1954-03-24

[Stage Direction]
Mr. H. P. Cavers (Lincoln) presented the first report of the sessional committee on railways and shipping owned, operated and controlled by the government, and moved that the report be concurred in.
Motion agreed to.


Mr. John Hunter (Parkdale) moved:: That the petition of Wilfrid Lavoie for a bill of divorce presented March 23, 1954, together with the report made thereon by the clerk of petitions March 24, 1954, be referred to the standing committee on standing orders for such recommendations as may be deemed advisable.


[Stage Direction]
Motion agreed to.


Mr. Brooks:: 1.	Has the Canadian National Railways recently purchased any real estate in the city of Moncton?
2.	If so, (a) where is it located; (b) from whom purchased; (c) price paid?


Mr. Langlois (Gaspe):: The Canadian National Railways advise as follows:
1.	Yes.
2.	(a) Between the right of way of National Transcontinental Railway and the old Intercolonial Railway; (b) city of Moncton; (c) it is not the policy of the company to divulge prices paid in transactions of this nature.



FEDERAL SECURITY PANEL SECRETARIAT


Mr. Fulton:: From what government departments or agencies are the personnel forming the secretariat of the security panel selected?


Mr. St. Laurent:: The personnel forming the secretariat of this committee, like that for most other interdepartmental committees, are selected from the privy council office.



FEDERAL SECURITY PANEL


Edmund Davie Fulton: What government departments or agencies are represented on the security panel?


Louis Stephen St-Laurent: Like other interdepartmental committees, the security panel is made up of representatives from those departments most directly concerned with the matters to be considered. In the case of the security panel these are at this time: the Department of National Defence, the Department of External Affairs, the Department of Defence Production, the Department of Citizenship and Immigration, the Department of Northern Affairs and National Resources, the Royal Canadian Mounted Police and the privy council office. It is also provided that representatives of other departments and agencies may be asked to attend meetings at which matters of particular concern to them are to be considered.



ORGANIZATION OF AMERICAN STATES

Mr. Holowach:: 1.	Has Canada ever been a member of the interAmerican association or the O.A.S., (Organization of American States) formed in 1890?
2.	If so, during what years was Canada a member?
3.	If not, what are the particular reasons for Canada not being a member?
4.	What nations are now members of the above organization?
5.	Has the government a knowledge of the basic democratic principles incorporated in the charter of this association of North and South American countries? If so, what are the principles enunciated?
6.	Was an invitation from any source extended to Canada to participate or send an observer to the tenth inter-American conference held recently at Caracas, Venezuela?
7.	If so, from whom was the invitation received?
8.	Did Canada have any observers or delegates?
9.	If not, for what reason was there no observer or delegate present?
10.	Has Canada been officially informed of the general action and policy for the succeeding five years as enunciated at the tenth conference of the inter-American association?
11.	Is the Canadian government in agreement with the anti-communist resolutions passed at the conference?
12.	What position does the government take with respect to such resolutions?


Mr. Pinard:: 1.	No.
2.	Answered by No. 1.
3.	Canada's position with regard to the Organization of American States was
32S2

Questions
explained to the house by the Prime Minister on March 27, 1953. (See Hansard, page 3341.)
4.	Argentina, Bolivia, Brazil, Chile, Colombia, Costa Rica, Cuba, Dominican Republic, Ecuador, Guatemala, Haiti, Honduras, Mexico, Nicaragua, Panama, Paraguay, Peru, El Salvador, United States, Uruguay and Venezuela.
5.	Yes. The charter of the Organization of American States, signed at Bogota, Colombia, in 1948 is a public document.
6.	No.
7.	Answered by No. 6.
8.	No.
9.	Delegates may be sent only by states which are members of the organization and Canada is not a member. There is no provision in the charter of the organization or the regulations of the conference for governments to send observers.
10.	No.
11 and 12. The government's position with regard to the threat to the free world presented by communism is a matter of public record and there seems to be no reason for it to be restated in relation to a resolution of the Organization of American States.



KURT MEYER

Mr. Cameron (Nanaimo):: 1.	Was SS. General Kurt Meyer convicted solely on evidence of crimes against Canadian troops?
2.	Was the Canadian government consulted about the personnel of the tribunal which recommended commutation of his sentence?
3.	If so, did the Canadian government give its consent to the inclusion of two German members on that tribunal?


Mr. Blanchette:: 1.	Yes.
2 and 3. Article 6 of the "Convention on the settlement of matters arising out of the war and the occupation" (known as the "Bonn convention"), entered into between France, the United Kingdom and the United States of America, on the one hand, and Germany on the other, provides for the establishment of a mixed board, consisting of six members, one to be appointed by each of the three occupying powers (France, the United Kingdom and the United States of America) and three to be appointed by the federal German government. This tribunal was to look into the sentences of each of the war criminals and make its recommendation to the government of the occupying power concerned.
Due to the delay in bringing this agreement into effect, the occupying powers and Germany agreed to establish mixed advisory
(Mr. Pinard.]
boards to review the sentences of war criminals in each of the respective French, British and United States of America zones. Pursuant to this arrangement, a board was established to review the sentences of prisoners in the British zone by order of the British high commissioner, dated September 1, 1953. This board was to consist of five persons appointed by the United Kingdom high commissioner, two of whom were appointed at the nomination of the federal German government.
Canada was not an occupying power and consequently was not a party to either of the above-mentioned two arrangements. However, the Canadian government was kept informed of the negotiations throughout leading to the appointment of the board established in the British zone and did agree that the sentence of Kurt Meyer should be looked into and reported on by that board in precisely the same manner as the sentences of all other war criminals held in the British zone. It is understood that the review of war criminals' sentences in the French zone and the United States of America zone followed the same pattern as that in the British zone.



FEDERAL SECURITY PANEL SECRETARIAT


Mr. Fulton:: 1.	What are the functions of the secretariat of the government security panel?
2.	Does the secretariat, in discharging its duties, in fact exercise most of the functions for which the security panel was originally created?


Mr. St. Laurent:: 1.	The functions of the secretariat of the security panel are no different from those performed by the secretariats of other government interdepartmental committees. They are, under the direction of the panel, to prepare papers for its consideration, to transmit its views to government departments, and to carry out such routine duties arising from its work as the panel itself may from time to time direct.
2.	No.



WATER POLLUTION


Mr. Diefenbaker:: 1.	Has the government received representations from either the city of Prince Albert, the town of North Battleford or The Pas, or from any organizations in any of said municipalities requesting that the Criminal Code and/or the Fisheries Act be amended so as to constitute an offence where pollution of rivers or streams takes place which has been caused by anyone dumping therein chemicals, or other substances which causes the waters of such rivers or streams to be contaminated in taste or odor?
2.	If so, has the government decided whether legislation will be introduced at the present session to make it an offence under the Criminal Code

and/or under the Fisheries Act for anyone to pollute any stream or river of the waters on which people depend for domestic or industrial purposes?


Mr. Pickersgill:: Mr. Speaker, part 1 could be made an order for return. The answer to part 2 is that it is not the practice to state government policy in answer to questions on the order paper.


Mr. Diefenbaker:: That will give great hope to the people.


Mr. Speaker:: Order for return, subject to the remarks of the minister.
Questions
2.	If so, (a) what are their names; (b) on what dates were they appointed; (c) what positions do they occupy in the administration?
3.	Are they bilingual?


Mr. Blanchette:: 1.	No civilian employees engaged on administrative duties have been appointed since September 1, 1953.
2.	Not applicable.
3.	Not applicable.



TOTAL NATIONAL INCOME AND PRODUCTION, SAINT-JEAN MILITARY COLLEGE-CIVIL EMPLOYEES

Mr. Dufresne:: 1. Have any civil employees been recently appointed to the administrative staff of le College Militaire Royal de Saint-Jean, province of Quebec?


Mr. Leboe:: 1.	What was the total national income for each year from 1910 to 1953?
2.	What was the total national production for each year from 1910 to 1953?
3.	What percentage of the national production was


Mr. Dickey:: to 1953?			
1, 2 and	3.	(1)	(2)	(3)	(4)National	War	Col. (3)National	production	and	as percentageincome	(G.N.P.)	defence	of col. (2)($ million)	($ million)	($ million)	(per cent)1926	
4,185	5,294	15	0-31927	
4,417	5,647	19	0-31928	
4,823	6,105	20	0-31929	
4,789	6,166	22	0-41930	
4,283	5,546	24	0-41931	
3,333	4,560	18	0-41932	
2,630	3,767	14	0-41933	
2,452	3,552	20	0-61934	
2,897	4,034	22	0-51935	
3,188	4,345	27	0-61936	
3,487	4,701	25	0-51937	
4,062	5,355	33	0-61938	
4,018	5,233	36	0-71939	
4,373	5,707	70	1-21940	
5,263	6,872	543	7-91941	
6,563	8,517	1,046	12-31942	
8,337	10,539	3,100	29-41943	
9,043	11,183	3,565	31-91944	
9,826	11,954	4,299	36-01945	
9,840	11,850	2,891	24-41946	
9,821	12,026	847	7-01947	
10,985	13,768	227	1-61948	
12,560	15,613	236	1-51949	
13,194	16,462	361	2-21950	
14,550	18,203	493	2-71951	
17,128	21,466	1,157	5-41952	
18,135	23,110	1,800	7-81953	
18,977	24,242	1,909	7-9Note: Comparable data not available prior to 1926.	SAINT-JEAN	MILITARY	COLLEGE	APPOINTMENT Mr.	Blanchette:



OF PROFESSORS

Mr. Dufresne:: On what date were the following professors appointed to le College Militaire Royal de Saint-Jean. province of Quebec:	Samuel E. Stallard
(mathematics); Donald E. Tilley (physics); Walter Thumm (physics); Eli Mandel (English), and Gordon Smith (history) ?
2.	What was the occupation of each of them at the time of their appointment?
3.	Are they bilingual?
1. Samuel E. Stallard, July 2, 1953.
Donald E. Tilley, September 15, 1953.
Elias Mandel, July 2, 1953.
Gordon Smith, August 1, 1953.
Flying Officer W. Thumm, as a member of the R.C.A.F., was merely seconded from the school of English at St. Johns, Quebec, to lecture in physics when no other suitably

Questions
qualified candidate was secured as a result of a competition; he took up his duties on August 1, 1953.
2.	Mr. Stallard was a graduate assistant in mathematics at Queen's University. Mr. Tilley was a part-time lecturer in physics at Sir George Williams' College and at Macdonald College. Mr. Mandel was an instructor in English at University College, Toronto. Mr. Smith was an instructor in history at the University of Alberta.
3.	Of the five professors above named, four are civilians appointed as a result of competitions held by the civil service commission. The notice for teaching positions at le College Militaire Royal de Saint-Jean pointed out that in the exercise of certain duties it would be necessary to lecture in English while for others it would be necessary to lecture in French. English-speaking, French-speaking and bilingual candidates were invited to apply. As a result of the competitions, forty professors were appointed, of whom ten were assigned to lecture in French only, six in English only, and the remaining twenty-four in both languages. Among the six assigned to lecture in English only are the five professors mentioned in the question.



COAL AND GOLD MINES


Mr. Purdy:: According to the latest figures, what is the number of employees in (a) the coal mines of Canada; (b) the gold mines of Canada?


John Horace Dickey: (a) and (b)
Number of Employees
		Coal	Gold
1953	Mining	MiningJan.	1 	. . 22,777	20,302Feb.	1 	. . 22,818	20,306Mar.	1 	,. 22,412	19,957Apr.	1 	. . 21,191	19,888May	1 	.. 20,881	19,945June	1 	. . 20,476	20,112July	1 	. . 19,623	20,196Aug.	1 	. . 19,517	19,926Sept.	1 	. . 19,236	18,956Oct.	1 	. . 19,607	15,934Nov.	1 	. . 19,965	15,820Dec.	1 	, . 20,155	15,379Average for year ..	. . 20,722	18,893
Source: Reports from employers having 15 or more employees.
Note: The declines in employment in gold mining during the later months of the year were largely caused by labour-management disputes in this industry.



IMPORTS-SOYA BEANS AND COPRA

Mr. Pommer:: 1.	What amount of soya beans was imported into Canada in the year 1953?
2.	What amount of copra was imported into Canada in the year 1953?


Mr. Dickey:: 1.	274,807,510 pounds.
2.	24,828,590 pounds.



* EXTERNAL AFFAIRS


Mr. Fulton:: 1.	Did the Secretary of State for External Affairs make the following statement in Washington, D.C., on March 15, 1954, in connection with the Canadian government's method of dealing with communist subversion: "We leave that to the agencies of government appointed for that purpose, who work quietly and, we think, fairly and effectively and normally without benefit of headline; and who are all responsible to some minister. He in his turn is responsible to parliament, of which he is an elected member, and answers for the conduct of his officials on the floor of the House of Commons"?
2.	If so, does this statement reflect official government policy?
3.	Will the government now give answers to questions in the house seeking information as to the nature and extent of its security program, including answers to the questions following?
4.	What agencies of government have been appointed for the purposes referred to?
5.	To what minister are they responsible?
6.	Who are the officials for whom the minister is answerable to parliament in this field?
7.	What are the activities of these agencies for which the minister concerned will give answers in the house?
8.	What is the total number of government employees of all categories dismissed, released from government service, or transferred to less sensitive positions in the government service, for security reasons, since January 1, 1947?


Louis Stephen St-Laurent: Mr. Speaker, this question has before it an asterisk, which denotes that the hon. member putting the question wishes to have it answered orally. This question is in eight paragraphs, the first of which is as follows:
Did the Secretary of State for External Affairs make the following statement in Washington, D.C., on March 15, 1954, in connection with the Canadian government's method of dealing with communist subversion:
And then follows the quotation. The answer to that question is yes.
The second question is:
If so, does this statement reflect official government policy?
The answer is that this statement is a description of Canadian parliamentary practice and government organization, and the way it normally works, rather than a declaration of policy.

The third paragraph is as follows:
Will the government now give answers to questions in the house seeking information as to the nature and extent of its security program, including answers to the questions following?
This question is answered by the answers to Nos. 2 and 7. They are a description of Canadian parliamentary practice, and how it works.
The fourth question is:
What agencies of government have been appointed for the purposes referred to?
The answer is that the civil service commission is charged with the duty of determining the qualifications of candidates applying for positions in the public service and for making normal inquiries regarding their character and competence. The Royal Canadian Mounted Police are charged with the duty of making special investigations relating to security. All ministers and the departments and agencies which they direct have the duty of determining whether or not persons whom they employ and retain in employment are reliable from a security point of view. The security panel has been established as an interdepartmental committee for consultation between officials whosv duty it is to assist ministers on security matters, and for the preparation of general questions in this field for the consideration of the government.
Then, the fifth question:
To what minister are they responsible?
The answer is that the civil service commission, in the making of appointments, acts within the scope of the Civil Service Act and is responsible directly to parliament through the Secretary of State.
The Royal Canadian Mounted Police are responsible to the Minister of Justice (Mr. Garson) and report through him to parliament. Each department, in the administration of its own personnel, is responsible to the minister who is the head of that department. The government as a whole has and accepts responsibility for all procedures or policies of general application which may arise from the work of the security panel. Normally it is the Prime Minister or the Minister of Justice who answers in parliament in regard to these matters, but if they are especially concerned with one department it might be the minister of that department who would feel called upon to answer in parliament.
Question No. 6 reads:
Who are the officials for whom the minister is answerable in parliament in this field?
Well, the minister is answerable in parliament for the decisions made and any actions 8327C-208
Questions
taken by him or in his department by any of the officers of that department. Question No. 7 reads:
What are the activities of these agencies for which the minister concerned will give answers in the house?
Well, the extent and nature of the answer to be given in the house have to be determined in respect of every question that arises.
Then, question No. 8 reads:
What is the total number of government employees of all categories dismissed, released from government service, or transferred to less sensitive positions in the government service, for security reasons, since January 1. 1947?
I understand that by "security reasons" the hon. gentleman is concerned with reliability with respect to loyalty, and on that assumption the answer is as follows: Reasons for the transfer or removal of government employees because of unreliability include not only indications of communist or fascist activities or associations, but also indications of weakness of personality or character or habits, and circumstances that render a person susceptible to pressure or blackmail, or unintentional indiscretions. Security reasons involving risks of disloyalty are only part of the circumstances giving rise to certain removals or transfers. To segregate the cases of suspected unreliability with respect to loyalty, it would be necessary to analyse the circumstances of each case where there has been a dismissal or a transfer to determine the degree to which security reasons of that kind were responsible for the removal or the transfer, and that would make it, if not impossible, very difficult to draw up a list that could set out in a mathematically accurate way the number of cases-and they are not very numerous, you know-where there have had to be removals or transfers because of indications of unreliability with respect to loyalty to Canada.
It is practically impossible to give the exact number of employees of all categories dismissed, released or transferred for such security reasons, and if that list were established it might even be found to be not in the best interests of the public to make that kind of list public.
Here hon. members will realize that whenever anything like that has to be done, it is of course done because we feel it is necessary; but we feel sorry, whenever there does arise that kind of case, that action has to be taken, and we endeavour to act as a discreet employer and not to give any publicity that would be unnecessarily harmful, because, as has been said more than once here, we do not attempt to find guilt. We merely attempt to discharge our responsibility to be careful. We

Questions
are not in the position of a court trying an individual and having to have direct evidence, but we would rather have the benefit of the doubt go the other way. If there is any doubt about the likelihood of there being disloyalty, we just cannot take any risks; but we do not feel that we are making any kind of conviction that would justify branding an individual in such a way as to cause him harm in the community generally. Whenever there are questions, we have to consider whether or not it is in the public interest that there be this possibility of identification that will cause unnecessary prejudice to an individual who has not had any trial, against whom no charge has been brought, but about whom we feel it would be undesirable to take risks.
I mentioned the possibility of there being, well, involuntary indiscretions. We know of cases where that has happened. In an evening party something occurs that unloosens one's tongue, and it wags more freely than it should in view of the information one has acquired because of his official position. We do not want to make that a scandal, but we do feel that it requires being careful and cautious, and I assure hon. members that we do try not to be unfair; but we also do try not to raise any hysterical anxiety over the personnel of the public service, because my experience has been that on the whole Canada is entitled to be proud of both the loyalty and the devotion of most of its public servants.


Edmund Davie Fulton: Having regard to the answer the Prime Minister gave me earlier this day, and particularly the answer to part 8, might I ask if the Prime Minister is aware of the fact that on two occasions in the United Kingdom details as to the number of government employees released for security reasons have been given, and also that the names of an advisory board which hears security cases have been made public? In the light of that information, will the Prime Minister reconsider the matter of whether or not similar information could be produced in Canada?


Louis Stephen St-Laurent: Well, Mr. Speaker, of course this government has no responsibility for what is done in the United Kingdom. Naturally, this government is always impressed by what is done in other countries, and it does consider whether what is done elsewhere would be appropriate to Canadian conditions. I know the hon. member is just as much concerned about this subject as we can be on this side of the house, and is concerned that the measures be effective

without being unfair. I expect there will be a discussion about it when we come to the estimates of the Department of Justice.
If at that time the hon. member still feels that we are not going far enough, and will give his reasons, I can assure him they will be carefully considered, because it is not a matter between one party and another party. It is a matter in which all responsible Canadian citizens want to be fair, but they want the government to be prudent.


Mr. Fleming:: May I ask the Prime Minister a question on that point? What provisions, if any, exist for appeal on the part of a public servant affected by such decisions?


Mr. Si. Laurent:: There has been no formal mode of procedure set up, but I believe the gravity of making a removal or an exchange is always one of the considerations that the minister responsible for it has in mind. There are some cases where a thing like that can be done, you know, and it involves no possible unfairness. A suggestion may be made that an ordinary messenger become a confidential messenger. Whether or not he shall be made a confidential messenger has not been brought to his attention, so that is not dealt with nearly as seriously as where an officer in an important grade in the service is found to be someone who should be transferred to some other department.
We gave consideration to the possibility of appeal, and we even inquired from the officials in the United Kingdom how it worked there. We have not yet been able to convince ourselves that there would be any greater assurance of fairness to an individual by going beyond the rather informal character of the proceedings that are now taken in that regard. We have not found any system that could be considered as an appeal that would work.



QUESTIONS PASSED AS ORDERS FOR RETURNS


Mr. Nowlan:: In each of the calendar years since the Cape Breton park was instituted, how much money has been spent by the government of Canada for or in connection with each of the bridges in or adjacent to the said park?


Mr. Lesage:: Return now tabled.


RURAL MAIL ROUTES-DISCONTINUANCE IN PRAIRIE PROVINCES
Mr. Pommer:: 1.	Have any rural mail routes been discontinued in 1953, in (a) Manitoba; (b) Saskatchewan; (c) Alberta?
2.	If so, in what locations?

3.	Are steps being taken to discontinue any rural mail routes in (a) Manitoba; (b) Saskatchewan; (c) Alberta, in 1954?
4.	If so, in what locations?


RURAL MAIL COURIERS
Mr. Kickham:: 1.	Since 1935, has the government increased rural mail couriers contract prices?
2.	If so, on what dates and in what amount?
3.	What has been the total percentage of increase granted to all mail couriers since the above date over their own firm tender contract price?
4.	What is the average rate of remuneration per mile now paid in each of the ten provinces of Canada for rural route service?


BELCHER HOSPITAL
Mr. Hansell:: 1.	What is the total bed capacity in the Belcher hospital, Calgary?
2.	How many patients were treated, other than preliminary examinations in 1953?
3.	What has been the total percentage of incraese pital, what are the categories of employment, and how many in each category?


MOTIONS FOR PAPERS
John George Diefenbaker: For a copy of all correspondence that passed between any department of the government of the United States and any department of the government of Canada, and a copy of all agreements entered into, since the 1st day of January 1952, in connection with the St. Lawrence waterway and power project.


Mr. Pearson:: Mr. Speaker, there is no difficulty in regard to the production of information sought in the last part of this question. It deals with all agreements entered into, since the 1st day of January, 1952, between Canada and the United States in connection with the St. Lawrence waterway and power project.
The first part of this question, however, asks for correspondence between the two governments in this matter. Such correspondence, being diplomatic correspondence between two governments with a view to working out an international agreement, and in that sense working papers leading up to that agreement, is normally privileged and not made public. There would therefore be a very real difficulty in producing that correspondence, quite apart from the fact that the consent of the United States government would have to be obtained.


John George Diefenbaker: Would the minister allow a question? Would the United States government raise any objection to producing that correspondence?


Lester Bowles Pearson: At this time I am not objecting to it on that ground at all, but on 83276-2084
Motions for Papers
the ground that this kind of correspondence is privileged here and is not produced.


Mr. Speaker:: Subject to the statement by the minister, is the motion carried?


[Stage Direction]
Motion agreed to.

Mr. Gagnon:: For a copy of all correspondence exchanged since January 1, 1948, between the international Bible students, the watchtower and tract society, the Jehovah's witnesses and the national defence, justice and post office departments and the Canadian Broadcasting Corporation.


John Whitney Pickersgill: I have spoken to the hon. member who is moving this motion, and suggested to him that the words "of a general nature" be inserted in the motion after the word "correspondence". It has been represented to me, by all the four departments concerned, that if we left the motion in its present form they would have to search every file they have because their filing system is based on subject. I have informed the hon. member of this fact, and he agrees that if we put those words in it would not be necessary for the department to scrutinize all their files but only to look in the most likely places for this correspondence. If the motion can be passed on that basis, it is quite agreeable to the government.


Mr. Speaker:: Shall the motion carry, subject to the statement by the minister?


[Stage Direction]
Motion agreed to.

[Stage Direction]
On the orders of the day:
Mr. Hector Dupuis (St. Mary):: I should like to direct a question to the Minister of Justice. Has the minister received a telegram from the retail tobacco merchants of Quebec, complaining against the selling of tobacco at cut prices, especially cigarettes which in some stores are sold at cost price and in some instances below cost price? If so, has the minister any declaration to make now with regard to this matter?


Hon. Stuart S. Garson (Minister of Justice):: I wish to thank the hon. member for having given me notice of his question. I have received such a telegram, and I have written in reply to Mr. E. Falstrault, secretary of the retail tobacco association in Montreal, to the effect that the restrictive trade practices commission is now engaged in an inquiry into the
3288	HOUSE OF
Inquiries of the Ministry practice of loss leader selling in the cigarette field and in other fields. The commission has announced that it will hold hearings beginning in early May for the purpose of receiving information and submissions. I have sent a copy of Mr. Falstrault's telegram to me to the commission so that the commission may advise the retail tobacco association as to the time and place of its hearings in the Montreal district, since I gather from the telegram that the association would wish to appear before the commission.
The purpose of the inquiry is to try to determine the prevalence and effects of the practice and to recommend suitable amendments if necessary to the Combines Investigation Act.



LOSS LEADERS


[Stage Direction]
On the orders of the day:
Mrs. Ellen L. Fairclough (Hamilton West):: Mr. Speaker, I should like to direct a question to the Minister of Justice. Can the minister inform the house at what points in Canada it is proposed to hold hearings under the restrictive trade practices commission on the subject of loss leader selling?


Stuart Sinclair Garson: Mr. Speaker, I cannot do so in detail but I can find out from the commission and inform the house tomorrow, if indeed the commission itself has as yet decided.



INCOME TAX


[Stage Direction]
On the orders of the day:
Mr. Leon Balcer (Three Rivers):: I should like to direct a question to the Prime Minister. When can we expect the government to take a position on the question of the deductibility of the Quebec provincial income tax, and when can we expect that position to be made public?


Louis Stephen St-Laurent: I think I should take the two parts as forming one question, and answer that government policy on fiscal matters is normally announced by the Minister of Finance <Mr. Abbott) in his budget speech, which this year, as has already been announced, is to be made on the evening of April 6. It can be expected the government's position in relation to the matter referred to in this question will be made public in that speech.



ARMED FORCES


[Stage Direction]
On the orders of the day:
Hon. W. Earl Rowe (Dufferin-Simcoe):: Will the Minister of National Defence, Mr. Speaker, give assurance that the current report that a substantial portion of the armed emits and schools are to be moved from Camp Borden to the eastern part of Canada is not correct?


Hon. Brooke Claxion (Minister of National Defence):: There is nothing in the report.



NARCOTICS


[Stage Direction]
On the orders of the day:
Mr. Harold E. Winch (Vancouver East):: Has the attention of the Minister of Justice been drawn to a report in the Globe and Mail under date of March 23, 1954, to the effect that Sergeant Price of the R.C.M.P. said that he thinks Charles Luciano is the supplier of most of the illegal narcotics entering Canada by the west coast?
If so, can the minister inform this house if the R.C.M.P. has evidence to back up this statement, and if so will the Department of Justice be taking the matter up with the appropriate authorities in an endeavour to bring this vicious trade to a halt?


Stuart Sinclair Garson: Mr. Speaker, I wish to thank the hon. member for having given me notice of this question. In reply I would say that my attention has been drawn to articles which have appeared in the press which give the impression that a member of the R.C.M.P. narcotic drugs squad in Vancouver has given it as his opinion that Charles "Lucky" Luciano is responsible for the supplying of drugs now being smuggled into that city. I am advised that the member quoted merely referred the newspaper reporter to a report published by the subcommittee on narcotics of the judiciary committee of the California legislature in 1952 in which it is stated that Luciano has established headquarters in Italy from which he was supplying narcotic drugs to New York and San Francisco. The R.C.M. Police member did not express a personal opinion.
Luciano has been prominently mentioned in many newspaper headlines during the last few years which linked his name with the international drug traffic. His name has also been mentioned frequently by witnesses appearing before various vice commissions and committees in the United States.

I think the hon. member will understand that it is not a question of the R.C.M.P. having evidence, but I may say that the force has been in touch with police forces in several other countries in this connection and with the Italian police. I may also say that Luciano is the subject of a warning circular issued by the international police body.


[Stage Direction]
On the orders of the day:
Mr. E. G. Hansell (Macleod):: Mr. Speaker, I would like to direct a question to the Minister of Labour. After sending the minister notice of this question it occurred to me that perhaps it may have been more appropriate to address this question to the Minister of Mines and Technical Surveys (Mr. Prudham). My question is this, based upon a telegram which I received this morning. Has the government any knowledge of the report appearing in the Calgary Albertan that the coal mines in Coleman, Alberta, are to close down operations on March 31, and that other mines in the Crowsnest pass are likely to follow with shut-downs? If so, does the government contemplate any remedial action?


Hon. Milton F. Gregg (Minister of Labour):: Mr. Speaker, notice of my hon. friend's question reached me as I was entering the house. I have no information on the matter and I did not have an opportunity to speak to my colleague the Minister of Mines and Technical Surveys, who is more likely to have some information. Perhaps he could add something to my reply.


Hon. George Prudham (Minister of Mines and Technical Surveys):: Mr. Speaker, I have not seen the report to which my hon. friend refers. I am sure all hon. members know that the coal industry in both eastern and western Canada is experiencing difficulty at the present time. In western Canada the industry's difficulties have been brought about largely through competition from oil and gas. I need not remind hon. members that the natural resources belong to the provinces. The province of Alberta has prospered enormously from the sale of natural gas and oil rights; only recently I saw a report of one sale amounting to over $30 million for two comparatively small areas of land. The province of Alberta is prospering from these recent developments. The coal industry is suffering from these
Inquiries of the Ministry developments. What I would like to know is, what is the Alberta government going to do about it?


Ernest George Hansell: May I ask the minister a supplementary question, since his answer was somewhat long? Does the minister believe that the reason the railroads have adopted the diesel engine lies in Alberta's prosperity?



UNEMPLOYMENT INSURANCE


[Stage Direction]
On the orders of the day:
Mr. W. B. Nesbitt (Oxford):: Mr. Speaker, I would like to direct a question to the Minister of Labour and I trust he will take this as notice. In view of the relatively new and increasingly large-scale current practice in many industries, including the textile and machine-tool industries, of placing employees on a short day week in order to prevent lay-offs and consequent total unemployment, would the minister take into consideration making either appropriate changes in the Unemployment Insurance Act or appropriate changes in its present administration in order that industrial employees working on a short day week may receive full benefits under the act?


Milton Fowler Gregg: Mr. Speaker, I shall be glad to take that as notice of my hon. friend's question.



TRADING ON LONDON MARKET


[Stage Direction]
On the orders of the day:
Hon. Douglas Abbott (Minister of Finance):: Mr. Speaker, on Monday the hon. member for York West (Mr. Adamson) asked me if the government intended to initiate a gold market in Canada. There are no restrictions on the buying, selling, or ownership of gold in Canada. There are no restrictions placed by the government of Canada on the use which Canadians may make of their holdings of sterling or of any other currency. Gold may be imported into Canada but no undertaking will be given that a subsequent application to export the gold will be approved._____
No changes in the regulations concerning the export of gold are currently under consideration. In the judgment of the government the present regulations serve the best interests of Canada. If any changes were to be made, there would, of course, be an immediate public announcement.
3290	HOUSE OI
Inquiries of the Ministry COMMUNICATIONS



SALE OF BRITISH COLUMBIA TELEPHONE AND TELEGRAPH SYSTEM


[Stage Direction]
On the orders of the day:
Harold Edward Winch: Mr. Speaker, I would like to direct a question to the Minister of Transport. Is the minister now in a position to answer my question as to what provision is being made for government employees when the telephone and telegraph services of the federal government in British Columbia are taken over by private companies on April 1?


Hon. Lionel Chevrier (Minister of Transport):: Mr. Speaker, unfortunately I am unable to add a great deal to what I have already said. The reason for that is that negotiations with the British Columbia Telephone Company have been proceeding satisfactorily. The negotiations with the Canadian National Telegraph Company have not yet been completed. These negotiations are proceeding at the present time. In any event, if it is felt that there is any immediate urgency the railways and shipping committee will be sitting all of next week and members of that committee can obtain information from Canadian National railway officials in connection with that part of the undertaking.


Harold Edward Winch: I would like to ask a supplementary question. Is the minister aware of the fact that agents of the Canadian National Telegraph Company have been visiting government employees now in the service for over a period of two weeks and informing them where they stand as far as the Canadian National telegraph service is concerned?


Lionel Chevrier: Mr. Speaker, I should think that that is exactly what should take place and that the purchaser would wish to communicate with the vendor and ascertain what relationship will exist after the sale. That is I presume the reason why the officers of the Canadian National Telegraph Company have been in communication with the employees of the government telegraph and telephone services.


Harold Edward Winch: They have not asked them, they have told them.


Lionel Chevrier: As to what is transpiring between these two bodies I would rather not make any statement until the negotiations between our people and the Canadian National Telegraph Company have been completed.
	.



CENTRAL MORTGAGE AND HOUSING CORPORATION


[Stage Direction]
On the orders of the day:
Mr. Maurice Bourgel (Parliamentary Assistant to the Minister of Public Works):: Mr. Speaker, on March 8 the Minister of Public Works (Mr. Winters) was asked a question in regard to Votes and Proceedings No. 59, for February 26, in the name of the hon. member for Digby-Annapolis-Kings (Mr. Nowlan), and he stated at that time that it would be difficult to supply all the information sought, but that if it was agreeable to the hon. member the information would be provided which it was hoped would serve the purposes he had in mind. The hon. member agreed to have the question answered in a modified form, and I am tabling the answer now.



PIPE LINES


[Stage Direction]
On the orders of the day:
Mr. Carl O. Nickle (Calgary South):: Mr. Speaker, I should like to direct a question to the Minister of Defence Production. Has the government made any commitments, verbal or in writing, for the provision of tax concessions, tax remissions or any other form of subsidy in order to make financially feasible a trans-Canada gas pipe line in the form apparently desired by this government? If so, what are those subsidies? If not, does the government intend to extend such subsidies?


Right Hon. C. D. Howe (Minister of Defence Production):: Mr. Speaker, the
answer to the first part of the question is no. The second and' third parts are answered by the answer to No. 1.



INCOME TAX-PROVINCE OF QUEBEC

[Stage Direction]
The house resumed, from Tuesday, March 23, consideration of the motion of Mr. Abbott for committee of supply.
Mr. LaCroix:: Mr. Speaker-[DOT]


Mr. Speaker:: Is the hon. member going to debate the subject which was under discussion prior to the adjournment last night?


Wilfrid Lacroix: Yes.


Mr. Speaker:: Very well. I understand that the hon. member for Lethbridge (Mr. Black-more) will introduce a new subject later, once this matter has been disposed of.
*M. Wilfrid LaCroix (Quebec-Monimo-rency): Monsieur l'Orateur, le 28 novembre 1952, quelques mois avant la derniere election federale, j'ai declare a la Chambre ce qui suit:
Je crois qu'il serait de l'interet de tous que la delimitation des possibilites de taxation accordees & chaque gouvernement soit revisee et preeisee le plus rapidement possible car les subsides tempo-raires en face de droits acquis laissent entiere-ment le gouvernement qui les regoit a la merci du donateur et constitue une situation inacceptable pour ma province.
Plusieurs rapports soumis a la Commission Tremblay depuis cette date m'ont donne raison. Permettez-moi de citer, entre autres, celui de la Corporation des ingenieurs pro-fessionnels de la province de Quebec, qui declare:
Les octrois, d'ou qu'ils viennent, impliquent une possibilite d'intervention immediate ou ulterieure, directe ou indirecte de la part du donateur, une possibilite de marchandage. Le danger est grand que la crainte du retrait de l'octroi tienne sous silence ou elimine de saines oppositions. A vrai dire, il faudrait que tous les gouvernements, ainsi que les universites se suffisent a eux-niemes, sauf dans les cas d'extreme urgence.
En defendant cette these, je reste d'ailleurs dans la meilleure des traditions liberates. En effet, n'est-ce pas sir Wilfrid Laurier qui, en 1887, declarait a Somerset, aujourd'hui Ples-sisville:
C'est un principe tout a fait faux que celui d'apres lequel un gouvernement pergoit les re-venus et un autre gouvernement les depense.
Un article de la loi relative a l'impot federal sur le revenu permet aux contribuables du Quebec de deduire 5 p. 100 de la cotisation payee au fisc provincial. A la suite de l'elec-tion federale, un echange de correspondance a eu lieu entre le gouvernement de Quebec et celui d'Ottawa afin de determiner si le gouvernement federal se chargerait au moins, volontiers, de la collection de ce 5 p. 100 deductible de l'impot federal, et cela afin d'eviter une double taxation et de conserver la possibilite de distribuer en entier aux universites, aux colleges classiques et aux commissions scolaires le revenu provenant de ce 5 p. 100, leur assurant ainsi l'assistance dont ils ont absolument besoin. Le gouvernement federal a refuse, et il est evident que l'on a force ainsi le gouvernement provincial a organiser lui-meme son service de collection dont le cout, a etre deduit de ce 5 p. 100, ce qui ne peut laisser grand'chose aux institutions et services ci-dessus mentionnes.
A mon avis, le gouvernement provincial a parfaitement raison d'estimer qu'une part de
* (The following remarks In French are repeated In English on pages 3293-5.)
24, 1954	3291
Income Tax-Deduction of Quebec Tax 5 p. 100 ne serait pas suffisante, actuellement, pour lui permettre de donner a nos universites, maisons d'enseignement superieur, etc., l'assistance dont elles ont absolument besoin pour leur permettre de vivre et developper 1'heritage sacre de notre culture frangaise dans le cadre de l'autonomie educationnelle et fiscale.
J'ose esperer que le Parlement canadien consentira a accorder des degrevements plus considerables couvrant la totalite de l'impot paye a l'Etat provincial. La justice et le bon sens reclament que l'on permette aux contribuables quebecois des deductions equiva-lentes aux subsides qu'Ottawa leur a offerts pour signer une entente a laquelle le gouvernement du Quebec renonce, comme c'est son droit pour exploiter lui-meme ses sources de revenu et empecher ainsi qu'un droit, laisse a la debandade sous forme d'abandon temporaire,-renouvele trop souvent,-de-vienne perime.
On objectera peut-etre que le gouvernement provincial pourra un jour ou l'autre augmenter cet impot et reclamer de nouveau une autre deduction, mais je crois qu'avec un peu d'esprit de conciliation, il y aurait moyen que les deux gouvernements s'enten-dent pour fixer une limite, basee sur un pourcentage du total de l'impot sur le revenu et sur les societes pergu par Ottawa dans la province de Quebec, comme je l'ai suggere a la Chambre le 21 novembre 1952, ce qui aurait pour avantage de tenir compte des variations de la situation economique cana-dienne.
La province de Quebec est chez elle dans le domaine de l'impot sur le revenu, et d'ailleurs elle n'en retirera qu'une somme d'en-viron $25,000,000, somme tres inferieure a ce que le gouvernement d'Ottawa lui offrait pour signer une entente fiscale, raison de plus pour deduire totalement de l'impot federal celui qui sera verse au fisc provincial. Ottawa a, du reste, deja donne des preuves de conciliation et cela sans consulter les autres provinces, lorsqu'il a permis aux corporations puissantes du Quebec de deduire de l'impot federal le 7 p. 100 qu'elles etaient obligees de verser au fisc provincial. J'ai confiance que cet esprit de conciliation servira a traiter les individus sur le meme pied que ces corporations dont l'influence considerable a entraine ce resultat.
On nous objectera que le gouvernement federal a besoin de tous ses revenus pour la defense. Mais examinons ce que representent dans le budget federal les debourses resultant des lois de securite sociale.
Nous constaterons que si le gouvernement provincial avait passe ces lois sans l'apport de l'impot sur le revenu, il n'aurait pas reste
3292	HOUSE OF
Income Tax-Deduction of Quebec Tax grand'chose pour l'administration de la province, et tous admettront qu'aucun des gou-vernements provinciaux, sans l'impot sur le revenu, ne pouvait les adopter. Plus le gou-vernement federal penetrait dans le domaine de la security sociale, plus il assumait des obligations financieres qui le forgaient a augmenter l'impot federal jusqu'au point de saturation, oil il est rendu actuellement, pro-voquant la presque impossibility, pour les provinces, d'utiliser l'impot sur le revenu, et s'assurant ainsi le monopole de ce revenu.
A mon humble avis, tout cela est la consequence des recommandations de la Commission Rowell-Sirois, creee a la suite d'un travail persistant des bureaucrates du Conseil du Tresor federal, afin de trouver un moyen de centraliser definitivement entre les mains du gouvernement d'Ottawa, sous pretexte de veiller a la defense nationale et a la securite sociale, ces deux importantes sources de revenus de l'impot sur le revenu et de l'impot sur les successions, auxquelles les provinces avaient droit et sans lesquelles elles ne peuvent pas se procurer les ressources necessaires a l'administration des domaines qui leur sont assignes par la Constitution.
En resume, si le gouvernement d'Ottawa, tout en adoptant les lois de securite sociale actuellement en vigueur dans notre pays,- que j'approuve entierement d'ailleurs,-a pu offrir quand meme a la province de Quebec un subside de plus de 100 millions en echange de l'abandda de ses droits & l'impot sur le revenu, comment peut-il alors refuser d'ac-corder aux payeurs de taxes du Quebec une deduction de l'impot federal representant une somme inferieure a l'octroi ou au subside offert en echange de l'abandon de ses droits.
La population de la province de Quebec jouit d'une culture frangaise et confessionnelle dont elle est here. Les ecoles, les universites en sont les vehicules indispensables; mais pour les maintenir et les developper il est necessaire d'avoir les revenus essentiels per-mettant de donner aux professeurs des traite-ments non pas derisoires comme ceux qui leur sont payes actuellement, mais une remuneration qui les attache de plus en plus & l'apostolat magnifique qu'ils accomplissent chez nous depuis longtemps, avec tant de devouement et de desinteressement.
L'ecole est l'usine ou se moulent les generations montantes des jeunes Canadiens d'origine frangaise, des citoyens dont la collectivity pourra, a juste titre, s'enorgueillir, permettant ainsi a deux cultures differentes de se developper parallelement et d'enrichir notre patrimoine national d'une richesse in-tellectuelle qui n'a son equivalent qu'en Suisse.

Les municipalites, qui relevent du pouvoir provincial sont dans une situation precaire, et cela tout le monde le sait. Les commissions scolaires ont accumule tant de dettes que 1'fitat provincial a du les assumer presque toutes; apres cette intervention des autorites provinciales, elles tombaient a une vingtaine de millions de dollars. Mais, trois ans plus tard, elles atteignaient 59 millions et ont encore augmente depuis, indication tres claire que les ressources sont insuffisantes.
Au cours de l'exercice 1952-1953, la province de Quebec a regu comme contribution totale, de la part du gouvernement federal, la somme de $4,211,000, soit 1-49 p. 100 de son budget qui, pour cet exercice, etait de l'ordre de $281,735,000. Ontario a touche la somme de $127,442,000, alors que son budget, pour la meme pdriode de 1952-1953, s'dlevait a $339,566,000. Voici le tableau d'ensemble, pour 1952-1953, des revenus de chaque province et de la contribution qu'elles ont regue du gouvernement central. Je cite:
Provinces
Revenu Contribution total	fSderale
Nouvelle-Ecosse	 $ 45,228,000
Nouveau-Brunswick _______ 46,401,000
lie du Prince-Edouard ..	7,133,000
Ontario	 339,556,000
Manitoba	 53,737,000
Saskatchewan	 83,960,000
Alberta	 142,467,000
Colombie-Britannique ..	184,737,000
Terre-Neuve	 30,925,000
Quebec	 281,735,000

Ces chiffres vous demontrent combien mo-deste, juste et raisonnable est notre requete d'un degrevement de l'impot federal cou-vrant la totality de l'impot paye a l'Etat provincial, ce qui equivaudrait a environ 25 millions.
Pour 1'annee fiscale terminee le 31 mars 1953, le gouvernement federal a pergu dans la province de Quebec $286,595,000 en impot sur le revenu des particuliers, $387,019,000 en impot sur les corporations et $6,771,000 en impot sur les successions, soit au total $680,385,000 en impots directs. Cela repry-sente un montant de $167.73 par tete. Or, la loi de l'impot provincial ne represente que $5.50 par tete. Peut-on dire qu'on n'est pas raisonnable de demander $5.50 sur $167.73?
En 1930, le gouvernement federal et les municipalites, qui relevent des provinces, percevaient a peu pres le meme montant de taxes, soit 316 millions et 307 millions respectivement; quant aux gouvernements provinciaux, leurs revenus s'elevaient a 158 millions. En 1951, les revenus federaux atteignaient la somme astronomique de 3,791 millions, tandis que les revenus provinciaux s'etablissaient a 918 millions, et ceux des
[Mr. LaCroix.l

municipalites a 636 millions. En pourcentage, ces chiffres donnaient le tableau suivant:



REVENUS DE TOUS LES GOUVERNEMENTS

[Stage Direction]
1930	1939	1951Federal	
40-5	48 0	70-9Provinciaux	
20-2	22-3	17-2Municipaux	
39-3	29-7	11-9
100 0% 100-0% 100-0%
L'examen de ce tableau nous indique qu'en 1930 le gouvernement federal prelevait 40-5 p. 100 de tous les impots; en 1951, il en tou-chait 70-9 p. 100. Les gouvernements provinciaux n'ont pas beneficie d'une avance equivalente durant la meme periode; 1-eurs revenus sont passes de 20-2 p. 100 a 17-2 p. 100. Les municipality ont subi un desas-treux recul; elles percevaient 39-3 p. 100 de tous les impots en 1930, et elles n'en tou-chent plus que 11-9 p. 100.
La province de Quebec subit actuellement une perte materielle sensible en menant seule cette lutte pour le maintien des privileges et des libertes qui lui ont ete reconnus par des traites engageant l'honneur britannique.
Ces privileges et ces libertes ont ete ga-rantis par le pacte confederatif, garantie sans laquelle ses chefs religieux et politiques n'y auraient pas souscrit. En plus de ce que peut lui rapoprter son patrimoine, la province de Quebec entend rester maitresse de ses lois civiles, de ses libertes educationnelles et reli-gieuses, de ses traditions sociales. Et elle compte sur le sentiment d'equite de ses amis des autres provinces pour reconnaitre que sa cause est juste et raisonnable.
On November 28, 1952, Mr. Speaker, a few months before the last general election I made the following statement in the house, as found at page 194 of Hansard:
I believe It would be in everybody's interest to revise and specify as soon as possible the limits of taxation possibilities granted each government; for temporary subsidies, because of vested interests, leave the receiving government at the donor's mercy and produce an entirely unacceptable situation as far as my province is concerned.
Since then many reports submitted to the Tremblay commission have supported my opinion. May I quote, among others, an excerpt from the report by the professional engineers corporation of Quebec. They say:
Subsidies from whatever source always imply the possibility of an intervention sooner or later, directly or indirectly, on the part of the grantor- the possibility of bargaining. There is much danger that healthy opposition may be stifled or suppressed by the fear that the grant may be withdrawn. Indeed, all governments, as well as universities, should be self-sufficient, except in cases of extreme emergency.
24, 1954	3293
Income Tax-Deduction of Quebec Tax
In supporting this theory I follow one of the best traditions of the Liberal party. Indeed, Laurier stated in 1887 at Somerset, now called Plessisville:
The principle whereby the revenues levied by a government are spent by another is absolutely unsound.
A provision in the federal Income Tax Act permits taxpayers of the province of Quebec to deduct 5 per cent of the amount paid to the provincial treasury. Following the federal election, an exchange of correspondence took place between the Quebec government and the federal government, to ascertain whether the federal government would at least agree to collect this 5 per cent tax deductible from the federal tax- and this in order to avoid double taxation and to ensure the distribution of the whole proceeds from this 5 per cent tax to universities, classical colleges and school boards, thus providing these institutions with the help which is absolutely needed. The federal government rejected this request, and by so doing obviously forced the provincial government to set up its own tax-collecting agency, the cost of which, if deducted from this 5 per cent tax, would not have left much for distribution to the above-mentioned institutions and services.
I think that the provincial government is perfectly right in assuming that a 5 per cent tax would be insufficient at present to provide our universities, our high schools and so on with the help they urgently need to carry on and develop the sacred heritage of our French culture, within the framework of educational and fiscal autonomy.
I hope that the parliament of Canada will agree to grant a more substantial tax deduction in order to cover the full amount of the tax paid to the province. Justice and common sense make it imperative that Quebec taxpayers should be granted deductions equivalent to the subsidies offered them by Ottawa to sign a tax rental agreement. The Quebec government was within its rights in rejecting this offer, as it preferred to tap its own sources of revenues and, in so doing, prevent the lapsing of a right which is too easily lost when it is repeatedly relinquished, even if only temporarily.
It may be objected that the provincial government may later on increase this tax and ask for a further deduction, but I think that if both governments showed some conciliatory spirit they could set a limit based on a percentage of the whole income and corporation taxes collected by Ottawa in the province of Quebec. This suggestion which I
3294	HOUSE OF
Income Tax-Deduction of Quebec Tax made in the house on November 21, 1952, would allow for variations in the economic situation of the country.
The province of Quebec is mistress in its own house in matters of income tax; besides, it will derive from this source only about $25 million, which is considerably less than the amount offered by the federal government in return for a tax rental agreement. This is a further reason to deduct from the federal tax the whole amount of the tax which will be paid to the provincial treasury. Moreover, Ottawa has already shown some conciliatory spirit, without consulting the other provinces, by allowing large Quebec corporations to deduct from the federal tax the 7 per cent tax they are required to pay to the provincial treasury. I am confident that the authorities will agree to deal with individuals on the same basis as with those corporations, whose widespread influence brought about such a result.
It may be objected that the federal government requires all its revenues for defence purposes. But let us examine the portion of the federal budget which disbursements for social security represent. It is seen that if the provincial government made such provisions without collecting the proceeds from the income tax, it would have had but little left for the administration of the province. Everybody will agree that none of the provincial governments, without imposing an income tax, could have passed such laws.
The farther the federal government entered into the social security field, the more it assumed financial obligations which compelled it to increase the federal tax, up to the saturation point which it has now reached. It has thus made it almost impossible for the provinces to levy an income tax, and has monopolized that source of revenue.
All that stems from the recommendations of the Rowell-Sirois commission which was set up as the result of persistent efforts on the part of the bureaucrats of the federal treasury board, in order to find means of centralizing definitely in Ottawa, ostensibly to provide for national defence and social security, those two important sources of revenue-income tax and succession duties, to which the provinces were entitled and without which they had not the wherewithal to administer those fields assigned to them by the constitution.
In brief, if the government at Ottawa, when passing the social security legislation which is now in force, in this country, and which I approve entirely, was able to offer at the same time a subsidy to the province of Quebec of over a hundred million dollars in
[Mr. LaCroix.l
[Stage Direction]
return for the abandonment of its rights to income tax, how then can it refuse to grant Quebec taxpayers a deduction from the federal tax of an amount smaller than the subsidy offered in exchange for the relinquishment of its rights?
The province of Quebec is endowed with a French and religious culture of which it is proud, and which is necessarily embodied in its schools and universities. In order to maintain and develop those institutions, it is essential to have sufficient revenues to pay our teachers salaries that will not be so ridiculously low as they are at present, but adequate to uphold their interest in the magnificent work which they have been carrying on for such a long time with deep devotion and self-denial.
The school is the mould in which the growing generation is being fashioned and which will produce young Canadians of French origin who will become citizens of whom the community will justly be proud. Thus two different cultures, developing side by side, will add to our national heritage intellectual treasures the equal of which can be found only in Switzerland.
Municipalities in my province which come under provincial jurisdiction are now in a precarious situation. School boards are so heavily in debt that the province was forced to assume most of that indebtedness. After the province stepped in, those debts were reduced to approximately $20 million. Three years later, however, they had reached $59 million and have increased since. That clearly indicates the inadequacy of financial resources.
During the 1952-53 fiscal year, the province of Quebec received from the federal government a total contribution of $4,211,000 or 1-49 per cent of its budget, which amounted to $231,735,000 for that year. Ontario received $127,442,000, although its budget in 1952-53 amounted to $339,566,000. I shall now place on record a table giving the revenues of each province, during the 1952-53 fiscal year, with the amount each province received from the federal government:
	Total	Federal
Provinces	Revenues	SubsidyNova Scotia 	45,228,000	20,360,000New Brunswick 	46,401,000	16,333,000Prince Edward Island	7,133,000	3,939,000Ontario 	339,566,000	127,442,000Manitoba 	53,737,000	28,173,000Saskatchewan 	88,960,000	28,193,000Alberta 	142,467,000	35,440,000British Columbia 	184,737,000	48,579,000Newfoundland 	30,925,000	20.107,000Quebec 	281,735,000	4,211,000
Those figures show that our request for a deduction from the federal income tax of the whole amount of the income tax which is

paid to the province-approximately $25 million-is reasonable, modest and fair.
During the fiscal year ended March 31, 1953, the federal government levied, in the province of Quebec, $286,595,000 in personal income tax, $387,019,000 in corporation income tax, and $6,771,000 in succession duties, a total of $680,385,000 in direct taxes. This represents $167.73 per capita. Under the provincial income tax law, the tax per capita is only $5.50. Can anyone say that it is unreasonable to ask for $5.50 out of $167.73?
In 1930, the amount of taxes collected by the federal government and the municipalities under provincial control was approximately equal:	$316 million and $307 million
respectively, while the revenues of provincial governments amounted to $158 million. In 1951, the revenues of the federal government reached the astronomical figure of $3,791 million, while those of the provinces were only $918 million and those of the municipalities . $636 million. Expressed in percentage, the figures were as follows:
Revenues of all governments
1930	1939	1951Federal government .	... 40-5	48-0	70-9Provincial governments	.. 20-2	22-3	17-2Municipalities 	... 39-3	29-7	11-9100-0%	100-0%	100-0%This table shows	that the	federal	government collected 40 [DOT] 5	per cent	of all	taxes in
1930, and 70-9 per cent in 1951. The levies of the provincial governments increased only slightly during the same period. The situation of the municipalities has seriously deteriorated. While they collected 39-3 per cent of all taxes in 1930, they collect only 11-9 per cent at the present time.
The province of Quebec is now sustaining a heavy material loss in its lonely struggle for the maintenance of its privileges and freedoms, which have been recognized by treaties based on British fair play.
Those privileges and freedoms have been secured through the confederation pact, and nobody denies it; without this guarantee the religious and political leaders of the province of Quebec would not have accepted that pact. The province of Quebec intends to keep control over its heritage, its civil law, its educational and religious freedoms, and its social traditions. It has confidence that the sense of fair play of its friends from the other provinces will convince them that its claims are just and reasonable.
(Translation):
Léon Balcer: Would the hon. member allow me to ask him a question?


Wilfrid Lacroix: Certainly.
83276-209i
Old Age Pensions


Léon Balcer: Does the hon. member's speech reflect the general feeling of the federal Liberal members from the province of Quebec?


Wilfrid Lacroix: I was stating my own views.


Mr. Boisvert:: I would like to direct a question to the hon. member for Quebec-Mont-morency (Mr. LaCroix). Will the hon. member allow me to do so?


Wilfrid Lacroix: Yes, certainly.


Maurice Boisvert: The hon. member seems to be well informed but has he any proof that the government of the province of Quebec was compelled to resort to a tax on personal and corporate incomes within the province in order to obtain an additional sum of $25 million?


Mr. Poulin:: The people of Quebec will answer that question.


Maurice Boisvert: I am not directing it to the hon. member, but to the member for Quebec-Montmorency. Has he any proof that the government of the province of Quebec had to impose a tax on the taxpayers and the corporations of the province of Quebec to obtain additional revenue of $25 million?


Wilfrid Lacroix: In the circumstances, yes.


Léon Balcer: Definitely, yes.
(Text):



REQUEST FOR INCREASE IN OLD AGE PENSIONS

Mr. J. H. Blackmore (Lethbridge):: Mr. Speaker,-


Mr. Deputy Speaker:: Before the hon. member for Lethbridge speaks, I understand that he is introducing a new subject. Do I understand that the previous subject is exhausted?


J.-Wilfrid Dufresne: Perhaps the hon. member for Nicolet-Yamaska (Mr. Boisvert) would like to speak on the subject.


John Horne Blackmore: Mr. Speaker, I rise to voice a grievance. The senior citizens of the federal riding of Lethbridge are suffering serious deprivation occasioned by the woefully inadequate financial assistance now being provided them by reason of the action or lack of action of this federal government and parliament.
May I remind the house and the country that prices of practically all commodities and services in Canada have risen enormously, in some cases doubling, since this parliament last substantially increased its allowance to the elderly folks in Canada.
May I also remind the house and the country that never yet has the meagre pension

Old Age Pensions
granted the senior citizens of Canada rendered possible even the bare necessities of healthful existence to any old age pensioner obliged to live upon only that pension. In other words, we have never provided the bare necessities of healthful living for our elderly citizens in this country.
May I further remind Canadians of the tremendous amount of goods and services this nation is equipped right now to produce? In this connection may I cite once more the fact that in 1952 our production exceeded $23 billion in value, equivalent to well over $1,530 for every man, woman and child in this country. On the face of it, it looks utterly preposterous that we should not be able to give our senior citizens enough of those goods and services to provide a comfortable and satisfying standard of living.
May I finally remind Canadians that in any community of richly varied resources and richly varied products such as Canada has, what is physically possible could be made financially possible provided that a realistic financial system be employed, a financial system including an instrument appropriately resembling the Finance Act of 1923?
I have gone into this with some care in times past, and I hope to go into it more elaborately as days go by, for somehow or other it must be brought to the attention of the ordinary person of Canada that what is physically possible ought to be financially possible and if-


An hon. Member:: C.C.F. policy.


John Horne Blackmore: -we are not rendering what is physically possible financially possible then something is radically wrong. In all probability, that something is the financial system.


Mr. Ellis:: Economic system.


John Horne Blackmore: Financial system, because the financial system is the system which has to do with distributing goods.
May I point out that it is becoming almost monthly more and more difficult for any one of most individuals to provide for his own needs. We often hear people say, "When my old dad came to this country he went out into the wilderness and he hewed out a home, etc., etc." They quite forget that the conditions which obtained when "my old dad" came out to this country no longer prevail.


An hon. Member:: Go west, young man, go west.


John Horne Blackmore: Now, if you go west you go into the sea. As a matter of fact, while we are on this matter, it is no longer possible for the ordinary person to go out into the

wilds, take up land, and have a chance of making good. This means that conditions have completely changed.
Now, there are other reasons why it is next to impossible for people to provide for their own old age. Taxation is severe. "My old dad" did not have to exist under any such taxation structure as that levied by the Minister of Finance (Mr. Abbott) today. Living costs are high. Regulated standards of living are almost unavoidable. Jobs for those over 45 are becoming less and less available. I know of people who have walked the streets for days and days, and who have been refused even consideration after it was learned that they were 45 years of age. What conceivable chance have men and women under such conditions to provide for their own declining years?
Self employment is growing harder to provide. Such industries as laundering, sewing, knitting, the provision of milk, cream, butter, cheese, eggs, etc., all of which were occupations through which the elderly used to be able to eke out an existence, are now mainly non-available to our senior citizens. Practically every member in this house can recall the time when, if elderly people fell upon difficult days, they were able to take in washing or keep a cow and sell the milk, butter and cheese, or sell a few eggs, and get a few cents in that manner. In the average community today, no one of these industries is available to the elderly people. This is because machines have taken the place of these industries, and in many cases the keeping of a hog or a cow is forbidden by community laws.
All these matters and many others must be taken into consideration in any realistic approach to the problem of the elderly citizens of this country.
The problems of elderly people become yearly more pressing for several reasons. In the first place people are living longer-and we want them to live longer. We want them to attain the age of 125 or 150. The Bible commands:
Honour thy father and thy mother: that thy days may be long upon the land which the Lord thy God giveth thee.
Canadians are keenly sensitive to that command. How can we be honouring our fathers and mothers when we are almost starving them to death or when we are forcing them to live for years with only one suit or in a hand-me-down overcoat? This matter requires attention, and requires effective redress. In the second place, families appear to be growing smaller. Just why our particular race should be cursed with the idea that they ought to eliminate themselves

irom the earth now by having one child and four or five poodle dogs per family, I do not know. Nevertheless, that is what is happening. Since the elderly people are living longer and the number of elderly people to be taken care of by those who are actively producing and paying taxes appears to be getting progressively larger in proportion, something must be done. We have to face up to this matter.
There is no reason why we cannot take care of our elderly people, considering the accumulating machines and skills which enable us to produce enough. Our problem is how to distribute our production to the elderly.
In previous parliaments I have asked that we consider, and if possible grant, $60 per month to our elderly citizens at the age of 60. We could make that possible. It will be objected that an increase in taxation would be necessary in order to pay such a pension. I maintain that an increase in taxation would not be needed if we employed a realistic financial system, one that was genuinely able to make what is physically possible financially possible. We can take the money out of production by simply monetizing our surplus production.
Let us bear in mind that a dollar bill, looked at in the most realistic sense, is merely a ticket to goods. This would naturally suggest to any practical mind that where there are surplus goods dollar bills can be created as tickets to represent those goods. If we start with that concrete way of looking at the matter, I believe we can think ourselves through. We can monetize our goods and our services either by using the Bank of Canada or by re-enacting and using a finance act as they had it in 1923 or in 1914.
It will be recalled that through the use of the finance act of 1914, $16 million-


Mr. Martin:: I rise to a point of order. I do not like to interfere with the hon. member's argument, but I do feel that, under the circumstances, I should point out to you, sir, that while it is understandable that the hon. member perhaps should discuss the immediate proposal he has in mind, it is doubtful if on this particular motion it is proper for him to discuss monetary policies or Social Credit theory, commendable or not commendable as that theory may be. There is a place for that kind of discussion. An opportunity will soon be afforded when the budget is presented, but I would submit that on this resolution a discussion of the theory of Social Credit is not in order.


Mr. Deputy Speaker:: The minister has raised a point of order which is of considerable interest. I notice also that in the
Old Age Pensions
estimates, vote 282 under the Department of National Health and Welfare, there is a provision for the administration of old age assistance and blind persons allowances. Under citation 345, of which I shall only read a part, we find the following:
The ancient doctrine that the redress of grievances should be considered before the grant of supplies is maintained in the House of Commons of. Canada . . .
Then later it goes on to say:
Matters of detail which should be discussed iH committee cannot be debated on these occasions, n;:r can debate be permitted relating to grants already agreed to, or to resolutions which will be proposed in the committee, or to items in the estimates.
Such questions are always difficult, and I hesitate to make a definite ruling, but I do feel the point of order raised by the minister is well taken, and I would ask the hon. member to confine himself to a discussion of grievances which can properly be discussed under this motion.


Mr. Knowles:: Mr. Speaker, on the point of order may I ask that at some stage further study be given the point which arises out of the sentence Your Honour read from citation 345. There is a reference in that citation to discussing items in the estimates. I submit it is one thing to discuss an item in the estimates, and to say that that item should or should no be passed. It is another thing to discuss a matter which, it might be said, could be raised on the estimates. That matter is dealt with not only in citation 345 of Beauchesne's third edition, but it is also dealt with in citation 467 of the same edition. At the end of citation 467 there appears the notation "M.525." That means that the gist of citation 467 is to be found at page 525 of May's thirteenth edition, and if one goes a little further in his research he will find that on page 525 of May's thirteenth edition the point is dealt with by a reference to some footnotes. These footnotes take one back to volumes 165, 173, 189, and 209 of the British Hansard. I have taken the trouble on former occasions to look up these various volumes of the British Hansard and it is quite clear that the significance of that citation is that an hon. member is not permitted on the motion to go into supply to discuss the estimates themselves. There are instances in these volumes of the British Hansard which are referred to in that footnote, in which members were proposing to argue for or against an item in the estimates. The speaker stopped the member from doing so but permitted him to discuss in general the question which he had raised, so long as he stayed clear of speaking for or against an item in the estimates as such. Your Honour has not stopped the hon. member for

Old Age Pensions
Lethbridge (Mr. Blackmore) so I shall not pursue my argument further, but I do submit that since the point has been raised the references I have given should be studied before the point comes up again on another occasion.


Paul Joseph James Martin: Mr. Speaker, may I just briefly say that I certainly did not suggest that the hon. member had no right to discuss old age pensions and assistance at this time. What I was complaining about was that this was not a motion to discuss monetary policy which may have some, but only some, bearing on this matter. The hon. member can discuss the need to improve old age pensions and that sort of thing but I was suggesting that this was not the time to engage in a discussion of monetary theory.


Mr. Deputy Speaker:: I am afraid we are interfering with the hon. member for Lethbridge at too great length. I was very glad to hear the remarks of the hon. member for Winnipeg North Centre (Mr. Knowles). This point is one of considerable difficulty and interest and I will be glad to take his remarks into consideration.


John Horne Blackmore: Mr. Speaker, if anyone were to rise and advocate a pension of $60 per month at the age of 60 in a country of which 90 per cent was desert anyone would be justified in asking how in the world we could produce goods to support that pension. One of the most important things would be that one would have to satisfy oneself that we have sufficient goods and a sufficient level of production to enable us to provide such a standard of living.
But having established that there will be plenty of goods, one has to satisfy oneself next as to whether there is a method of making these goods available to the old age pensioners. If that cannot be done then certainly the strength of my appeal on behalf of old age pensioners will be greatly vitiated. Consequently, I fail to see how a person could make a real case for increasing old age pensions in Canada without referring to the method by which that production, once it is brought into existence, can be placed in the hands of elderly people without taking so much in taxation from the population as to render the burden unbearable.
I spent some time on that subject and it was not my intention to discuss Social Credit. I merely wished to show that to any person facing existing facts realistically it is an absolute outrage for us to deprive our elderly citizens of the good things of life.
I am rather surprised that the Minister of National Health and Welfare (Mr. Martin) should rise on a point of order when a method

was being suggested by which, if he acted on the suggestion, he could strengthen his hand tremendously in doing the thing he surely wants to do. Certainly the Minister of National Health and Welfare wishes to increase the old age pension to $60 a month if means can be found whereby that can be done. But for him to raise a point of order when the problem is being solved for him surprises me considerably.
I thank you, Mr. Speaker, and also the hon. member for Winnipeg North Centre for what both of you have said, but if hon. members of this house do not want to learn these things then I suppose we shall have to stop discussing them lest we offend them.
I was about to point out that there will be those who will claim that in connection with the use of the device I referred to, and I referred to the Finance Act of 1914, nothing effective can be done. But I would point out that, under the Finance Act of 1914, $16 million were created and brought into circulation by the Minister of Finance and that sum was backed only by railway securities. What has been done in the past can surely be done again, and if it cannot be done again then certainly an explanation ought to be forthcoming as to why it cannot be done again.
That was all I was dealing with. I had intended to say something about the remarks of the hon. member for Okanagan Boundary (Mr. Jones) when he maintained the other day that such a procedure would cause inflation. I had intended to show that he was in error when he supposed that the operation of this act would cause inflation. I was also going to refer to the remarks of the hon. member for Saskatoon (Mr. Knight). He displayed some anxiety and felt that if we used the finance acts of 1914 and 1923 we would be placing in the hands of the Minister of Finance (Mr. Abbott) a very powerful weapon which he might use to the detriment of the nation. I was going to point out that when the minister of finance created money under the finance acts of 1914 and 1923 every dollar he created had to be created with the specific permission of parliament, and every dollar he spent had to be spent with the particular permission of parliament. In the same fashion, we must now have the permission of parliament in order to raise money as is prescribed in each budget, and the estimates under which that money is spent receive the scrupulous scrutiny of members of parliament. It is therefore obvious that parliament now controls the behaviour of the Minister of Finance. In a similar manner parliament would control the actions of the minister administering a finance act like that of 1914 or of 1923.

Once that difficulty has been cleared up there can be no serious objections to the proposal I was making. I do not hesitate, Mr. Speaker, to advocate once again that we should set up as our immediate goal the payment of a $60 a month pension to our senior citizens after they reach the age of 60. I stipulate that that would not cause an increase in taxation if we used a realistic financial system.


Stanley Howard Knowles: Mr. Speaker, it is not my purpose to comment on the financial proposals put forward by the hon. member who has just taken his seat, but I should like to say a few words in support of his contention-which some of us have made frequently on the floor of this house-that the time has come for an increase in the amount paid to our old age pensioners.
It seems to me that the case is so clear for an increase in that pension that it should not be necessary to argue for it at all. The amount of the pension across Canada at the present time is $40 a month, a figure that was reached in 1949 just prior to the election before the last one. Since that time the cost of living has gone up. It should also be pointed out that the Canadian standard of living has improved. As technological progress makes possible an improved standard of living I submit that our senior citizens should share in that improvement.
Not only has there been an increase in the cost of living and an improvement in the standard of living in this country but there has been a tremendous increase in our gross national production. In the year 1949, when the old age pension was fixed at $40 a month, our gross national production was of the order of $16 billion a year. At the present time that figure is of the order of $24 billion a year, or perhaps it is even closer to $25 billion a year. If we have been able to increase our gross national production in this country by 50 per cent since the time the old age pension was set at $40 a month, I submit that that pension should be increased at least by that same amount, namely 50 per cent. If a pension of $40 a month is increased by 50 per cent, that brings it at least to the figure of $60 a month.
Moreover, in the years that have gone by since the pension figure was set, there have been other increases. There have been wage and salary increases in many cases. There have been many increases, voted by parliament, in the salaries of various people, not forgetting the increase that was voted this year in the indemnities paid to senators and to .members of parliament and in the salaries of cabinet ministers. In the light of all of
Old Age Pensions
these changes that have been made and in the light of the improvements that are enjoyed by other people, I suggest that it is a disgrace to parliament and a crying shame that the government has done nothing to improve the position of our senior citizens. I feel that this session should not be allowed to go by without the government's introducing the necessary measure to increase the amount of that pension.
Like the hon. member for Lethbridge (Mr. Blackmore), I feel that the eligible age should be lowered with respect to the pension without a means test. There are those who suggest that the pension should start at age 60 and there are others who suggest that it should start at age 65. Perhaps that is a point over which we should not get into an academic argument at this time. However, I certainly believe that the very least that should be done at the present time is to remove from the pension at age 65 the means test which we now have and pay the full amount of at least $60 a month at that age. It is utterly ridiculous that so many people find themselves in the position of being retired from industry at the age of 65, having just enough by way of their own resources that they cannot qualify for old age assistance but being told that if they can somehow manage to live through the five years from age 65 to 70, they will then get the full old age security pension without a means test. It does not make sense; it does not add up; it is not to the credit of the parliament of Canada. I suggest that that change is long overdue.
There are other changes of a similar character that should be made. I hope that we shall not have to wait many more days before the government will bring in whatever other legislation it has respecting our veterans, and that that other legislation will include an increase in the amount of the war veterans allowance. In my view our senior citizens in these various groups deserve more than the brush-off they have had from the government in these recent years.
The plan that was put through as a result of the sittings of the committee on old age security back in 1950 was, in principle, an excellent one. At that time it was also good in respect of its terms. But just because something was good at one point in time does not mean that it is good enough in those precise terms for all time to come. What annoys me is that the government seems to be satisfied to sit back and let the matter stand as it was settled as a result of the meetings of that committee in 1950. Time has moved on and our senior citizens deserve

Old Age Pensions
a better deal than we are now giving them. As I have done on previous occasions, I urge strongly once again that the amount of the old age pension should be increased to not less than $60 a month. At the same time that that pension is being increased, the amount paid to our blind pensioners should be increased and, in my view, the means test should be completely removed from the blind pension.
These, Mr. Speaker, are but some of the items of unfinished business that were left over when parliament was dissolved last year. If I recall correctly, the very last recorded vote in the House of Commons before the dissolution of the twenty-first parliament was on an amendment of mine asking for an increase in these pensions commensurate with the increase in the cost of living. That amendment, of course, was defeated by the majority on the government side; but that item is still a matter of unfinished business and I submit that it has high priority so far as the people of Canada are concerned. I support strongly the proposal that at this session of parliament something should be done to increase the old age pension and the blind pension. I also hope that, before very long, the government will bring in legislation increasing the amount of the war veterans allowance and doing something about the means test in respect of the burnt-out pension. These things are long overdue.


Ernest George Hansell: Mr. Speaker,-


Mr. Deputy Speaker:: I understand that the hon. member for Kamloops (Mr. Fulton) intends to introduce a new subject. Do I understand that the hon. member for Macleod desires to speak on the same subject?


Ernest George Hansell: Yes. I will take only a moment or two. I had not intended to say anything and would not have done so except that another note has been injected into the discussion. I am thankful that the hon. member for Lethbridge (Mr. Blackmore) has introduced this subject. I wish only to amplify his remarks with one or two other suggestions. The Minister of National Health and Welfare (Mr. Martin) is in the house at the present time. He interrupted the hon. member for Lethbridge (Mr. Blackmore) when he was attempting to give the minister a remedy for his apparent dilemma. I am quite sure we all agree that the minister is just as anxious to increase old age security pensions as anyone else. We have always regarded the minister as a humanitarian. Otherwise I do not suppose he would
tMr. Knowles.]
be occupying the position he does. Yet it does seem quite strange to me that when the hon. member for Lethbridge began to put forward a suggestion as to how this thing could be done the minister rose on a point of order which, Mr. Speaker, you are now considering. I am not dealing with the point of order. The only point I am raising is that surely the minister wants to find a remedy.
Is the minister looking around for a remedy? Can the minister find this remedy within the confines of the government's present taxation policy? If he cannot, then he is up against it for a solution. There is no other argument to that. The minister can rise in his seat session after session and explain the marvellous work that his department has done and I will give him credit for all that has been done. But, after all, in the final analysis the remedy resolves itself into the financial policy that the government wishes to pursue because it is the government's present financial policy that is tying the hands of the minister so far as increasing old age security pensions is concerned.
I have heard ministers and political speakers boast before of what their government has been able to do, but I have never been able to bring myself to believe that it takes such a huge amount of brains to be able to figure out how much you need to do a certain job and then turn around and ask the law clerks to devise a piece of legislation that is going to increase taxation. It does not take any brains to do that. A schoolboy can take out his pencil, figure out how much is needed for a certain thing and then go to his old man and ask him to cough up. That is all the brains it takes to do such a thing under present monetary policy.


Mr. Zapliiny:: What if the coffers are empty?


Ernest George Hansell: If the coffers are empty you have another problem, and that, my hon. friend, is where we as Social Crediters come in.


Mr. Goode:: Then you put on the 5 per
cent sales tax.	[DOT]


Ernest George Hansell: Our remedy is to change the basic financial policy so that it can be done.


George Prudham: In other words, start the printing presses.


Mr. Low:: The minister ought to go and learn something.


Ernest George Hansell: I fancy the reason the Minister of National Health and Welfare rose was that he did not want this matter to be discussed now. He rose and said that there

was a proper time to discuss it. O.K.; suppose we agree with him. When it is discussed at that time I do not suppose the minister will be the least bit interested in listening to the discussion.


Paul Joseph James Martin: I would always be interested in listening to the hon. gentleman.


Ernest George Hansell: I surely appreciate that, Mr. Speaker. Is he interested in-


John Horne Blackmore: In learning.


Ernest George Hansell: -finding a remedy? Can he find it under the present policy, and is he interested enough to urge the government to change the policy so that a remedy can be found?


Frederick Samuel Zaplitny: Mr. Speaker, I will only detain the house for a few minutes. I want to support the plea made by the hon. member for Winnipeg North Centre (Mr. Knowles). It is not the first time, and I am sure it will not be the last, that he has made a plea for the senior citizens of this country. I agree with everything he said and therefore I see no necessity of repeating his arguments. The particular question I should like to bring to the attention of the Minister of National Health and Welfare (Mr. Martin) has to do with the administration of the Old Age Security Act rather than with the over-all question of what the amount of the pension should be. From time to time we run across the problem of proof of age, with which I am sure the minister is familiar. I realize that some adjustments have been made in the regulations but we still face the problem, particularly in the case of persons who have come from other countries where quite often the only proof of age they can submit is their immigration record. The information on that record is of course taken from their passports when they enter Canada.
I realize that in these days passports are fairly complete documents containing considerable detail with respect to the person's age and so forth. But in the early days of immigration into this country, in the last part of the nineteenth and the early part of the twentieth centuries, people who came here from European countries had passports that were not particularly complete. I have examined hundreds of them myself and I have yet to see one in which the actual date of birth of the person concerned is stated. In those days only the year of birth was shown. The result is that in such cases, even though the applicant may be able to prove that he or she, as the case may be, was born in a certain year, that of course
Old Age Pensions
does not prove that the applicant reached the age of 70 at such and such a date. That part of the submission must be supported by other means.
As I have stated quite often, these passports are the only existing available documents containing any proof of age. As one who>
has had a great deal of experience in dealing with these matters in my own part of the country, I would certainly recommend that the department lean over backwards in accepting the stated date of birth provided there is some supporting evidence to substantiate it. If the inflexible attitude is taken by the department that the applicant must prove his exact date of birth and only in the case of inability to do so will it accept the year of birth it means that the pension may not be paid until the end of the particular year in order to make sure that the person has reached the age of seventy. In many cases an injustice is done.
I realize there is some risk in accepting a person's word as to the exact date of birth, particularly if it is unsupported by any evidence, but if it costs the treasury a few thousand dollars a year because of cases where there may be errors, that is a small sum to pay to avoid injustices such as have occurred in the past. I have plenty of evidence of such injustices. I hope the minister will take this matter into consideration. I realize it is one having to do with regulations under the act and does not require legislation by the house, but it is one way in which injustices can be avoided. I merely want to add that I support the contention of my colleagues with respect to the removal of the means test, particularly in the case of blind pensioners.
People who are in that category are perhaps the most unfortunate type of citizens, and I think we should use the greatest possible leniency in respect of persons who are receiving blind pensions. Often it is possible for them to supplement their incomes to some extent by some form of employment. We are told, by those who know better than we do, that nothing could be better for the mental health and well-being of persons of that type than to have some kind of employment to keep them occupied and happy, and to give them a feeling of usefulness in society. It seems to me unfair and unnecessary to penalize such persons because they are able to earn a few dollars in addition to the pensions they receive. I certainly hope that if there is going to be some priority exercised in the removal of the means test from pensioners it should be exercised first of all in respect of the blind pensioners.

Old Age Pensions
I support to some degree the arguments offered by my friends to the left. Occasionally I make interjections when they speak, but I hope they will not feel I do so in any spirit of levity. It is merely because at times they do say humorous things. I agree with hon. members in the Social Credit group on the general principle that what is physically possible should be made financially possible. Perhaps we do not agree one hundred per cent on the method by which this could be done, but certainly I think it is time the house considered the fact that the productive capacity of our country has increased tremendously, and is still increasing. As was pointed out not long ago, our gross national product in 1953 reached a value of more than $24 billion. If it is possible to produce goods and services to the extent of $2 billion a month, then certainly there must be something radically wrong with our financial system if it does not distribute the wealth it has created.
I certainly hope the house will give its unprejudiced attention to the ways and means by which the distribution of wealth in this country can be accomplished. We have our views on that subject. My colleagues and I on various occasions have suggested how we think it can be done. I simply reiterate that we still believe the best and most effective way in which to redistribute the wealth of the country and to place purchasing power in the hands of the people who need it, and who can and will use it, is by the social security measures we have championed through the years.
There may be other ways. We are open to suggestions and would like to hear the government's views of how they intend to do it. But there is one thing upon which I think we will all agree, regardless of party, and that is that if we can produce goods and services to a value of $24 billion, even allowing a third for capital replacement and extension, we must find some means of distributing the other $18 billion to the people so that we may raise the general standard of living of all our citizens.


Paul Joseph James Martin: Mr. Speaker, I should like to take only a very few minutes to place on record one or two statistics that I do not think have been borne in mind by those who have spoken this afternoon, with the exception of the sponsor. At least the hon. member for Lethbridge (Mr. Blackmore) predicated his submission upon a monetary theory that is not now the orthodox and accepted way of financing government expenditures in this country.
[Mr. Zaplitny.l
But others who have spoken, I take it, assume that the general monetary policy pursued in this country at the present time is, generally speaking, the one that should be pursued. And within the context of that assumption it should be noted that the proposal made by the hon. member for Lethbridge, on the basis of 1951 figures, assuming a population aged 60 of 1,631,900 would cost a total of $1,174,968,000. On the basis of an estimated population aged 60, for 1954, of 1,734,000, the total cost of that program would be $1,248,480,000. This would mean that we would spend in 1954, for old age security, not the sum of $339 million, as we now estimate, but an additional $900 million.
Now, I ask the hon. member for Winnipeg North Centre (Mr. Knowles) and the hon. member who has just spoken, and who generally gives great thought and care to what he says, if they seriously wish anyone in the house or in the country to believe, having in mind even the present level of the national product, that it is possible for us to do these things?
I take second place to no man in my desire to see improved and responsible social measures; but it is my duty as Minister of National Health and Welfare to point out the limitations and the extent to which some of these things can be realized.


Mr. Argue:: Try deficit financing.


Paul Joseph James Martin: My hon. friend says to try deficit financing. Well, let me -tell him what the provincial treasurer in the province of Saskatchewan has to say about irresponsible suggestions such as are made from time to time by some people, including the hon. member. Here is what Mr. Fines, provincial treasurer in Saskatchewan, said the other day:
We must not increase our social services and health services and educational services to a level beyond which we cannot maintain them.
Those are words which, if used by me, would bring opposition at once from my honourable and genial friend, the hon. member for Winnipeg North Centre. But I have quoted, not a Liberal-no, not a doctrinaire Liberal-I have quoted the provincial treasurer in the only socialist government in this part of the British commonwealth.
Seriously, sir, I think we must realize that when proposals are made in the House of Commons they can raise false hopes; and I suggest the proposal made today, having in mind that it would be financed under an orthodox financial system, is one that cannot be taken seriously. When one considers that the total expenditures of the government

are in the neighbourhood of $5 billion, can an hon. member suggest that, in one particular field alone, we should make an increase which would cost an extra $900 million on top of what we are now spending?
I suggest that is a proposal which cannot be taken as having been offered on serious reflection.
Before the recommendation by the parliamentary committee on old age security in 1950 we were spending $106 million on old age pensions. Today we are spending on old age security, as I said, for 714,197 recipients the sum of more than $28 million a month by way of old age security in respect of those aged 70 and over. We are spending for the fiscal year 1953-54 the sum of $339 million; and every year there is an increase on an average of about $15 million. When one takes into account the ageing of our population, it will be seen that the cost will grow.
Even on the basis of the present amount, which represents three and a half times what we were spending three years ago, old age security within the next few years will become the most expensive single item in our social security program. On the 700,000 to 800,000 aged 70 and over-and I am not now dealing with those aged 60 and over-we will be spending more than we spend now for two and a half million families, with five million children, through family allowances; three times as much as for disability pensioners of world wars I and II, and three times as much as for unemployment insurance benefits paid out to insured unemployed members of our entire national labour force of 5 million paid workers.


Stanley Howard Knowles: Will the minister relate that to our defence budget as well?


Paul Joseph James Martin: Our defence budget is around $2 billion. I would suggest this. The government will be introducing during this session a nation-wide scheme of disability allowances. As I said earlier, and as the Prime Minister (Mr. St. Laurent) indicated, the government, having in mind its responsibilities in peace and war arising out of our relations with other countries, having in mind our other domestic obligations, continually bears in mind the desirability of providing responsible measures for social welfare for our people. When these various schemes are proposed without any relation to what we are doing in other fields, without any relation to what we still have in mind, I suggest that they present the greatest obstacle to the realization of other measures which in the course of time, in the light of our obligations, we will want to consider and propose.
Old Age Pensions
Do we want to see a nation-wide scheme of disability allowances such as contemplated by the government at this session of parliament?


Stanley Howard Knowles: Hear, hear; and soon.


Paul Joseph James Martin: Do we want to see Canada's national health program expand in public health, cancer control and so on.


Stanley Howard Knowles: Yes, and health insurance too.


Paul Joseph James Martin: Do we want to see improvements in certain features of veterans' social welfare measures? Do we want to see improvements in our unemployment insurance provisions? Do we want to see improvements in the provisions we make for the blind? Do we want further measures taken to relieve the burden on our people in the matter of our hospital and medical care? If we really want to see these things done, then I ask my hon. friend if he really is sincere. If we are really sincere, no one then will make a proposal which at this time we all know could not possibly be accepted and would only thwart the fulfilment of these other objectives.
The hon. member for Winnipeg North Centre was a member of a parliamentary committee that went into the whole question of old age security. That committee, made up of all political parties, was of the view that we should now try to base our social security measures on the contributory principle in so far as that was possible, if we were going to extend universal coverage as distinguished from the partial coverage system that they have in the United States.
Well, now, if we were sincere then, why should we be less sincere now in trying to maintain the contributory principle? Here is what the committee of which the hon. member for Winnipeg North Centre was a member, of which the hon. member for Red Deer (Mr. Shaw), representing the Social Credit party, was a member, a committee which did distinguished work, said:
The committee is in favour of the contributory principle, not only because of the importance of this in raising total moneys required, but also because of the importance of establishing a close association in the mind of the individual between his contribution to the cost and the ultimate benefit he is to receive.
That was what all hon. members wanted in 1950. If we are going to still maintain that principle which they advocated with great vigour, then they should at the same time not bring in these proposals without letting the country know what it would cost by way of additional contributions by the people of Canada. This would mean an additional cost; it would impose an additional burden not of 2 per cent, but a burden going up as high as 10 per cent on individual persons in this country.

3304	HOUSE OF
B.C. Telephone and Telegraph System
I commended the members of that committee when they made that recommendation to the house for the objective approach that they had made to this problem. I should like to think that in the consideration of these important matters I would be able to continue to commend hon. members for adhering firmly to the principle that they themselves recommended to this house. If they do that, they will find that we shall make very considerable progress in developing responsible social measures for the people of this country whom we all want to help.


Stanley Howard Knowles: Will the minister permit one question?


Mr. Mclvor:: I want to ask one question.


Edmund Davie Fulton: We are not in committee.


Stanley Howard Knowles: Is the minister for or against an increase in old age pensions?


Paul Joseph James Martin: There is no one in this house who is not as anxious as the hon. member to do what they can to improve the welfare of any segment of our population.


Stanley Howard Knowles: Where does the minister
stand?


Mr. Noseworthy:: I want to ask the minister what answer we are to take back to the old age pensioners who are now literally starving on $40 a month?


Paul Joseph James Martin: The answer to take back is this. The hon. gentleman can point out that in addition to the assumption of full responsibility for people 70 years of age and over the federal government is now being assisted in what it is doing for our aged citizens by supplementary payments that are being made in the province of British Columbia to the extent of $15, in the province of Alberta to the extent of $15, and in the province of Saskatchewan to the extent of $2.50. I would say that if my hon. friend really wanted to, he should examine the extent to which all provinces are bearing their share in the matter of supplementary assistance.



BRITISH COLUMBIA TELEPHONE AND TELEGRAPH SYSTEM

Edmund Davie Fulton: Mr. Speaker, perhaps we should leave this interesting debate on old age security where it now lies. Hon. members from the C.C.F. party and Social Credit party have had their answer, but I am quite sure no one could advise them as to what interpretation they put on the answer given by the minister. I must say that it did not seem to me to deal very specifically with their questions; but I want

now to deal with another matter which is of concern to the whole province of British Columbia.


Paul Joseph James Martin: Sometimes the best way to water a garden is not to put water on it.


Edmund Davie Fulton: That is a profound observation.


Stanley Howard Knowles: The minister is all wet.


Edmund Davie Fulton: I want to bring forward a matter which is of concern to a large area of the province of British Columbia, namely,, the sale and transfer to the Canadian National Telegraphs and the British Columbia Telephone Company respectively of the government telegraph and telephone system in that province.
The government telegraph and telephone system serves the central and northern areas of the province and some portions of Vancouver island. For some time we have been trying to obtain from the Minister of Transport (Mr. Chevrier) a full statement of the position which is going to result from this sale and transfer. The minister has indicated to us from time to time in replying to questions that he feels himself not in a position to give any details on it for the reason that negotiations with the purchasers are still continuing. The fact is, Mr. Speaker, that, according to the last information I have, the transfer is going to be made effective as of April 1, just one week from today.
The reason I am bringing the matter forward now is that there are matters which are giving very great concern to the public generally served by that system as well as to the employees of the system, and it would seem to me to be a rather hollow discussion if we are not to have any details or are not going to be in a position to make any recommendations as to the points that should be covered in the terms of sale or, alternatively, if we should find that these features are not covered, and we are not going to be in a position to make any protests until the transfer is made. If we are going to make protests and carry on a discussion after the transfer has taken place, at a time when the chance of effecting adjustments and obtaining satisfaction with respect to these points has gone by, then it would be a hollow discussion. It is for that reason that 1 raise the matter now, although I appreciate the obvious difficulty the minister finds himself in while negotiations are in process.
I suppose the negotiations are of a character that might normally be regarded as private, and it is difficult to make public the details of what you are actually negotiating at the time the negotiations are taking place. But I raise the matter now for the further purpose that the minister may know,

and the purchasers may know, the opinion of this house and of the member who represents a constituency where a large area is dependent upon this service. The government and the purchasers will thus learn the conditions which we feel should be covered in that transfer concerning the protection that should be afforded to the public with respect to continuation of service, and to employees of the government system with respect to their seniority rights if they transfer to the service of the purchaser, and also with respect to their superannuation rights.
Now, I do not think I need to go into much detail, Mr. Speaker, as to the importance of this question to the area served. I believe it will be sufficient if I say that by and large it is a comparatively sparsely populated area, a portion of which lies in my constituency. It is mainly farm and ranch country, including the territory from Ashcroft and Lytton to Lillooet and the whole of the Cariboo and Chilcotin range area. There are some settled communities, but by and large it is sparsely populated country with quite rigorous winter conditions. It will be seen that the maintenance of telephone communications is a very real consideration to the inhabitants of a country of that sort. It is, therefore, from that point of view first that I should like to say a few words on the matter; that is from the point of view of the continuation of service to those presently using the government-owned system.
As a result of such information as I have been able to obtain on this matter in answers to questions that have been asked in the house, I find that an important consideration arises in relation to the price to be paid by the purchasers. When the minister announced on November 12, 1953, that negotiations had been concluded to the point where he was able to say the system was being sold, he told us the purchase price was $1 * 5 million. That is the total price to be paid by the two purchasers together.
I asked on February 3, 1954, for information as to the value of the system, and as reported at page 1734 of Hansard for that day, the minister informed me that the system had been valued by the Department of Transport at $4,436,000; by the Canadian National Telegraphs at $3,776,000 and by the British Columbia Telephone at $2,357,000, but the telephone company valuation covered only a portion of the system. I should say that those valuations were based on the replacement cost of the system, depreciated as of June, 1952. It will be seen, therefore, that the total purchase price of $1-5 million to be paid by the purchasers is just about
B.C. Telephone and Telegraph System one-third the valuation made by the Department of Transport, and well under half the valuation placed on the system by the Canadian National Telegraphs as a result of their survey.
The fact is that the purchasers are getting a system the depreciated replacement cost of which exceeds by two or three times the amount that they are paying for it. There is a considerable concession being made from the point of view of purchase price. This being the case, Mr. Speaker, not only are we entitled to ask why that small purchase price, in terms of its relationship to the actual replacement value of the system, is being paid; we are entitled also to insist upon the most stringent assurances that the purchasers will be bound to continue the service, even in those areas where the service might not operate at a profit.
I think it is true to say that in some of these sparsely populated areas where there is a long telephone line, it is obvious the number of subscribers paying for the use of the line will not be enough to produce an actual operating profit. The system is being sold to a private company that is in business, and can only continue in business, on the basis that it makes a profit on its over-all operations. I make no criticism of the private company from that point of view; that is the only way they can continue to operate. The point I am making is that they might be tempted to say, well this line obviously does not operate at a profit and we should discontinue the service there until such time as the population increases so we can show a profit or at least operate without a loss.
I maintain that since they are getting this concession with respect to the purchase price, there must be the most absolute conditions written into the terms of sale so the companies will be required to continue the service to these sparsely populated areas. I should like an assurance from the minister that such a provision will be written into the terms of sale.
I believe, too, that we should have assurances that the terms of sale will contain satisfactory restrictions on the right of the purchasers to apply for rate increases. It is true that, in this respect, both the British Columbia Telephone Company and the Canadian National Telegraphs come under the board of transport commissioners. However, neither the railway company nor the telegraph company has displayed any undue reluctance in applying to the board for increases in rates where they feel such increases are necessary if they are to continue profitable operations. Once again I point out that if they are to take over this system
3306	HOUSE OF
B.C. Telephone and Telegraph System at a price that is less than the value of the system, and they are obtaining what is a valuable and exclusive franchise in that area, there should be not only the most strict provisions requiring them to continue the present service and to improve it where possible, but also a restriction on the right to apply for increases in rates.
This is a rapidly-growing area and the franchise will be most valuable in the future, and although they are obtaining it on these advantageous terms, I take it as a fact that they will be able to show that portions of the system are not operated at a profit, and that might normally be taken to justify an application for an increase in rate. My position is that having obtained these advantages they should be required to accept restrictions on their rights to increase rates.
Now, Mr. Speaker, it may be of interest to the house and to the country to know just what these purchasers are getting, at least with respect to the telephone system. On January 18, the minister answered another question of mine, as appears at page 1190 of Hansard for this session. He gave details as to what the system comprises, I find there are 4,720 telephone sets in the government telephone system.
There are 37 exchanges; or rather, counting those places where there are multiple switchboards, there are 37 exchange switchboards. Anyone here who has studied the matter knows that a switchboard is a highly complicated and very expensive piece of machinery-think what 37 of them represent. There are 3,159 miles of pole line which, at approximately 35 poles per mile, makes 110,250 poles. There are 17,661 miles of wire, of which 11,354 miles are copper wire. That information will indicate that it is an extensive and valuable system with a great deal of expensive and complicated equipment.
We also find, as appears at page 1190 of Hansard for January 18, that since 1943-44 there have been seven repeater stations constructed, all comparatively new installations, four of which have been taken over by the Canadian National Telegraph Company and three by the British Columbia Telephone Company. The total cost of these repeater stations was approximately $685,000. In other words the cost was not very far short of half the total purchase price of $1,500,000. It will therefore be seen that these companies have acquired between them a very valuable and extensive system with an exclusive franchise, and they have acquired this at a price which is considerably less than the replacement cost of the system, according to the government's own figures, and at a price, I suggest, very much less than the actual worth of the system on an installed cost basis.


In view of that feature, if for no other reason, my position is that we are entitled to assurances from the minister. If he says he is not in a position to give us any details today we are entitled to assurances from him that binding conditions will be inserted into the agreement for sale and transfer which will require the purchaser to continue the service as it exists at present, at no less frequency than it operates at present, and which will restrict them in their right to apply for increases in the rates.
I would like next to say a word about the position of the employees of the system. There are many hundreds of faithful civil servants engaged in the operation of the government telegraph and telephone system throughout British Columbia in that part of the province which I have described, and throughout my constituency, the constituency of the hon. member for Cariboo (Mr. Leboe) and the hon. member for Skeena (Mr. Applewhaite). It is and always has been the only communication system available, and by and large the regard of the population for the personnel who serve them and operate the system is of the very highest order.
Many of these men and women have many years of service in that government system. I believe it is only proper therefore, and I know the minister shares this feeling, that we should insist that so far as it is possible the position of these government servants should be protected. Where it is possible to arrange for them to be absorbed into the staff of the purchasing companies that should be done, and due regard should be paid to their present seniority. Some arrangement should also be made to carry into the purchasing companies their superannuation or pension rights. I am satisfied some arrangement could be made between the Department of Finance and the purchasing companies to facilitate such a transfer.
I would also suggest it is but fair to insist that where it is not possible to absorb any of the employees of the government system into the staff of these purchasing companies so that an employee is in a position of relative equality to that which he enjoyed in the government service, then arrangements should be made for these men and women to be absorbed into some other branch of the civil service. I do not believe it is fair that men and women with long and faithful service should be left, as it were, to fend for themselves after having given such service, nor that they should be placed in that position as the result of a decision over which they have no control.
We have already asked the minister for assurances in this regard. The reason why I

believe it is safe to say the minister shares our feeling in this respect is that he has from time to time given us assurances that this matter will be looked after, and that negotiations are proceeding with the purchasers to work out the details on this point.
I was therefore very much disturbed when on March 16, eight days ago, I received a telegram from the Vancouver branch of the Amalgamated Civil Servants of Canada reading as follows:
Statement made in house by minister transport recent date to effect efforts being made by C.N. Telegraphs and B.C. Telephone Company place as many employees possible but minister also stated he did not know what final disposition of staff would be. C.N.T.-
That is C.N. Telegraphs.
C.N.T. representatives now interviewing employees various offices state no recognition of past service government telegraphs being considered and employees seniority dates from day of entry into C.N.T.; also representatives know nothing what proposed for employees superannuation plan. Entire staff of government service definitely contend this intolerable situation and submit their welfare not at all safeguarded. Employees consider be grave breach faith if departmental communications sold before these questions namely past service recognition superannuation rights and salary clarified for well-being employees and announcement made to employees by department understand proposed date set for takeover April first.
When one receives a telegram which contains a very disturbing communication to the effect that the rights and the position of the employees are simply not being safeguarded, at least in so far as the C.N. Telegraphs are concerned, and one receives it just about two weeks before the actual date of transfer, then our concern is understandable. That concern is shared by my colleagues in my own party from British Columbia, and also hon. members from British Columbia in the C.C.F. and Social Credit party, and I am sure by hon. members in the Liberal party as well. We therefore wish to obtain assurances from the minister that these matters will be rectified and will be adjusted in so far as the Canadian National Telegraph Company is concerned, and that provision will be made by them to absorb the employees of the government system with due recognition for seniority rights and with proper arrangements to carry forward their pension and superannuation rights.
I understand from conversations with the minister that apparently the British Columbia Telephone Company has not found the same difficulty in making satisfactory arrangements, and I must confess that I have received no complaints from anyone on the telephone side of the government service. The complaints I have had with respect to the position of employees relates only to those
B.C. Telephone and Telegraph System on the telegraph side. I should like to supplement what I have just read with some specific information with respect to one employee. I am not going to mention his name but a summary of his position will indicate just how unfair this could be to an employee or to all employees of this sort unless some satisfactory solution is worked out.
This is a man with 20 years' service with the government telegraph and telephone system, on the telegraph side. He has been offered what is called a swing-relief position at a salary of approximately $260 per month. He points out that that position is not at all comparable with the position that he now occupies with the government service and that, with the bidding rights available to operators on the Canadian National Telegraphs, he is apt to stay in that position for a long time because he does not carry with him into the Canadian National Telegraphs any seniority, not even proportionate seniority based on the 20 years' faithful service that he has put in with the government service. Then he points out that suppose he should decide that the offer made by the Canadian National Telegraphs is not sufficiently attractive because it is not at all comparable with his present job and that he has no seniority in it, he would have to look around for other employment or else go on superannuation. Yet, by what I can only call, under these circumstances, a cruel stroke, he points out:
Under the new superannuation act effective January 1, 1954, it will be another seven years at least before I will be eligible for pension benefits.
He is now 43 years of age. He has had 20 years' service on the government system. By the new act, which became effective January 1 of this year, he has to wait until he is 50 before he can draw his own superannuation. He would therefore have seven years to wait. Then he says this:
An employee entering the Canadian National Telegraph service over 40 years of age is not eligible for pension benefits.
He is just three years over 40 years of age; he has seven years to wait before he can draw his own pension. Yet he cannot qualify under the Canadian National Telegraphs superannuation fund. So he has seven years to wait for his own superannuation to start, and no seniority and no pension rights in so far as the Canadian National Telegraphs are concerned.
He goes on to point out that he has paid into the superannuation fund for 20 consecutive years, has also paid up some back time, and that these contributions were paid under the provisions of the old act which provided that in the case of abolition of office-which
3308	HOUSE OF
B.C. Telephone and Telegraph System is what is in effect happening here-of a permanent employee, pension benefits would commence immediately. Yet as I have said, by what under these circumstances amounts to a cruel stroke, by virtue of the regulations which came into effect on January 1, and because he does not cease to be employed by the government service until April 1 that three months interval has the effect of depriving him of his pension rights under the government superannuation scheme until he reaches the age of 50.
I have placed that individual case before the minister and the house because it serves as a clear illustration of the unfairness that can result to the employees of the government system unless some satisfactory arrangement is worked out with the Canadian National Telegraphs to cover the employees on the telegraph side.
I do not wish to take longer on this matter. There is much more material that I could read into the record, including further material from the amalgamated civil servants branch in Vancouver, but I think I have said enough to outline the situation. I should therefore like to conclude with this suggestion. If there could be an opportunity for a full report as to the extent to which the interests of the public and of the employees are being safeguarded in the sale agreement, before April 1, that situation will take care of itself; we can discuss the matter in the light of the facts of which we then have knowledge and we shall have a few days-it may only be a few days, It is true, but it will still be valuable time- in which to try to force an adjustment if we should find that the situation is not satisfactory from the points of view that I have mentioned.
If, however, the minister finds that the negotiations on these points are not going to be completed until after April 1, I would urge most strongly that the justice of the situation demands that the turn-over date be postponed until after April 1, in fact, until after the agreement is concluded, so that the agreement can be laid before the house and can be discussed in the house before the physical assets are transferred.
For the reason I gave at the beginning, if the system is to be handed over before the bouse knows what are the terms of the agreement, then any dissatisfaction which we might express would be useless, and any discussion which would take place as to the terms of the agreement would be a hollow discussion indeed because we would be dealing with an accomplished fact. We could register our protests, we could say what we wished had been done, but the fact would be that what has been done will have been done and we
[Mr. Fulton.1

would be powerless to change it. I have tried to lay before the minister, as briefly as I can, the things which I think should be incorporated in the agreement. I hope he will be able to give us some assurance, either that these matters are in fact being satisfactorily written into the agreement or, if he is not able to report to us at the present time on the situation of these negotiations, that he will postpone the date of the transfer.


Lionel Chevrier: Mr. Speaker, I wonder whether I might be allowed to interject here the remarks that I would have made at the normal time but should like to make now because, just as soon as I have made my observations, it is necessary for me to leave the house.
I want to thank the hon. member for Kamloops (Mr. Fulton) for raising the question in the fair manner in which he has raised it. As he has said, I know that there are other members of the house who are keenly interested in the subject of this sale, as there are on this side of the house. Over and above those who I know will take part in this debate, I want to make special mention of the correspondence which I have had, more particularly with the hon. member for Skeena (Mr. Applewhaite) and other members from British Columbia on this side of the house about the transfer of these assets.
The hon. member for Kamloops has, in effect, dealt with two main questions, first the price of the facilities that are being sold and, second, the conditions of employment after the transfer. I should like to follow him in sequence on those two points. It is a fact that the assets of the government telephone and telegraph services are being sold for $750,000 to the Canadian National Telegraphs and, in the same amount, to the British Columbia Telephone Company. Those assets were valued at various prices following a survey in 1952 made jointly by the British Columbia Telephone Company, the Department of Transport and the Canadian National Telegraphs.
According to the Department of Transport survey the total valuation was $4,436,000; according to the Canadian National Telegraphs survey it was $3,776,000 and according to that of the British Columbia Telephone Company it was $2,357,000. No appraisal was made of these facilities on the basis of depreciated value of capital originally invested. This would have been a complicated study since many parts of the system are very old and moneys have been spent from time to time on renovation and replacement as well as on new services. However, it is quite reasonable to assume that had the

appraisal been based on depreciated value of capital invested instead of on replacement value, the figure would have been very much lower, in all probability lower than the offer which has been accepted.
It is the policy of the government to provide service such as this in isolated areas until such time as private initiative or private enterprise can take them over. That time, it appeared to the government, had arrived, and we had before us a joint bid or joint offer from these two companies. But that joint offer must be considered in relation to the operation of the government facilities. By that I mean the financial operation, whether or not there was a profit or a loss, and over the years the financial operation has not been a good one. Having regard to that as well as to the large capital expenditures required in the very near future to place these facilities in a better operating condition, and also having regard to the increasing traffic, particularly in the northwest part of the province, we had to give serious consideration to this offer.
Let me bring this to the attention of the committee. The cost of operating the government telephone and telegraph system in British Columbia for the year 1952-53 was practically $1 million. The exact figure is $997,881. For the first six months of the current fiscal year operating costs amounted to $638,381, an increase of $41,573 over the corresponding period of last year. I have here the financial results of these facilities for the last three years. For 1950-51 operating expenditures were $863,000-I will give round figures-earnings were $599,000, and the deficit was $264,000. For 1951-52 operating expenditures were $935,000, earnings were $787,000, and the deficit was $148,000. For 1952-53 operating expenditures were, as I have already indicated, $997,000, earnings were $858,000 and the deficit was $139,000.
I referred to capital expenditure for the future. We had before us a report prepared by the departmental officials indicating a capital expenditure of approximately $3 million over the next four years. That was required to renovate and to expand the existing system which is now heavily overloaded. During a portion of this period there would be an operating deficit now estimated at about $300,000 provided leased circuit demands anticipated at the present time actually materialize.
In the face of these circumstances and having been presented with these offers, we came to the conclusion that we should accept. I should say that in the case of Canadian National Telegraphs the offer for their part of the facilities was from the outset $750,000.
B.C. Telephone and Telegraph System However, the offer of the British Columbia Telephone Company was not that at the outset because when that company had completed its survey and had made a complete valuation of the facilities it felt that the amount of expenditure required on the line was such that it could not offer a great deal, and they were told that if that was the position the government would not consider a sale.
Having regard to that, the company first decided to offer $110,700. This was turned down. Then the company increased its offer to $400,000, which was also refused. Finally, it raised its offer to $750,000. When the offers were submitted to the government the government felt, having regard to all the circumstances, having regard to the expenditure of money which was required, that they were fair offers and did accept, namely, a total of $1,500,000.
Having disposed of that, the next step was to enter into negotiations to ascertain the conditions upon which the transfer would be effected. When the government had made its decision to accept the offer it was indicated to these purchasing companies that we proposed to include in the agreement for sale certain conditions that would protect not only the employees but also those who were receiving services in the area concerned. Here are some of the conditions that we indicated to the purchasers we proposed to include in the agreement for sale:
1.	As of the date of the sale, the federal government will no longer operate its telegraph and telephone service west of the Rocky mountains. The said service will not again operate in that area nor will the federal government be in any way responsible for the provision of such services.
2.	The B.C. Telephone Company . . . will give, or cause to be given, telephone service to all places and communities now served by the above-mentioned facilities-such service at all times to be at least equivalent to the service heretofore given by the government telegraph and telephone service.
3.	The Canadian National Telegraphs will give or cause to be given telegraph service to all places and communities now served by the above-mentioned facilities-such service at all times to be at least equivalent to the service heretofore given by the government telegraph and telephone service.
4.	The new owners will promptly and efficiently and without undue delay augment and increase their telecommunication facilities so as to supply adequate service as required from time to time by the development of the above described area.
There is set out as an annex the areas where these facilities exist.
5.	The new owners will employ-
This is the matter to which the hon. member has given attention.
-all personnel now on the payroll of the government telegraph and telephone service who meet their employment requirements and who are desirous of being so employed and will give such employees every reasonable consideration for employment in other parts of their systems.
3310	HOUSE OF
B.C. Telephone and Telegraph System
6.	The new owners agree to inspection of the area from time to time as may be deemed necessary or desirable by the federal government to ascertain if the conditions of this agreement are being met.


Edmund Davie Fulton: For what term is the right of inspection expected to continue? Would that be a permanent thing?


Lionel Chevrier: This is a general condition as set out in the proposal for the agreement for sale. No time has been mentioned there, but I suppose it will be worked out in the agreement. I am not able to answer that. A series of discussions were then held between the government, British Columbia Telephone Company and Canadian National Telegraphs. I can say here and now that the discussions with the B.C. Telephone Company have been conducted on a very satisfactory plane. For instance, the B.C. Telephone Company has informed the department that it is willing to take over, as of the effective date of the sale, all of our people then engaged in telephone work in the British Columbia division and who were employed with the telephone service. There would of course be a provisional period of not more than nine months and if during that time the ex-government employee's services are satisfactory he or she will then become a full-fledged employee of the telephone company.
The company has stated further that in no case will there be a reduction in salary and that in the majority of instances there will be an increase. We thought that was a very fair offer.


Mr. Green:: Could I ask the minister
whether there is any provision for superannuation?


Lionel Chevrier: I am coming to that.


Edmund Davie Fulton: I think that is very fair too.


Lionel Chevrier: With reference to existing services, the company is undertaking to provide telephone service to all points served by the facilities which it is purchasing, such service to be at least the equivalent of what was given by the Department of Transport. The company wishes to commit itself only to the provision of such additional service as It considers reasonable.
My hon. friend asks: What about superannuation, etc., and I suppose that includes seniority. There then followed a series of discussions having to do with those matters. I think that in so far as seniority is concerned the position is a satisfactory one because the British Columbia Telephone Company has indicated to us that they have a collective bargaining agreement with their employees. To the question which was asked of them, in these words:
Will seniority rights apply on a local or system basis?


The reply by the British Columbia Telephone Company was:
Seniority rights will apply on a system basis consistent with Article XII of the British Columbia Telephone Company agreement with federation of telephone workers, which reads:
"Arrangements of staff shall be made on the basis of ability, seniority, merit and service requirements. Seniority, under all circumstances, shall be given every consideration."
And then, with reference to superannuation, I might say that the matter is a pretty complicated one, and it would take a great deal of time to discuss it in detail now. I believe however I can put it in this way, by saying that none of our employees-and I am speaking now only with respect to British Columbia Telephone-will lose superannuation benefits from the federal government. Employees entering the service of the British Columbia Telephone will be brought under their plan; and from the letters I have seen and read I believe I am safe in saying that their plan is an even better one than we have in the Department of Transport to cover government employees. I say that because the wage rates are higher. That is, I believe, on the subject of superannuation, the arrangement that the telephone company intends to put into effect and which, in so far as I understand the situation, I feel will be a satisfactory one.
Now, then, the other point raised by my hon. friend was that of Canadian National Telegraphs. I have been unable to give the house any information in the matter, because it was thought that if first we could dispose of the arrangement with the B.C. Telephone Company, we could then proceed to enter into a detailed discussion with Canadian National Telegraphs. It has not been possible to do that until this week. The officials of my department are this very day in Montreal discussing with Canadian National Telegraphs the points I am now relating in regard to the telephone company.
They are discussing not only the question of employees that will be taken over, not only the question of salaries which will be paid, but also the matter of seniority, superannuation, and all such other matters. Therefore I am not in a position to make a statement in so far as that is concerned, other than to say that I am hopeful that Canadian National Telegraphs would not want to place themselves in a position of inferiority vis-avis British Columbia Telephone Company, in so far as the treatment of our employees is concerned. I know that I have already in my conversations with the president of the Canadian National Railways brought to his attention the importance of dealing with these people on a fair and equitable basis;

and I am sure from communications I have received from him that he will be co-operative to the fullest extent.
My hon. friend suggested a method of procedure, that of holding over the agreement for one or two months until we know what the position is. Well, in answer to that all I can say is that we have no funds in the estimates after April 1 to make that provision. Negotiations have taken a far longer period of time than I had anticipated and certainly longer than departmental officers had anticipated. But if there is any fear that any of our employees will be prejudiced, there are still the sittings of the committee on railways and shipping, which will begin on Monday. The officers of the Canadian National Telegraphs could be made available if necessary. It is the Canadian National Railways we are studying-their annual report, and general business activities-but I think I could make available officials of Canadian National Telegraphs if it were thought necessary.
I am hopeful that it will be possible to make this transfer on April 1 in a manner as equitable as possible under all the circumstances. There are bound to be some difficulties; there are bound to be complaints. We cannot cover them all. My hon. friend has brought up one case with which I must say I am not familiar, but I shall read in Hansard what he has said and see what the position is. If I am able to make a statement -and I hope I shall be able to before April 1 -as to the rest of this transaction, I shall be glad to do so. But, so far as I can see,
I do not think there is any reason why there should be undue anxiety over the matter.


Howard Charles Green: Will provision be made by the government to retain in the civil service those employees who cannot be taken over by the British Columbia Telephone Company or Canadian National Telegraphs?


Lionel Chevrier: I would not like to answer that until I can look at the position in greater detail. From the statement I have made to the house thus far it would appear that all the employees can be taken over by British Columbia Telephone Company. So that that point will not arise. I know also that in the case of Canadian National Telegraphs there are a number of men who have reached retirement age; some are over 65 years. It would not be the intention of Canadian National Telegraphs to take those men on. I do not think the house would expect that to be done. And there are one or two other cases where the position is a little more difficult. For that reason I think I
24, 1954	3311
B.C. Telephone and Telegraph System should withhold my answer until I know the number that Canadian National Telegraphs and British Columbia Telephone Company are able to take on.


Mr. Leboe:: I should like to ask the
Minister of Transport a question with regard to the extension of services in that part of British Columbia east of the Rockies, which might take up some of the slack, so far as personnel is concerned.


Lionel Chevrier: Does my hon. friend mean extension of facilities by ourselves or by British Columbia Telephone Company?


Bert Raymond Leboe: By yourselves, east of the
Rockies.


Lionel Chevrier: Is that included in this sale?


Bert Raymond Leboe: No; how will the sale affect services there? I thought perhaps the minister might be planning extensive work there which might take up some of the slack, so far as members of the staff are concerned.


Lionel Chevrier: Well, in so far as the facilities being sold are concerned, we will have no further responsibility for any extension. In so far as facilities that are not being sold are concerned, well, that is a matter of policy which will have to come up when from time to time facilities are required. I cannot answer that now.


Mr. Barnett:: In relation to the question just asked by the hon. member for Cariboo, I am under the impression that the minister misunderstood the import of the question. As I understood the question-and I would like to know the answer myself-in the case of one who is now employed in the British Columbia division and who wishes to remain in the government service, would provision be made for his transfer to a division of that service which is not involved in this sale so that he could continue his employment with the government telegraph and telephone organization?


Lionel Chevrier: I think the intention is to have all the employees taken over either by British Columbia Telephone Company or by Canadian National Telegraphs. If there are some who are not going to be taken over, then consideration might well be given to their employment in some other part of the service.



INCOME TAX COLLECTIONS FROM FARMERS IN CALGARY AREA

Mr. D. S. Harkness (Calgary Norih):: Mr. Speaker, I wish to raise a grievance concerning methods employed in collecting or attempting to collect income tax from certain farmers in the Calgary area and other places.

Income Tax-Calgary area farmers This matter came to my attention while I was in Calgary during the Christmas recess, at which time I was shown a letter sent to one of these farmers from the income tax office demanding a large amount of information. The information supplied as a result of the letter, and an interview with the farmer, was then used for the purpose of determining his net worth and then, in many cases, imposing arbitrary assessments for income tax purposes.
I made a copy of this particular letter. It was headed in this way: "Re income tax returns 1946 to 1952, inclusive." In other words, they were going back a considerable length of time. I will not take time to read it all because I want to get finished shortly. In any event, the farmer was required to come into the income tax office and bring his records. The letter says:
Please bring with you all record books, vouchers and receipts pertaining to the income and expenses of the years under review; also your bank pass books or ledger sheets (all banks), for both current and savings account (a wife's account to be included) and your cancelled cheques.
The farmer is asked to give all sorts of information in regard to land owned, when it was secured and so forth, balance of principal owing, interest and so forth during this period. He is asked the same in connection with any land that had been sold and in connection with all chattels; he is asked questions in regard to his machinery and so forth back over all this period. He is asked about items he had purchased, the original cost, the date and month of sale, the selling price or trade value and the name and address of purchaser or dealer. He is asked the same in connection with all livestock.
It is manifestly clear that when you ask a man to go back six or seven years and tell how many pigs he had on a certain date and how many chickens he had and so forth, he just cannot do it; he has to guess at it. In other words, a good deal of the information was not such as 99 farmers out of 100 could reasonably be asked to furnish or could furnish. Then the letter goes on to say that:
"Certain other information respecting your affairs will be requested at the time of the interview. If you are unable to attend on the day mentioned, please arrange for an alternative date to suit your convenience.
You will realize that this arrangement affords you a reasonable convenient opportunity of giving or requesting needed information and enables you to produce documents for examination without the difficulty that sometimes arises through correspondence.
Your efforts in assembling the records and bringing them with you at the appointed time and place will be appreciated and should serve to provide a proper understanding of your affairs which may be of benefit in the future.

The whole tone of the letter is to give the farmer the opinion that this is going to be of benefit to him, to help him out. Any benefit that might be derived from that procedure was quite naturally going to be for the income tax officials and not for the farmer. That certainly is not the way the thing was worded, and the understanding which I think was wrong was that it would help the farmer. I put some questions on the order paper in connection with this matter. The first question was: Was a letter of this kind sent out? The answer was yes. The answer was contained in a return dated February 12, 1954. The second question was:
If so, to how many fanners?
The answer was:
Approximately 500.
That is in the Calgary income tax district. My third question was:
Were similar letters sent to any other class of income taxpayers?
The answer was no. I would ask first of all why our farmers of all the classes and groups of taxpayers in Canada are singled out for this particular type of treatment? Why are they the only class of people? If farmers are going to be subject to this type of thing and to the inquisition, which I will come to later, which follows it, why are not other classes of taxpayers to be subject to it? Why pick on only one group of people? Why are they treated in a different way from other income taxpayers in this country? My next question was:
If so, how many of these letters were sent out in each of the provinces?
The answer to that question was:
Answered by No. 3.
In other words, I did not get any further information there. My next question was:
If this letter was sent out, what was the purpose of seme?
The answer was:
To arrange a meeting with each farmer, at a time and place convenient to him, at which his income tax returns for specified years could be reviewed and reference made, where necessary, to his books and records supporting the figures shown on the tax returns.
My next question was:
What benefit to the farmers is envisaged?
The answer was:
An opportunity is afforded the farmers to clarify, with the aid of factual data, all points in their returns requiring explanation and to discuss, in general, income tax matters of interest to them.
I submit, Mr. Speaker, that these two answers were, if not designed to mislead me, certainly phrased in such a way that if I took

them at their face value I would be misled, as would anybody else who reads Hansard, because the purpose for which this was sent out was quite clearly to establish the net worth of these farmers and in some cases at least arbitrarily to assess them for income tax purposes back over a period of years. It was wrong to answer the question in that way. In other words, it looks to me like an attempt at evasive tactics as far as giving to me as a member of this house and the house generally a true picture of the situation with regard to how this income tax is being collected from farmers.
I put another set of questions on the order paper and got a return on March 3, to further clarify this matter. The first of these questions was:
Were letters, similar to the ones sent to farmers in the Calgary income tax area, sent out to farmers in all provinces?
The answer was:
No. Similar letters were sent in the Edmonton district in Alberta, in Manitoba and in Ontario.
In other words, the only places in Canada in which farmers are having this letter sent out, and in which they are being brought in and subjected to inquisitorial methods, are in Alberta, Manitoba and Ontario. If this is being done in these three provinces to farmers, why is it not being done in all provinces? Why is it not being done in Saskatchewan where conditions are certainly the same as they are in Manitoba and Alberta? Why are these letters not being sent out to those farmers, and why are they not being treated in the same way? The only answer that suggests itself to me is that probably the Minister of Agriculture (Mr. Gardiner) was able to exert sufficient influence so that such treatment was not given to farms in Saskatchewan.


Mr. McCann:: Shame; poppycock.


An hon. Member:: What is the reason?


Douglas Scott Harkness: The minister says "poppycock". I should like to get any other reason. In other words, this is the one that suggests itself as the only possible reason, because we have exactly the same conditions in Saskatchewan as in Alberta and Manitoba. Yet, the farmers in Saskatchewan are not being subjected to these methods. Again why is it in Quebec, where conditions are certainly similar to those in Ontario as far as farmers are concerned, that such letters are not sent out? Once more the inference
Income Tax-Calgary area farmers that one would draw seems to be fairly obvious.
However, the general question remains. If certain farmers in three provinces are being subjected to this sort of thing, why are farmers throughout Canada not being subjected to it? Why pick on the people in three provinces only to give them this treatment?
Following the appearance of the answers to these questions and some comments I made in the Calgary Albertan I received some letters from farmers in connection with this. I have one here which details just what happens when a farmer is called in for this interview which has been represented to him is going to be of benefit to him. This man writes as follows. I will not read the whole letter:
I know of what took place at the meetings, and of the gestapo methods of questioning.


Mr. Speaker:: Order. Is the hon. member reading a private document? If so, he will have to divulge the source.


Douglas Scott Harkness: That is fine with me, Mr. Speaker. I wrote and got this man's permission to divulge his name. The letter is written by W. H. Evans of Calgary. He says:
I know of what took place at the meetings, and of the gestapo methods of questioning. Our objection is to the demand for a net worth statement. As far as I can learn no other industry but farmers are asked for a net worth. As so many things over years and years could go into a net worth which are not taxable, I am convinced such a demand is definitely not just. So you will have a clear picture of what takes place at a first meeting with tax officials, the person would go in with receipts and expenditures prepared to answer questions regarding the years asked for. Then without any warning: We want your net worth and how did you acquire those things? In the case of my son the questioning went this way: What did you do with your gratuities when you were discharged from the air force?
Now, there is the first thing. A man who is an air force veteran is taken into the income tax office and the income tax people ask him:	"What did you do with your
gratuities?" What business is it of theirs what he did with his gratuities? Surely, when a man returns here after fighting for his country, the last thing he should be subjected to some seven or eight years later is a demand to know how he spent the money he got as gratuities.
The next question was, "What clothes do you buy?" Is it any business of the Minister of National Revenue (Mr. McCann) and his officials what clothes a farmer or any other
3314	HOUSE OF
Income Tax-Calgary area farmers taxpayer buys? Then he was asked, "Have you been buying any fur coats or jewelry?" This would be for his wife, of course. Once more they are trying to pry into all the details of a man's domestic life.
Then, the next question was, "What does it cost you for board?" They want to know what he pays for groceries and so forth, how much it costs. This is another thing that is no business of theirs. Then, he was asked, "How much do you spend on liquor?" I do not know whether the Minister of National Revenue and his minions are turning themselves into agents of the temperance association, but certainly it is none of their business how much liquor a farmer or any other individual buys. I know the minister would resent anyone asking him how much liquor he buys.


James Joseph McCann: I never got any from you, anyway.


Douglas Scott Harkness: These officials are demanding that he give the information or he would be arbitrarily assessed for his income tax. They asked, "Have you been on any holiday trips, and how much did they cost?" The writer of the letter goes on:
You can imagine how perplexed one would be to have to depend on memory and to have had no inkling such was expected.
The general situation is this, that a certain limited number of the farmers in the southern half of Alberta, which is in the Calgary income tax district, were dragged in and subjected to these gestapo methods of questioning concerning their private affairs. Then, on the basis of that, as I say, the department goes ahead and establishes the net worth and places an arbitrary assessment on it. No doubt they do the same with a limited number of farmers from other provinces. We have not been able to find that out. That is one answer I did not read from this return. I asked:
Were letters, similar to the one sent to the farmers in the Calgary income tax area, sent out to farmers in all provinces? If so, how many were sent out in each province?
The answer I received was:
They were sent from time to time to make appointments in a nearby town for farmers in the area. Statistics are not available because this was a routine procedure.
It is not very routine when you have 500 farmers in southern Alberta, and no doubt a like number in the northern half of Alberta,


Manitoba and Ontario, subjected to this procedure. It is anything but routine. I would think the first thing the minister should do would be to repudiate these methods and give the house an undertaking that this sort of thing will not be continued at any time in the future.


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


William Earl Rowe: Is the minister going to answer?


James Joseph McCann: I shall answer at the proper time.
Motion agreed to and the house went into committee, Mr. Robinson (Simcoe East) in the chair.



DEPARTMENT OF EXTERNAL AFFAIRS

[Stage Direction]
84. Departmental administration, $3,333,583.
Item stands.

[Stage Direction]
239. To provide for the Canadian forces, the defence research board and other expenditures relating to defence, including contributions toward the military costs of the North Atlantic Treaty Organization; to authorize expenditures in the current year out of the amount hereby provided, not exceeding $300,000,000, under the provisions of section 3 of the Defence Appropriation Act, 1950, and to provide that, notwithstanding subsection 3 of that section, where equipment or supplies acquired by the Canadian forces after March 31, 1950, are transferred, the estimated present value thereof shall, if the governor in council so directs, be credited to this vote instead of being paid into the special account mentioned in the said subsection 3, and when so credited may be expended for the purposes of the Canadian forces; and notwithstanding section 30 of the Financial Administration Act to authorize total commitments for the foregoing purposes of $4,577,641,724 regardless of the year in which such commitments will come in course of payment (of which it is estimated that $2,711,822,159 will come due for payment in future years), $1,865,819,565.
Item stands.

[Stage Direction]
247. Departmental administration, $1,150,272.
Item stands.

[Stage Direction]
210. Departmental administration, $470,422.
Item stands.
Mr. Harris:: Would the committee rise, report progress and ask leave to sit again.
Progress reported.



BUSINESS OF THE HOUSE

Walter Edward Harris: Tomorrow, Mr. Speaker, the following motion will be presented as the first item after orders of the day:
That items Nos. 84 to 103 inclusive, the main estimates, 1954-55, be withdrawn from the committee of supply, and referred to the standing committee on external affairs, saving always the powers of the committee of supply in relation to the voting of public moneys.
There has been an effort made to ascertain the best means of disposing of the debate which will follow on the presentation of that
Business of the House
motion. We have felt that it would be the wish of the house to have a fairly complete survey of matters on external affairs. For that reason, we are suggesting that the first speaker will be the Secretary of State for External Affairs (Mr. Pearson) who will touch on matters in general and then the Prime Minister (Mr. St. Laurent) will make a statement with particular reference to some of the matters concerning his recent trip but more especially with the subject of China.


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

[Stage Direction]
\