, and even at the resolution stage introducing this amending bill. The mere fact that wide latitude was allowed at those stages does not necessarily mean that the same latitude should be allowed throughout the remaining stages of the bill.
That is point No. 1. Point No. 2 is that if I correctly read the explanatory note for this bill, then it deals with matters that have to do with slum clearance, increasing the statutory appropriations under parts I and II, and so on. If the hon. member's question having to do with assistance to the municipalities toward the cost of providing serviced land is in order, then I do not see any reason why the question which was asked before would not be in order. It would mean that all questions pertaining to housing generally in Canada, that is the rate of interest, the increase in loans, the matter of the down payment, town planning-to which reference was made by the hon. member for York West -ribbon line development, and so on, would be in order. I suggest that unless there is unanimous consent I cannot tolerate such a discussion.


Howard Charles Green: Surely we are in order in dealing with such things as the down payment on housing, the interest payment and various things of that kind. If we are not, what is the use of having a discussion about the act at all? All those matters come within the scope of the amendments. We could not ask questions at the second reading stage of the bill. The point I am asking about now is one that was discussed on second reading all afternoon, not the particular act I mentioned but the question of how the municipalities were to finance these improvements. Such a question is involved in the matter of slum

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clearance. I submit to Your Honour we should be entitled to ask questions about it.


Louis-René Beaudoin: Perhaps when we come to the particular sections of the bill we might be in a better position to deal with these matters. At the moment, during the discussion of the first section of the bill, I submit that to ask the minister his reaction to the use of the Municipal Improvements Assistance Act is out of order. I so rule.


Donald Methuen Fleming: Mr. Chairman, when the minister made his remarks this afternoon he did not touch on the question of the capacity of the Canadian construction industry, even while he was taking issue with the estimates that have been put forward by some hon. members as to the extent of the backlog of housing units in Canada. One figure that has been put forward as the capacity of the Canadian construction industry to build houses, given what is required in the way of financing, was 130,000 houses per year. Is the minister prepared to make any comment on that estimate of the physical capacity of the Canadian construction industry?


Robert Henry Winters: I am not, Mr. Chairman, nor is anyone else in a very good position to make a comment on the capacity of the Canadian construction industry to build 135,000 housing units per year. I think there are too many other factors involved, such as the load of general construction for other purposes, the availability of serviced lands, the availability of mortgage loans, and any other factors. I have no doubt that if all the factors were favourable, if there were adequate serviced lands, mortgage money and so on, the Canadian construction industry could easily build
135,000	units per year. I am equally sure that if there were not serviced land available, if there were not mortgage money and there was a heavy burden of other construction on the industry, then the Canadian construction industry could not build 135,000 units per year. I think it depends entirely upon the circumstances of the moment.


Donald Methuen Fleming: I grant you that, but this question relates to the physical capacity, given the other factors. I take it the minister does not quarrel with that estimate of the physical capacity.


George Harris Hees: This afternoon the hon. member for Cape Breton South took me rather severely to task for some statements I was reported to have made while speaking in Saint John, New Brunswick, about ten days ago regarding what is known as the Lowren housing project which is being constructed

here in Ottawa. I should like to take this opportunity of putting on the record what I did say at that time.
The project is known as the Lowren housing project. It is in the process of construction here in Ottawa at the present time. I spoke of it in Saint John because I believe it is an example of what can be done to meet the need for good housing at low rents for people with families and low incomes.
The city of Ottawa is now in the process of constructing the first lot of 50 of these houses, and it is expected that these will be completed by the end of May. These houses will be made available to families with incomes of between $2,000 and $2,500 per year, with at least two children under 16 years of age. It is this group which finds it most difficult to obtain rental housing at the present time.
The financing of this project is done as follows:	The city of Ottawa has borrowed
90 per cent of the money required to complete the project from Central Mortgage and Housing Corporation at 31 per cent interest, and will pay off the loan over a 40-year period. The other 10 per cent of the money is made available to the housing project by the municipality of Ottawa, free of interest.
Now, Mr. Chairman, I spent considerable time inspecting this housing project, and the information I give is from having examined the project personally. These houses are built in blocks of four and six and are of frame construction, with a solid brick exterior and plaster finish inside. The cellars are of cement block construction, and are well-drained and waterproof. The outside dimensions of the houses are 21 feet by 24 feet.
Each house consists of two floors and a basement, with the ground floor divided into a living room, dining room and kitchen. On the second floor there are three bedrooms and a bathroom, and the cellar is full size and contains a hot air furnace, coal bin and laundry tubs. The sizes of the bedrooms are as follows: 10 feet by 12 feet; 10 feet by 9 feet, and 10 feet by 7 feet. There is a modern bathroom, and each bedroom contains a goodsized clothes closet. There is also a large linen closet in the upstairs hall, and in addition there is ample storage space for trunks and boxes. On the main floor the sizes of the rooms are as follows: living room, 11 feet by 18 feet; dining room, 11 feet by 10 feet; kitchen, 11 feet by 10 feet. Floors throughout are hardwood. These houses are being built around a large rectangular sodded area, which will include a children's playground 100 feet by 120 feet, a wading pool, and recreational equipment.

The rent which will be charged for each of these houses during the first year of operation will be $55 per month, made up as follows:
Per Month
Interest on, and amortization of, the cost of the house and all local improvements $31.00
Insurance	75
Taxes (guaranteed for five years)	 13.75
Reserve for repairs	 5.00
Administration	 4.50
Total rent per month	 $55.00
In an effort to reduce the rent by $5 a month after the first year's operation, the head of each household will be given the opportunity of donating one hour a week of free work, to be used in a co-operative effort to look after needed repairs and maintenance of the grounds. Heads of families will not be required to give more than five hours of free maintenance or repair work in any one week, or more than a total of 52 hours in any one year.
If this plan works out satisfactorily during the first year a repair and maintenance reserve approaching $2,500 will have been built up, and the plan is to reduce the rent to $50 a month at the beginning of the second year. From then on the head of a household will be charged $1.25 per hour for each hour he is short of the 52 hours he is expected to donate during the year. This $1.25 per hour will pay the cost of outside labour which will be needed to make up any deficits in labour donated to the co-operative maintenance effort by those who live in the project.
This very practical and desirable low-rental project will not cost the taxpayers of Ottawa one cent in subsidy, because the rents have been worked out on the basis of meeting all construction and maintenance charges. Neither will it cost the Canadian taxpayer anything, because it will pay an economic rate of interest on the money lent by the federal government agency, Central Mortgage and Housing Corporation. No subsidy of any kind will be required.
This project has been made possible by the combination of two things. The first is the business ability and public-spirited attitude of an Ottawa businessman, Mr. Cecil Morrison, who has taken on the supervision of the building and operation of this enterprise as a public service to the community. He receives no remuneration whatsoever. The second is the desire of the municipality of Ottawa to meet the need for good housing at a reasonable rent, for people with small children and moderate incomes.
Mr. Chairman, I believe the result has been a clear-cut demonstration of what can be done when governments get together and get on with the job. I hope that many other
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municipalities will follow this example and start producing good low-rental housing at a reasonable rent for those who need it most.
When answering the hon. member for Vancouver-Quadra a few moments ago, the minister gave the government's reason for not reducing the down payment from 20 per cent to 10 per cent. He said that housing production today is in balance between the mortgage money available and the serviced land available. Mr. Chairman, I think that is one of the most extraordinary explanations I have ever heard. As was pointed out this afternoon at great length by almost every speaker, two of the things that are holding back housing production at the present time are the shortage of mortgage money and the shortage of serviced land.
Many speakers, including myself, advocated specific cures for those deficiencies. Simply to say that we are not going to reduce the down payment, which all speakers explained is a highly necessary step, simply because two things which are critically short are equally short, is to me a rather fantastic explanation. I am greatly surprised that the minister, with a trained and clear mind like his, should have given an explanation of that kind. To me it simply does not hold water.
As I say, members of this party and other opposition members have suggested a number of what I consider to be extremely practical ways of overcoming the difficulties of lack of mortgage money, lack of serviced land, the high down payment, the high interest rate, and the shortness of time over which the mortgage must be paid off. The minister seems to have ignored all those suggestions. He simply says that housing production at the present time is satisfactory because it is in balance as between two things which are critically short. To me that is an extraordinary explanation.


Robert Henry Winters: Because the hon. member did not listen to the rest of it; that is all.


George Harris Hees: As I heard him, the minister went on to say this, and I jotted it down. He said he considered that there really was not the shortage that we pointed out, and that he figured that it was only 100,000 instead of half a million houses. If we want to go into that question, Mr. Chairman, may I say that I arrived at the figure of half a million in the following way. I took the figure worked out by the government's own survey, namely the Curtis survey of 1944, according to which there was a shortage of
320,000	units up to that year. Then a total of 13,500 houses every year need to be replaced because of obsolescence. You multiply that

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by the number of years between 1944 and 1953. Then you take the number of houses we have built and you take the number of net new family formations. You find out how much one exceeds the other. Then by simple arithmetic you come to a figure as of January 1, 1953-and it is an established figure-of 492,000 houses, or by now, half a million.


Robert Henry Winters: The hon. member can take his arithmetic and I will take mine.


George Harris Hees: The minister is entitled to take his own arithmetic, but on this occasion I much prefer my own. I hope the minister does not leave the discussion of this bill with the idea in his mind that the situation is satisfactory. I suggest that he get out of the ivory tower and go and talk to the people. I talk to people most of the time when I am away from here, and I find that housing is far more important to most of the people in towns and cities today than are all other problems put together. If he thinks the people of Canada are satisfied with the housing situation, then I suggest that he has not talked to nearly enough of the right kind of people; I refer to the kind of people that have small incomes and large families.
I hope the government does not get the idea that the 20 per cent down payment is satisfactory. I have talked to workingmen who are making good salaries and who say they can meet the carrying charges on a house, but that they simply cannot get together that $2,000 as a down payment; and that fact excludes them from buying a new house. They say they have saved $500 or $600, and they can get another $500 from their credit union, but they cannot get more than that; and they desperately want to move out of their family's house and get out on their own.
If the minister thinks the great majority of people who are living doubled up today are doing so because they want to, then again I say that he has not talked to nearly enough of the people who are facing this problem; and they are to be found all over this country by the hundreds of thousands. I say that he has not talked to nearly enough people to get a clear picture of the situation; and I hope he will do so very soon.


Clarence Gillis: Mr. Chairman, I was glad the hon. member for Broadview explained the press item that I saw in a New Brunswick paper. He said that I was taking him to task. I was not; I was merely seeking information. I wanted to know where you could find housing in the city of Ottawa for $50 a month such as was described in the press statement that I put on the record this afternoon. The press statement would definitely lead one to
[Mr. Hees.l
believe that at the present time you could rent that kind of accommodation in Ottawa for $50 a month, and I had a fairly good idea that you could not find it. The hon. member's explanation clears up the point and shows that they are building that kind of accommodation in a couple of sections of this city.
The press statement was very emphatic about another point, and that was that free enterprise was building this type of accommodation. That is in error. The mechanics of the project that the hon. member put on the record just now show that it is government housing. Ninety per cent of the necessary money is being lent to the city of Ottawa by the government of Ontario. That is government money. Ten per cent of the money comes from Central Mortgage and Housing Corporation.


Robert Henry Winters: Ninety per cent.


Clarence Gillis: That is much better.


George Harris Hees: That is what I said.


Clarence Gillis: It is still government housing; it is not free enterprise. We have argued a good many times in this house over the years that that should be done, that the federal government should make money available to the municipalities for the purpose of establishing low-rental housing. I am glad to see that a start has been made on it. But there is this point. While the city of Ottawa may be able to take advantage of that kind of assistance, many municipalities across the country are not in a position to do so. I wanted to say that.
I have a question I want to ask the minister. I have had considerable correspondence and discussions with him on it. It has to do with people who built houses under the National Housing Act between the years 1945 and 1952. At the time their loan was granted, lumber costs and building costs were at a certain figure; but at the time the houses were completed, owing to inflated prices for lumber and building materials generally, they found that the loan they had secured under a mortgage was $2,000 or $3,000 short of the amount required to complete the building. They were caught short because of inflated prices, not because they had miscalculated the amount that was required. In many instances the lumber dealer gave them the amount of lumber and materials necessary to complete the houses, but when they were completed the builder found himself in debt $2,000 or $3,000 to a certain lumber dealer, and he wanted his money.
I have brought several specific cases of that kind to the attention of the minister. The owners have varying incomes, but they cannot afford a second mortgage. I have

suggested verbally and by correspondence that the old provision in the act which was taken out some time ago, providing for a supplementary loan to cover a situation of that kind, should be restored; but the minister did not see his way clear to do that. I also urged that perhaps Central Mortgage and Housing Corporation or the Sun Life Assurance Company, the lending agency, with a little prodding from the government institution, might take that mortgage, add the extra amount, work out a new mortgage and relieve that particular individual of that extra problem. Apparently that is not going to be done.
These people are anxious. In certain instances the lumber dealers are threatening court action, and placing a lien against the property and so forth. I do not suppose it would involve very much money across the country because only a certain period is involved, the matter of a couple of years during which that type of individual was caught by inflated prices. During the course of preparing the amendments that are contained in this bill, was consideration given to that problem, and is there any intention on the part of the department to try to get the lending institutions to revise the mortgages and wipe away that state of anxiety these people are going through, because the individuals I have in mind cannot afford to go out and take a second mortgage and provide for the additional payment? They would rather have it all under the one contract. I wonder whether the department has any intention of doing anything about that type of problem.


Robert Henry Winters: Parliament has always
regarded the government's position under the National Housing Act as one of trying to create conditions which would enable people to build new houses rather than to finance existing ones. I have every sympathy for the people in the position which my honourable and good friend from Cape Breton South has brought to my attention. On more than one occasion I told him that if the lending institutions in the first instance thought the additional intrinsic value were there the government would be prepared to participate with respect to its 25 per cent; but the lending institutions in the particular cases in question apparently have not thought the intrinsic mortgage value was there.
It seems to me rather odd that the lumber companies, who are obviously close at hand and know the house builder, should not be prepared to carry the loan, but prefer to look to all the taxpayers of Canada to do it for them. I should think it would be a good case for the lumber dealer to show some
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confidence in the man and continue to help him until he can pay off his obligation.


Donald Methuen Fleming: At the resolution stage a week ago the minister promised to look into a matter I brought before him at that time, namely the notice to quit served by Central Mortgage and Housing Corporation on the 160 veteran tenants of the Merivale road housing project in Ottawa. The time is drawing close; it is within 48 hours of the day when the notice will take effect. Is the minister in a position to make a statement now as to what action he proposes to take in the matter?


Robert Henry Winters: Yes, I did look into that, Mr. Chairman; and while I must say I do not think it has any relation to the bill under discussion, perhaps in the circumstances I might remark on the question raised by the hon. member. I must say that the letter written by the official of Central Mortgage and Housing Corporation might have been considerably more diplomatic.


Donald Methuen Fleming: That is a masterpiece of understatement.


Robert Henry Winters: To the extent that the language was not acceptable as such I apologize to the hon. member and to the people of the project.
The government's approach to these rental projects is that at a certain time they are offered for sale. When a house is sold the purchaser must pay full taxes rather than the relatively low grant in lieu of taxes that is paid to the city in respect of that house by Central Mortgage and Housing Corporation.
It is considered by Central Mortgage and Housing Corporation, and I agree, that after half the houses in the project are sold, then the city should have the opportunity, if it cares to do so, to come to Central Mortgage and Housing Corporation and say: "Will you arrange with respect to the remaining houses of this project to give us the same level of grants in lieu of taxes as applies with respect to the houses that have been sold?" In almost all these instances Central Mortgage and Housing Corporation agrees to the higher levels of grants in lieu, with the understanding that in every instance the higher rate of payment goes to the city, and there is no increase in revenue to Central Mortgage and Housing Corporation. I think the arrangement is eminently fair to all concerned in the project; and when a city makes such a request of Central Mortgage and Housing Corporation to increase the grants in lieu
4500

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to place houses in the same area on the same footing, it seems to me difficult to deny that request.


Donald Methuen Fleming: I was not quarrelling with the payment of a sum more closely equivalent to what would be the taxes if the property were in private hands. The minister has not touched on a couple of other aspects of the matter which I understood he was going to look into. I pointed out that the advances in rents involved increases, in two jumps, by as much as 50 per cent over the original rents. I think that is obviously much more than is justified by the increase in payments to the city in lieu of taxes.
Then I thought the minister would comment on the contention of certain of these veteran tenants, that they were told that if they did buy at a later date they would receive some form of credit for the rents they had paid. I would ask the minister if he will comment upon that; because I understand it has been the basis of some dispute between the officials of Central Mortgage and Housing Corporation on the one hand and some of the veteran tenants on the other.
Then my third question is this. Is the minister's statement to be taken to mean that there will be no time given to the tenants, but that the notice to quit will be made effective as of April 30?


Robert Henry Winters: On the matter of rents paid over the years applying to the purchase price, that has never been the policy of Central Mortgage and Housing Corporation nor of the government. It is difficult for me to understand that there was even any implied understanding that this would take place.


Donald Methuen Fleming: I do not think anyone has suggested that it was put in writing. It was said to have been made orally by officials.


Robert Henry Winters: That is not government policy. On the question as to whether or not this deal will go through as of the date indicated, my only answer is that the arrangement is a fair one. The city has made the request, and I can see no reason why we should not accede to that request.


Donald Methuen Fleming: It was not a matter of acceding to the city's request. It was a question of-


Louis-René Beaudoin: Could we not carry on this discussion when the minister's estimates are before the committee?


Donald Methuen Fleming: It will be all over by that time. These notices are to take effect 48 hours from this evening.


Louis-René Beaudoin: I understand the plight in which these people find themselves, but my 
problem is this. Is it in order under this clause of the bill to have this discussion? I would like the hon. member to answer that question. If it is in order then I know he will continue. If it is not, then may I depend upon him not to pursue his questioning?


Donald Methuen Fleming: The matter is certainly in order under the general discussion normally permitted on the first section of a bill in committee. The matter has been discussed. A week ago in the discussion on the resolution stage the minister said he would look into it, and I was just trying to clarify two remaining points.


Louis-René Beaudoin: I must ask the hon. member to wait until the estimates of the department come before the committee. And may I comment-


Donald Methuen Fleming: It will be all over by that time.


Louis-René Beaudoin: I appreciate what the hon. member has said; but I must say that a member taking part in the debates in the house and one who has to perform the functions of chairman do not always agree in interpreting what is and what is not in order. The hon. member certainly is not in order when he pursues this discussion on a clause in the bill.


Mr. Graydon:: I understood you, Mr. Chairman, to ask the hon. member whether or not he was in order, and he gave his answer.


Gordon Knapman Fraser: This matter is urgent.


Donald Methuen Fleming: I say, with respect, that there is no use leaving this matter until the minister's estimates are being considered, because it will be all over by that time. It will be over in 48 hours.


Louis-René Beaudoin: May I suggest to the hon. member that when he feels it is absolutely necessary for him to ask certain questions it would be very easy to follow this course, by saying, "Mr. Chairman, this question is important. It must be dealt with at once. Therefore may I ask the unanimous consent of hon. members of the committee to have this matter dealt with?" I am sure if that were done hon. members would consent gladly. But if he leaves it to the chair, then I must stop it.
Has the hon. member unanimous consent to pursue this matter?


Some hon. Members:: No.


Donald Methuen Fleming: May I ask the minister if he will complete his answer? In my last question I was asking him for clarification of a

question you had already permitted. I had asked three, and he had answered one and a half.


Louis-René Beaudoin: Perhaps they should not have been answered.


Donald Methuen Fleming: The questions were there; permission was given to ask them.


Louis-René Beaudoin: The hon. member will understand that there are those who take part in the discussions and there are those who listen. My responsibility is toward both groups of members.


Donald Methuen Fleming: May I be permitted to dispose of this matter in only a few seconds- and it could have been done while we have been discussing this point. In his last answer the minister did not address himself to the point I was raising. I was not touching upon the question of the payment of taxes to the city. I was asking the minister if the increase in taxes to the tenants, which is to become effective on May 1-or in the alternative they must vacate on April 30-* is to be given effect, or whether they will be allowed more time to discuss this matter with corporation officials. That was my question on the latter point.
My other question was as to whether it is fair that these rents should be increased by as much as 50 per cent?


Robert Henry Winters: Mr. Chairman, this is clearly out of order. There is nothing in the bill which encompasses the discussion introduced by my hon. friend. I answered certain questions only because there was some urgency about the matter. The hon. member raised what we all regard as a matter of great importance to the tenants concerned. However, in view of your ruling, which you have given properly, I suggest, there is nothing I can add to what I have already said.


Louis-René Beaudoin: Shall the section carry?


Donald Methuen Fleming: The questions remain
unanswered, then.


Howard Charles Green: The new amendment which is to be paragraph (c) of subsection 1 of section 3 of the National Housing Act, 1944, makes provision for an agreement to be made between Central Mortgage and Housing Corporation and the approved lending institutions, whereby the institutions will act as agents on behalf of the corporation where loans are made by the corporation to borrowers. Can the minister tell us in what cases loans can be made direct? I understand it will now be in all centres with populations of 5,000 or under, and also in centres with populations from 5,000 to 50,000. But I am not clear as to just how far that arrangement is to extend.
68108-2S5i
National Housing Act


Robert Henry Winters: The wording in section 31A, which is the section under which direct loans are made, reads as follows:
If in the opinion of the corporation a loan is not being made available to a person pursuant to sections four, eight or fourteen of this act, the corporation may make a loan to such person to assist in the construction of a house or rental housing project on the same terms and conditions and subject to the same limitations as those upon which a joint loan may be made to such person under the provisions of the said sections four, eight or fourteen of this act.
Up until relatively recently the lending institutions were operating in all municipalities of Canada down to about 5,000 population. They were in fact making loans satisfactorily in many municipalities having less than 5,000 people; so for the practical administration of this section, Central Mortgage and Housing Corporation said that where lending institutions were not operating in centres of less than 5,000 population the applicant for a loan could make his application direct to Central Mortgage and Housing Corporation and if he qualified he would receive a loan.
Within the past year the lending institutions have tended to concentrate their operations in the larger centres, and it was found that there was a gap between the municipalities of 5,000 population and those having a population up to, say, 50,000. It has always been the government's intention that the coverage of the National Housing Act should be truly national. Hon. members are well aware that the various steps we have taken during the past few years have been designed to give the housing act a truly national coverage.
We took steps which were designed to keep the lending institutions operating under the National Housing Act even when they were able to find more lucrative investments elsewhere. Section 31A was designed to maintain coverage in the smaller municipalities. Now this agency arrangement is designed to ensure coverage in those municipalities with populations between 5,000 and 50,000 not otherwise receiving mortgage loans. This is on the practical assumption that the lending institutions are generally now concentrating their efforts in municipalities of over 50,000 population. Therefore this will result in a truly national coverage.


Howard Charles Green: If the lending institutions will not advance loans, say in certain districts in Vancouver, will it be possible for the residents of those districts to obtain loans direct from Central Mortgage and Housing Corporation?


Robert Henry Winters: That is something we have to keep under close scrutiny. The pattern of mortgage lending changes from time to time;

National Housing Act that was the reason for section 31A and now the reason for the agency agreement. There are municipalities with populations over
50.000,	such as Saskatoon and Saint John and a few elsewhere, where the supply of mortgage money is diminishing but in which the lending institutions are still operating. They create problems.
Units under construction as of March 31, 1952, in Vancouver were 2,302, whereas for the same period in 1953 there were 3,256 housing units under construction. That indicates that houses are being financed in greater volume this year than last year. I would not disagree with the hon. member that there are difficulties, but to the extent that there are problems we are keeping them under close observation.


Howard Charles Green: That does not answer my question. Would it be possible for a resident in a district where the lending institutions will not advance money to get a loan directly from Central Mortgage and Housing Corporation?


Robert Henry Winters: I cannot answer that without knowing what, are the merits of the case. Perhaps the applicant does not have a good case for a mortgage loan. Perhaps his location is not good. Perhaps his project is not good. There may be a number of reasons why he cannot get mortgage money. It is only where the lending institutions do not normally carry out lending operations that Central Mortgage and Housing Corporation comes into a direct position.


Howard Charles Green: Will Central Mortgage and Housing Corporation make a direct loan in a city of over 50,000?


Robert Henry Winters: Not under the present
regulations.


Howard Charles Green: Why did not the minister say that in the first place?


Robert Henry Winters: You did not ask me that.


Howard Charles Green: Where a lending institution does not wish to lend money in a particular district I think it is most unfair that those people should not be able to get a loan from Central Mortgage and Housing Corporation, simply because the city has a population of over
50.000.


Robert Henry Winters: It would be unfair if it were the case, but so far the lending institutions are doing a pretty good job of lending in municipalities of over 50,000.


Donald Methuen Fleming: I should like to ask a question which is indisputably in order because I am going to quote the language of the section. In paragraph (c) reference is made to permitting the private lending institutions to


act as agents of the corporation in the making or administration of loans that the corporation is authorized to make. May I ask the minister if that has been a matter of discussion with the lending institutions? Have they asked for that; for what particular purposes are they likely to be asked to act as agents of the corporation, and upon what terms and conditions?


Robert Henry Winters: I thought I explained that fully in my statement on the motion for second reading. It is intended to apply in those municipalities which I have discussed, where the lending institutions are reluctant under present conditions to make joint loans. If nevertheless the corporation feels that there are credit-worthy Canadians who should have mortgages but who cannot get them from the lending institutions, then in order to keep the channels of the National Housing Act open, Central Mortgage and Housing Corporation can, if parliament approves this section, go to the lending institutions and say, "If you make that mortgage loan we will provide the money on condition that you take it and service it; you will have an option for two years of changing the mortgage into a standard joint loan mortgage with government participation."


Donald Methuen Fleming: What about the terms and conditions as between the agent and the corporation? What type of remuneration is contemplated?


Robert Henry Winters: As I understand the present arrangement, the agent will get somewhere between one-half of one per cent and three-quarters of one per cent; I have forgotten the exact figure. They will receive a small percentage for servicing the loan.


Mrs. Fairclough:: Is the minister aware that postal carriers by virtue of their earning capacity are deemed to be undesirable borrowers under this scheme?


Robert Henry Winters: I am not aware of that.


Ellen Louks Fairclough: That is right. You had better look into it.


[Stage Direction]
Section agreed to.
On section 2-Corporation may take steps to safeguard mortgage.
Donald Methuen Fleming: It is obvious on its face that this section has much to commend it, but I wonder if the minister would give a further explanation as to how this will fit in with the maximum lending value. I presume there is no thought of having this power used to exceed the permissible limit.


Robert Henry Winters: There will be no change in the amount.


Donald Methuen Fleming: This power could not be invoked in the early period of a new mortgage loan? It is the sort of thing that would come into effect only after there has been some reduction in the principal of the loan?


Robert Henry Winters: That is the intention. I expressed the hope today that we would not have to use it. There is a provision in the act in connection with joint loans, and we felt it would be the course of wisdom to have the same thing in connection with direct loans.


Charles Edward Johnston: I just cannot follow this section, although the explanatory note says that this provision is extended already to the corporation and lending institutions in respect of joint loans and that this amendment will give the corporation similar powers with respect to direct loans. I could not follow the minister when he was speaking a moment ago, and I cannot see the necessity of an increased loan in order to make the mortgage security more secure.


Robert Henry Winters: I gave one illustration today in my statement on second reading, when I used the hypothetical case of a large project having a failure in its heating system after it had been in operation for some time. It might be that the borrower would be unable to finance the repair or installation of a new heating system and the project could conceivably, under those conditions, cease to be revenue-producing. This provision gives the corporation authority to advance sufficient money to restore the project to revenue-producing status and thus protect its loan. It just seems a matter of good business to do that.


Charles Edward Johnston: I think the illustration which the minister gives is sound, and I can quite see the necessity under those conditions. I wonder whether this applies in respect of a house which has not been completed, for instance.


Robert Henry Winters: No.


Charles Edward Johnston: It would just apply to a case similar to that which has just been given.


Robert Henry Winters: That is right.


[Stage Direction]
Section agreed to.
Section 3 agreed to.
On section 4-Advances out of C.R.F. to make loans and pay losses.
Donald Methuen Fleming: I have just one question with regard to clarification of the increase to the sum of $500 million made available by this section. Will the minister say whether this
National Housing Act
is interpreted in the practice of the corporation as being the total permitted to be outstanding at any time, or is it the total that may be committed altogether?


Robert Henry Winters: It is the cumulative total.


Donald Methuen Fleming: Has it no features of a revolving fund?


Robert Henry Winters: No, Mr. Chairman, I would not say it revolves. It is a cumulative total; and this provision will empower us, if it is passed by parliament, to accumulate mortgages for part I operations up to an amount of $500 million. To the extent that they are loans which are repaid to the government the moneys revolve, but it is not a revolving fund.


Donald Methuen Fleming: The same answer would apply under clause 7 of the bill?


Robert Henry Winters: Yes, that is correct.


[Stage Direction]
Section agreed to.
Section 5 agreed to.
On section 6-Grants to municipalities for clearance of slum areas.
Howard Charles Green: Clause 6 is the one that deals with slum clearance, and perhaps I could have an answer now to my question about the Municipal Improvements Assistance Act.


Robert Henry Winters: Mr. Chairman, this is a question that perhaps I am not competent to answer. The Municipal Improvements Assistance Act to the extent that it is operative, and I understand that has not been a very great extent, comes under the Minister of Finance. I have not had very close association with it, but I understand it was put on the statute books at a time when it was considered important to encourage municipalities to undertake those works which would relieve unemployment. I am speaking subject to correction but as I recall- and I am not too familiar with it-it requires a municipality to give its debentures to the federal government and to have them guaranteed under some arrangement by the provincial government. The arrangement has never been too satisfactory to either provincial governments or municipalities and, as I understand it, for all practical purposes the act has become inoperative.
If there is anything further which the hon. member wishes perhaps he had better direct his inquiries to the Minister of Finance, who 1 am sure is much more familiar with it.


Howard Charles Green: No; the tenor of my suggestion was that the minister himself should look into the provisions of this act to see if it could not be used to help municipalities instal these services. I think the act would

National Housing Act
have to be amended, but it does seem to me that it might be one way of helping them overcome the problem of lack of serviced land.


Some hon. Members:: Carried.


Donald Methuen Fleming: I have several questions on section 6. The first one relates to the provisions on page 3 of the bill. Will the minister enlarge on the reference in the proposed new section 12 (1) to contracts with municipalities? It is made quite clear, of course, that this can be done only where the entering into a contract on the part of a municipality is approved by the provincial government. There is a new departure here, however, and I wonder if the minister would enlarge on the matter of entering directly into contracts with the municipality.


Robert Henry Winters: Mr. Chairman, I doubt
whether there is very much I can add to what I have already said this afternoon and what is set forth in the bill. Perhaps if I referred to a concrete example it would serve to crystallize the approach to the problem. The only concrete example I know of, the only one in Canada, is the Regent Park project in Toronto. Under an arrangement which was approved by the government of Ontario the municipality acquired property, cleared it and assigned to it an end price. Under section 12 of the act the federal government was then empowered to arrange to contribute one-half of the cost of acquiring and clearing the property less half of the end price of the property, which in this case was assigned a value of $1, I think.
The existing section limited the use of the land to limited dividend companies and insurance companies. It was felt by the committee on banking and commerce last year that the provision was too restrictive and that property thus cleared should be made available for a partnership arrangement under section 35 of the National Housing Act. That suggestion seemed eminently fair to the government and this section is designed to give effect to that recommendation.
It means that the land can be acquired and cleared under the same arrangement through which the federal government makes a grant of half of the cost of acquiring and clearing the land less, of course, half of the end value assigned to the cleared land. Then the land can be used under section 35 if the provincial government sees fit to do so. For a project on that property the federal government will pay 75 per cent of the cost provided that the provincial government and the municipality jointly or, under some arrangement acceptable to themselves, pay the remaining 25 per cent of the cost.
IMr. Green.]
It was decided that still more flexibility should be given. Perhaps under municipal plans the area cleared might more appropriately be used for some public purpose such as a park. Therefore the act envisages that such action can be taken on condition that the municipality undertakes to make available elsewhere a suitable area on which houses can be built in numbers at least equal to the units removed in the slum clearance operation.


Donald Methuen Fleming: On page 4 in lines 14 and 15.
we have the words:
-leased to tenants on a fair and reasonable basis . . .
I wonder if the minister would enlarge on the meaning of those words. How is this question to be approached? Is it on the basis of economic rent, or is it to serve some social purpose?


Robert Henry Winters: Well, Mr. Chairman, normally I would think that any project built on an area cleared of blighted or substandard housing would be a subsidized project. It would seem normal to envisage it in that way. However, if we bring section 35 into operation it can also be an economic project. I would think, though, that in any area so cleared the first obligation would be to rehouse the people whose accommodation has been removed from the site. It is difficult to conceive that they could be rehoused in any way other than through a program involving subsidization.


Donald Methuen Fleming: In line 34 this expression appears:
the value of the area after clearance, . . .
How is the value to be determined for the purposes of this section?


Robert Henry Winters: Mr. Chairman, that depends on the purposes for which the property would be used. I would think that under normal circumstances the end value would be purely nominal. If the land were cleared and then left as a playground area, for example, and some alternative area were acquired elsewhere, I would think parliament might wish the government, in co-operation with the municipal and provincial governments, to assign to the area which is cleared a value approximating the value of the alternative site on which an equivalent number of houses are to be built. However, that is a matter which has to be worked out.


Gordon Francis Higgins: Would the minister translate into dollars and cents what is a fair and reasonable monthly rent for this particular type of housing?


Robert Henry Winters: I would say that would depend upon the income in each particular case. In

these housing operations, and in fact in the subsidized operations under section 35, the fair and reasonable rental is a figure related to the income of the tenant.


Gordon Francis Higgins: Would the minister answer the question? He has an idea what he expects to get as a return. Would it be $20, $30 or $40 per month?


Robert Henry Winters: It varies from project to project, Mr. Chairman. Once these projects are completed they are operated by the local housing authority pursuant to agreements between the province, Central Mortgage and the authority. The agreement fixes the average rental to be recovered and the range of income of the occupants of the units in the project. Once the agreement has determined the average level of rental, and automatically determined the amount of subsidy to be paid, then the authority sets about determining how low it should go for low income groups and how high it should go for the highest income group eligible for accommodation in the project.


Gordon Francis Higgins: That is not an answer. I still put it to the minister that he knows what the project is going to be. I think he knows what the land is going to be, and in the main places he knows what the cost is going to be. Surely he has an idea, an outside idea, what the rental is going to be?


Charles Edward Johnston: Do I understand the minister to say that the rent paid would depend on the income of the tenant?


Robert Henry Winters: When there is subsidization, that is right, Mr. Chairman.


Charles Edward Johnston: I quite understand the minister's difficulty in stating an amount because he could not state what that would be unless he knew the income of the tenant. May I put it this way, and I think it is reasonable. Can the minister give us the percentage of income that would be paid for rent?


Robert Henry Winters: In a typical project for a scale of incomes within which tenants would be eligible for units in the project, the low might be as low as $960 a year, and the high might be $3,180 a year, for example, and the rental would be roughly 20 per cent of the income.


Gordon Francis Higgins: May I ask the minister this, so we will not have any misunderstanding about it. If a house costing the government $37,500 were to be rented to a tenant, what would the government expect to have as a rental?


Robert Henry Winters: There again, I cannot add to what I have said. The local housing authority has the responsibility for managing the project, and it is up to the local housing authority as already indicated to determine the rental
Canadian National Railways it wishes to derive from the accommodation it is managing.


Gordon Francis Higgins: The manager of the project is immediately in front of you.


Mr. Macdonnell (Greenwood):: Could the minister give us a simple illustration?


Robert Henry Winters: I gave an example to the hon. member for Bow River. I have not a scale of rentals for all projects before me tonight.
I would be glad to see the hon. member for Greenwood privately or otherwise give him any information he wishes. I do not have that before me at the moment.


Ellen Louks Fairclough: Does the minister mean a rental may be as low as $16 per month for an income of $960 per year?


Robert Henry Winters: Yes, Mr. Chairman.


[Stage Direction]
Section agreed to.
Sections 7 to 15 inclusive agreed to.
Title agreed to.
Bill reported.
Mr. Deputy Speaker:: Shall this bill be read a third time now, by leave?


Stanley Howard Knowles: By leave.


Robert Henry Winters: the third reading of the bill.
Motion agreed to and bill read the third time and passed.



CANADIAN NATIONAL RAILWAYS


Hon. Alphonse Fournier (for the Minister of Finance) moved: that the house go into committee to consider the following resolution:
That it is expedient to bring in a measure to authorize the Canadian National Railway Company to make capital expenditures in the year 1953 not exceeding $146,767,193 and to make certain capital expenditures and enter into certain contracts prior to July 1, 1954; to authorize the national company to issue securities to provide amounts required for the authorized expenditures; to provide that, except as expressly provided, the aggregate principal amount of securities outstanding at any time shall not exceed $221,867,198; to authorize the governor in council to guarantee the principal and interest of securities issued by the company for the purpose aforesaid; to authorize the Minister of Finance to make loans to the said company secured by such securities and not exceeding $221,867,198 in principal amount to enable the said company to meet such expenditures and with authority to give financial aid and assistance to other companies of the national system.
Motion agreed to and the house went into committee, Mr. Beaudoin in the chair.


Mr. Lesage:: Mr. Chairman, I have a short statement and a table which I should like

Canadian National Railways to put on Hansard before we reach second reading of the bill, which I hope will be tomorrow.


James MacKerras Macdonnell: The matter is a complicated one, and I think it would be convenient for consideration of the measure tomorrow if the parliamentary assistant would put his statement on Hansard now.


Louis-René Beaudoin: I understood that was what he said.


Jean Lesage: This is the annual resolution that precedes the introduction of the Canadian National Railways Financing and Guarantee Act. Hon. members will recall that last year the form of this legislation was changed to include the financing of all capital expenditures whether authorized in that act or in earlier financing and guarantee acts. This procedure has been followed again this year.
The bill to be founded on this resolution is divided into four specific parts. The first part is to authorize the Canadian National Railways to incur capital expenditures up to $146,767,198. The second part is to authorize the railway company to acquire additional working capital of $15 million. The third part authorizes the railway company to make capital expeditures prior to July 1, 1954, to discharge obligations incurred under this act which become due and payable after January 1, 1954. The fourth and last part authorizes the railway company to enter into contracts for new equipment and for general additions and betterments in the amount of $74,705,625.
To summarize, parliament is being asked to approve financing, either by way of the issue of new securities guaranteed by the government or by way of direct loan, in the amount of $221,867,198. For the convenience of hon. members, I would ask permission to place on Hansard a table giving the details of these amounts.


Louis-René Beaudoin: Is it agreed?


Some hon. Members:: Agreed.


Jean Lesage: The table is as follows:
Additions and betterments (excluding new equipment) -
Ordered prior to 1953
(revote)	 $35,561,634
Ordered and to be paid
in 1953	 12,323,366

Branch line construction Sherridon-Lynn Lake..	2,758,513
Terrace-Kitimat	 6,580,000

 9,338,513
New equipment
Ordered prior to 1953 ..	79,291,685
Ordered and to be
paid in 1953	 9,959,000

 89,250,685

Acquisition of	securities	89,250,685
Additional working
capital	 15,000,000
Capital expenditures,
January 1,	1954, to
June 30,	1954, incurred prior to January 1, 1954		 80,000,000
241,767,198
Less amount available from depreciation reserves	 19,900,000

The usual authority is provided for the making of temporary loans to the railway company and Trans-Canada Air Lines to meet the operating deficits to June 30, 1954. While the budget of the railway company contemplates a surplus of $400,000 for the calendar year 1953, deficits usually occur in the early months of the year.
Loans made by the government to the railway company under previous financing and guarantee acts were outstanding on March 31, 1953 as follows:
1951 act	$ 21,750,327.84
1951	(No.	2)	act	
3,225,924.371952	act	
119,722,537.32
1952 act-
Account	of	deficit	 12,000,000.00
(1953 deficit)


James MacKerras Macdonnell: Mr. Chairman, it will be in the memory of hon. members of the committee that what is happening now is in the ordinary course of the annual arrangement connected with the Canadian National Railways. Their statement comes before the special committee which examines the figures, and it is followed by this legislation.
Hon. members will recall that a year ago certain relief from fixed charges was given to the railway, and it was also provided that each year the Minister of Finance would take up a certain amount of the preferred shares of the railway, each of which steps has contributed to make the load of the railways a little bit lighter. We all recognize the fact that the Canadian National Railway Company, in its inception, was a conglomeration of various lines and that it has had a heavy burden to bear.
Generally speaking, the legislation now before us is precisely in the form which we have grown accustomed to. As the parliamentary assistant has pointed out, we get a fresh beginning each year. The authorizations not used are, so to speak, washed out and we get a fresh start each year so that we know where we are at.

With regard to the one large item of expenditure, to wit the expenditure for equipment, it is hoped that that is done on a self-liquidating basis so that eventually it will work itself out. Apart from that, as far as I am concerned, I think the matter can stand until second reading of the bill and perusal of the statement which the parliamentary assistant has placed on Hansard.
Resolution reported, read the second time and concurred in.
Mr. Fournier, Hull (for Mr. Abbott) thereupon moved for leave to introduce Bill No. 363, to authorize the provision of moneys to meet certain capital expenditures of the Canadian National Railways system during the calendar year 1953, and to authorize the guarantee by Her Majesty of certain securities to be issued by the Canadian National Railway Company.
Motion agreed to and bill read the first time.
Business of the House BUSINESS OF THE HOUSE


Alphonse Fournier: Mr. Speaker, may we call it ten o'clock? Tomorrow we shall consider the following legislation: first, amendments made by the Senate to Bill No. 225, to amend the Excise Tax Act; Bill No. 363, which is the bill based on the resolution which has just been carried, namely to authorize the provision of moneys to meet certain capital expenditures of the Canadian National Railways system; Bill No. 334, to provide for the superannuation of persons employed in the public service of Canada, in conjunction with the resolution of the Minister of Finance respecting superannuation of civil servants. Then we shall move to go into supply and take up the estimates of the Department of Agriculture, the Department of National Health and Welfare, the Department of Mines and Technical Surveys and the Post Office Department.
On motion of Mr. Fournier (Hull) the house adjourned at 9.55 p.m.

Wednesday, April 29, 1953