1954-02-04

ARMED FORCES


Hon. R. O. Campney (Associate Minister of National Defence):: Mr. Speaker, further
to the answer given to a question asked by the hon. member for Calgary North (Mr. Harkness), which appears at page 1188 of Hansard of January 18, 1954, I can now give from additional information received the approximate figures of the number of former cadets joining the armed forces during the calendar year 1953. These are: Royal Canadian Navy, 353; army, 564; Royal Canadian Air Force, 700; total, 1,617. These figures are, of course, subject to final revision.



PRIVATE BILL


Mr. John Hunter (Parkdale) moved:: That the petition for divorce of Annie Bray Hodgson, presented on February 3, 1954, together with the report made thereon by the clerk of petitions on February 4. 1954, be referred to the standing committee on standing orders for such recommendations as may be deemed advisable.


[Stage Direction]
Motion agreed to.


Mr. Fulton:: In connection with the case of Campbell-Bennett Limited, v. Comstock Midwestern Limited and Trans Mountain Oil Pipe Line Company, heard recently by the Supreme Court of Canada, and in particular in connection with the question of whether a provincial statute creates a lien on a pipe line falling under federal jurisdiction:-
1.	Was the Attorney General of Canada represented by counsel at the hearing of this case?
2.	If so, what instructions were given to counsel, and what position did he take as a result of such instructions?


Mr. Garson:: I wish to answer this question orally. The answer to the first portion of it is yes. In reply to the second part, I have arranged with the hon. member for
Kamloops to send across to him the brief filed on behalf of the Attorney General of Canada in this case.


Mr. Speaker:: Answered.


BREAD FLOUR
Mr. Dinsdale:: 1.	What substances are added to bread flour as improvers by milling companies?
2.	What quantity of these improvers was used for domestic consumption, during each of the past three years in Canada?
3.	Is bone meal added to bread flour? If so, in what quantities and for what purpose?
4.	What protein content is required for different grades of bread flour under the Food and Drugs Act?


Mr. Robertson:: 1. The term "improvers" as used in the milling industry has meant bleaching agents and maturing agents. The term is no longer accepted by the department because its use is deemed to be misleading. Instead, millers are required to label flour in which bleaching agents have been employed, as "bleached". If maturing agents have been used, the statement "maturing agents added" must appear on the labels. These bleaching and maturing agents are permitted in all wheat flours. Some chemicals such as chlorine, chlorine dioxide and nitrosyl chloride are both a bleaching agent and a maturing agent at the same time, while potassium bromate, for example, is a bleaching agent only and ammonium persulphate is a maturing agent only. Section B.13.003 of the regulations under the Food and Drugs Act lists those substances which are considered to be bleaching and/or maturing agents, as follows:
(g)	oxides of nitrogen,
(h)	chlorine,
(i)	chlorine dioxide,
(j)	nitrosyl chloride,
(k)	benzoyl peroxide mixed with not more than six parts by weight of one or a mixture of two or more of
(i)	calcium carbonate,
(ii)	calcium sulphate,
(iii)	dicalcium phosphate,
(iv)	magnesium carbonate,
(v)	potassium aluminium sulphate,
(vi)	sodium aluminium sulphate,
(vii)	starch, and
(viii)	tricalcium phosphate,

Questions
in an amount not exceeding 100 parts of benzoyl peroxide for each 1 million parts of flour,
(l)	potassium bromate in an amount not exceeding 50 parts for each 1 million parts of flour, and
(m)	ammonium persulphate in an amount not exceeding 250 parts for each 1 million parts of flour.
It will be noted that limits are stated only for (k), (1) and (m) above; no limits are stated for the other substances since the amount of these latter chemicals that can be used is self-limiting at a very low level.
2.	There is no way of estimating the quantity of the ingredients which have been used for domestic consumption in Canada. Since the amounts of some are self-limiting and of others are limited by regulations, it is reasonable to assume that the total amount of these ingredients is very small in relation to the amount of flour produced. Generally, millers do not use more than one bleaching agent and one maturing agent in any flour and frequently one compound performs both functions.
3.	Under section B.13.004 of the regulations under the Food and Drugs Act calcium carbonate or edible bone meal in an amount that will provide in one pound of enriched flour not less than 500 milligrams and not more than 650 milligrams of calcium is a permitted addition. This addition is not compulsory. The addition of edible bone meal is required in Newfoundland. This is the only province in which such a law exists and it is designed to correct a local dietary condition. Enriched flour, supplied in the rest of Canada, does not contain edible bone meal or calcium carbonate, to the best of our knowledge.
4.	The regulations under the Food and Drugs Act do not specify the protein content for flour. This is considered to be regulated by the fact that "cleaned milling grades of wheat" are stipulated as the starting point for the manufacture of all types of wheat flour.


CLARKE STEAMSHIP COMPANY
Mr. Thatcher:: 1.	During the last fiscal year, what federal steamship subventions, if any, were paid to the Clarke Steamship Company for their service between Quebec, Natashquan and Harrington, Quebec?
2.	How many ships were used by the Clarke Steamship Company to provide this service?
3.	How many passengers were carried during the period mentioned in (1)?
4.	What freight cargo, if any, was carried during the same period?


Mr. Langlois (Gaspe):: 1.	Fiscal year 1952-53, $520,000.
2.	Four-(two passenger cargo vessels and two cargo vessels).
3.	9,289 passengers.
4.	40,055 tons, 20 head of livestock, 14,025 bags of mail.


NATIONAL DEFENCE
[Stage Direction]
On the orders of the day:
Mr. G. R. Pearkes (Esquimalt-Saanich):: May I ask the Associate Minister of National Defence the question which inadvertently I asked on motions yesterday, when you pointed out very kindly, Mr. Speaker, that that was not the right place to ask it? Has the minister any statement to make regarding the causes of and the losses resulting from the collapse of the new naval building at Halifax?


Right Hon. C. D. Howe (Minister of Defence Production):: Mr. Speaker, this is a matter relating to Defence Construction Limited. Early reports indicate that part of the roof structure and three walls of the storage and maintenance garage at H.M.C.S. Shearwater, Dartmouth, collapsed on Tuesday morning, February 2. A bus and several other vehicles were damaged. No personnel were seriously injured.
The cause of the collapse is not known. An investigation is being carried out by Mr. K. E. Whitman, consulting engineer of Halifax, who is a specialist in structural design of many years' standing. Officers of Defence Construction Limited and of the navy engineering division are collaborating with him in the investigation. The contract originally was for $279,000, I believe. The building is in two sections. One section is quite intact, that is, the section containing the machine shop. The storage section has collapsed apparently through the falling of one of the trusses. No one knows why it fell or what happened, but that is being ascertained by engineers.
The fact that the building was taken over by the navy almost on the day the truss collapsed is not material, because the contractor has guaranteed the structure for one year. It was a structure designed by the contractor who was both the engineer and the contractor on the job. I am stressing that the damage can be made good without loss to the crown. I may say that Defence Construction Limited, the organization that handled this contract for the government, has handled $512 million

worth of construction which already has been completed, and this is the first accident of the kind that I know of in the course of that program.


George Randolph Pearkes: What was the type of construction; wood, brick or stone?


Clarence Decatur Howe: Reinforced concrete walls and laminated wooden trusses. The design of the trusses was approved here in Ottawa. I am quite certain that the truss itself was not defective. My own theory, which is only a theory without having any data as to the collapse, is that there must have been a defect in the fastening between the truss itself and the walls. However, that will be determined and the damage made good.


Mr. G. C. Nowlan (Digby-Annapolis-Kings):: May I ask a supplementary question? Has the contractor who was responsible for the construction of this building since been awarded a contract for another building for the navy and, if so, has that contract been held up pending investigation?


Clarence Decatur Howe: No, sir, it has not. This contractor is well-known and, as I say, has carried out five or six million dollars worth of work for Defence Construction Limited. The erection of the trusses was sublet to an Ontario firm, which is also a responsible organization. As far as the main contractor is concerned, the firm has always been good for its liabilities and I am sure it will be for this. There is no reason to question their integrity.


Edmund Davie Fulton: May I ask a
supplementary question? Is it a fact that during the course of the construction of the building in question representations were received from an engineering organization or association calling into question the particular method being used in connection with this laminated wood process?


Clarence Decatur Howe: Not to my knowledge. Laminated wood trusses are widely used throughout Canada. They were used with success during the last war, and they are used, not only in government construction but in private construction. As I say, the firm that designed and built the trusses and was responsible for their erection is well-known in Ontario. I know of no representations of that type having been made.
Inquiries of the Ministry SUPREME COURT OF CANADA


SUGGESTED JOINT REFERENCE OF PROVINCIAL STATUTE
[Stage Direction]
On the orders of the day:
Mr. M. J. Coldwell (Roselown-Biggar):: May I ask the Minister of Justice if he will approach the appropriate authority in the province of Quebec with a proposal to submit jointly to the Supreme Court of Canada an act of that legislature which, according to the press, has been finally passed and which is known as the freedom of worship act, to determine whether or not the act is an amendment to criminal law and therefore of doubtful validity as a provincial statute? Will the minister endeavour to secure the co-operation of the provincial government of Quebec with a view to obtaining the opinion of the Supreme Court of Canada?


Stuart Sinclair Garson: I wish to thank my hon. friend for having given me notice of his question. In reply to both portions of it I may say that the Supreme Court of Canada does not have jurisdiction to determine whether or not a provincial statute is of doubtful validity on a submission made jointly by the governor in council and the appropriate authority in the province.


Major James William Coldwell: What was done several years ago in the case of the Alberta legislation which was referred to the Supreme Court of Canada? Was that not done through a co-operative arrangement between the two governments?


Stuart Sinclair Garson: I am afraid I cannot answer my hon. friend's question from my own offhand memory. There may have been correspondence, but the point I am making now is that there is no authority in the Supreme Court Act for the two governments to act jointly in submitting a reference.


Major James William Coldwell: The federal government may direct one.


DUMPING
[Stage Direction]
On the orders of the day:
Mr. Michael Starr (Ontario):: I should like to direct a question to the Acting Prime Minister, the Minister of Trade and Commerce. In view of the conditions now prevailing in industries producing malleable castings, where serious unemployment exists and a reduction in the hours of employment is taking place, caused by Japan dumping pipe fittings into Canada, will the government give

Inquiries of the Ministry consideration to using the powers under the recent anti-dumping legislation to meet this situation?


Clarence Decatur Howe: Mr. Speaker, I submit that that is a statement rather than a question.
I have asked our people to let me know what the Japanese imports amounted to, and I find that from January to September, 1953, they totalled $83,000 as against imports of $3,480,000 from the United States and $330,000 from the United Kingdom. On the basis of those figures there is certainly no evidence that anti-dumping legislation is required. If it is anti-dumping legislation that is sought, the appropriate place to apply is the Department of National Revenue. If the hon. gentleman wishes to ask a question rather than to make statements, the place for it is on the order paper.


Mr. Green:: Could the minister get the figures for the period following the end of September last year?


Clarence Decatur Howe: They could be obtained direct from the ports of entry. I was using the figures available from the bureau of statistics. If the hon. member will put his question on the order paper, then it can be answered. It is not a question to be asked on the orders of the day. What is the urgency of it?



POST OFFICE


[Stage Direction]
On the orders of the day:
Mr. Stanley Knowles (Winnipeg North Centre):: Mr. Speaker, I should like to direct a question to the Postmaster General based upon a telegram from the Winnipeg branch of the Canadian postal employees' association, the text of which I have sent to him. Will the manipulative staffs of the Winnipeg post office be included when the 40-hour five-day week is implemented?


Hon. Alcide Cote (Postmaster General):: Mr. Speaker, I want to thank my hon. friend for giving me notice of his question, and also the hon. member for St. Boniface (Mr. Viau) who asked a similar question. I am sorry to have to say in reply to both questions that I cannot give an answer because so far we have received no complete information from the civil service commission. It is quite understandable that they do not want to handle this on a piecemeal or hypothetical basis. I am sure that when they have set up the whole pattern for the implementation of the 40-hour


five-day week we will be duly informed and then I shall be glad to give the information to the house.



WATER POLLUTION


[Stage Direction]
On the orders of the day:
Mr. J. G. Diefenbaker (Prince Albert):: Mr. Speaker, I should like to direct a question to the Minister of National Health and Welfare. Would he tell the house something of the actions of his representatives in the meetings they have had with representatives of the provinces of Alberta and Saskatchewan in relation to the pollution of the North Saskatchewan and also whether or not, in view of the dispute as to the responsibility being federal or provincial, his government has . given consideration to amending the Criminal Code in order to cover a situation such as this, as a means of arriving at a permanent solution?


Hon. Paul Martin (Minister of National Health and Welfare):: Mr. Speaker, I thank the hon. gentleman for giving me notice of his intention to ask this question. As I told him and the house the other day, the chief of the public health engineering division of the Department of National Health and Welfare went to western Canada to confer with the appropriate authorities in the provinces of Alberta and Saskatchewan. I may say also that he has conferred with health authorities regarding the same problem in the province of Manitoba.
He advises that due to the complexity of the wastes being discharged into the North Saskatchewan river near Edmonton and the very small amounts of the various pollutants it has not been possible to determine the particular material or materials which are causing taste and odour problems in downstream water supplies. The low flow in the river at this time and the fact that the river is covered with ice are factors which are probably contributing to present conditions. The ice cover prevents oxidation of the pollutants.
The hon. member for Churchill (Mr. Weaver) had asked privately regarding the situation at The Pas in Manitoba. I can say that the use of activated carbon at The Pas appears to have corrected the taste and odour problem. Lack of equipment and treatment facilities have prevented a similar solution at water treatment plants between The Pas and Edmonton. The city of Prince Albert has made arrangements to treat its water with fluorine

chlorine dioxide. Laboratory experiments have indicated that this treatment is effective in removing the objectionable tastes and odours.
With regard to my hon. friend's use of the word "dispute" as to jurisdiction, I must say that what I said the other day with regard to the competence of the particular authority in question does not, in so far as our relations with the provinces are concerned, justify, to the best of my knowledge, the use of the word "dispute". There is no suggestion on the part of the provincial authorities that the matter is not one within their jurisdiction. However, the matter is receiving continuous study on the part of the industries, the provinces and other interested parties and we have assured the provinces that we will be glad, within our constitutional authority, to continue to collaborate in the matter of providing whatever technical skill we have at our command.


Major James William Coldwell: And the legislation required?


Paul Joseph James Martin: What I have said covers the interjection which my hon. friend has just made.


John George Diefenbaker: Mr. Speaker, may I ask a supplementary question. I wish to thank the minister very much for his statement. I know his department is co-operating, but certainly action of the most drastic nature should be taken. The minister's answer to my last question scarcely covers the matter. My question is, in view of the fact that it is admitted by the provincial governments of Alberta and Saskatchewan that this is a matter of provincial responsibility, has consideration been given by way of a permanent solution to the amendment of the Criminal Code in order to cover situations such as this?


Paul Joseph James Martin: My hon. friend knows that whatever responsibility the dominion government might have in this or like matters would come under the head of navigation. 1 suppose theoretically it would be possible, under the guise of criminal law, to deal with the situation. However, that is a matter which, as I indicated the other day, is being explored by the law officers of the crown and I do not think I would desire or be expected to comment on that at this time, and in any event this is a matter of policy.


Major James William Coldwell: The government has power to care for the health of fish in these rivers. What about the care of human beings, who are a great deal more important?


Paul Joseph James Martin: As my hon. friend knows, to the full extent of the authority given the federal parliament and the federal government
Inquiries of the Ministry under our constitution this government has not been remiss in meeting its obligations.


Stanley Howard Knowles: Yes, to the fish.


Mr. A. M. Campbell (The Balilefords):: Mr. Speaker, I intended asking the minister a question similar to that asked by the hon. member for Prince Albert (Mr. Diefenbaker). What action if any does the government propose to take to prevent this pollution of Canadian rivers running through two or three provinces?


Paul Joseph James Martin: I thank my hon. friend for giving me notice of his question but, as he has just observed, it has already been asked. As a matter of fact, this very question was raised by the hon. member for Prince Albert on January 19, and on that occasion I made a careful and fairly extensive reply. That reply may be found at page 1234 of Hansard and I commend to my hon. friend what I said then.



NATIONAL FILM BOARD


[Stage Direction]
On the orders of the day:
Major James William Coldwell: Mr. Speaker, may I direct a question to the Minister of Citizenship and Immigration (Mr. Harris) regarding the removal of the film board to Montreal. The question, similar to one I asked the other day, is this. Will the contract be let before the house has had an opportunity of considering the estimates that will be necessary for the removal of the film board? That was the one part of my question which remained unanswered the other day.


Hon. W. E. Harris (Minister of Citizenship and Immigration):: I am not certain what procedure the Minister of Public Works (Mr. Winters) has in his department for letting contracts, so I am not prepared to answer until I consult with him.


Major James William Coldwell: Then may I ask the Minister of Public Works if he will give the answer?


Walter Edward Harris: He is not here.


Major James William Coldwell: Will he consider it at the first opportunity?



TRADE AND COMMERCE-DEFENCE PRODUCTION INQUIRY AS TO MERGING OF DEPARTMENTS

[Stage Direction]
On the orders of the day:
Stanley Howard Knowles: Mr. Speaker, may I ask a question of the Minister of Trade and Commerce and Minister of Defence Production (Mr. Howe).

Post Office Act
Would the minister care to comment on a report which appeared in the press a few days ago, to the effect that his two departments are likely to be merged into one department called the department of trade and production?


Clarence Decatur Howe: Mr. Speaker, I have not heard that rumour, but I can assure the hon. member that that will not happen.



POST OFFICE ACT


Alcide Côté: Post Office Act
department that my predecessor obtained the services of a firm of outside consultants. The postal officials recognized that with the growth of the service a greater measure of decentralization was desirable and that they had not sufficient time to devote to the task of making a survey of the organization and procedure without leaving undone some of the many daily tasks which require their personal attention.
I wish to make it crystal clear, beyond any possible misinterpretation, that there never was any question of maladministration or even of complacency on the part of the administrative officials. It was not any investigation of any wrongdoing or any lack of interest, but simply a request for a managerial report, a desire on the part of these administrative officials to ascertain if their ideas of development and decentralization were along sound business lines and in conformity with up to date practices. They wished to take advantage of the knowledge and experience and progressive methods possessed by outstanding business consultants as a consequence of their constant study and experience.
The fact is, as the report repeatedly states, [DOT]that the department is well administered and departmental officers have vigorously pursued a program of efficient operation over the years. What better evidence of this is required than the fact that during the past 20 years the volume of mail has increased by 178 per cent whereas the increase in total staff approximated 100 per cent? It is simply by good, hard-fisted administration, by scrupulous attention to every detail, that this has been made possible.
What is the reaction of my friends in the opposition to this unquestionably efficient administration? The Leader of the Opposition (Mr. Drew) states he has nothing but praise and commendation for the way in which those who are carrying out their daily routine of mail service have been performing their functions. He pointedly remarks that his criticism is directed to the administration of the department. Other members of the opposition refer to the need for a housecleaning of these officials, and make other similar unjustifiable comments. Is it not strange, however, that during the same debate, in fact on the same day, still other members of the opposition were most complimentary in their references to the efficiency of the postal department?
The Woods and Gordon company do make a number of recommendations. I shall deal with them in detail later, but before doing so let me stress that the report states that

many of the suggestions originated with the administrative officers at headquarters. Let me give you just one simple illustration of what was done by the departmental officials in the past, years before the survey was made. In the financial branch, on their own initiative and without any outside help, the officials replaced the old system of handling money order accounts which had been in effect for many years-incidentally, under both Conservative and Liberal administrations-by the new type of money order which effected not savings of hundreds 'of dollars, not even the $30,000 stressed by the hon. member for Notre Dame de Grace (Mr. Hamilton), but over $350,000 annually. Many other such developments had taken place long before the Woods and Gordon company were called in.
The department has developed the mechanical handling of mail to a degree which is not even approached by many other first-rank postal administrations. We are now undertaking research to take care of the sortation and letter distribution problems of tomorrow by the utilization of electronics. It will be some little time before the complete machine is built, but it is another indication of the efficiency and progressiveness of the postal officials. It was by this kind of administration that we were able through all these years to more or less balance our books and not come to parliament asking for rate increases when practically every other business in Canada was imposing increased charges as a matter of course.
As I have already mentioned, payments to transportation companies have increased some 72 per cent. The salaries of employees have increased 100 per cent. During that time the increase in postal rates, applied to the whole range of charges to the public, had been approximately 22 per cent. The hon. member for Brandon-Souris (Mr. Dinsdale) gave a clear indication of what is being done when he referred to the fact that many years ago the revenue at Brandon was $110,600, with 44 employees. Now, with revenue of $217,120, there are only 41 employees. Like comparisons can be made in other offices. It was this close attention to routine administration and improvements in procedure that made the savings possible.
It was this same close attention to administrative details which occupied the time of departmental officials to such an extent that they could not look around to explore every field of potential future savings. Is this a crime? On the contrary, I think it is indeed a solid tribute to the zeal, energy and capacity of those men who have given devoted and efficient service over the years, and whose

ability and loyalty to their duties some members of the opposition attempt to depreciate. May I again read what the Woods and Gordon company state on this point:
We have been impressed by the over-all efficiency of the department and the basic soundness of its organization and administration. Many of the proposals incorporated in this report were brought forward by them. A number of important steps have been taken in recent years to improve both the organization and the administration. Further improvements are under active consideration by your senior officials and some are in course of implementation.
The summing up in the report is to the effect that departmental officials, if given more help, can free themselves from a lot of routine and they, and they alone, can make the savings which the report holds out, not as an immediate possible benefit but one to be derived in future years. May I again emphasize that they do not at any point in the report, or in any conversations I have had with them, indicate that these savings are to be realized immediately. What they say is that we must be prepared to spend more money at headquarters and in the field to achieve returns in the way of good service and possible economies in later years.
For my convenience Woods and Gordon Limited prepared a brief summary of the organizational and administrative items in their report, with some related observations. With the same reservation I made concerning the tabling of the main report, I am tabling the summary now, as it is much easier to follow than the lengthy main report.


Stanley Howard Knowles: Are there enough copies available for hon. members?


Mr. Cole:: This is the copy which was sent to me on the 17th of December, and which I am prepared to table.


The Acting Speaker (Mr. Applewhaile):: Is
it the intention of the minister that the document should be printed as part of Hansard?


Charles Delmar Coyle: I have absolutely no objection. If I may have the unanimous consent of the house I will agree to that.


Edmund Davie Fulton: May I ask whether the summary is prepared by Woods and Gordon?


Charles Delmar Coyle: Yes.


Edmund Davie Fulton: It is not the minister's
summary?


Charles Delmar Coyle: No, this is a copy of the summary prepared by Woods and Gordon, which was sent to me on the 17th of December.


The Acting Speaker (Mr. Applewhaile):: Is
it the unanimous opinion of the house that this document should be printed as an appendix?
Post Office Act


Stanley Howard Knowles: As an appendix, yes.


Some hon. Members:: Agreed.


The Acting Speaker (Mr. Applewhaile):: Then it will be printed as an appendix to Hansard.
(For summary referred to above see appendix, pages 1806-08.)


Charles Delmar Coyle: Now, Mr. Speaker, referring to the report, it is true that 73 major and minor recommendations have been made. But to say only this is unfair and incomplete, as I have already indicated, because the whole truth is that of these 73 major and minor recommendations 59 have already been implemented in whole or in part, nine are still under study, four have been rejected as offering no economy or improvement, and one is a matter of government policy.
In some instances it will take several months before the changes are finally completed. In addition, there are recommendations which require further study before they can be adopted as a matter of general practice because, while commendable in their conception, they are questionable from the standpoint of practical application. We do not, however, discard any of these recommendations until we have examined them thoroughly. Thus the sweeping statements to the effect that efficient administration will permit us to make enough savings to meet the added cost are swept away by the facts.
The fourth main proposal of the opposition is that if we cancel subsidies such as franking, etc., we will not require added revenue. Before dealing with the abolition of franking may I briefly refer to subsidies, which I dealt with rather fully earlier. The opposition suggest doing away with the franking subsidies and, in the same breath, suggest that we should have kept the excise tax which was in itself a subsidy to the Post Office Department. They cannot be serious in this suggestion, because they are so inconsistent. Surely this inconsistency shows that they are both for and against subsidies. They want to have their cake and eat it too.
Dealing now with the suggested abolition of franking, may I say that even if this were done the revenues obtained in that way would cover only a small fraction of the total additional expenditures of $13,500,000. Hence this is another futile suggestion, which brings no remedy to the situation. Moreover, the opposition is only presenting one side of the picture. The principle of franking is to give free mail communication to those seeking, as well as to those supplying, administrative information. The franking privilege

Post Office Act
is given so that free mail communication may be established between the Canadian public, the ministers and members of parliament.
If we abolish franking in one direction, it is only logical to expect it to be abolished in the other direction. Otherwise one group could very easily place the other in an untenable position, and thus the flow of information could well become a trickle in one direction and a river in the other. In order to obtain free administrative information, franking must be maintained in both directions. If, on the other hand, the opposition want to abolish franking in one direction, they must expect it to be abolished in both directions. It is a two-way street.
Thus, while the opposition suggest that the franking privilege be abolished, they neglect to show that the Canadian public will then have to pay for all mail communications sent to their elected representatives. The members of the opposition, therefore, while appearing to oppose a necessary increase in postage rate, are themselves at the same time proposing a further increase in mailing cost to the public.
I shall now deal with some of the statements made by my hon. friend the Leader of the Opposition. I am following this procedure because it will also answer many of the questions asked by other members of the opposition. The Leader of the Opposition makes comparisons with the rates paid in other countries. He points out that the rate in the United States is 3 cents, but he does not mention that the authorities in that country, as I have already indicated, are endeavouring to increase their letter postage rates and that there is under study a measure very similar to that which forms the basis for the present bill. This has already been covered by my reference to the message from the President quoted in Time. Neither does the hon. member draw to the attention of the house the fact that during the last fiscal year the United States post office department had a deficit of $770 million.
In making his reference to postage rates in the United Kingdom he compares the rates paid there on the basis of exchange rates, rather than in relation to the United Kingdom economy. A rate of 2\ pence in relation to the British economy is practically the same as 5 cents in relation to the Canadian economy.


Mr. Drew:: For how many ounces?


Alcide Côté: I am coming to that now. He mentions that this rate is for 2 ounces, but overlooks the fact that the maximum distance which a letter travels in the United

Kingdom is not more than 500 miles whereas in Canada it may travel three or four thousand miles, a large part of which is by air transport with no additional charge to the mailer. A fairer comparison would be the rate paid in Australia, where conditions in so far as distance is concerned more closely approximate those in Canada. In that country the rate is 3J pence, which in relation to the Canadian economy is 7 cents.
Moreover, the hon. member for Saint John-Albert (Mr. Bell) said in the house that the rate paid on postcards in Poland is 6 cents and on postcards in Czechoslovakia, 5 cents. In addition, he said that the rates were much higher in Portugal, Egypt, and India. The figures I have for the United Kingdom and Australia, and the figures given by the hon. member for Saint John-Albert, show very clearly the inaccuracy of the statement by the Leader of the Opposition "that we will have the highest postage rates in the world."
He also makes reference, as did previous speakers, to the penny postage introduced by Sir William Mulock. He fails, however, to make reference to the increase introduced by the Conservatives in 1915 or to the increase from 2 cents to 3 cents made by the Right Hon. Mr. Bennett in 1931, and this at a time when the country was suffering from a depression.
The Leader of the Opposition indicated that it would be quite reasonable for anyone close to the United States to carry their letters, which would normally be posted in Canada and deposit them in the United States post office, in order to take advantage of lower rates of postage. He even went so far as to say that there would be nothing illegal in this. I must issue a warning to those persons who might take seriously the suggestion made by the Leader of the Opposition. International postal regulations, to which every postal administration is signatory, expressly deprecate such a practice and specifically provide that the administration in which the letters are posted may either return the items in question to the country of origin or impose a surcharge equal to the amount of its internal rates.
The Leader of the Opposition made the statement that the government knew quite well when the excise tax on notes and cheques was removed that an increase in postage rates was to follow. I am rather surprised that my hon. friend would so disregard the facts. The first intimation of the discontinuance of the excise tax on notes and cheques was in February, 1953. The civil service commission did not commence the salary adjustment until sometime in the fall of 1953, and the first list of revised salary rates was

published on or about the 1st of December, 1953. Furthermore, no decision was given by the government in regard to the general adoption of the five-day 40-hour week in the operating service of the Post Office Department until sometime in September, 1953. The bill authorizing a readjustment of the rates for rural mail couriers did not become law until the 14th May, 1953.
I am, therefore, completely at a loss to know on what grounds the Leader of the Opposition could possibly justify the statement made by himself, and other members of the opposition, when items which occasion the additional expenditures were not even contemplated at the time the excise tax on notes and cheques was removed.
The hon. member states according to page 1152 of Hansard for January 15, 1954:
Surely we are not going to be told that there was no difference in the cost of the operation in the handling of the $7,500,000 worth of stamps.
Certainly there is a difference in the cost of operation, but not to the extent which the Leader of the Opposition endeavours to indicate. The actual cost of the stamps would be in the neighbourhood of $20,000, and the reduction in operating and distributing costs might be as high as $10,000, making a total of $30,000, which is somewhat far removed from the $7,500,000 which the post office has lost in the removal of this excise tax.
Now, Mr. Speaker, I have again placed before the house most objectively the position of the government in regard to this bill. I have also answered all the major criticisms and many of the less pertinent comments of the opposition. I feel that this further constructive presentation shows without any doubt the soundness of the position of the government, and destroys alleged objections put forth by the opposition. I must say that the elementary principle that one thing cannot at the same time be white and black applies to everyone, and I am sorry to say that some members on the opposite side have sinned against this principle.


Mrs. Fairclough:: Who is without sin?


Alcide Côté: I shall not look at you.
May I give still another typical example of this contradictory attitude by referring to the speech made by the hon. member for Notre Dame de Grace (Mr. Hamilton) the other day, when, after having repeated for almost 40 minutes that the postal department should cut its expenditures, he concluded by asking that the same postal department spend $4 or $5 million more to give the service of a second delivery a day in residential areas. You cannot have it both ways. That is why
Post Office Act
I say that some of my friends on the opposite side have sinned against the principle that nothing can be white and black at the same time.
As I said a few minutes ago, we are all agreed that the additional expenditures of $13,500,000 are essential. There are two ways of obtaining the money to meet these additional and essential expenditures. One is by an increase in the postal rates; the other is by general taxation. So far I have not received from anyone in the house any other suggestion. We prefer the former. We feel that the cost of the service should be borne by the users and not by the taxpayers generally. We think this is an equitable arrangement. The opposition prefers the latter. They want to subsidize the service, with all the illogical and dangerous consequences to which I have already drawn attention.
The present issue is a clear-cut one. Foreseeable additional expenditures to carry out decisions already made total $13,500,000. The additional expense can be met either by taking it out of the general tax or by increasing postage rates. I recommend the straightforward approach so that the public will know exactly where they stand. I am of the opinion, as I have already indicated earlier, that the persons who use the service should pay for it, rather than that we should becloud the issue by subterfuge.
I know the measure is not a popular one in some quarters, but it is at least honest, and I am sure it will appeal to those members of the public who desire to pay their way rather than throw their burden on someone else.


Stanley Howard Knowles: This is sin out in the open.


George Alexander Drew: Mr. Speaker, with one statement and one statement alone of the Postmaster General I should think there would be agreement at this time, and that is that this problem should be discussed frankly. The speech we have just heard has followed the convenient practice-that is, convenient to some people-of attributing to members of the opposition statements they did not make, and then on that false foundation presenting an argument which had no relation to anything that had been said in this house in this discussion.
The minister has just read a tawdry political statement. It has been a review of political considerations which had no relationship to the immediate matter now before us. In fact, some of his statements reminded

Post Office Act
me very much of a quotation from "Alice in Wonderland" which I am sure he will recall:
When I use a word, it means just what I choose it to mean-neither more nor less.
The minister said that the opposition has suggested subsidies. Where has he found that? When the minister talks with horror of subsidies, will he explain to us how on the one hand he has such horror of something that was not suggested, while at the same time he conveniently overlooks the fact that the method he is proposing means a subsidy on a large scale to Trans-Canada Air Lines? The merits of that may be subject to debate on other occasions, but let the minister not suggest for one moment in this house that the proposal he is making is not a straight subsidy to T.C.A.
The minister has shed crocodile tears about the little man whom he is going to serve, as against the interests of the big man and the big business. He is doing the very opposite. What he is doing is charging the little man more than the big man who can use air mail, and get air mail service without paying for an air mail stamp. That is what he is doing. That really is exactly along the lines of the statement in "Alice in Wonderland" to which I have referred.
But, Mr. Speaker, there are other points that I should like to mention before I pass on to some of the subjects the minister discussed. He says that things cannot be black and white at the same time, and that it would be well if that elementary proposition were recognized. It would indeed. I want to speak about that. In tabling the memorandum prepared for him in December by J. D. Woods and Gordon the minister told us that he made it available to the house under the same terms as he made available the confidential report of J. D. Woods and Gordon.
Now, Mr. Speaker, we have here the interesting question of when a report becomes confidential. I hold in my hand the report which has been under discussion, and I have not been able to find outside, back or front or inside, the words "personal, confidential" or anything that suggests that it is such. Again this bears repetition, because we see it in the words of the Postmaster General. What he tells us is that when he uses a word it means just what he chooses it to mean, neither more nor less. We do not need to attribute that to "Alice in Wonderland"; that is what the Postmaster General says. He says it is confidential; therefore it is. J. D. Woods and Gordon did not think of putting that covering restriction on it.

Again I express some surprise, Mr. Speaker, that what the minister regarded as a confidential report should have been so freely referred to in the statement made on behalf of the department, where it appeared it would be helpful to refer to it. Surely this is an elementary proposition, to use the term the minister used. If you use part of a document to support your argument, the whole document must become available. I know he will agree with me immediately in regard to that proposition. Therefore when the department sees fit to support its statement by partial reference to the document which was not marked "confidential", but which he says is, then we may ask ourselves, how are we to tell just which pages are confidential, which paragraphs, and so on?
The fact is that it is not confidential. It is part of the business of this house; it is part of the business which is to be attended to by the hon. members who are now able to devote more time to the business of the house or who will be able to as a result of the decision of a majority of the members within the past few days.
May I repeat that documents referring to administration which do not in some way affect security, or which do not in some way deal with matters that are subject to limitations of secrecy, are not in any way the private property of this government. One of the statements the minister made when he was setting up the false proposition was that we had criticized the appointment of this firm of specialists. I do not know where any such criticism was made. On the contrary, we have been urging that specialists in many lines be permitted to examine the organization of government and improve its efficiency, as we are confident could be done in many directions.
The minister made another statement that I should like to deal with before I pass on to something else. He referred to my remark about the invitation that this would offer in cities along the international boundary to firms and individuals to take their very large daily mailings across the boundary and buy stamps in the United States for 3 cents, which would perform the same service to any part of Canada as the 5-cent stamp would here after this bill passes. He said I had overlooked a provision in the departmental instructions where it is suggested that the department deprecates such a practice. Oh, we not only must abide by the law; we must abide even by the wish of this government. If the government deprecates, then nobody must do it. If the government deprecates, then that is enough to stop anybody doing it.


Charles Delmar Coyle: I just want to clarify that point.
I was talking about the universal postal union.


George Alexander Drew: I hope the people of this country will abide by the laws of Canada. The statement that somebody has deprecated a practice does not in any way affect the legality or propriety of anybody availing himself of such facilities as are presented in a perfectly legal manner. I would think most of us would regret if it became necessary or even desirable for anyone to go out of this country to get a service at 60 per cent of the cost he would pay for the same service here in Canada. This government are telling us about the need for continental integration, and surely they will recognize how readily it would fit into the picture of continental integration in business, in a very simple manner right across the border, if they invite this to be done.
I indicated quite clearly before that I did not think that would be a desirable situation. I repeat that there is no law against it. I also repeat, however, that if a service of that kind is available along the border it should be available everywhere else in Canada. It is not something that should be available to the few; and in this case it is not something that would be available to the little man about whom the minister professes to express such concern. It is something that would be available to the big organization which would find it useful and valuable where they were handling mail on a sufficiently large scale.
No, it is not big business or the person with lots of money who is affected adversely by this. It is the little man. Let me give an example, and I am ready to name the man who writes this letter, which is one of many that have come to me on this subject. It is written by a man named Harris.


Stanley Howard Knowles: Of Grey-Bruce?


George Alexander Drew: Not of Grey-Bruce; of Aylmer West. I shall simply read the first paragraph, which tells the story of the letter, and which is as follows:
Dear Sir:
I am a shut-in and very short of cash and I write a bit which is all I can do to put in time and a 5 cent postage means more cash and I have only $65 per month plus $2.50 interest to spend on household and the M.P.'s are increasing pay.
That is a comment by just one of the little men about whom the minister is expressing such concern. I submit that this expresses in simple terms the attitude of a great many little men in regard to the proposition now before us.
Post Office Act
This is not just something effecting an increase of 1 cent in the cost of postage; this is something that increases the cost of mailing generally, particularly to those people who find the mail a very useful means for the exchange of ideas. Again may I remind the minister that the little man cannot use the telephone and the telegraph as readily as big business or the person of substantial income, nor can he use it in the free and easy way in which the government does. The postal service is the means of communication of the little man, and the result of this change becomes a substantial total when every penny must be watched over the year in which letters are written.
The minister says that we have put forward four different propositions: One, that we take it out of general taxes; two, that we live off past surpluses; three, that there be an increase in administrative efficiency; four, that there be subsidies.
Only one of those is correct; only one of those even moderately resembles the arguments that have been made. We have urged that administrative efficiency be increased and that new methods be employed to seek a wider kind of service which would in itself increase revenue. The minister, in referring to Sir William Mulock, whose name has been mentioned on different occasions, pointed out that since that time increases have been made. That is true. However, he should recall that when Sir William Mulock decreased the cost of postage stamps it was not because of a decrease in the cost of living or in wages or salaries. He believed that there would be increased revenue which would make this possible, through the increased use of the mail as a result of the lower stamp charge. That in fact was the whole history of the use of postage stamps from the time they were inaugurated during the last century.
This is something that might well be considered now because of the fact that the department has cut out deliveries and has made the usefulness of the mail service much less apparent. There is a greater reliance on the telegraph and the telephone by those who can afford to pay for it, particularly by the government or contractors operating on a cost-plus basis.
We believe there can be an increased administrative efficiency. We believe that the J. D. Woods and Gordon report makes that perfectly clear. While pointing out quite frankly and most satisfactorily from the point of everyone that they found a commendable measure of efficiency in the general administration, at the same time they pointed out

Post Office Act
many things that could be done and many specific things that would effect very substantial savings in themselves.
Just to deal with the four points that have been made, I do not recall the suggestion that it would become necessary to take this out of general taxes, if proper methods were employed. Then so far as living off past surpluses is concerned, my impression was that when the surpluses were referred to it was to emphasize that there had been deficits before and that following those deficits there were again surpluses for varying reasons, we will hope either because of new methods, increased efficiency or the increased use of the mail service.
Certainly my contention in pointing out the very large surpluses which had been accumulated was to suggest that when those accumulated surpluses became a deficit in a single year on this occasion, it should not cause any more concern than the deficits which had occurred twice in the past 30 years and which were followed immediately by substantial surpluses. My own conviction is that if the department will put into effect the recommendations of the J. D. Woods and Gordon report and will seek to supply a wider and more frequent mail service by many devices not yet employed but which are available elsewhere, in the immediate future that deficit might well be followed by surpluses once again. We believe there is no necessity to suddenly jump at this large increase because of the immediate increase in expenditures, without first testing other methods of meeting that cost.
The minister has said everyone agrees that the additional $13,500,000 must be paid in this way. Everyone does not agree. I do not agree; I do not believe most hon. members on this side agree, and I am inclined to think many hon. members on the other side do not agree either that this is necessary. Of course that $13,500,000, if that is the correct figure, will have to be met, as other increases will have to be met from time to time. But what we suggest is that there are different ways in which this can be done.
Let us see what some of the points are that might well be given consideration. The J. D. Woods and Gordon report was, after all, simply dealing with administration, and suggests methods of improving that administration. It did not come within the terms of their reference to make suggestions regarding policy. That is something which seems to have been overlooked by the minister. When they did not suggest changes in policy, that does not mean they did not think there might not be changes in policy.

If they had been asked to recommend changes in policy doubtless they could have suggested certain changes.
They simply made passing reference to possible consideration of the fact that other departments are not paying for their services. When we begin to examine the subject we learn that the Post Office Department gives free service to other departments amounting to $4,700,000. But these other departments pay for their telegrams, and pay their telephone bills. They pay for other services they obtain. It would seem to me that good government accounting would suggest it would be advisable that these other departments pay for their postal service. After all, the public in the end is going to pay for this one way or another, and it would leave the actual departmental costs on a much more realistic basis. At any rate, there should be an examination of that fact before there is any suggestion that we simply go right ahead and meet that $13,500,000 by increased postage rates.
There is another figure that has been under consideration. The minister said we claimed that the stamp tax should not have been taken off. I do not recall when that was argued. What was suggested, and what I repeat, is that unless the government is even more inefficient in every department than we believe it is-and we certainly believe it is very inefficient in many-then it certainly knew when it took off the stamp tax what that would mean in loss of revenue to the postal department. That was what we said. What we pointed out was that at the time they took that tax off they claimed the credit for doing so, but offered no indication to the people that this would have to be paid for in the way it is now being paid for.
An election intervened. They told the public what they were doing, but they neglected to tell them they were going to claim later on that they would have to meet the cost in some other way. Do not let the minister suggest that the postal department was not aware of this. That would be an infinitely more serious indictment than anything yet put forward in this house. It would mean a complete lack of realism in their approach to the examination of their revenues. No, Mr. Speaker; the proper method would have been to indicate that this was going to have that effect and to have made the adjustment at that particular time within the Post Office Department to compensate for it.
I also pointed out that this $7,500,000 is not all lost revenue. Let us see just what that proposition means. That $7,500,000 represents the sale of stamps that would have

gone on cheques if the law had remained as it was. Does the minister suggest that his department is so organized that it can sell $7,500,000 more stamps without any extra cost? To put it the other way, does he believe that the selling of $7,500,000 less in stamps means no saving in the cost of operation? That surely would be an indictment of the organization within his department. I do not believe anything of the kind, and I do not think he does. We have had no figure yet of what the net result would be, but that is a balancing saving which could be put against that amount.
Then, Mr. Speaker, there are the specific recommendations in the J. D. Woods and Gordon report. With all the complimentary- and properly complimentary-things said, the report states this:
On the basis of extensive tests we believe that the addition of staffs trained in time and motion study and in the design of equipment should result in improved operating methods and substantial savings in costs.
The minister says it has not been possible to introduce some of the new machinery, but let us hope that this will become available during the current year. Certainly the present increase in postage rates, which would be inclined to become permanent now, should not pay for a temporary situation which can be changed by the acceptance of that recommendation and the savings that would result.
I am not going to deal with the recommendations into research and planning and various things of that kind, all of which have their impact upon operations, but another recommendation in the J. D. Woods and Gordon report is this:
The operations of the post office savings bank should be discontinued or restricted in the interests of economy. The bank was established originally to meet certain needs of the public which can now be taken care of by other institutions.
Now, Mr. Speaker, there is an interesting and well-known history in regard to this. In the early days of this type of post office savings bank there was not the general service of banks that we have today. When this system was introduced in England with exactly the same name it was to meet the absence of local services. In a large measure the same arguments prevailed here. Today there is hardly a little community that has not satisfactory banking services; and certainly with the increase in the number of automobiles and buses and better transportation facilities of that kind, banking services are within the reach of everyone who wishes to use them. Here is a
Post Office Act
recommendation which would make a positive and definite saving if it were carried out. The report states:
If it is decided to wind up the post office savings bank there would be an estimated annual saving of $377,000 per annum and the field organization would be relieved of much detailed work.
That amount of $377,000, Mr. Speaker, is not very much to this government which has symbolized or epitomized its view on that subject by the classic expression, "what's a million, anyway?" Nevertheless $377,000 is just one item.
I come now to the specific references to the departments:
The department-
That is the Post Office Department.
-is required to bear the cost of mailing privileges granted to other government departments and of carrying out government policy in connection with the subsidization of transportation-
Oh, that horrible word; that word which so alarms the minister when he thinks somebody else used it, although he did not. To continue the quotation:
-the transportation of certain classes of mail at rates which are below cost and the operation of various services such as the post office savings bank.
Then another quotation; and may I say that these are only samples of some of the recommendations.
Primary sortation is the first division of unsorted mail into a number of different groups. While this plan will require further development there is an indicated annual saving in the forward letter section of the Toronto post office alone of approximately $200,000 per annum.
Then the next one I should like to read is this:
It is apparent that one of the major fields for economy and improvement in service open to the department lies in modification of the transportation facilities and methods used for distribution to the areas surrounding the larger cities.
What that merely means is this. Let the post office keep up with the times. Let the post office recognize that conditions are changing and that there are many means by which distribution and collection can be facilitated which they have not even tried or attempted to try, so far as anyone knows.
Then let me give one other quotation:
While these suggested revisions in the organization structure of the transportation branch do not materially change the administration functions, they strike at the primary weakness-the lack of future policy and program regarding the extent and nature of transportation services.
Then from appendix "A" may I read these words:
The saving of $850 a day or, say, $250,000 a year would appear to be a conservative estimate.

Post Office Act
May I say that is a small "c", Mr. Speaker; nevertheless it is obviously not the estimate put forward by this department. Going still further, and placing it on a still more conservative basis, the report says:
Although no detailed costs are available, it would not be unreasonable to expect that the initial capital outlay would be paid for within a year and thereafter there would be an annual saving of $200,000 a year.
Mr. Speaker, these are only some of the recommendations, and these figures I have been referring to have been directed to only one area and to one municipality with regard to increased efficiency. They could be extended right across the country. We do not know what the possible total would be; but, Mr. Speaker, there is enough before us to suggest that before this house approves of placing the burden for higher-cost mail on the little man in this way, we should receive from the department some positive statement of the things they are prepared to put before us by way of recommendations.
I want to deal with the reservation made with regard to the tabling of this report because I think there should be no doubt and no uncertainty left on the record which would mislead anyone outside this house, now or in future years, as to what took place on this occasion. The hon. member for Notre Dame de Grace (Mr. Hamilton) asked if he could see this report. He did see it. The minister knew he was examining it. The minister knew perfectly well that a stenographer had been taken in there.


Mr. Speaker:: Order. Are we not now embarking upon a matter which was dealt with previously? I think what the hon. gentleman is now trying to allude to is perhaps a matter with which we dealt previously, and which to my recollection has been settled, although perhaps not in a satisfactory manner. I merely want to point this out to the hon. gentleman.


George Alexander Drew: No, Mr. Speaker. I am dealing with a statement made today by the minister, that in tabling the summary he is doing so under the same terms as those applying to the report which was made available to us. For that reason we must examine those terms and the justification for any restraint on the full use of those documents and their availability under any circumstances. It is the minister who has raised this subject once again by simply saying, "You can place under what I said about the report, which I regard as confidential but which is not so marked, the statement

that this reservation applies also to the summary." It is for that reason that I wish to refer to the matter, because these are the reservations.
In presenting the report-and this is the reservation which now applies to the summary which we have not seen-the minister said that in tabling it he was not creating a precedent. Then he referred to the statement of the Prime Minister (Mr. St. Laurent), and I quote the words of the minister as recorded at page 1280 of Hansard:
Alter pointing out that it was not the practice to table such documents and that there was no obligation to do so, the Prime Minister said that a minister could of course table such documents if he felt it was desirable, and he asked me if I had any objection to doing so. I would not wish to do anything to alter the general practice or to create a precedent which would have a bad effect on the proper administration of government.
I want to make it clear, Mr. Speaker, that when the minister tables a summary today, it is no bad precedent or no bad practice. It is a practice which should be followed without any demand. This is the business of the people of Canada. This is something which is paid for with the people's money. The members of this house should know, and should have known all along, what is in this report. They certainly should know, as they now will, what is in this summary. Why should we not know that this firm of experts, paid from public funds, had made these specific recommendations which would result in substantial savings? Of course we should.
I submit, Mr. Speaker, that in this case there has been no hint of any breach of the confidential relationship between a member and a minister or between a member and a document shown to him. The hon. member for Notre Dame de Grace had a perfect right to do what he did; and may I say that, in doing what he did, he offered to every member of this house an example as to how information should be placed before the house. When the opportunity was presented, he accepted it; and we are indebted to him for this information having become available to us, as it is today.
Then again, Mr. Speaker, may I suggest that there would be many reasons why the Post Office Department should explore the possibility of increasing the number of mail services, and of employing some automatic devices. The minister laughs. I regret to say, Mr. Speaker, that I think that exactly measures the approach of the minister to this problem.


Mr. Sinclair:: Oh, be fair.


George Alexander Drew: I am being perfectly fair.


James Sinclair: You are not being fair at all.


Mr. Lapointe:: Just because he does not look surly all the time-


Alcide Côté: I am sorry to say I was not even listening to my hon. friend. I would not like to impute to him ideas or thoughts that he does not have, and I think it is only fair for him to act in the same way toward me.


George Alexander Drew: If the minister was not listening to me, and of course I take his word, then that indicates he is not interested in the subject we are discussing.


Alcide Côté: Mr. Speaker, I think this time I should be the one to tell my hon. friend that he is not fair. I may discuss things with my parliamentary assistant, which are interesting to me and which I must know, without telling my hon. friend what I am talking about. I think he should show me as much courtesy as I on my part would want to show him.


George Alexander Drew: Mr. Speaker, if the story told the minister by the hon. member now sitting next to him was as funny as that-


Alcide Côté: Mr. Speaker, I am sorry to say that there was no story, and I am very sorry to see that my hon. friend does not act as he should.


George Alexander Drew: Mr. Speaker-


Mr. Speaker:: Order. Perhaps we would make better progress if we were to discuss second reading of the bill. I do not think it is reasonable to say that a member, especially if he is a minister piloting a measure, is not interested in it because he happens at one moment during a sitting of an hour and a half to have a conversation with his neighbour, and perhaps has indicated that the remarks were appreciated by smiling. Hon. members know that some hon. members never laugh and others perhaps laugh all the time. They have a happy manner about them, and I think that is so with the congenial Postmaster General. I know there is no intention to offend anyone, and I would suggest that we simply carry on with the debate on second reading of the bill.


George Alexander Drew: Mr. Speaker, now that the minister is in a position to follow the debate I shall proceed.


Some hon. Members:: Oh, oh.


Alcide Côté: Mr. Speaker, I shall not say what I think because if I did I would have to withdraw.


George Alexander Drew: Mr. Speaker-
Post Office Act


Mr. Speaker:: Order. The minister has not said anything, but I do not think it was necessary on his part to even indicate that he has in mind some expression-


Alcide Côté: Inspired by the Leader of the Opposition.


Mr. Speaker:: -which he would have to withdraw. It amounts to the same thing. I think the matter should rest there. After all, are we going to dispute about something which really should not delay the house in its proceedings? I invite the Leader of the Opposition to carry on with his speech.


Alcide Côté: Mr. Speaker, I shall withdraw what I did not say.


George Alexander Drew: Mr. Speaker, now that it is convenient I am directing my remarks to the minister. I was pointing out that there are many ways in which mail delivery could be stepped up by the employment of modern devices which are becoming available in increasing numbers and variety, and which are employed with such satisfactory results in many large industrial units whose plants are spread over wide areas. Devices useful in one area might not be useful in another, but certainly consideration should be given to some of these things.
The minister has quite incorrectly attributed to the opposition suggestions they never made. I am not going to comment on that or even say what I think about it. I am simply pointing out that the minister has suggested a number of propositions which were not put forward. Let him deal specifically with the points that have been made. Let him indicate to us how far he is prepared to go in examining new methods for the speeding up of delivery by mechanical and other devices now available.
The history of postal service has been a history of improved service in most organized communities. In some of the larger cities of the world today there are several deliveries every day. Many people in these larger communities seldom think about using a telegram within their communities, because in some cases a reply may even be received by mail the same day. That has been the history of the development of efficiency and the encouragement of the use of postal service. It does not increase the desire to use the mail for business and other purposes, if other methods are open, when the service is cut to once a day. The fact that mail is only picked up once a day and only delivered once a day

Post Office Act
often has the effect of delaying for two days mail that otherwise would have been received within 24 hours.
No one is more anxious than I am to see that genial smile on the face of the minister who is presenting this bill, but may I suggest that if smiles are to be found on both sides of the house he should not in future attribute to members of the opposition motives or statements such as were contained in the presentation he read to us this afternoon, and which I believe on re-examination he will agree do not correctly interpret the statements made by myself or other members of the opposition.
We are dealing with something that is related to our whole society. We are dealing with the oldest form of communication. The life of people throughout the whole of recorded history is set out in letters that have been preserved. There you find frank and uncensored opinions. You find the attitude of the people of the time with respect to both sides of a question. We find not only inspiration but much of the history of Christianity itself in the letters of St. Paul. We find the other attitude, the other side of the story, in the letters of the emperors and officials of the time who were opposing the expansion of Christianity. Right throughout we find the way people thought and acted disclosed in their letters. We find many of those little things that indicate how life carries one along some path. In looking for a quotation that I might use to deal with the situation, I happened to find a quotation from Pliny the Younger. Obviously, he had not been getting as many letters as he thought he should, and Pliny the Younger said in a letter addressed to his son:
There is nothing to write about, you say. Well, then, write and let me know just this,-that there is nothing to write about;
From letters we can find how little life changes, and sometimes how little boys change, no matter how greatly the surrounding circumstances may change. That very wise, but not always acceptable writer, Voltaire, said that the post is the consolation of life. The old man who wrote the letter from which I quoted today was implying the same thing. Then, I recall the words of William James: "So long as there are postmen, life will have zest."
I do not suppose there is a single home where the arrival of the postman is not an exciting point in the day. I do not suppose there is a family where the arrival of the postman does not offer encouragement, and some news of their friends or relatives which is greatly enjoyed. An increase in that service

is not only to be desired from the point of view of encouraging the use of the mail, but it is part of our society. I believe, on the one hand, we would be serving our people well by trying that out and by returning to multiple services. We would also be following ordinary business methods by encouraging more business, and in that way getting more revenue.
Mr. Speaker, I believe that this is a case that we should look at from the point of view of business, and the point of view of the relationship of the postal service to society itself. Before we are asked to impose this burden on the little man, for the benefit of those who will get free air mail service, I believe, on the one hand, we would be serving our people well by trying that out and by returning to multiple services. We would also be following ordinary business methods by encouraging more business, and in that way getting more revenue.
Mr. Speaker, I believe that this is a case that we should look at from the point of view of business, and the point of view of the relationship of the postal service to society itself. Before we are asked to impose this burden on the little man, for the benefit of those who will get free air mail service, I suggest we should have much more information before us than we have. Without any more information than we have before us now, it is certainly my intention to oppose this bill.


Mr. Alistair Stewart (Winnipeg North):: Obviously, the minister is going to have a rather rough time with this bill. He is suffering, of course, for the sins of his colleagues, and he understands that. He grieved publicly in his first few words when he said that the arguments of the opposition had been repeated over and over again. He is quite right. We have repeated them over and over again, but how can we possibly get them to enter into the heads of hon. gentlemen opposite unless we do? We have been singularly unsuccessful. I have a feeling that the minister takes the position that since he has made up his own mind, he is now quite prepared to listen to reason. For the next few minutes I hope to speak in terms of reason as to why we are going to oppose this legislation.
We have already made it clear that we are going to do so. The minister has not advanced as yet an adequate case which would lead us to support it, nor has he given us reasons which we think are valid. The position that has been taken is that the principal cause of the deficit in the postal department this year is the advent of the five-day 40-hour week, the increase in salaries and the increases to contractors. I think it is specious reasoning.

Why is it that the employees of an organization must always be blamed for any increase in costs? Is there not another reason behind it? Is it not the fact that before the election this government removed a tax which resulted in a substantial loss of revenue to the post office? Is it not a fact that after the election the same government is imposing the tax, but in another area? Had that tax not been removed originally, there would have been no reason for the minister coming here today with this bill.
The minister maintains that a public service should pay its way. I do not think there is consistency in that position as between the minister and his colleagues. After all, why should the post office be the only department which is expected to pay its way? It is true it is providing a service, and that service must be paid for somehow or other. I think, for instance, of the Minister of Labour (Mr. Gregg), who has a department which provides a very important service to the people of this country. It is a service which is called upon frequently. It is used widely, and yet those who use it are not asked to pay the costs of the Department of Labour.
The Minister of Trade and Commerce (Mr. Howe) has a department whose services are used throughout the country, and rightly so. Those who use the services of that department are not expected to see that the departmental books are balanced at the end of each year. The minister states that the people who use the service should pay for it, and he regards it as a principle. Is he suggesting he is the only principled member of the cabinet? Is he suggesting the Minister of Labour is unprincipled because his department does not pay its way? Is the Minister of Trade and Commerce unprincipled because he does not make his department pay on the basis of public service?
What about the Minister of Public Works? He is in charge of a development which provides a service to the people of Canada, a means of communication, the trans-Canada highway. Are the users of it the only ones who shall be expected to pay for this service? Is there a principle there, or is the Minister of Public Works again one of my hon. friend's unprincipled colleagues? The minister stands above and far beyond any of them on the basis of his own arguments concerning principles.
Perhaps there is another reason for the deficit. Again, I am going to bring up this dreadful word "subsidies". The fact is that the imposition of this tax is going to penalize those who use the first-class mails of this country, and none other. There are deficits occurring in the post office because of hidden
Post Office Act
subsidies. The hon. member for Vancouver East (Mr. Winch) pointed out when he spoke that there is a hidden subsidy to the newspapers in this country in the form of mailing privileges. As he argued, and as I argue, why should that subsidy be borne by the post office? Why should that subsidy not come out of the consolidated revenues of the country, instead of asking one group in Canada, the users of the first-class mails, to pay for it?
The minister used the word "equitable" in this respect, and he considers this legislation is equitable. He said the cost of the service should be borne by the users. The fact is, however, that the cost is not being borne by the users; the cost is being borne by only that particular group using the first-class mails. That is not equity, and that is not fair. Were the cost to be spread across the whole population, then perhaps there would be a different approach to this subject. One of the newspapers which, of course, benefits from this hidden subsidy is one which a person would expect would protest most loudly against it. In Winnipeg, we have the Winnipeg Free Press which, on past occasions, has opposed all manner of subsidy to anyone else, but of course not to itself. I see no reason why I, as an occasional user of first-class mail-I say "occasional" because most frequently I use the frank-should have to help subsidize the Winnipeg Free Press. I agree that it might be unfair to ask the small storekeeper to subsidize the large operator of the mail order system, but any subsidy in the Post Office Department should come out of the consolidated revenues and not be charged against one particular group.
In this particular respect I should like to know, and perhaps the minister can enlighten us later, what is the actual cost of delivering a letter which goes by first-class mail. I know that in the United States the cost is a little over 3 cents. It would be very interesting to know what the cost is in this country. We should then be in a position to find out how much the users of first-class mails are going to subsidize other users of the postal system in this country.
There is another matter which I should like to bring up. It concerns a type of inefficiency which we find in the post office organization. It is not an inefficiency amongst employees; it is not an inefficiency in the staff anywhere. I, in common with all others, receive my mail; be it rain or shine, be it 40 below or 100 above, I get my mail. I have no complaint in that regard; I have written to the postmaster in Winnipeg asking him to thank the staff for the help they have given. But there is still inefficiency in the post office, and there always will be inefficiency as long as the post

Post Office Act
office is used as the medium of political patronage. That is happening today. And when you get politics interfering with the administration of the post office, there, I fear, you are going to get unwarranted expenditures at the cost of course of the public.
There is a situation which exists just now in Winnipeg, and if the government would capitalize on it they could perhaps get some revenue, but I suggest it would be revenue taken in a most iniquitous way. This is actually what happens, and this is what leads to inefficiency in the post office. I have already taken the matter up with the department. This particular case will not be new. There is a drug store at Inkster and Main in north Winnipeg which has been a sub-post office for over 40 years. As an institution people know it is there. They are well looked after; the service is good.
One of the prominent members of the Liberal party in Winnipeg went to this drug store some months ago and said to the druggist: "You realize this drug store has been here for a long time and there is some rumour that there may be a change." I should say there had been a change in the ownership of the drug store. The new owner was an ex-serviceman who had fought for his country, and when he came back he bought the drug store and of course got the sub-post office, after the department had approved of the change. Since he was somewhat worried, the druggist, Mr. Chapman, went to see this prominent gentleman who had approached him and said: "What exactly do you mean, sir?" He was told that it was an expensive thing carrying on a political party. The Liberal said: "We need money; you have had the drug store for a long time. There might be a change, but I think the change could be averted if you could pay us the sum of $500." I am not saying that in north Winnipeg $500 is the usual price. There are some who pay only $200, but I imagine it ranges from $200 to $500 for the right to have a sub-post office. Is that the right way and the efficient way to go about creating a public service?
I have been approached, and I am sure other hon. members have as well, to assist somebody in getting a sub-post office. I do not know why they would possibly want it. I can conceive of it as being nothing but a headache, but they want it. I have said: "The department itself must decide, but I would suggest to you that you put in your store forms of petition asking people who come in to sign to the effect that they would like to have a sub-post office there. Then when you have enough names, send them in to the department and let it decide." Surely that

is the reasonable way of going about it, because the department must know better than anyone else whether or not there should be a sub-post office in that location. But it does not happen that way.
During the election a druggist quite near to my committee room came to me and said that the post office had taken away his subpost office. I found out the reasons why. They were perfectly proper. There was a change of ownership, and the post office naturally closed down the sub-office so that an audit could be made and an accounting could be taken. This man wanted a sub-post office and he approached me. I telephoned about his case to the head of the postal department in Winnipeg. A day or two later, knowing that it would not be an infraction of the law in any sense whatever, I took into this drug store a couple of C.C.F. window cards. The druggist put them in his window; that was all. The next day I went around and I found that the cards had disappeared and Liberal cards were in their place. Being somewhat intrigued I went to find out why and I was told that my Liberal opponent had gone into that drug store and had said: "Now, look here, do you want to get the sub-post office back? If you do, take the C.C.F. cards out and put Liberal cards in their place." I was not prepared to argue. The whole business was utterly absurd but it was the culminating act of many. That day, or the day after, I sat down and dictated a letter to the Prime Minister (Mr. St. Laurent), a letter which I never sent for the simple reason that on the day I dictated it the subpost office was granted. This is what I had to say. Since I was prepared to send it, I think I should be prepared to read it. It is dated July 22, 1953, and reads as follows:
The Right Hon. L. S. St. Laurent. P.C.
House of Commons,
Ottawa.
Dear Mr. St. Laurent:
I have already complained to the Postmaster General of cases of unmitigated blackmail on the part of some of your supporters in Winnipeg.
I consider it blackmail when a person has to pay to render a public service. I continue with the letter:
There has been no action yet that I know of.
A Winnipeg man has applied for a sub-post office in his drug store at Mountain and Main in this city. Money has already been demanded from him by members of the Liberal party for the favour. The public need apparently does not enter into the picture.
The druggist had one of my election cards in his window. My Liberal opponent went into the drug store this morning and insisted that my card be removed immediately and his substituted. The druggist was warned that if he did not do so, the recommendation for the sub-post office would be cancelled.

I call this blackmail. It is a form of venality which has no place in public life in Canada and I would like to know within the next few days what is going to happen to this man's application for a sub-post office if he keeps my card in his window.
I cannot see for the life of me how the post office can assert its efficiency when certain areas are so dependent upon political pressure. The sooner that type of pressure is taken off the department the sooner will it be the efficient vehicle which we hope it can become. We in the C.C.F. are dissatisfied. We are dissatisfied with the measure which is before us. We cannot agree with the suggestion which has been made that there should be an increase in rates, because we see no justification for the increase either in reason or in logic. Therefore, Mr. Speaker, I move, seconded by the hon. member for Moose Jaw-Lake Centre (Mr. Thatcher):
That Bill No. 168 be not now read a second time, but that it be resolved that in the opinion of this house a parliamentary committee should be established for the purpose of making an inquiry into the organization and operation of the Post Office Department and the postal services of this country.


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


Stanley Howard Knowles: There is an amendment.


Mr. Speaker:: I am sorry, I was interrupted in my listening to the hon. member's speech. Before I read the amendment I should like to tell the hon. member that, prior to the moment when someone came to the chair to speak to me, I had been listening to him intently and I was wondering whether he was not drifting away from the principle of the bill.


Alistair McLeod Stewart: I had
suggested an alternative form of revenue which is quite iniquitous.


Mr. Speaker:: It may be I was particularly attracted to the little story that he was telling the house, and that was the one which I felt was not precisely in order.


Miss Margaret Aitken (York-Humber):: In
the few brief months that I have been in this house it seems to me that one chief topic of debate has been increases. Here, there and everywhere, we are talking about increases for the unfortunate taxpayers.
Since this bill came forward I have had a good many letters from people in my constituency. They have not been letters from angry taxpayers, and they have not been anti-government letters, but I have found them pitiable and bewildering letters. Most of them are from old age pensioners. They tell me that when you have to live on $40 a month this extra penny becomes a real burden.
Post Office Act
The minister told us today that the government does not believe that the Post Office Department should live off general taxation because that would mean that those who do not use the mails would be paying for those who do. I agree with that viewpoint, but I go further. Surely there are other ways of increasing postal revenues. This general increase certainly hits what the minister calls the little man far more than it does those who can afford it. As my leader said earlier, the little man is subsidizing the carrying of air mail more cheaply for the big man.
I suggest that one way in which revenue could be raised is to put the stamps back on cheques. Those who can afford to write cheques can certainly afford to buy stamps, whereas those who have to live on $40 a month simply cannot stand this extra burden. I would suggest that the seven-cent air mail postage be maintained. Those who want speedy delivery of their mail can afford to pay for the privilege.
The hon. member for Hamilton West (Mrs. Fairclough) has called this a back-handed subsidy to the T.C.A. Why should those who cannot afford the luxury of the T.C.A. be asked to pay this subsidy? Let those who want speed pay for it.
Truth to tell, I view with some skepticism the worthiness of the claim of speed and efficiency in our air mail service in Canada. In increasing the postal rates the minister offers us something of a sop when he says that he is decreasing air mail rates. I must say that he presented this sop in a most beguiling way. He told us that the air mail rate would go down to five cents and that, wherever it was expedient to do so, letters would be carried air mail whether they were so designated or not.
I do not feel too happy about this promise. The other day the hon. member for Fort William (Mr. Mclvor) said that we wanted to do everything too fast, that we want a letter to reach its destination just a few minutes after we have written it. That of course is unreasonable. I have here three envelopes which were mailed from Toronto addressed to Woodstock, New Brunswick. Ordinarily these letters would take two and a half or three days to go from Toronto to Woodstock, New Brunswick. There was no extra postage on them, just the four-cent stamps, but they went air mail with speed and dispatch. In fact they went at such speed and dispatch that it took them 11 days to go from Toronto to Woodstock, New Brunswick. An interesting thing about it is that they went around by Goose Bay, Labrador, in order to reach their destination.

Post Office Act
I wonder if the minister would consider a pithy little suggestion which a Toronto writer put forward the other day. Perhaps he would put out a six-cent stamp which would provide that the envelope would go by train only. This business of having our letters go air mail whether we want it or not is not always to our own advantage.


Alcide Côté: If my hon. friend will hand me those letters I will inquire the cause of the delay, whether it was by accident or otherwise.


Margaret Aitken: I am opposed to this increase in the postal rates. I am not even convinced that it is necessary. One hon. member called it a preventive measure. If the Post Office Department needs increased revenues they should put the stamps back on cheques. I know it is a nuisance tax but there will not be an election for at least four years and they can get away with it for that long.
The cheque stamps would be a nuisance but they would not be the hardship to anyone that this general increase will be. I suggest also that we keep the extra two cents for air mail postage and let the T.C.A. woo and win its own customers instead of having them handed to them on a silver platter. Let us not allow one of the most important facets of Canadian life, the means of communication, to become a luxury instead of the right of every citizen rich or poor. For that reason I am opposing this bill.
W. Ross Thatcher (Moose Jaw-Lake Centre): Mr. Speaker, I should like to ask a question for the sake of clarification. The Woods-Gordon report made one recommendation which on the surface seems to have a lot of merit. It suggested that if the post office savings banks were discontinued probably the banks could provide most of the service required and the taxpayer would be saved, I think it was $377,000. Listening to the debate, I do not think the minister has as yet made clear the government's position with regard to that recommendation. If it is true that that amount of money can be saved without resulting in any inconvenience to the people of the country, then I think we should know whether the government intends to proceed with that recommendation.


Mr. Speaker:: The minister cannot answer now as we are not in committee. The hon. member has asked his question and it will appear on Hansard. Perhaps when the minister takes advantage of the right to reply he may answer the hon. member, or the question could be answered when we are in committee on the bill.


Mr. Daniel Mclvor (Fort William):: Mr. Speaker, I shall be brief as usual. I contend that those who use the postal service should pay for it. I do not think that anyone who has attained the age of 65 or 70 years and has only $40 a month in the way of income will have very many stamps to buy.
Considering the opposition to the increased indemnity, I was hoping that the C.C.F. would bring in a motion supporting the hon. member for Charlotte (Mr. Stuart), who suggested that we cancel our franking privilege. We are getting an extra $4,000 a year and we should be able to pay for our own postage. Why should we ask the man getting only $40 a month to pay for our postage? Let us cancel our franking privileges and wind up this thing and help the Postmaster General (Mr. Cote).
I would like to speak longer on this because I think there is a lot of sense in it, but we have not heard anyone except the hon. member for Charlotte say anything about cancelling our franking privileges. If that were done it would result in more revenue for the Post Office Department and there would be a lot less mailing done.


Mr. Harold E. Winch (Vancouver East):: Mr. Speaker, I want to add a few words at this time in support of the amendment before the house. I believe this amendment, which calls upon a committee of this house to obtain the fullest possible information on the operations and administration of the Post Office Department and for the bringing in of recommendations that might be of assistance in providing more efficient postal services, is vitally necessary at this time. If I was not in favour of the amendment before then, the speech of the Postmaster General convinced me that it is necessary, because the more he spoke the more confused the entire situation became.
I believe his proposals are contradictory. This afternoon, for example, the minister time after time reiterated that those who use the mails must pay for them. I maintain, Mr. Speaker, that until he has demonstrated that the principle which he enunciated is in effect, then he has no business whatsoever in asking this house to authorize an increase in postage rates. The minister is definitely putting forward a basic principle which he himself knows is not in effect, because those who use the mails in all categories are not paying for the services they receive.
I am not going to take up the time of the house in expounding at too great length what has already been mentioned by several

speakers this afternoon, namely, the matter of second-class mail. If the minister is correct in his assertion that those who use the mails should pay the costs, then he ought to carry through his own contention and make those who use the second-class mail carry the second-class costs. If this were done I am convinced, from what I have heard, that there could not possibly be any deficit in the coming fiscal year.
As regards the minister's contention that those who use the service should pay, I want to add my voice in support of those who have already said that the various departments of government should not have the right of using the frank, which admittedly is a charge of $4,000,000 on the Post Office Department. That $4,000,000 is for administrative costs of government itself and administrative costs of various departments and it should honestly be charged as such. If that were done, there would be an immediate saving of $4,000,000- I believe that is the correct figure-on the charge for postal services.
There is another angle of this phase of the department's operations and that is this question of franking privileges. I am convinced an examination of this question would not only place the postal service in its right perspective, but would also save the taxpayers of this country a great deal of money. I have been absolutely amazed in the time I have been here, since becoming a member of parliament, at the terrific amount of mail I receive from government departments. I would make a bet, if it were legal to do so, that if a check were made on the waste-paper baskets in members' offices this very evening there would be found such a stack of envelopes and discarded material from government departments as to astound everyone. I have spoken to member after member and they have told me they have reached the point now where they do not even bother to open much of that mail but simply tear it in half and throw it in the wastepaper basket.


An hon. Member:: Not here; we open it and study it.


Harold Edward Winch: If you spend time on reading all the material from government departments, I do not know what you can possibly get out of it.
I believe that from the angle of efficiency and of lowering costs the minister's own principle of making those who use the mails pay for it should be extended to all categories of mail. Until that has been investigated by a committee of this house the increases proposed by the minister should not be passed
Post Office Act
at this time. Therefore, Mr. Speaker, I am very strongly in support of the amendment which is now before the house.


Mr. R. H. Small (Danforth):: Mr. Speaker, the speech of the Postmaster General (Mr. Cote), supplementing the remarks made when a resolution calling for an increase in postage rates was presented to this house, has little to commend it because the minister failed to establish by facts and figures his contention that the increase is necessary.
According to the Postmaster General the estimated deficit for the department will amount to $7,500,000 through the loss of revenue due to the cancellation of the excise tax on stamps for use on cheques. He estimates that there will be a $5,000,000 deficit due to the adoption of the 40-hour week; $7,000,000 due to the increase in wages of general post office staff; $1,500,000 due to an increase to rural mail couriers; and approximately $1,000,000 covers increased awards to railway companies. All these estimates belong in the realm of conjecture.
The addition to post office revenue of moneys arising from excise stamps on cheques was unwarranted, for this tax had its proper place in the consolidated revenue fund. To suggest the inclusion of the receipts from this tax in a post office department surplus or deficit was entirely wrong in the first place, and the only conclusion that can be drawn is that it was an indirect way of supplying the funds that were necessary for subsidies and subventions within the department. It is now apparent that these concealed subsidies will have to be paid from the consolidated revenue fund and not from postal revenues.
As to the deficit attributed to salary increases, it is quite evident that the predicted deficit will disappear through the normal expansion of business which, according to the department's own figures, shows an average increase per annum of $4,100,000 and which in turn exceeds expenditures by $100,000 per annum.
Further support for the claim that the government has blundered in proposing increased postal rates at this time may be found in the J. D. Woods and Gordon, Limited, report, which was so abridged in the Postmaster General's report that one could only obtain the gist of its content. After reading a major portion of this report I came to the conclusion, as many hon. members have surmised, that the department has allowed the perfection of its service to deteriorate because of inadequate staff and equipment, and

Post Office Act
that an overburdened staff could not cope with the demands of an expanding economy and an increased population.
It is my contention that the department has only to put into effect the recommendations of the report in order to return to its previous halcyon days. Had the government made a sincere effort to study this report they would have found it a veritable gold mine of useful suggestions, observations and recommendations. It clearly points the way for the pay-your-way advocates. Here are a few comments from the preamble to the survey. I am quoting from page 11:
We have been Impressed by the over-all efficiency of the department and the basic soundness of its organization and administration.
The Leader of the Opposition drew attention to that quotation. But page 12 contains this, and I quote:
Prior to war, the services were steadily expanding. During the war the expansion accelerated and has continued at an ever-increasing pace. The established policy of successive governments was that expenses should be kept within the confines of postal revenues.
That expenditures on salaries and services have increased substantially since 1945.
There was also a substantial increase in the volume handled.
On page 13 the report continues:
The principal object of the survey was to consider the over-all organization structure, for improvements in the service, and not merely ways and means of cutting costs.
Now, Mr. Speaker, that survey has the right approach as regards the method of improving the service without reducing staff.
On the general over-all organization of the department we find these recommendations on page 16:
(f) Provide and arrange for the erection of letter boxes or other receptacles at such locations as he deems appropriate, in which mail or mailable matter may be deposited or stored.
I will have further comments to make upon that matter later. On pages 19-20:
That decentralization has gradually taken place through pressure of events.
The senior officials of the department raised the problem of the difficulty of carrying out adequate operational planning under adverse circumstances, as they were fully occupied in their daily routines, with no opportunities to appraise the over-all situation and plan for the future.
Then on page 21 you will find this:
This is common to all organizations operating on a stringent budget. The staff who should be dealing with long-term plans are called on to assist in meeting the peaks of normal operations, and gradually become so involved in routine matters that they are unable to carry out their planning function.
Steps have already been taken to deal with this problem by some appointments, headed by a special assistant to the deputy postmaster general.

However, it is apparent that the number of qualified staff presently available for this type of work is completely inadequate to deal with the problems encountered throughout the department.
Here again is shown the need for more staff, and an effort made to meet the situation by the appointment of a key official.
At page 27, under "Grades of Staff":
In an operation of the magnitude of the Post Office Department, it is essential to have a sufficient number of top level positions of adequate remuneration to provide the incentive to high calibre men to join the service and make it their career.
Then on page 33, section II:
The work of the operations branch has over the years increased to the point where the staff at all levels are overloaded with a multitude of routine problems and correspondence. No one has had time to develop policies which can be applied on an over-all basis.
Then on page 34 under the heading of "Adequacy of Staff":
It is essential that detailed consideration be given to new construction in order that the most efficient operating methods be incorporated in the designs. Quite properly, the postal superintendent in charge of the buildings division has concentrated on this phase of his activities. All the staff in the division have been so engaged and they have not had time to seek out and introduce operating economies throughout the existing post offices. Our survey has disclosed that there is room for substantial savings through better lay-out, equipment and control.
Then on page 35, under "Equipment and Material Handling":
Certain improvements in equipment or methods which have been introduced in some post offices have not been made available to other offices as there is no machinery to pass on the experience gained or to ensure that the most efficient methods are used throughout the organization.
Our examination has indicated that there is opportunity for substantial savings if the best use were made of staff and equipment.
Controls.
The branch is operating under severe handicap as there are no standards established to measure the relative efficiency of a given method of operation. The lack of such standards is particularly felt when requests are received for additions to staff or accommodation. The lack of such a standard also makes it difficult to appraise the benefits which might be obtained from improvements in methods and equipment.
On page 37, under "Mechanical Engineering Division":
This division should make detailed examination of the equipment and lay-out presently in use. This study will disclose great differences in equipment. Equipment installed many years ago is still being used, although more efficient equipment is available, and no attempt has been made to standardize it.
On page 39, under "Postal Service Division -Letter Carrier Service", we find this. I may say that this is one matter in which we are all vitally interested.
There is a need for a re-appraisal of the services being provided at various centres across the country.

The department should be continually examining the nature and extent of services provided, and he prepared to make alterations to keep pace with changing conditions.
At pages 39 and 40, under "Revenue, Post Office Division":
It is essential that this division should delegate operating responsibility and authority to the field organization. At the present time, decisions are based on information collected in the field. This results in voluminous correspondence, and delayed action. In many cases, the men who collected the information in the first instance are in the best position to make the decisions.
I would add this. There is in the department nothing more disconcerting and more demoralizing than to have suggestions offered by the staff with regard to various improvements either ignored or not acted upon. Under "Methods and Procedures", on the same page we find this:
The staff available for this work has proved inadequate, and the existing manuals were in many cases issued years ago and are now to a large extent obsolete.
The production of up-to-date operating manuals should more than repay the expenditure involved in staff salaries required to prepare them. At the present time, there are numerous errors occurring throughout the service, and the correction of each one requires the expenditure of time and labour. Clear instructions should do much to reduce the number of errors.
It should be quite apparent to anyone who is on the operations staff that that would be good business and would be a good method of improvement. Here again is failure to take full advantage of information gained and to introduce needed improvements. On page 42, under "Workshops":
It was noted during our survey that a number of these workshops have extended their activities to the manufacture of equipment, such as cupboards, waste paper containers, binneys and skids, and to the repair of typewriters and other office equipment. These workshops were not established for this purpose, and it is questionable if this type of work is economical.
At pages 43-44, under "Time Study- Equipment Design":
One of the time consuming tasks in the post office is arranging letters on their arrival so that the addresses can be read and the stamps cancelled, -the "facing-up" and "primary sortation" operation. The use of conveyor belts and changes in equipment would allow two operations to be combined. While this plan will require further development, there is an indicated annual saving in the forward letter section of the Toronto post office alone of approximately $200,000 per annum.
Work Place Layout
In our opinion there is a tremendous scope for this work, and we feel that the benefits which would be derived would far outweigh the cost.
Post Office Act
Here is a case where they venture to place the saving at 20 per cent. At page 49, under section III, "Transportation Branch-Planning":
Pressure is continually brought to bear on the branch by the public, or through their parliamentary representatives, to institute new services, or to extend existing services. The officials investigate these proposals and finally accept or reject the individual submissions.
These decisions are often difficult, for while the cost of providing a service can be calculated, the benefits are not easy to evaluate. This has left the branch in a position of continually taking a defensive stand in regard to new proposals.
Little effort has been made to appraise the whole transportation problem, and to develop a rational plan or policy to govern future operations and methods. This lack of planning appears to be the most serious shortcoming of the branch.
At page 57, under "Establishment and Extension of Services":
The department in many cases has not considered the establishment of completely new services, or the extension of existing services until public demand has drawn their attention to the need for such action. This has resulted in the services varying according to the demands of the public in various parts of the country.
There should be a constant review of the services to be in a position to anticipate complaints.
At page 57, under	"Transportation-
Within Cities":
A limited survey of conditions in Toronto disclosed that the planning of this pick-up and delivery service had not been given the consideration which it deserves. A careful planning of routes and scheduling of services should reduce the transport required by the contractor, and the time the transport would be in use, thus reducing the cost to the department. In larger cities, where continued changes in traffic regulations are being made, this is a full time job. Officers should be appointed to study this problem.
The last three quotations I just read from pages 49 to 57 give a fair and impartial summation of what has happened generally, but particularly in suburban areas, and the members representing such ridings know the end result thoroughly, because they are constantly approached by their constituents to improve these services of which they are so sadly in need and to which they are entitled. On page 58 rural mail couriers are dealt with as follows:
This question has many broad aspects, and a clearer policy seems indicated. It would include further developments on standards of service, and the possible introduction of fulltime couriers employed, and provided with motor transportation.
I will go further here and make the comment that in the report reference was made to the fact that there was supposed to be a study of the situation with regard to rural mail delivery by a committee of the house. But that was not pursued further and no action was taken with the exception that an

Post Office Act
increase was granted to them. That has been the only action so far. There still has not been any investigation of the conditions under which rural mail couriers find themselves. On pages 76 and 77, in section V dealing with the administration branch, there are the following observations and comments under the heading "Financial and Statistical Controls":
It has been recognized in the department for some time that there is a lack of information on which to base policy decisions and control activities. The only existing data which can be used to compare the operations of two post offices is the dollar revenue received by post offices. This is not an adequate measure of the volume of work performed by each. This lack of information is particularly felt when additional staff or space is requested. It is not possible to decide whether these requests are justified by comparison with other similar operations.
A cost division has been established to devise a practical method whereby the cost of handling various types of mail could be established or estimated. It has made some progress and each year reduces the cost of the various postal service estimates.
On pages 77 and 78 there is the following:
During recent months a few of the larger post offices have been asked to estimate their expenditures in advance and submit monthly reports comparing their actual expenditures with these estimates. It is recommended that the development of controls be pushed forward vigorously.
The immediate goal should be the production of regular monthly statements for the various operations in the major post offices showing:
(i)	Actual expenditures for the period on an over-all and unit basis for each operation.
(ii)	Similar figures for the same period in the prior year.
(iii)	The budget figures for the period.
The information contained in the monthly statements of individual post offices should finally be compared on a unit cost basis and differences investigated.
These are some of the salient points picked at random from the survey, a selection of opinions, observations and recommendations, and a fair summary of them would be that there is no system or method of breakdown to determine the cost of each operation within the postal service; that decentralization has taken place by the very force of circumstances and not by any conscious policy of the department; that the survey is interspersed with comments on the lack of competent personnel and the need for modern equipment, and because of this the senior officials cannot solve the many problems confronting them, let alone carry out adequate operational plans; that this lack of planning is evident, whether caused by neglect, pressure of work or complete indifference; that work has increased to the point where the staff at all levels is overloaded with a multitude of routine problems and correspondence, and no one has had time to develop policies and the situation has produced a catalogue of deficiencies.

I shall now revert to page 18 and the chart of the organization set up for the top level- the Postmaster General, the deputy postmaster general, a chief executive officer to be assistant to the deputy minister, and a special assistant. Their duties are also defined. The one I am interested in is the special assistant whose position is defined on page 18 in these words:
There Is also a special assistant who has been carrying out special assignments of a planning nature.
All through the survey it is indicated that there is a pressing need for such an official. How long has he been appointed and where has he been? In the face of the facts presented, is this lack of staff again, or is it a question of too late and too little? The survey reveals that some changes have been in operation for some time, that some have just been initiated and that the remainder are in the realm of probable outcome. While the survey implies that a reduction of staff will result in certain instances, these people can be absorbed by transfer and promotion to departments now undermanned, and an abundance of opportunities will be provided for ambitious personnel with talent to aspire to higher positions.
It is now abundantly clear that we have established our claim that the government has made a major error in introducing a bill to increase postal rates before effecting the reorganization of the department. We are entitled to have the plan of reorganization tried out before the imposition of the proposed increases in rates, and to insist upon these increases before the plan has had a fair trial is an affront to the people of this dominion. Let me state that all through the survey positive statements have been made by the consultants that savings can be made. Such assertions are repeatedly made, and the report even goes so far as to say that the savings would amount to approximately $1 million.
When the minister presented his statement today supplementing what he had previously said, he said he had been further advised by the consultants that the proposed changes to be put into operation would result in an increased cost to the department of over $700,000 and that this would be an added burden on the department. This advice is not contained in the survey. It clearly indicates and points out where savings can be made. As far as the increase in staff is concerned, I do not think it is going to be as great as mentioned. I think that men of talent required for the top level positions will be produced, and you will have to establish a training school to develop them.

It seems to me that no attention is being paid to the development of staff for future use. It has not been established when the service deteriorated into a deplorable state. The fault is attributed to no one and I am trying to find out whether there is not some person in the department to whom some vestige of responsibility can be attached.
The only place in the survey where I can find any indication is where reference is made to the appointment of a special assistant to the deputy minister. In fairness to him, the only thing that remains to be established is when he was appointed and what time he has had to accomplish the improvements mentioned as being necessary in the survey. I would say that this survey, on the face of it, is a wonderful one. It is not a woebegone chant or the lament of selected Jeremiahs trying to establish that there is something wrong with the operation. It is surprising that the postal department has been so good and has provided us any service at all in view of the handicaps under which it has had to operate.
If further staff were provided and the improvements implemented, the increased revenue that would result would more than make up for any loss caused through the adoption of the 40-hour week and increased wages for the mail carriers. On the face of this survey I say that the government has been ill-advised, and commits an outrage on the intelligence of men who are supposed to be of $10,000 a year calibre by putting this kind of proposition forward without first putting into effect the improvements which the report says can be accomplished. I think that this should be further questioned, and that the minister would be well advised to impress upon his colleagues that this is the time to show, for once, a little intelligence. I believe this bill should be withdrawn until such time as the minister has an opportunity of convincing them that there will be surpluses instead of the deficits that have been predicted.


Mr. J. W. Noseworihy (York South):: We
have heard from a number of members in the house, and we have seen quite a number of brickbats thrown across the chamber at the Postmaster General (Mr. Cote). This has been true, not only in this session but in previous sessions, and I have probably thrown some myself. Before I throw any this afternoon, I want to publicly express my appreciation of the co-operation which I have received from the Postmaster General's department, and particularly the Toronto postmaster, with regard to cases I have brought to their attention.
Post Office Act
I have found the postmaster at Toronto and the postal officials here, particularly since the present Postmaster General took office, quite ready to investigate any case which I have referred to them. I have had occasion to refer complaints about delay in mail delivery; I have had occasion to refer complaints about the time of the delivery; complaints about the location of post office boxes; complaints about the inadequacy and unsuitability of sub-post offices in my riding; and in each and every instance I found the department ready to investigate the complaint. I think that wherever there was justification for the complaint, or where the service was suffering by reason of these particular circumstances, changes have been introduced and improvements made. I find that the tension which existed, certainly two years ago, as between the general public and the Post Office Department on the one hand, and as between the postal employees and the Post Office Department on the other, has lessened considerably.
I keep in fairly close touch, both with the postal employees and with the service rendered by the post office in my constituency. I have every reason to believe that there is much less dissatisfaction today with the service being rendered, certainly than there was one or two years ago. I have often wondered just how the post office functions as well as it does, considering the frequency with which postmasters general are changed. Since I have been here I would say that no postmaster general has1 ever held that office long enough to really acquaint himself with the business of the post office-


Stanley Howard Knowles: They get promoted.


Joseph William Noseworthy: -or to take any effective action towards improving that service. I do not know who runs the post office. Certainly, it is not the postmasters general, because they never hold the position long enough to become acquainted with the post office. I do not know why cabinet ministers do not want to hang on to that position longer. It may be because there are so many headaches in it that just as soon as they find out how many headaches there are they want some other cabinet position or some promotion. Certainly, I would think that is the basis of much of the trouble in the Post Office Department. I would recommend to the cabinet that once they get a good Postmaster General they keep him in that job for a while and give him an opportunity to do something.
The bill before us is based on two theories. The first theory is that the post office should

Post Office Act
be placed on a paying basis. I think that is a basic question that the house and the government should consider. I believe it is one of the questions that a committee such as is recommended in the amendment could investigate at some length, and a question about which we could get more than the opinions of postal officials themselves. I suspect this idea that the post office should be maintained strictly on a paying basis is a tradition that has grown up over the years amongst postal officials, and one that has not received very careful examination. For the life of me, I do not see why the post office should be singled out as the one public service that should be placed on a paying basis.
I do not see why the post office, for instance, any more than the Department of National Health and Welfare should be on a paying basis. It is a service department. I have not heard anyone suggesting that the Minister of National Health and Welfare (Mr. Martin) should collect enough revenue to offset all the expenses of his department. The mines branch of the Department of Mines and Technical Surveys is rendering a service to the mining operators in all parts of this country. I have never heard any suggestion that that department should collect from these mining companies enough fees to offset the expenses of the department. The whole question is, why should the post office be the one department of government rendering a public service that should pay its way? I think it is a fundamental question that should be examined.
The second point, of course, is the statement by the Postmaster General that the users of this service should pay for it. Even if you accept the theory that the over-all service rendered by the Post Office Department should be paid for by those who use the service, in other words that the revenue coming into the post office should be sufficient to offset the total expenditures, there are groups of people being served whom it would not be in the interests of the country generally to require to pay for the service.
About two years ago, I believe, the government brought in an amendment to the Post Office Act to increase the rates on second class mail. There was a flood of propaganda from newspapers and magazines against the original government proposals, and the consensus in this house and, I believe, in the country was that by enabling Canadian citizens to receive newspapers and magazines at a lower cost than the actual cost of carrying them, and thereby keeping down the price of those newspapers and magazines to the public, the government was rendering a

public service. If I remember correctly the government, in the face of that propaganda, modified their original suggestions regarding the rate that was to be charged. I quote that as one example to prove that we certainly do not expect the users of the post office to pay the whole cost of the service. We do not expect the editors and publishers of newspapers and magazines, nor do we expect the individual subscribers to those papers and magazines, to pay the whole cost of the postal service.
I just cannot see why one group of people who use the services, the group who use the first-class mail service, should be called upon to carry the deficits which result from giving other users a service below cost, especially in the light of the fact that the users of first-class mail are the one group of users of the public service who not only pay for the service they get but every year contribute a considerable surplus to help carry other branches of the post office service.
I am going to support the amendment. I am sure that as far as his office is concerned the present Postmaster General has no greater ambition than to see that that service is maintained on as efficient a basis as possible. I would think that the Postmaster General would welcome the setting up of a committee before which he and some of his officials could appear, and at which a study of the whole administration of his department could be made. If the department is administered as efficiently as the minister would have us believe it is, surely he has nothing to fear from the investigation of such a committee. I would think it would be a feather in his cap to have a committee set up and to have his officials come before it and to find out that he has the most efficiently run department in the government service.
If on the other hand we can discover ways and means of improving this service, I am sure that the minister would welcome any suggestions along that line. We are told that there is nothing perfect. It is just possible that the administration of the post office may not be perfect in every respect. It is just possible there may be ways of improving it; and if by the type of investigation that is visualized by the mover of this amendment we can improve that service to the public, then by all means let us do it. I hope the minister will consider the possibility of having such an investigation.


Mr. F. G. J. Hahn (New Westminster):: should like to say a word in respect to the amendment. The charge has been made that we have political patronage in our postal department. I for one feel that the hon. member for Winnipeg North (Mr. Stewart)

was certainly right on the beam when he said that. We find it apparent everywhere. We need only go to our own particular ridings and examine some of the incidents and we shall find probably no end of them.
Perhaps it is a coincidence that in my particular riding the post office at Newton-it is a rather small one-should have required a new postmaster this year. I would not charge that this was a particular case of political patronage. There are about six or eight boxholders in that Newton post office, and it does a very substantial business. The reason it is doing such a substantial business is that the area surrounding the post office has a rural route, and naturally these people have to get their mail through the rural route. They buy their stamps and their postal notes, and so forth, at their nearest post office, which all helps the post office business.
Apparently, under the existing act the only people who can apply for a postal position of that particular kind are those who happen to get their mail at that post office. War veterans wanted to apply for the position but because they happened to live around the area, perhaps not more than 50 yards or 100 yards from it, and were on the rural route, they became ineligible. I wrote a letter to the postal officials and explained the situation but apparently the rules prevented them from changing the system. We found that a young man who was not a war veteran-I do not say that we must necessarily put war veterans in every position-got the position, since there were only one or two other applicants eligible and they were found to be, shall I say, of an inferior nature.
Another instance that I have in mind has to do with the post office that serves my own community. Some three or four years ago we had occasion to require a larger postal outlet. The people in the community knew nothing about the post office until it practically became a reality. The fact is it was only through representation on my part, and from one or two other prominent citizens, that they took it from a proposed building in a lane and forced the man who got the contract finally to build it up on the highway to which people had access. I would say that the rents for a building such as that were excessive. When you have to pay about $5,000 a year for a post office building which is only 120 feet long and 60 feet wide, I would say you are paying too much, especially in a rural area.
In the Cloverdale area a department, possibly the Public Works Department in this instance, hopes to build a federal building which is to be used for the purpose of housing 83276-1131
Post Office Act
the post office. When you pay $22,500 for a two lot building site in a small town of about 500 people, I think it is a little excessive. I do not know how the departmental officials feel about it, but it would appear to me that there is some patronage involved.
I now come to the most specific cases of patronage that our postal officials give. I refer to the users of second-class mail. I do not think we can reiterate that statement too frequently in order to bring it to the attention of the Postmaster General (Mr. Cote). There is no way that you can get the support of the newspapers more freely than to give them a cheaper rate of postage than anyone else.
That brings in the matter of efficiency. The Postmaster General was quite happy about the efficiency report he had received on the service. It sounded very good. However, would you call an automobile an efficient automobile if there was a continuous drip of gasoline from the gas line? I would say that in comparison our Post Office Department is not an efficient department if the users of first-class mail must continually give in order to keep the second-class mail in operation. To my mind that is certainly patronage.
Business today exists for profits. If a business finds its profits sagging it will examine its books. In this particular instance we are operating a big business-[DOT] the post office business is big. Apparently its profits are about to sag and we must examine the books. We are told that the big businessman is going to pay for this first-class mail, but let us examine things a little more closely. If Eaton's, the Hudson's Bay Company or any large mail order house finds that its profits are sagging, the management will be told they must make a profit. Where are they going to get that profit? They are going to pass on this one-cent increase in the postage to the consumer. It will go right back to the little man who in turn will be subsidizing the second-class mail for newspapers.
Postage stamps will be no exception to this ruling. Big business bases its costs on small items like stamps, light, heat and other overhead items. It gives nothing unless-perhaps I may be so blunt-it donates to political slush funds of the party that is going to see to it that these postal rates continue to give them a better deal.
If the little man is going to be protected, and I think he should be, we should see to it that he gets the cheapest service it is possible to provide. We should examine our efficiency. I was happy and surprised to hear the hon. member for Winnipeg North (Mr. Stewart), a socialist, suggest that we should examine

Post Office Act
one of our greatest socialistic institutions. I was glad to see that he recognizes that a system of patronage can offset any socialistic idea that he may have in mind for the future.
The Postmaster General referred to earlier debates and he referred to the suggestion that we should live off post office surpluses. He said that it cannot be recovered from the public treasury. I have no doubt that it cannot be recovered from the public treasury because it does not exist. He is quite right there.


Alcide Côté: My hon. friend is misquoting me. I did not say it could not be recovered; I said that even if it could be recovered there still would be no surplus in fact.


Frederick George Hahn: I stand corrected. Even if it could be recovered, but it does not exist in fact. That is what the minister said and that is what I intended to say. We must examine the facts very closely. The minister has suggested that $20 million has been made over a 20-year period. But the charges were not all-inclusive to the post office. Business does not operate that way. Why should not all these charges be charged to the Post Office Department?
Why should we keep hoodwinking the Canadian public by telling them that the Post Office Department has made $7 million, $5 million or $10 million. Let us tell them the truth, that their Post Office Department has cost them a million a year, that they were in debt last year to the extent of $5 million. It is ridiculous for us to say that we made $3 million or $5 million profit last year and did away with the excise stamp on cheques; that there was that additional profit and we are not going to be in need of it. I do not know whether that was an election ruse; I do not pretend to know and possibly nobody knows. My position is that as long as the condition exists today whereby the taxpayer is going to be charged more money without every fact being examined in full detail, then I cannot support the idea. I am ready to support the appointment of a committee, as suggested by the hon. member for Winnipeg North.


Edmund Davie Fulton: Mr. Speaker, 1 was interested in reading the amendment moved by the C.C.F. party to the motion for second reading. The amendment reads:
That Bill No. 168 be not now read a second time, but that it be resolved that in the opinion of this house a parliamentary committee should be established for the purpose of making an inquiry into the organization and operation of the Post Office Department and the postal services of this country.
After what has been said by the leader of the official opposition, there could be no

question but that we would be in full agreement with the first part of the amendment, namely, that Bill No. 168 be not now read a second time.


Stanley Howard Knowles: Or any other time.


Edmund Davie Fulton: Or, as the hon. member for
Winnipeg North Centre says, any other time. I am interested particularly in the second part of the amendment which suggests that consideration be deferred until the matter can be discussed by a parliamentary committee. I imagine that most hon. members will agree that a parliamentary committee or any committee to get information on the matter, in view of our feeling that the measure is ill-conceived and ill-timed, would be desirable. But what does interest me, without making any further comment on the matter, is that this suggestion that the matter be studied by a committee comes from a party whose members not many days ago greeted with some ridicule or attempted ridicule a similar suggestion which we made when dealing with another matter. We suggested at that time that nothing would be lost and a great deal would be gained by having a proposal which affected us personally referred for other study-


Stanley Howard Knowles: To a royal commission.


Edmund Davie Fulton: -to a royal commission or to a parliamentary committee. That was the suggestion made on this side. As I say, a good deal of ridicule was advanced against that proposal and it was suggested that it needed no further study, that we could deal with it ourselves, and that we really did not need the benefit of any other assistance or any further study of the matter.
I only point out that it is strangely inconsistent for a party which takes that position on one matter to advance an almost similar proposal when dealing with another matter.


Stanley Howard Knowles: That is not true at all.
You were taking that matter outside of parliament whereas our amendment keeps this question inside parliament.


Edmund Davie Fulton: Obviously hon. members are
worried, but I just remind them again that when they objected to a royal commission we said that we were prepared to send it to a parliamentary committee if that would suit them better. I did not notice that the hon. gentleman indicated any readiness to accept the second proposal.
Having said that, I would point out that the effect of the amendment, if carried, would be to delay consideration of this matter. Indeed, the Leader of the Opposition (Mr. Drew)

when speaking on this present bill, and as reported at page 1153 of Hansard, suggested to the Postmaster General (Mr. Cote) that he would be well advised to withdraw the bill and study it further before bringing it in again. In effect, therefore, the motion moved by the C.C.F. party in this instance merely places in a formal manner before this house the suggestion made by the Leader of the Opposition on that earlier occasion.
For myself, I cannot see very much reason why I should not support this proposal as at least a suggestion which would result in a further delay of the bill before the house. In case there should be any doubt, sir, I can certainly say that even if this proposal would not carry, then we will stand by our position that the bill should not be proceeded with and, as the Leader of the Opposition indicated, we will most certainly vote against it.
I believe we should deal in some detail with the reasons why the government's proposal should not be accepted by this house. The Postmaster General again this afternoon based his arguments in favour of the bill on the fact that without the proposed increase the Post Office Department would incur a deficit of approximately $13,500,000. I want to deal with two or three other methods by which this hypothetical deficit could be dealt with, and methods which would be an alternative to the increase in rates now proposed.
I refer first to the question of franking privileges. Earlier this session, on December 16 to be exact, I asked the Postmaster General how much it was estimated the franking privileges available to government departments cost the Post Office Department, and how much revenue the department would receive if government departments had in fact to pay for their mail services. The answer which I received to that portion of my question reads as follows:
Based on periodical checks made at the Ottawa post office it is estimated that the postage involved on free mail posted by or addressed to government departments and agencies during the fiscal year 1952-53 was $4,060,230.
Therefore, based on the estimates for the last fiscal year there is a possibility of increasing revenue to this department by over $4,000,000.
When the Postmaster General was dealing with that this afternoon he said-I took his words down and if I missed anything I would ask him to correct me-he said in effect that the elimination of the franking privileges would cover only a small fraction of the increased costs which his department is now facing, and which, as he said, would result
Post Office Act
in a deficit of $13,500,000 if this proposed increase were not accepted. But, Mr. Speaker, according to my calculations the elimination of the franking privileges would result in increasing the revenue to the department by approximately one-third of his anticipated deficit, and one-third cannot be described as a small fraction.
It is true, as the Postmaster General pointed out, that if other government departments were required to pay for their mail the taxpayer would in the long run have to meet the cost. But the position at the moment, according to indications we have from the various monthly reports of the Department of Finance, is that there is a substantial surplus of revenues over expenditures to date in the fiscal year; and certainly, if the calculations of the Minister of Finance (Mr. Abbott) are correct, we will end up with a surplus this year. I believe we will actually end up with a much larger surplus than the minister forecast. Therefore, it would not involve an increase in tax rates to absorb the extra costs, and to provide extra revenues for the Post Office Department, which would be occasioned if other government departments paid for their mail.
That extra cost would be more than covered by anticipated surpluses of government revenues over government expenditures for the current fiscal year, and thus an increase in taxes is not a possibility, certainly not a necessity if that suggestion were adopted.
I would suggest, Mr. Speaker, it would be much sounder accounting practice for the Post Office Department to be credited with the amounts which would otherwise be paid to it for the purchase of stamps by other government departments, and that there should also be included in the estimates of this house a credit for the franking privileges now enjoyed by hon. members.
I am not going to deal with the question of whether our franking privileges should be taken away, except to repeat the statement I made earlier, when the hon. member for Charlotte (Mr. Stuart) was speaking, that if he is serious about his suggestion he has but to move a motion, which he suggested someone else should move, and I will be glad to support it.
I would also point out to the hon. member for Fort William (Mr. Mclvor), who also seemed reluctant to take the responsibility and who asked somebody else to move the motion, that if he is prepared to give up his franking privileges all he or anyone else has to do is to move a motion. In addition, there is nothing to stop him going down to the post office and buying stamps for all his letters,

Post Office Act
nothing at all, if he puts that forward as his solution. But I do not see why he should ask someone else to move a motion.
As long as franking privileges are extended to members of parliament I believe it would be a sound thing to include an amount under a legislative item which would cover the revenue that would otherwise revert to the Post Office Department if our mail in fact were required to carry postage stamps. In that way, and if the same thing were done for other government departments, there would be a very substantial increase in revenue for the Post Office Department at no greater expenditure to the taxpayer, because somebody has to pay for the carriage of mail in any event.
The hypothetical deficit, which seems to worry the Postmaster General so much, would be decreased by almost one-third of what he anticipates it would otherwise be.
At six o'clock the house took recess.


[Stage Direction]
AFTER RECESS

The house resumed at eight o'clock.
Edmund Davie Fulton: Just before six o'clock, Mr. Speaker, I had dealt with the fact that although the amendment now before the house is, as I see it, somewhat inconsistent- in fact entirely so-with the attitude expressed by the members of the C.C.F. party on an earlier occasion, still as giving a further opportunity for study and providing, if it were carried, a means of delaying the passage of this bill, I felt that we should support it because we like to be consistent ourselves even though our opponents are not always consistent.


Stanley Howard Knowles: I thought we settled that matter before supper.


Edmund Davie Fulton: I indicated that therefore in all probability we would support the amendment which they have moved. I then dealt with the question of other possible methods of avoiding the entirely hypothetical anticipated deficit which would otherwise arise out of the operations of the Post Office Department if the government's proposal were not carried. I had pointed out that if other government departments-and indeed the House of Commons-were to provide, through their estimates, for the meeting of the cost of carrying their mail, there would accrue to the Post Office Department an additional revenue of something over $4 million which would be approximately one-third of this anticipated deficit. I certainly suggest that that method should be adopted as one of the methods

which would be preferable to the imposition on the people of Canada of an additional tax of one cent on the first-class letter mail.
Then there is another way in which this anticipated deficit could be met and which would obviate the necessity of an increase in postage. That would be by requiring those who wished to use air mail service to pay for it. In this connection I want to put forward a point of view which applies particularly to the people who live in rural areas. I have said before, in discussions of the post office estimates and of other measures submitted to us by this department, that I feel it is entirely improper that the residents of rural Canada should be required to subsidize what I might call luxury services for the residents of the urban areas when, at the same time, the people in the rural areas are getting a service which is of a lower standard than that which they are entitled to expect.
There is not a member here from a rural area-and I am quite sure there is not a member here from an urban centre who has visited or lived for any length of time in a rural area -who will not agree with me that, by and large, the mail services now accorded to the rural areas of Canada are far below standard and are far below what should be accorded to them in this present century. Yet a person living in a rural district in my riding or in any other such riding in Canada is now going to have the cost of his letters increased by one cent per letter, largely in order to support the provision of a super-service to the people living in urban centres. As between urban centres of Canada, there are now in existence the facilities for providing an adequate air mail service. There is also, incidentally, in existence the means of providing a fairly, if not completely, adequate surface mail transportation system. Yet the people who live in those large urban centres are now going to be able to avail themselves of air mail service at no extra cost. All they are going to have to put on their letters is a five-cent stamp and then they can have them carried from Montreal to Vancouver in a day whereas the same five-cent stamp will not enable a letter to be delivered from one end of my riding to the other in less than four days. But people living in Vancouver or Montreal, or other large cities, who want the super-service, and who under the old method have been able to get it for an additional two cents-or rather, I should say, an additional three cents over the old rate of four cents per letter-all they have had to put on was an additional three cents to buy themselves an air mail stamp in order to make sure their letters were carried from Vancouver to Montreal, or the reverse, by air and were delivered within twenty-four hours. If

there is that much importance attached to the air mail service in Canada, I would think that those people would be quite willing to continue to pay the extra three cents so that the people of my riding would not be subjected to the necessity of paying an extra cent on every one of their letters in order to get them delivered-and not by air mail- within a space of three days from one end of the riding to the other.
This air mail delivery does not benefit the rural areas. Their letters still have to go down-and I am thinking of British Columbia particularly-to Vancouver before they ever get on the air mail service. It takes a letter perhaps two days to get to Vancouver. Then it may have to go only as far as Seattle, Calgary or any other place with which the people of my riding have business. The fact that from Vancouver on it goes by air mail is really not of benefit to the people of my riding or to any of the similar areas of British Columbia. Mr. Speaker, I am just not able to appreciate that there is any equity or justice in demanding that all my people should be required to pay five cents per letter, an additional one cent which does not improve their service one iota, when the air mail service which might be required by large businesses in large centres is available to them if they want to pay an extra three cents per letter. Why should not the people who want luxuries have to pay for them?
What was that comment, Mr. Speaker? What did the hon. member say?


Mr. Byrne:: You should have a special
stamp.


Edmund Davie Fulton: If Kamloops riding were able to get the Post Office Department to change its mind on this proposition, it would deserve a special stamp. I am surprised that the hon. member who comes from a rural area in British Columbia should make a remark like that. If he would get to his feet and make a similar speech and similar suggestions, then he should have a special stamp for his riding.


Stanley Howard Knowles: Then he would be stamped.


Mr. Speaker:: Order.


Edmund Davie Fulton: Post Office Act
order that a luxury service can be provided to people who are already adequately served and to whom, if they want to use air mail, the financial resources to use it are readily available in any event.
Let us take the third heading under which the Postmaster General said this hypothetical deficit might arise, namely, that the cancellation of the excise stamps on cheques and notes will reduce the revenues of the Post Office Department by $7,500,000 or, in other words, over half the anticipated deficit to which the Postmaster General has referred. A great deal has been said about that already and I am not going to repeat all that has been said except to emphasize that when the Minister of Finance (Mr. Abbott) announced the proposed elimination of stamps on cheques in the last budget he introduced before the election, he did not indicate that it would be necessary to make up the revenue loss by another tax. No sir! He was prepared, and I do not blame him, to take any advantage that he could from this proposed reduction in taxes. The government badly needed to take any credit they could around that time, and so he took the credit.
But, sir, it is impossible for any of us to believe that the Minister of Finance did not know what the loss of revenue was going to be. He is here tonight, and if he is prepared to say he did not know what the loss of revenue was going to be then we would all be glad to hear from him. I do not hear from him and therefore I assume he did know what the loss of revenue was going to be. It would be interesting to know why he did not say before the election that it would be necessary to make up for this loss of revenue after the election by the imposition of an additional tax on the users of the letter service of Canada. I still do not hear from the minister so I assume that the only explanation that occurs to us is the correct one, namely that he did not want to tell the people of Canada before the election that this tax concession was a mere phantasy, that it was introduced for election purposes only, and that the government knew at that time that they were going to demand from the people of Canada after the election that they make good that loss of revenue which was held out to them as an additional bait in the pre-election budget which the minister himself introduced.


Mr. Argue:: Cynical budgeting.


Edmund Davie Fulton: Well, sir, we have had some experience before with cynical budgeting. I thank my hon. friend for that term. It seems to be a much better one than cyclical budgeting, the term which the Minister of Finance likes to attach to it.


Mr. Speaker:: Order. I think that perhaps we had better consider the principle of the bill. While I am on my feet, I should like to point out to the hon. member for Kamloops that under our rules repetition is not in order. That includes not only repetition of one's own arguments but also repetition of other members' arguments. I have heard it said since this debate was initiated that the postal increases sought by the bill are perhaps a consequence of measures announced by the Minister of Finance in a previous parliament. Therefore I hope that every hon. member who speaks on the bill will not repeat the same argument. I should like to warn the hon. member about this standing order.


Edmund Davie Fulton: I thank you, Mr. Speaker, for your warning. I might draw to your attention, sir, and the attention of other hon. members, that, while it may be true that the point I am now putting forward is to some extent a repetition of points put forward by previous speakers, we have not on previous occasions always had the advantage of the presence in the house of the Minister of Finance.


Mr.   A.bboii@: It is very seldom he is not here.


Edmund Davie Fulton: Let me make it clear. I want to be fair to the Minister of Finance. He has been away on an important conference and that is the reason why he has not been here at earlier stages of this debate. But he is here now, sir, and I have invited him to make certain comments.


James Sinclair: How nice of you.


Edmund Davie Fulton: The terms of my invitation were more courteous than any invitation that would have been extended by the Minister of Fisheries (Mr. Sinclair), but we will let that pass. The Minister of Finance is here for the first time, I believe, in this debate, and I have invited him to make certain comments. I suggest that if he does not offer an explanation, then the obvious explanation which we ourselves advance must be accepted as the true one.
Som


a hon. Members:: Oh, oh.


Mr. Abbott:: That is unworthy of a Rhodes scholar.


James Sinclair: I Object.


Clarence Decatur Howe: You really do not have to speak for 40 minutes, you know.


James Sinclair: There are Rhodes scholars and Rhodes scholars.


Edmund Davie Fulton: I shall be very glad to give up my place right now to the Minister of Finance if he indicates any willingness or

desire to offer an explanation of why the government took off a tax before the election and put it back on afterwards. Does the minister want to explain that?


John George Diefenbaker: You cannot explain the obvious.


Edmund Davie Fulton: Does the Minister of Trade and Commerce and Acting Prime Minister want to explain it?


Clarence Decatur Howe: We would like you to get on with your speech.


Edmund Davie Fulton: Does the Postmaster General want to explain it?


Mr. Speaker:: Order. I think we ought to carry on with the debate in the manner-


Alcide Côté: When I close the debate I will be glad to answer my hon. friend, and I think it will be satisfactory to him.


Mr. Speaker:: Order. I think we ought to continue with this debate in the usual manner of debate, and not in the form of a private conversation. If the private conversation which was taking place a moment ago at the other end of the house was intended for me, I am sorry but I could not follow it.


Edmund Davie Fulton: Well, sir, I thought I was doing fairly well until you drew my attention to a rule which had not been previously applied in this debate. In the absence of any satisfactory reply from the government, I shall let the matter stand because I feel that the answer is obvious. I shall not pursue that point any further.
I want to deal with one additional point before I sit down, and that concerns the report of J. D. Woods and Gordon on the Post Office Department. I was interested particularly in the section of the report which appears at page 70 of the copy tabled as sessional paper No. 94-A. It reads as follows:
The postage supply section of the postage stamp division is responsible primarily for the receipt, storage and dispatch of postage and unemployment insurance stamps to postal depots and government agencies. The physical facilities presently available for this purpose are inadequate both from the viewpoint of security and material handling. Many improvements in procedure could also be made.
We have reviewed a report of the civil service commission. A comprehensive analysis was made in 1950 of the method of keeping records and issuing stock. It is suggested that this report be reviewed and the suggestions put into practice.
One of the reasons the Postmaster General says he needs an increase in postage rate is that his department is going to run into a deficit if he does not get it. Yet we find, as established by the Woods and Gordon report, that in 1950 the civil service commission made a report which recommended certain changes in the procedures and methods. Then, 83276-114
Post Office Act
the Woods and Gordon report suggested that the civil service commission report be reviewed, and the suggestions put into practice. The Woods and Gordon report is dated November, 1952. This means that two years before Woods and Gordon reported, the civil service commission had made a report recommending certain changes, which report was not implemented. When Woods and Gordon came along two years later and found the same unsatisfactory conditions, they suggested the Postmaster General might just look at the civil service commission report and implement it.
In this house we are accustomed to finding examples of the government having had reports available which suggested streamlining of methods and procedures to increase efficiency and save money for the taxpayers of Canada, yet these reports have been gathering dust in departmental files. It seems obvious that is the situation here. How the Postmaster General has the temerity to come along and tell us that we must now increase the letter rate in Canada by one cent when this report makes it obvious that, had his department had the interests of the taxpayer at heart sufficiently to read and implement the report made two years earlier, they might have saved substantial sums of money, I am at a loss to comprehend. How can they expect this house or the taxpayers to swallow such a suggestion?
The reason I feel somewhat strongly on that matter is that almost two years ago we had a similar example. At that time there was another important report being considered by the house, a report made by Mr. George S. Currie. He made certain recommendations which, if implemented, would save the taxpayers of Canada a considerable sum of money. After that report had been under discussion for some time, we found that two years before Mr. Currie's investigation the civil service commission had made a survey of the same field, and had found a situation which they said was resulting in substantial losses to the taxpayers of Canada. The civil service commission report had been gathering dust in the archives of the government for two years because while the taxpayers' money was being wasted during that period of time the government had not bothered to implement the civil service commission report. When, sir, we asked for the production of that report in the house-


Mr. Speaker:: Order. I think the hon. member is now flirting with a violation of the rule of relevancy. I believe he will agree with me that, having quoted from a report relating to the Post Office Department, and

Post Office Act
having complained of the fact that that report would have saved money for the taxpayers if acted upon and perhaps rendered unnecessary the measure which is now before the house, I let him present another argument by analogy. If the hon. member continues along that line, I feel he is going too far.


Edmund Davie Fulton: We are confronted here with a situation where the government is asking us to authorize an increase of one cent per letter to all users of the mails in Canada. I am suggesting that if the government would merely implement the reports they have had available to them for two years, substantial sums of money would be saved which would obviate the necessity they think now confronts them.


Mr. Speaker:: The hon. member could
argue, if he followed that line of argument to the extreme, that the entire fiscal policy of the government should be changed.


Edmund Davie Fulton: So it should.


Mr. Speaker:: We would have, therefore, another budget debate in this house. I do not believe the rules of relevancy give the hon. member the opportunity of going so far afield.


Edmund Davie Fulton: You will recall, sir, that the Postmaster General covered a fairly wide field this afternoon in the statement he made to the house. It does seem to me that in dealing with this report of J. D. Woods and Gordon, which refers specifically to an earlier report made by the civil service commission, we are entitled to know what was in that civil service commission report. We are entitled to know-


Mr. Speaker:: Order. Let us be reasonable on this point. When I stopped the hon. member he was dealing with the Currie report. Now, if he wants to go back to the Woods report, let us remain with the Woods report.


Mr. Harkness:: Let us get amongst the tall timber.


Edmund Davie Fulton: You have anticipated me because I want to show a similarity which exists between this situation and the attempts we made to deal with an earlier report. I am coming back directly to the civil service commission report referred to here. Your Honour will recall that in the earlier case-


Mr. Pickersgill:: I rise on a point of order, Mr. Speaker. Is it not true that some days ago a motion was made to have this report tabled, and that it was turned down by the

house? Is it possible for the hon. member to renew debate on a subject upon which a decision has already been made?


Edmund Davie Fulton: I expected that eventually we would get the Secretary of State (Mr. Pickersgill) to his feet to raise the very point he has raised. I would submit to you, sir, that at this point I am not seeking to change a decision of the house. I am pointing out, as I am entitled to point out in connection with the present discussion, that the government refused my request for the production of a report made by the civil service commission on January 20, 1954. The government, whose spokesman on this occasion was the Secretary of State, has just raised a point of order. It is true that matter was thus decided, but what I am trying to point out is the position we are placed in as a result of that refusal of information by the government, led by the Secretary of State. He is a very apt pupil in following the precedents which have been set by this government in connection with the refusal of information.


Mr. Speaker:: Order. On the point raised by the Secretary of State, so far as I can ascertain, after consulting with the deputy clerk, the report referred to was voluntarily tabled, was it not, by the Postmaster General?


Alcide Côté: We are talking about another report, the civil service commission report, which was asked to be tabled by my hon. friend, and which we voted on in this house, turning down the request.


Douglas Scott Harkness: Cloaked in secrecy.


Mr. Speaker:: I was not aware there was a second report. I thought the hon. member was discussing the Woods and Gordon report. If he is dealing with a report that is not before the house I do not think he should refer to it.


Edmund Davie Fulton: Mr. Speaker, I was leading up to the particular point raised by the Secretary of State. The production of the report made by the civil service commission on the Post Office Department has been refused. This was a report made two years before the Woods and Gordon report was made, and to which the Woods and Gordon report referred, suggesting that it be implemented even at this late date. What I am pointing out is that a report exists, and had it been implemented then, the people of Canada might have been saved a considerable amount of money from the point of view of expenditures by the Post Office Department, and possibly the necessity for this increase might to that extent be lessened.

I am quite prepared to admit that the production of that report was refused earlier this session by the government majority, on the suggestion of the Secretary of State. I am sufficiently aware of the rules of the house to know that I cannot at this stage seek to have that decision reversed. But I am pointing out that this is just one of a great many examples with which we have been confronted, where information as to the possibility of saving the money of the taxpayers of Canada has been refused and is still being refused by this government.
I want to ask the Postmaster General this question. Will he extend to me the same courtesy that was extended to the hon. member for Notre Dame de Grace (Mr. Hamilton)? If there is nothing to hide in this report, if it is a matter of not establishing a precedent by tabling it in this house, if that is what is bothering the government, will the minister extend to me the same courtesy of going to his office-


Mr. Speaker:: Order. We are now discussing the second reading of a bill. The house is in good humour. I should like to remain in very good humour; I much prefer to be in good humour, but there seems to be a tendency to-


Douglas Scott Harkness: Levity.


Mr. Speaker:: -drift away from the
principle of the bill which should be discussed, and to indulge in a discussion of various other matters which, no matter how germane the hon. member may think they are, in my opinion are completely out of order.
The hon. member knows that he is not in committee. A moment ago he was asking a question of the Minister of Finance. He is now asking questions of the Postmaster General. When we get into committee on this bill he may proceed to ask questions, and it will be in order for the Postmaster General to reply. If the hon. member wishes the Postmaster General to speak now he will, as he knows, close the debate. I am sure he does not want him to do that. No, he would not close the debate because there is an amendment. My mind was carrying me a step farther. I thought that the amendment had been disposed of, but that is not so.
The hon. member is quite right; there is an amendment before the house. Let us have a normal discussion on the second reading of this bill. The hon. member has had wide latitude. I know he will want to continue this debate with strict adherence to the rules of the house.
Post Office Act


Clarence Decatur Howe: His time is
exhausted.


Mr. Gauthier (Portneuf):: He has been speaking for 45 minutes.


Hazen Robert Argue: Less 40 minutes for interruptions.


Edmund Davie Fulton: Mr. Speaker, I quite agree with you that the Postmaster General could not answer now without making a speech, although, with the amendment before the house, he could speak again without closing the debate. Therefore in the same way that I have asked other ministers opposite, and indeed private members opposite, if they wish to rise to their feet to interrupt-they are prepared to interrupt while sitting-if they want to interrupt-


Mr. Speaker:: Order. I have to advise the hon. member that having spoken for 11 minutes before six p.m., and having commenced to speak again at 8.02 p.m., his 40 minutes expired at 8.31 p.m. I allowed him a few more minutes because of interruptions but I now have to ask him to resume his seat.
Perhaps I should deal with the amendment moved by the hon. member for Winnipeg North (Mr. Stewart). The amendment reads:
That Bill No. 168 be not now read a second time, but that it be resolved that in the opinion of this house a parliamentary committee should be established for the purpose of making an inquiry into the organization and operation of the Post Office Department and the postal services of this country.
What the hon. member sought to do by this amendment was to seek some information by way of a committee. Citation 657 of Beauchesne's Parliamentary Rules and Forms, third edition, reads:
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, or expressing opinions as to any circumstances connected with its introduction, or prosecution: or otherwise opposed to its progress; or seeking further information in relation to the bill by committees, commissioners, the production of papers or other evidence or the opinion of judges.
If the hon. member looks at the reference underneath this citation he will see that it refers to May, page 390. During the dinner recess I looked at the reference 'of May at page 390 and I found the following:
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; . . .

Post Office Act
It carries on repeating the same words as I have just quoted from citation 657. But then a little further on it goes on to say:
The principle of relevancy in an amendment governs every such, proposed resolution, which must, therefore,-
I should like to draw the attention of the hon. member to these words:
. . . which must, therefore, strictly relate to the bill which the house, by its order, has resolved upon considering-[DOT]
I draw the attention of the hon. member to these words "strictly relate to the bill". Does he think for one moment that his amendment does just that, strictly relate to the bill which is under consideration? What the hon. member is seeking to do by his amendment is to have a committee inquire into the operations of the Post Office Department and of the postal services of this country. He is seeking to have a wide investigation held. What he is now asking is much wider than the scope of the bill.
I should like to draw his attention to the words which follow the words I have just quoted from page 391 of May. After having stated that the amendment must strictly relate to the bill which the house, by its order, has resolved upon considering, it goes on to say:
-and must not include in its scope other bills then standing for consideration by the house.
I direct the attention of the hon. member to the fact that there is now an item on the order paper calling for the second reading of Bill No. 78, to amend the Post Office Act, standing in the name of the hon. member for Quebec West (Mr. Dufresne). Would not the amendment moved by the hon. member cover the subject matter included in a bill which, as May says, is standing for consideration by the house?
In my view the amendment as it now stands is one which cannot be allowed. What the hon. member seeks to do, in the words to be found in Beauchesne's third edition and repeated in May, is "seeking further information by committee". That is perfectly permissible. If the hon. member wishes to reword his amendment in order to comply with the rules I shall be glad to hear him in that regard, but I think he will agree with me that the amendment he has proposed is too wide. I would not want to rule it out of order on a mere technicality and deny him the right of moving an amendment such as he might have in mind, which is merely to seek information by committee. I think his amendment should read, "that the subject matter thereof be referred to a select committee."


Alistair McLeod Stewart: Mr. Speaker, with deference and with some regret I have to differ with you. I cannot imagine anything more strictly related to the bill than the amendment which I have offered. We have a department asking for a 25 per cent increase for a certain part of its services and that to us seems to be such an extreme increase that it demands investigation into what is going on in that department. This is a point which we could argue interminably and I do not intend to do that. However, without conceding in any way whatever the rightness of my position, I think I can say that my colleague, the hon. member for Winnipeg North Centre (Mr. Knowles), would be prepared to move an amendment to the amendment I have moved which I believe would fit in with your wishes.


Mr. Speaker:: Would it be agreeable to the hon. member if on the grounds I have indicated I rule his amendment out of order, and then the hon. member for Winnipeg North Centre could immediately propose a new amendment which at this time would be in order? If that is agreeable I think it would be the best procedure, because if the hon. member for Winnipeg North Centre proposes to amend an amendment which in my view is not in order I do not think the amendment to the amendment would stand.


Stanley Howard Knowles: Naturally we do not want to do this in a clumsy way if it can be done in a simple way. I think perhaps my colleague, the hon. member for Winnipeg North (Mr. Stewart), might be permitted to change the wording of his original motion. If so, the suggestion I would make, subject to my colleague approving of it, would be that all the words after "organization" to the end of the proposed amendment be deleted and that in their place be inserted the words "reasons for the introduction of this bill." My colleague's amendment would then read:
That Bill No. 168 be not now read a second time, but that it be resolved that in the opinion of this house a parliamentary committee should be established for the purpose of making inquiry into the reasons for the introduction of this bill.


Edmund Davie Fulton: It is still introducing new
matter.


Mr. Speaker:: That wording seems to be more in accordance with the rule. The only reservation I have in my own mind is that the amendment is that a committee be established to inquire into reasons. As I understand the definition of committee, it is a body to inquire into subject matters and to hear evidence. I do not know that we establish committees to inquire into reasons.


Stanley Howard Knowles: Then may I suggest to you and to my colleague these words:
-for the purpose of making inquiry into the circumstances connected with the introduction of this bill.
Have we got it now?


Mr. Speaker:: Is it agreed? Does the house give consent?


Walter Edward Harris: Mr. Speaker, with all respect to what my hon. friend is trying to do, I suggest that he knows perfectly well how he could make his amendment in order, and he has not approached it yet except by an indirect method. The reasons or the circumstances under which the government accepts responsibility for introducing a measure is something which they are prepared to defend here and are doing at the moment. But the subject matter is something about which an hon. member or the house can make any inquiry by the machinery that may be available to the house. I am afraid that I could not consent to the form of the amendment to the amendment.


Stanley Howard Knowles: If there is not consent to that, I would suggest that we fall back on the suggestion Your Honour made a moment ago, that my colleague be permitted to withdraw his amendment. I would then be prepared to move an amendment in the language which Your Honour suggested, namely, that the subject matter of this bill be referred to a committee for inquiry.


Mr. Speaker:: Has the hon. member leave to withdraw his amendment?


An hon. Member:: Agreed.


Mr. Speaker:: Agreed.
Amendment withdrawn.


Stanley Howard Knowles: If I may have the floor without making a speech I would then move, seconded by the hon. member for Saskatoon (Mr. Knight):
That Bill No. 168 be not now read a second time, but that the subject matter thereof be referred to a committee for inquiry.


Walter Edward Harris: On the point of order-I am trying to be helpful this time-I am sure my hon. friend means parliamentary committee, which was part of the original wording.


Stanley Howard Knowles: Yes. If I omitted that word it was through oversight and I am most grateful to the minister for suggesting it. Since we are thinking out loud about this,
Post Office Act
perhaps we could add the words "and report" at the end of it. The amendment I am now moving would then read:
That Bill No. 168 be not now read a second time, but that the subject matter thereof be referred to a parliamentary committee for inquiry and report.


Mr. Casselman:: Report to whom?


An hon. Member:: To the house.


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


Some hon. Members:: Question.


Edmund Davie Fulton: Mr. Speaker, speaking to the new amendment-


Mr. Speaker:: The hon. member, of course, is now taking advantage of a situation which, as he knows, is one that was created by unanimous consent. At the moment we are merely substituting an amendment which otherwise I would have ruled out of order. I would imagine that the hon. member, having spoken to the amendment as it originally stood, and the resolution having been amended in the manner that it was with the unanimous consent of the house, would not in these circumstances take advantage of the situation and make another speech.


Edmund Davie Fulton: Mr. Speaker, I will accept your suggestion, but I will make this brief comment. Were it not for the fact that I felt the extensive interruptions made during the earlier portion of my speech had occupied so much of my available time that I had not in fact spoken for more than 40 minutes, I would not have attempted to speak again at this stage, although, this being a new amendment, I would have the right to do so. However, it will be open to me to speak on the main motion and I intend to take only two or three minutes in which to ask the Postmaster General (Mr. Cote) to specifically reply to the suggestions I have made. Under these circumstances, I will wait until this amendment has been disposed of and then repeat my invitation to the Postmaster General.


John Whitney Pickersgill: Mr. Speaker, I am rising to support the motion for the second reading of this bill. I have no intention of attempting to defend the Post Office Department because I know that my hon. friend, the Postmaster General,

is perfectly capable of looking after it. I may say that I would be very happy to defend the Post Office Department because, when my hon. friend was absent in New York on the country's business, I was charged by the Prime Minister (Mr. St. Laurent) with looking after the Postmaster General's portfolio and I had a little bit of experience with the Post Office Department.


Some hon. Members:: Oh, oh.


Stanley Howard Knowles: That is when all this trouble started.


John Whitney Pickersgill: The impression I formed of the Post Office Department and of the things for which I was called upon to take temporary ministerial responsibility was the impression that I think most Canadians have outside this house, whatever party they belong to, namely, that the Post Office Department and the Canadian postal service are as good as any in the world and, in most respects, better.
I do not think that anyone on this side of the house relishes the idea of asking everyone who sends a letter to put a flve-cent stamp on it instead of a four-cent stamp.


Ellen Louks Fairclough: Why do it, then?


John Whitney Pickersgill: Some hon. member opposite-I think it was the hon. member for York South (Mr. Noseworthy)-said this was a policy that was decided by some official in the Post Office Department. That is not true at all. The Minister of Finance (Mr. Abbott) announced this policy for the government as the policy of the government-


An hon. Member:: After the election.


John Whitney Pickersgill: -that the actual current operations of the postal service, the running of the Post Office Department, not the providing of premises which the Minister of Public Works (Mr. Winters) does and for which he does not charge, should be paid for by the people who use the service and not by other taxpayers. The hon. member for York South said that was a question of policy. It is a question of policy and one that can only be decided by the house. It cannot be decided in any committee or in any other way. It is the policy of this party that the post office as far as possible should exact a charge to pay for the service it renders. I believe that is a good policy. I believe that policy commends itself to most Canadians, and it is because I am convinced the extra one cent is necessary for the purpose of balancing the budget of the post office that I feel we have no choice, even though it is not very agreeable, but to support it.
Post Office Act
The hon. member for Kamloops (Mr. Fulton) suggested there were two or three alternative ways in which we might meet the deficit. No doubt my hon. friend the Postmaster General will deal with most of those alternatives.


Mr. Hees:: If given a chance.


John Whitney Pickersgill: But there is one point.


Mr. Mcllrailh:: Do you mean only the
opposition should speak?


John Whitney Pickersgill: Even if a good many savings have already been made as a result of the Woods and Gordon report, even if there were a good many more savings here and there in the Post Office Department that could be made, and I dare say there are some-the hon. member for York South said that the Post Office Department was not perfect; of course it is not, and no sensible person says it is-even if a few thousand dollars might be saved here and there, and one evidence I got from my short experience was that savings were being made all the time, surely no hon. member opposite is so poor at arithmetic as to suggest that such savings have any relation whatsoever to the $13,500,000 which is going to be required to bring about an approximate balance next year.
But the real reason why I venture to take part in this debate is not because I was Acting Postmaster General but because of what was said by the hon. member for Kamloops, by the Leader of the Opposition (Mr. Drew), by the hon. member for York-Humber (Miss Aitken) and by one or two other members opposite about the air mail service. They suggested that in some curious way the air mail service was a luxury and that a luxury tax could be paid by those people who use it. It would probably be quite difficult to do a careful costing and probably would not be worth the money, but if it were done I would not be the slightest bit surprised to learn that it would cost more to collect a letter on one of those new streets in York-Humber, take it to the Toronto post office, carry it by rail to Ottawa and deliver it to one of those new streets out beyond Westboro in the constituency represented by the Leader of the Opposition than the actual out-of-pocket cost of sending a letter by air from the province and the constituency I represent to some post office in the province of Ontario where there is no letter carrier service and where people have to go and get their mail.
There are a great many people who, for economic and other reasons, find it necessary, as the hon. member for York South did, to

Post Office Act
leave the province of Newfoundland to earn their living in some other part of Canada. I am sure that the hon. member for York South would agree with me that the people of Newfoundland are very much attached to their families. They like to keep in touch with them and they, like the rest of us, want to get their mail as quickly as possible and do not regard air mail service as a luxury at all. In most parts of that province there is no letter carrier service and no pick-up service. There are just post offices where you go to get your mail. But most of them are not very far from an airport, and from that airport mail can come in one day to Montreal, Toronto or Winnipeg and perhaps in two days to Vancouver. There are a good many people from Newfoundland even in Vancouver.
It seems to me, sir, that this service is not a luxury service. It does not really cost very much more than it does to provide the kind of services that the hon. member for Notre Dame de Grace (Mr. Hamilton) thinks are still not good enough for his riding. I believe that in the first place people who live in these outlying parts, and who want to communicate with relatives and friends and carry on business communications as well with central Canada, are entitled under modern conditions and in the modern world to this kind of service, the kind of service which is given by the post office and by T.C.A. In addition, it seems to me that the postal air service we already have has added a great deal to the amenities of this country and has added a great deal also to the sense of national unity. If, by paying about one-third or one-quarter of the one cent that is to be added by this bill, we can have the kind of service that tends to bring all Canadians closer together, then it seems to me it is not a very high price to pay, and I feel that most of the people in most parts of the country will agree with the government in that view.


Mr. J. M. Macdonnell (Greenwood):: Mr. Speaker, I think we all felt, when the Secretary of State (Mr. Pickersgill) descended from the heights in which he had previously lived and came down to live among us, that new and perhaps exciting things were going to happen. I think to some extent we have been borne out in our judgment in the things that have happened already, but I submit that tonight we have gone quite beyond anything that we have had before. I suggest in particular to the hon. member for York South (Mr. Noseworthy) that he has been proved wholly wrong in the argument he made this afternoon in which he said it

was a pity that postmasters general stayed such a short time on the job, perhaps only a matter of a year or two.
But now he has been proved wrong because we have just been told by one who was only Acting Postmaster General for a few weeks that in that time he was able to know so much of the workings of the department that he is now able to tell us that it is as good as any system in the world and, in most respects, better. I do feel that after that it is almost a waste of time to continue this debate, and I think we should thank the Secretary of State for coming to our assistance and clearing up the matter.
(Translation):


Mr. J. W. Dufresne (Quebec West):: Mr. Speaker, we have now before us a bill to amend the Post Office Act. We are asked to repeal chapter 212 of the Revised Statutes of Canada, 1952, and to replace it with another providing for an increase in the postal rates of approximately 25 per cent.
Going over this bill which is introduced by a government which calls itself Liberal, I cannot but recall the pre-electoral period of August 10 last and discuss briefly the attitude taken by the Liberal party towards the Canadian people.


Mr. Gauthier (Porlneuf):: This is not
relevant.


J.-Wilfrid Dufresne: At that time, grandiloquent statements were made on-


Mr. Speaker:: Order. We are not going to begin over in this house, on the second reading of this bill, the election campaign of last August. I think that the hon. member must discuss the principle of the bill.


J.-Wilfrid Dufresne: Mr. Speaker, I certainly intended dealing with the principle of the bill, but before I get there it seems quite important to demonstrate to the country at large the contradictory attitude taken by the hon. members opposite when they are outside the house. I was just saying, Mr. Speaker, that at that time grandiloquent things were being said of the generosity of the Liberal government. I am getting there, Mr. Speaker; do not get discouraged, I am getting there.


Mr. Speaker:: I am all but discouraged even before starting, especially when I hear the hon. member returning to the subject I have just asked him to leave. I think that he should immediately get on with the subject matter of the bill and not deal at length with conjectural matters which have nothing to do with the principle of the bill.


J.-Wilfrid Dufresne: I have difficulty in understanding why in discussing a bill such as this one, we are not allowed-and if I am wrong you will put me right-to bring to the house details showing the really contradictory attitude taken by the government in their previous statements and subsequent actions. That is why I wanted to acquaint the house with certain statements made by Liberal speakers some time before the election when it was a matter of collecting votes from the people of this country.


Mr. Speaker:: The hon. member asked me to call him to order if he went wrong. I am sorry I have to inform him that if he continues to discuss the point he has just told us about in dealing with the principle of the bill under discussion, he would be out of order.


J.-Wilfrid Dufresne: I will therefore continue
my remarks in the way you have indicated and most certainly in the way my hon. friends opposite should wish for.
I was saying a moment ago that the government are now asking us to approve a measure which will force the people of this country to pay 25 per cent more for postage.
Allow me to make a comparison between a previous tax which has been removed and the one which it now intends to levy. What is your ruling on that, Mr. Speaker?


Mr. Speaker:: I have no authority to give rulings on points of order in advance. I give rulings on points of order as they come up. However, if I may be allowed to suppose that the tax which he wants to use as a basis of comparison is the one to which other hon. members have referred in the course of the debate, namely the excise tax on cheques, I must say that if he did touch upon this question he would be out of order, since no hon. member is allowed to repeat his own arguments nor the arguments advanced in the course of the same debate by his colleagues.


J.-Wilfrid Dufresne: Even if he was absent while these arguments were being used? Very well, Mr. Speaker.
Mr. Speaker, the workers, the small wage earners did not have very often the opportunity to put stamps on cheques. I will not say anything more on that subject. I only want to point out that workers in general belong to large families with members scattered all over the country, and that is particularly true in my province. The workers in my county have all asked me to oppose this legislation which discriminates
Post Office Act
against them, as it adds to the already too heavy burden of taxes which they have to carry.
The government have reminded us that they have granted substantial salary inincreases to postal employees. I agree that these employees, judging by those we have in Quebec, do a wonderful job and that it was only fair to give them a salary in line with the work they have to do in the carrying out of their daily duties. I congratulate the Postmaster General (Mr. Cote)-it will not be said that I am always criticizing-


Pierre Gauthier: We can see you
coming.


J.-Wilfrid Dufresne: -for his generous gesture and I would urge him to keep on recognizing the essential services rendered by the employees of the Post Office Department.
Mr. Speaker, there are some naughty boys opposite-


Pierre Gauthier: Go on.


J.-Wilfrid Dufresne: But, while recognizing the generosity of the hon. minister, I also recognize the additional work his employees have to perform in order to serve the people in the best possible way. There are sometimes complaints-justified complaints-about the slowness of some services, but we must admit that postmen, for instance, have to deliver their mail to 250 more families, particularly since the service was reduced to one delivery per day. They are accomplishing a difficult and exhausting task in all kinds of weather, going up and down the numerous stairs they have to cope with on their route.
Let us pay these devoted servants of the people what they are worth because they deserve the gratefulness of the citizens they serve. I have never known of an employer having become poorer because of the good wages he paid his employees. Once more I congratulate the minister on his decision to grant more acceptable salaries to the Post Office employees.
The Post Office Department, however, must be run according to normal business principles, by establishing an efficient administration, by replacing waste by economy, and by remedying whatever abuses may exist. Extravagance, even when it involves the taxpayers' money, leads to bankruptcy.
Let us stop certain departments from mailing each year millions of pamphlets of all

Post Office Act
kinds which are often nothing else but purely political propaganda or exaggerated praise of the government.
No doubt about it, the present government are clever; they know how to take advantage of every circumstance.
We are at the beginning of the twenty-second parliament and the government has not yet brought before the house one piece of legislation to alleviate the burden that is already weighing too heavily on the Canadian taxpayer.
I am very anxious to examine the bills that the government will submit to the house at the end of this parliament, that is on the eve of the next general election. You will note, Mr. Speaker-


Mr. Speaker:: I believe that the hon. member should examine the bill now before the house. There is much leeway granted to hon. members during the debate on a bill of this kind, because of the general nature of the remarks made at the beginning of the debate, but I think that the hon. member should not go any farther afield than the previous speakers.


J.-Wilfrid Dufresne: Mr. Speaker, I was just saying that the government has brought before us legislation that does not tend to help the people, those who need help. I am referring more particularly to the bill now before the house. I am sure that all measures enacted since the beginning of the present parliament are not popular. You will surely permit me to add that at the end of the present parliament more popular legislation will be enacted in order to get the people's vote.


Mr. Speaker:: I regret to have to interrupt the hon. member once again, but he stated twice that he was anxious to see the legislation the government would submit at the last session of this parliament. Having said that twice, I believe he should now revert to the bill before the house.


J.-Wilfrid Dufresne: Mr. Speaker, I know that my hon. friends opposite would like to see me resume my seat-


Pierre Gauthier: It is interesting.


J.-Wilfrid Dufresne: In my opinion, the bill now before the house is another insult to the intelligence and the great understanding of the electors of the constituency I have the honour of representing. To protest against the increase in postal rates-


An hon. Member:: Resign.
* Mr. Dufresne.]


J.-Wilfrid Dufresne: If my hon. friend wants to run as a candidate in my constituency, I am ready to do it.


Mr. Bourgel:: Be careful, you were elected by a minority.


J.-Wilfrid Dufresne: Mr. Speaker, I know you are a good father, that you have a large family, and that some of your children are rather annoying-


André Gauthier: Not your family.


J.-Wilfrid Dufresne: I was saying, Mr. Speaker, that this piece of legislation, in my opinion, is another outrage against the intelligence and the great understanding of the electors of the constituency which I have the honour to represent, and, by way of protest, I will do what each one of them would do if he were here in this house: I will vote against this measure which I consider a further provocation to those who are proud to call themselves the people.
(Text):


Mr. Erhart Regier (Burnaby-Coquiilam):: Mr. Speaker, I was pleased half an hour ago to have the first really possibly valid explanation why this new tax is necessary. That possible explanation was that there has been such a thing as absentee landlordism, which we all know is never a good business proposition. We in this section of the house would not hesitate to support the government if it could establish any need for a tax. However, after listening all the days that we have spent on this I find that nothing has come forward. I have watched the newspapers from one end of Canada to the other, and I have not noticed any newspaper openly coming out and saying that the government needs to impose this new tax.
I noticed the sympathy that was expressed for the little man. I think the statement was "pity the little man." This tax is a tax on the general public of Canada. It is a tax on the little man. I believe it was the hon. member for New Westminster (Mr. Hahn) who pointed out that even though big business may initially pay most of this tax, in the long run it is added on to the cost of goods and services, and is in effect a tax on the little man.
I find it rather amusing that this government should now come to parliament at this time, taking into consideration the state of its finances, and say that it needs additional revenue. I do not think the government has proved that it needs additional revenue at all. It says that the post office must pay its way. Well, assuming, although I am unwilling to do that, that it is a valid argument that the post office must pay its way, how can you ask us to supply the post office with additional

revenue if within the post office there are major divisions that are not paying their way? I am referring once more to the subsidization of advertising. I maintain that if advertising paid its fair share of operating our post office, the government would have a much larger surplus next year than they had last year. As I indicated on January 14, if advertising were made to pay its fair share the government would be doing the country a good service in many other ways besides helping out the revenues of the post office.
I am not going to say much more. I was pleased that the first solid argument has now been presented, and I would recommend that the difficulty can be easily avoided next year if our genial Postmaster General would remain in Ottawa during the coming fiscal year and help out in that way. I am wondering whether this idea in the post office originated during the term of the absentee landlordism. I notice that the Secretary of State is a pupil of a former prime minister of Canada who, despite a large majority, rode out of power on the philosophy of "not a five-cent piece". Perhaps that philosophy has been taken up by the pupils and this government, even though it now has a large majority, may not go out on a five-cent piece, but on a five-cent postage stamp at the time of the next election.


Mr. Roland Michener (St. Paul's):: Mr. Speaker, we are asked to approve an increase in postal rates on letters ranging from 25 per cent to 50 per cent, and the increase is to apply only to letters posted in Canada and delivered in Canada. I suppose the result will be that first-class letters which will require five cents in Canada will require only four cents when sent abroad, which seems to me to be an initial breach of the proposition of payment according to service. I appreciate the fact that there may be international arrangements involved. That is the first thing I should like to point out.
My purpose is to consider for a moment the effect of the increase in rates on certain users. Like others, I have had a good many communications from individuals, mostly on limited fixed incomes, to whom this increase in rates will be a cost which they will feel. It does not seem much, but to those who are confined to limited quarters and maintain their communications by letter writing, it is a consideration. I might add that in my riding are located Eaton's mail order house at Albert and Bay streets and Simpson's mail order house on Mutual street. Those companies will not be affected by the increase because they mostly use parcel post and I do not note that
Post Office Act
the parcel post rates are to be increased. The letters which they receive will be from their customers who will have paid the postage.
I would not think that other business will be greatly concerned with this increase because postage is an ordinary cost of doing business which is deductible from income before taxation. Although there is some increase in the cost, in the case of a corporation half of that would be borne by the federal treasury in loss of taxation. That would minimize the increase in these cases.
Nevertheless postage is a cost of doing business. I suggest to the minister and to the house that all costs of doing business in this country, which was described recently in very authoritative terms by Mr. James Muir of the Royal Bank of Canada as a high-cost economy, are worthy of consideration, whether they are large or small. This is particularly so when one considers our competitive position in export markets which is of vital importance to every Canadian.
If postage is an element of cost it seems to me the sound principle upon which to approach postage rates is the maintaining as far as possible of rates that are comparative with those of our nearest neighbour and competitor, the United States of America. We all know that their rates are lower and the divergence will be even greater. There has been the suggestion that Canadians living near the border will cross and use the United States mails in order to save money.
In any event that is a factor and it raises a principle which to my mind is more important than the principle advanced to support this bill, namely, the principle of maintaining competitive costs in this particular element of the cost of doing business. The house is well aware that the principle advanced by the government is that those who use the service should pay for the benefits which they receive. It has been pointed out many times that that principle is not one which is observed in many other governmental activities.
I have not heard the minister estimate what may be the loss in revenue due to the increase in the rates. Undoubtedly many people who would have written letters and used the postal services for the transaction of some of their business will not do so because of the increased cost. As everyone knows, there is a point where the law of diminishing returns begins to have an effect and offset any increase in revenue. There may be a reduction in the number of letters that would otherwise be posted, but I have not heard any mention of that.

Post Office Act
In any event, if we accept the proposition, there has been no basis on which these principles could apply to the operations of the Post Office Department. The sole basis on which any accountant would work would be that the cost of operating the Post Office Department should be the actual costs. It is true that we are given a balance sheet but no one can see what the actual costs are because they do not appear there. Nor can anyone see what the potential revenues are.
I would suggest that this is a matter of rating. Rating is not a difficult problem when applied to this kind of utility service. We have the board of transport commissioners which fixes the rates to be paid for the carriage of passengers in different cars on the same trains in which letters are carried. If it is possible to arrive at a fair rate for the carriage of passengers, surely evidence could be produced to show the fair cost of providing a service to carry letters on trains. The same with carriage by air.
The same principle applies to telephone and telegraph rates. This form of communication is in close parallel to communication by letter, and we all know that the rates are fixed on evidence as to the cost of doing business plus a fair charge for the service rendered. If the minister is serious in wishing to apply cost accounting principles to the department over which he has the honour to preside, it appears to me that the means of doing so are available. It may be that he should now reconsider whether the Post Office Department should be disentangled from other departments of government and established as a separate agency or utility whose rates would be fixed on cost principles by a board capable of handling that kind of proposition.
This is big business. The revenues of this department last year were $129 million, at least those revenues shown in the statement, and we know that the department did not receive payment for all the services it rendered. The expenses shown, which we know were not the full expenses, amount to $122 million, leaving a surplus of something over $6 million.
This is the kind of business which could be handled very much in the way the Bell Telephone Company handles the telephone business of this country, or in the way the telegraph companies handle their business. It is not too large in proportion to those businesses. If the minister is serious about this proposition, he could find many advantages in having the Post Office Department operated by a utility agency. He would then be sure that it was being operated at cost or at a profit, and the Department of Public Works would
[Mr. Michener.I
be in receipt of revenues for the buildings occupied by the Post Office Department. The department would be compensated for the services it rendered on a businesslike basis, which is to my mind the only justification which the government has attempted to put forward in support of this measure.
I suggest it would be an interesting speculation if the minister were to call for tenders for the operation of the postal services at the existing rates and find how many people would be ready to come forward and say that with efficient operation they could handle the mails of this country without increasing the rates. That of course is speculative, but it is no more speculative than the application of the principle upon which we are asked to approve this bill.
I have made it clear that I cannot vote to approve this increase in rates. I should like to conclude by giving one trifling example, but it is an example of what some government agencies are not doing to keep the cost of the postal service as low as possible. This communication was sent through the mail and reads:
From: National Film Board, Ottawa
Kindly note amendments to the cast-list of the film, "Farewell Oak Street" which now make the last two characterizations read:
Old Age Pensioners, Mr. and Mrs. Pat Kelly
Old Man, Doug Masters
This is to correct any erroneous impressions created by our previous listing . . .


The Acting Speaker (Mr. Applewhaite):: the hon. member is reading this document as an example of what is going through the mails and with a view to criticizing it, I do not think there could be any complaint; but if he is reading it solely on account of its contents, I fail to see that it has any relevancy to the subject under discussion.


Daniel Roland Michener: I am reading it on both counts, and I contend that it should not be going through the mail. I had finished reading it except for the last line, which is as follows:
This is to correct any erroneous impressions created by our previous listing of Mr. and Mrs. Pat Kelly and Doug Masters as playing "themselves" and "himself", respectively.
This is, I suppose, an important communication, but it is an example of the kind of material one hon. member today referred to as filling up the wastepaper baskets of members of this house and those of many other people throughout the country.


George Randolph Pearkes: Mr. Speaker, I was particularly interested in the remarks of the Secretary of State (Mr. Pickersgill) because, like him, I represent a constituency which is located on an island, but an island in the Pacific rather than an

Post Office Act
island in the Atlantic, and the people in my constituency are also anxious to keep in touch with absent triends and hence use the mails for that purpose.
We do not seem to have quite the same facilities as those provided to the Secretary of State, and that applies to all the communities in my constituency. However, I want to draw his attention and that of the Postmaster General to a thriving industrial community of several hundred people which exists within 60 miles of the provincial capital and which one can reach by means of a combination of road and rail in less than six hours from the provincial capital. The mail is carried to that community, which contains a large mill and important fishing interests, by a method which has existed for many years, namely, by sea. In the past the Canadian Pacific B.C. coast steamships services received a large subsidy to carry the mail to this community. Unfortunately the vessels used by the steamship company are not as good now as they used to be and the result is that in this community of Port Renfrew, only 60 miles from the provincial capital, they receive their mail once every ten days, despite the fact, as I said previously, that you can reach that community in six hours.
Does the Postmaster General believe these people are going to appreciate the increase in the postal rates from 4 to 5 cents? I can assure him they are not, and I would like to assure the Secretary of State that when I visited this community I never heard anyone there say that the postal services are the best in the world. Frequently I have heard them say, "It is the rottenest service that exists."


Mr. Speaker:: Is the hon. member moving the adjournment of the debate?


George Randolph Pearkes: Yes, I will move the adjournment.


Mr. Speaker:: Mr. Pearkes moves, seconded by Mr. Blair-


George Randolph Pearkes: I beg your pardon, Mr. Speaker; I had already taken my seat.


Mr. Speaker:: Does the hon. member for Vancouver East (Mr. Winch) wish to speak?


Harold Edward Winch: Mr. Speaker, I do not quite understand. If for some reason I should move the adjournment of the debate I should be glad to do so.


An hon. Member:: Go ahead.


Harold Edward Winch: Mr. Speaker, it was not my intention to speak again in this debate, and I would not but for the remarks made in the course of the evening by the Secretary of State. The Secretary of State this evening emphasized the principle outlined by the Postmaster General this afternoon and I feel it is essential that principles in opposition to those submitted by the two hon. members I have just mentioned should be put forward at this time.
At the opening of my remarks may I put it this way. Many years ago there was a man who was a commentator in the newsreel films and he always concluded his remarks with this statement, "Monkeys is the craziest people." I cannot help wondering, after listening to the Postmaster General outlining that principle this afternoon, aided and abetted by the Secretary of State, what that commentator would have said had he been here this evening. If there has been any discussion which means anything at all in this debate it is the statement of the Postmaster General that those who get the service must pay for it.
Mr. Speaker, may I call it ten o'clock?
On motion of Mr. Winch the debate was adjourned.



BUSINESS OF THE HOUSE

Walter Edward Harris: Tomorrow we shall continue this debate and when it is concluded we will take the Criminal Code.


[Stage Direction]
At ten o'clock the house adjourned, without question put, pursuant to standing order.
[Stage Direction]
Post Office Department


[Stage Direction]
General
The initial step in the implementation of our report on the organization and administration of the department will be to enlist the support of the senior officials in the department. It will also be necessary to obtain the approval of the civil service commission and the treasury board.
Detailed establishments of some of the new divisions will have to be developed. It is difficult in the initial stages to accurately estimate the final requirements for clerical staff and it will be necessary to review these requirements after the new organization has been in operation for a trial period.
One of the first steps should be the appointment of a personnel director. He should be supplied with a small staff possibly borrowed from some of the other branches and immediately undertake a study of the following matters:
(i)	Personnel available for immediate appointment to the new positions.
(ii)	Personnel who, after training, would be suitable for appointment to the new positions and the training they will require.
(iii)	What positions will have to be filled from outside the department.
The various changes in organization suggested in the report are set out below by branches with comments as to the timing.
Operations Branch
(a)	Chief superintendent-engineering-A man should be obtained from outside the service to fill this vacancy. It can be filled as soon as a suitable candidate is available. There is no need to delay any other moves in the interval.
(b)	Mechanical engineering division-This position should be filled either from outside the service or possibly by one of the engineers from the major post offices. The balance of the staff should be recruited either outside or from within the department but at least one engineer should come from one of the major post offices. This division can be organized as soon as personnel are available.
(c)	Methods and time study division-A start should be made immediately on the organization of this division. Either the man to head the division or one or two of his
assistants should be drawn from outside the department. A study should be undertaken of one of the major post offices and standards developed. The staff can be enlarged over a period of time as experience is gained and after suitable training could be drawn from within the department or, if suitable personnel are not available, from outside.
(d)	Chief superintendent-operations-This position should be filled by the most experienced man available within the service. He probably should be drawn from the field organization and might well be a successful district post office inspector.
(e)	Postal services division-This division will be made up of personnel presently in the branch. It can be set up as soon as a suitable postal superintendent is available.
(f)	Revenue post office division-The removal of functions from this division will be dependent on the completion of the organization of the postal services division and the district offices.
(g)	Methods and procedures division-The organization of this division is dependent on obtaining suitable personnel to carry out the work. This should be given a high priority and they should, if possible, be drawn from the field.
(h)	Inquiries division-As soon as a suitable postal superintendent can be selected, this division can be formed. A post office inspector would be most suitable for this position. The personnel in the inquiries section of the inspection division would form the staff.
(i)	The staff post office division would be transferred out of this branch to the personnel branch as soon as the personnel director is ready to receive it. It would form the nucleus of the employee services division in that branch.
Transportation branch
(a)	Chief superintendent - transportation planning and research-This position should be filled as soon as possible. It is important that the right man be selected as the success of the proposal will depend to a large extent on the imagination and energy of the individual chosen. The mail transportation officers presently on the staff would form the

nucleus of the chief superintendent's staff. A man with experience in commercial transport operations should be obtained from outside the service and added to the staff.
(b)	Chief superintendent - transportation services-This position should be filled by a man with proven administrative ability.
(c)	Motor vehicle services division-As soon as a postal superintendent has been selected from within the department, this division can be established, drawing its staff from the other divisions in the branch.
(d)	Account verification division-This division can be established as soon as the postal superintendent is selected. He could be drawn from either the transportation or finance branches.
(e)	The tender section can be reorganized and the new routines established as soon as the chief superintendent, transportation services, has been appointed.
Financial branch
(a)	There are three senior positions to be filled in this branch and the organization changes can take place as soon as suitable men are available. In addition there is the position of comptroller in the administration branch. It will probably be necessary to go outside the department to fill two or three of these four positions.
(b)	With the exception of the recommendations in connection with-
(i)	Preparation and recording of salary warrants,
(ii)	Punch card accounting machines,
(iii)	Post office savings banks,
all the recommendations in the section of the report on the financial branch can be proceeded with without delay under the direction of the director. The recommendations in connection with the preparation and recording of salary warrants and punch card accounting machines will have to be postponed until the district offices are ready to assume the additional responsibility. The recommendations in connection with the post office savings bank are subject to policy approval from the government.
Administration branch
(a)	Inspection division-The changes in organization of the inspection division and the change in the method of operation is dependent on the revision of the field organization. It is contemplated that the changes in the field organization will take place progressively one district at a time. As the change is completed in each district the
Post Office Department inspection branch would change its function in that district. The reorganization of the division at headquarters would be dependent on these developments.
The inquiries section can be transferred to the operations branch as soon as a postal superintendent is selected to head the new division.
The recommendations in connection with the misdirected mail office can be implemented forthwith.
(b)	Comptroller-As stated above, it may be necessary to go outside the department to fill this position. In the proposed plan for decentralized operations, the financial controls will be very important. It is essential that the man chosen to fill this position be imaginative and aggressive and have good accounting qualifications.
As soon as the comptroller is appointed, the budgets, estimates and costs division can be formed absorbing the personnel from the cost ascertainment division and the personnel of the staff relations division presently dealing with estimates.
A postal superintendent should be appointed to take charge of the statistical and office services division and the balance of the staff would be drawn from the other divisions as work is taken over. This can be commenced as soon as the postal superintendent is appointed. Consideration might be given to appointing the postal superintendent in charge of the cost ascertainment division to this post and filling the vacancy in the budgets, estimates and costs division with a younger man chosen from the department or outside.
(c)	Domestic mails division-The suggested illegal mail section can be formed from the staff of the dead letter office in Ottawa at any time.
(d)	International mails division-The reorganization of this division should take place at the same time as the accounting duties are transferred to the statistical and office services division. This will be dependent on the organization of that division.
(e)	Purchasing and stationery division- Approval of the treasury board of the suggested new limits of authority for expenditures will be required. The other recommendations can be proceeded with forthwith and do not affect the organization of the rest of the department.
Personnel branch
As already indicated the appointment of a director should be given priority.
[Stage Direction]
Post Office Department
The first step in organizing this branch should be the transfer of the existing divisions dealing with personnel to the personnel director.
As already mentioned the staff post office division can be transferred at any time and would form the nucleus of the employee services division.
The training and welfare division can also be transferred at any time and would form the new training division.
The staff relations division can be transferred at any time and would form a section of the employee services division. As previously stated the personnel dealing with estimates would be transferred to the budgets, estimates and costs division.
The staff to form the personnel development division should, if possible, be drawn from within the department. There are undoubtedly a number of men in the training and welfare division, and the staff post office division who would be suitable and could be replaced in their present positions.
The organization of the division along the lines suggested can be carried out progressively over a period of time. It will not be completed until such time as the district offices are sufficiently organized to assume their additional responsibilities.
Field organization
The suggested changes in the field organization cannot be carried out all at once and it will take a number of years to complete.
It is suggested that the change-over be carried out on a progressive basis as follows:
(a) Select two districts as pilot operations.
[Stage Direction]
(b)	Select the district directors, the principal members of the district office staffs and the area superintendents.
(c)	Draw up detailed plans for the organization.
(d)	Plan a training course for the personnel involved which would stress the significance of the decentralization and the part each person is to play in it.
(e)	Send half of the staff for each of the new districts on the training course. As soon as they have completed the course the other half would be sent.
(f)	Establish the organization in the two districts.
(g)	Routines and procedures should be carefully developed in these two districts as they will become patterns for the whole department.
(h)	In the first instance, the new districts would carry on the same duties as are presently performing in the field but under the new organization, as the transition progresses further, duties and responsibilities will be delegated from headquarters.
(i)	The same steps would be followed progressively in each of the districts.
(j)	It is recommended that the deputy postmaster general appoint one senior man whose full time would be spent in coordinating this development.
(k)	The recommendations in connection with the four major post offices can be proceeded with immediately personnel are available.
[Stage Direction]
Friday, February 5, 1954