1955-04-25

PRIVILEGE


Mr. W. Ross Thatcher (Moose Jaw-Lake Centre):: Mr. Speaker, may I crave the indulgence of the house for a moment to speak on a matter of personal privilege. On three different occasions I have been elected to this parliament as the standard bearer of the C.C.F. party. During those years I have appreciated the privilege of working with C.C.F. members of parliament and with the leader of this group, the hon. member for Rosetown-Biggar (Mr. Coldwell).
However, I regret to say that recently there have been growing differences between myself and my colleagues on matters of major public policy. At one time I had hoped these differences could be resolved. However, the present session of parliament has convinced me that such a hope is futile. Therefore, in fairness to my leader and in fairness to my colleagues and in fairness to myself I feel that I have no alternative but to resign from the C.C.F. party.
This is not the time to deal in detail with our differences, but I shall take an early opportunity in the house to explain the reasons for my action. For the remainder of the present parliament I propose to represent the constituency of Moose Jaw-Lake Centre as an independent member. I shall not apply for membership in any other party. I shall continue to support those measures and motions which I believe to be in the best interests of the people who elected me, no matter from what quarter they are advanced.
Under these circumstances I must ask you, sir, to allocate to me a seat in another part of this chamber.



COMBINES INVESTIGATION ACT


Hon. Stuart S. Garson (Minister of Justice):: Mr. Speaker, I was asked yesterday by the hon. member for Kamloops whether I would table the evidence received from the restrictive trade practices commission in the course of an inquiry into loss-leader selling. I am
now tabling such evidence. I may say that it is not on the table, but rather on the floor beside me. It is quite voluminous, and I doubt if there would be enough clear space on the table as presently covered to accommodate this evidence.
This voluminous evidence falls into two parts. The first part is the green book, as it was referred to throughout the hearings, which contains the information that was collected by the director of investigation research for the purpose of laying before the commission. The second part consists of the transcript of the evidence which was given before the commission in the course of the hearings which it held across Canada last summer and fall.


Mr. E. D. Fulton (Kamloops):: Mr Speaker, may I express my appreciation to the Minister of Justice for the rapidity with which he complied with the suggestion I made yesterday. May I ask whether he will table more than one copy and, if not, whether he could inform the house whether the evidence is generally available, or whether this is the only set.


Stuart Sinclair Garson: We would be in a position to supply a reasonable number of copies to any members in the house who are interested. But we could not by any means supply every member of the house.



IMMIGRATION


[Stage Direction]
On the orders of the day:
Mr. W. M. Hamilton (Notre Dame de Grace):: Mr. Speaker, since my question
affects two departments of government I am wondering if the Prime Minister would care to make a statement regarding an American gangster earlier identified in this house by myself as an undesirable alien, since detained by the Montreal police department and now being held by the immigration department in Montreal?


Right Hon. L. S. St. Laurent (Prime Minister):: No, I have no information I can communicate to the House of Commons in connection with that person.
3070	HOUSE OF
Inquiries of the Ministry COAL



REPORTED CLOSING OF NOVA SCOTIA MINE

[Stage Direction]
On the orders of the day:
Hon. George A. Drew (Leader of the Opposition):: Mr. Speaker, I should like to ask a question of the Minister of Mines and Technical Surveys. Has the minister received a telegram from Glace Bay with regard to the reported closing of Dominion No. 1-B colliery? If so, has he any statement in regard to the matter, or any statement in regard to the situation there from the point of view of employment?


Hon. George Prudham (Minister of Mines and Technical Surveys):: I have received several telegrams relating to the announced closing of No. 1-B colliery. Most of those telegrams cited the loss of markets as the reason for closing. My understanding is that the real cause of the closing is the high cost of production. That problem has been clearly understood by both management and labour for some time, and I believe the announcement of the closing of the mine has been made after very careful and serious consideration by both management and labour.


George Alexander Drew: Has the minister given any consideration to the possibility of appointing a group of experts, either from his own department or from outside, to examine the opportunities that may present themselves to make other uses of this colliery, if necessary, in view of the very substantial dependence of a large number of people in that area upon that operation?


George Prudham: Mr. Speaker, I do not quite understand what the Leader of the Opposition means by "other uses". There can be only one use of a colliery, and that is to produce coal. For the last two years the problem has been given very careful consideration by the dominion coal board, management and the unions. Only recently a representative of the Nova Scotia government was in Ottawa, and a plan was suggested by me to that representative. He was to take that plan back to the Nova Scotia government, the mining company and the unions. As yet I have had no further report as to how that suggestion was received. It is my intention to get in touch with the president of the company today to see if the suggestion is considered to have any merit.


George Alexander Drew: This is not in any way by way of a debate, but since the minister said that he did not know what I had in mind in suggesting other possibilities, may I say I was thinking, for instance, of the fact that in other countries there have been cases where mines which became uneconomic, from


the point of view of ordinary operations, became very economic from the point of view of the development of electricity right at the mine head. I had that in mind, and other similar possibilities, in view of the substantial dependence of a large number of people upon this operation.


George Prudham: Mr. Speaker, you just cannot produce electricity economically with $11 coal at the pithead.


Mr. Gillis:: May I ask the minister a supplementary question? Is it correct to say that in so far as the government is concerned, jurisdiction over this matter that the Leader of the Opposition is inquiring about is in the hands of the provincial government? Second, I should like to ask the minister whether the provincial government of Nova Scotia has made any representations to his department with respect to relinquishing control of the industry in order that the federal government might take some action?


George Prudham: No, Mr. Speaker.



LIFTING OF ALLEGED EMBARGO ON MOVEMENT TO THE LAKEHEAD

[Stage Direction]
On the orders of the day:
Mr. H. A. Bryson (Humboldi-Melfori):: Mr. Speaker, may I direct a question to the parliamentary assistant to the Minister of Trade and Commerce? Has the embargo on Saskatchewan grain moving to the lakehead been lifted?


Mr. J. H. Dickey (Parliamentary Assistant to the Minister of Trade and Commerce):: Mr. Speaker, the hon. member was kind enough to send over a notice of his question. In answer, I may say that there never has been any embargo by the transport controller. The railways had too many cars on track at the lakehead, and accordingly would not move any further cars to that destination. The situation has come to an end with the settlement of the strike and the opening of navigation on the lakes, and there should be normal movement from now on.



ADMINISTRATION OF JUSTICE


[Stage Direction]
On the orders of the day:
William McLean Hamilton: Mr. Speaker, may I ask the Minister of Justice whether the Royal Canadian Mounted Police will continue to leave to the Montreal police the responsibility for locating and detaining undesirable aliens, such as Michael Joseph Consolo, who was turned

over to the immigration department this afternoon by the Montreal police?


Stuart Sinclair Garson: Mr. Speaker, ordinarily, in those provinces in which the enforcement of the law is carried out by the provincial and municipal police forces, as in Quebec, the apprehension of criminals is the responsibility of those police forces.
With regard to my hon. friend's question, of which he did not give me notice, I shall be glad to discuss the matter with our own officers of the Royal Canadian Mounted Police to see whether there is anything further that I need to add to what I have just said.



THE BUDGET


[Stage Direction]
The house resumed, from Wednesday, April 20, consideration of the motion of Hon. W. E. Harris (Minister of Finance) that Mr. Speaker do now leave the chair for the house to go into committee of ways and means, and the amendment thereto of Mr. Macdonnell, and the amendment to the amendment of Mr. Coldwell.
Mr. F. G. J. Hahn (New Westminster):: Mr. Speaker, the budget debate so far has proven, among other things, that the Conservatives are bankrupt of ideas. Certainly, there is a marked resemblance between the amendment that they proposed to the speech from the throne and the amendment they moved in this budget debate. I also note that the leader of the socialist party, the C.C.F., did not at this time propose any socialistic means by which he could cure the ills of the nation. That certainly is a step forward.
The Minister of Finance is a charming man, but he is a Conservative wearing a Liberal mantle. His budget is a palliative, not a cure. It reminds me of an injured man who is given a cane and who is so badly injured that he requires a crutch for support.
Finance in this country today is a sick man, and I would say that it needs the full treatment. Time and conditions will prove that the Minister of Finance might have been the emancipator of all time. Instead of that, I think we shall have finally to record that he is just another tax collector. Instead of throwing caution to the winds, he has decided to follow the Conservative caution that I spoke of earlier. I am almost led to believe that he read some of the budgets that were brought down in the late Prime Minister R.
B.	Bennett's regime, for certainly he has nothing further to offer than was offered at that time.
The Budget-Mr. Hahn I may say that I have always admired the new Minister of Finance. I have always thought of him as a man of vision. Instead of that, I find him a man of revision. He has merely revised the tax structure that has been in existence for some time. I hope the minister will be at the proposed dominion-provincial conference. I would suggest he will find in the discussions at that conference that some of the ministers of finance from the far western provinces will propose new techniques and new principles which might be able to straighten out the affairs of this country. What we require today are alternatives, not remedies. In his first budget he has failed to relieve those who need it most. The man on the low fixed income is the man who gets the least. The man on the small superannuation and on the small annuity gets nothing. I find the budget does nothing for the old age pensioner, or for the war veterans allowance man who is unable to obtain casual earnings. It does relatively little for the blind and disabled. To my way of thinking, their plight is worse than it was a year ago. It does nothing for those who are on old age security. The budget reminds me of the biblical story. When the rich were putting their gifts into the treasury a widow put in two coppers, and our Lord said that she had put in more than all of them. The same widow is still putting two coppers into the treasury, and putting in more than all the others.
It is not my intention to treat the budget with derision, but I say that it is an orthodox conservative budget. It does not go far enough. I congratulate the minister upon the tax concessions and the tax cuts that he has made. It is the purpose of the opposition to offer constructive criticism, not just criticism that will tear down the house that we have built. The leader of my group gave some constructive criticism, methodically and well. It would be presumptuous of me to review all the information that he gave. Before going on with that, let me say that the tax cut now given is too little and too late to cure depressed industry and relieve the unemployment situation as it exists at this time. The situation will deteriorate still further unless additional action is taken by the government.
What we need is an injection of more purchasing power. We must have a balanced economy. We must balance the purchasing power within the nation with the productive capacity of our workers. It is most important that this injection of purchasing power should be made where it will do the most good.
Studying the matter I would say that the quickest way to create work today would be
3072	HOUSE OF
The Budget-Mr. Hahn to create a demand for the goods in connection with which we have the heaviest turnover, such as food, clothing and automobiles. The Minister of Finance (Mr. Harris) took care of the automobile matter to some degree with his 5 per cent reduction in the excise tax, but putting money into durable goods at this point is not of as great value from the point of view of creating immediate employment for people now unemployed as other methods would be. It will not cure the problem which is quite likely to continue and grow.
The greatest market for non-durable goods is to be found among the people who have no money, those who do not pay income tax, those who do not buy automobiles. The removal of the sales tax on clothing and textiles would create an increased demand for those particular goods and this demand would be set up almost immediately. It is quite possible that it would help in offsetting the unemployment which is prevalent today in the textile industry. If we had taken the sales tax off textiles we would have done more to create jobs in this country at this time than is being done by the reductions in the income tax. It certainly would have made the dollars which these poor people have go considerably further and would have created a demand for the goods which they require so badly.
It would be better still to inject purchasing power into the hands of these people themselves. This group consists of unemployed employables, war veterans on disability pension, those who are in receipt of annuity or superannuation payments and those who cannot make money by casual work because they are handicapped or because there are no jobs available. We could create purchasing power by increasing the old age pensions paid to our senior citizens. We could increase purchasing power by giving larger old age security payments.
We could also assist materially by putting dollars into the small annuities, into all annuities for that matter, and making them worth what they were when people first purchased them. You will possibly remember, as I do, the days when we saw large signs in our post offices and banks telling people to prepare for their old age by buying annuities or pensions of one kind or another. The people who bought those annuities some years ago were led to believe that if they bought a $20, a $30, a $40 or a $50 annuity it would be worth that amount of money when they needed it most.
However, the opposite is true today. The $50 annuity is worth approximately $25 today. Let us reward these people for their


thrift and foresight ih. investing in post office annuities and.-other forms of annuities by putting dollars back into the annuity fund.
I do not intend to spend any great amount of time discussing the budget, but I should like to draw to the attention of the minister the excellent way in which my leader drew attention to the relationship between agricultural production, labour and national income in the United States. I believe it was discovered that when you have a maximum of labour, farm income and production the ratio is 1-1-7. I commend my leader's address to the minister's careful attention because it is quite. possible that in this lies the key to an economic formula for full employment.
I listened with considerable interest to what the hon. member for Spadina (Mr. Croll) had to say during the course of the debate about a guaranteed annual wage. It is not my intention at this time to discuss the guaranteed annual wage because I think we can do a better job and be able to speak at greater length when the estimates are before us. However, I was struck by one point in his speech. I think he gave an excellent discourse, but then he tried, not with the same success, to make out a case against it.
There was one thing that did stick in my mind, that is his suggestion that if the auto workers were not continuously employed in building automobiles under a guaranteed annual wage they might turn to the making of cuckoo clocks. I wondered what was to happen to those who were already employed in the building of cuckoo clocks. Possibly they would be busy building something else of which somebody else had already produced too much.
As I said earlier, I would refer the minister to the address of my leader and his reference to the plight of the farmers. We have noted from time to time the fact that our labour problem depends largely on farm production. Whatever the labouring man creates is quite often the direct result of what the farmer has produced and what he has received therefor. I do not intend to debate this problem because, as I said before, there has been so much said about his plight and the effect of what he produces upon the nation as a whole.
There are other groups that could be dealt with at this time. There is the case of the old age pensioner, the blind person, the disabled person and the men and women who are receiving old age security. I am quite satisfied, as is possibly every hon. member in this house, that this problem is not being adequately dealt with today. We should spend more time studying what can be done for

these senior citizens. With automation and the fact that jobs are becoming fewer, these people have not the funds to carry on, and we must find some way of looking after them. Their plight can and will probably be discussed at the appropriate time on the estimates.
However, there is another group in regard to which I have checked the estimates carefully to see whether I can include it in the discussion on the estimates; but I cannot. Therefore I propose to tell you something about their difficulties. They play a most important part in the economy of the community and they are a most important economic group in the business of the nation. They are the forerunners of the metropolitan areas, they are the financiers of the community, and they are the hardest hit in times of depression. I refer to the small retail shopkeepers. What drew them to my attention was an article in the dominion bureau of statistics "News Notes" of April 1, 1955, from which I quote:
The number of commercial failures under the Bankruptcy and Winding Up acts increased 37 per cent last year from 1,657 in 1953 to a post-war peak of 2,278. Defaulted liabilities jumped to $53,142,000 from $32,818,000, average liability per failure increasing 18 per cent.
Now I know that this refers to commercial failures and does not necessarily include all retail merchants. However, it does include the retail merchants. They, as I said earlier, have played a most important part in the building up of our community and of our nation, and I feel that they have not been given the consideration which we are capable of giving them. The small shopkeepers in this country do approximately 60 per cent of the nation's business; the chain stores in comparison do 40 per cent.
Let us examine the significance of the statement which I have just read. It means in effect that there are 2,278 families who have become financially destitute. It means that those employed by these commercial enterprises are temporarily unemployed. It means that we are going to add all these people to the unemployed list. It means in effect that our employable unemployed list has grown by 2,278 families plus all the people whom they have employed.
That is a most discouraging state of affairs. Here we have people who have lost their life savings. They have no compensation; they have no unemployment insurance; they are destitute. They have given their all to the growth of this country and to the growth of their small communities. They are probably the greatest philanthropists within the nation, and yet there is not a place where we find we can discuss their plight. It is a tragedy of our 50433-195
The Budget-Mr. Hahn economic system that these builders of our community life should finish their business careers in this way.
There are certain factors which cause these failures. Some of them are of a personal nature over which we as a parliament have no control. However, I am not interested in their personal shortcomings. I am more interested in what we have done and what legislation we can pass in order that we might see that these continued failures should not be with us in the future, especially if they are not due to their own personal shortcomings. I speak of the economic aspect over which the small merchant has no control and all the legal technicalities which might be involved in giving him assistance.
The first of these items which I have listed is the fact that buying in quantity means that we should be able to purchase at a discount. I do not know whether hon. members are aware of what buying in quantity actually means. It means to some companies that if you buy one case of goods you are not buying a quantity but if you buy five cases of goods you are buying a quantity. Most people have the impression that one has to buy a carload lot of goods before one is buying a quantity. Does the hon. member have an observation to make?


Mr. Byrne:: You are selling a fine bill of goods.


Frederick George Hahn: Thank you. I hope to continue selling it too. Most people have the impression, as I said, that in order to buy a quantity one must buy in carload lots or at least in multiples of ten. Such is not the case. I am thinking of a particular item which you would be buying in quantity if you bought five items; but you have to buy ten to get a further increase in discount. If you buy 25 you are buying actually at carload lot prices. A particular firm may have 25 different items, and does not care which one of the items you buy. You can buy one of each, which means that it takes just as much bookkeeping and there is just as much trucking involved to pick up each one of the 25 items. You are supposedly buying in quantity, but in effect you are not buying in quantity in the true sense of the word. However, you are getting the advantage of a 25-case purchase. That is one of the reasons why we find that chain stores are possibly able to undersell these smaller retail merchants who are trying to be competitive with them. The man who is helping to build the community contends, and I contend, that buying in quantity should mean certainly buying more than one item, or one per article, not
3074	HOUSE OF
The Budget-Mr. Hahn 25 items each of one different article, especially when the same amount of bookkeeping and the same trucking and so forth is involved in carrying out such a transaction.
To illustrate my point further with respect to the sales made by the small retailer as compared with the chain store, I would say this. If the chain stores were to purchase all their goods from the one wholesaler and were to get the chain store price, the wholesaler would in all likelihood go bankrupt. Today the small merchant is in effect subsidizing the chain store. The small merchant is buying 60 per cent of the wholesaler's product, as against 40 per cent by the chain store. In effect it means this. For purposes of illustration, we will use a lot of 100 cases of goods which are sold on the national basis of 40 to a chain store and 60 to the small retail merchant. If each of those pieces of goods is worth $7-assuming it is the net cost-the net cost of that parcel of goods would be $700. If the wholesaler is willing to sell that commodity to the chain store at 10 cents less than cost and to the small retailer at 10 cents more than cost, the price will then be $6.90 to the chain store and $7.10 a case to the small retailer. The 40 cases of goods which the chain store buys at $6.90 would return to the wholesaler 40 times $6.90 which would be $276. The 60 cases of goods which are sold to the small retailer at $7.10 would, in effect, give the wholesaler $426. That would be his net return. The wholesaler then, adding those two figures together, would receive for his goods $426 plus $276 or $702 in this transaction.
In effect what has happened is that the wholesaler has sold his commodity for less than cost to the big chain store and for more than cost to the small retailer, and has still wound up with a $2 profit on the whole transaction. That is something that is being done. For that reason I say that the small retailer is subsidizing the chain store today.
I contend that that is not fair business practice. I contend that we in this parliament should take action to see that no commodity is offered for sale, unless it is on a clearance basis, at a price less than wholesale to any particular group of merchants or individuals. The small merchants of this country should not be discriminated against.
A second factor in this matter is the unethical practice of coupon disposal. I am satisfied, Mr. Speaker, that each hon. member from time to time has seen the coupons that are offered by certain firms in this country and that are put out as an introductory offer. In one instance I am thinking of a soap firm in the city of Edmonton. I think it was called Soapone. Those people issued thousands


and thousands of coupons to the merchants in western Canada. Then after the merchants had given the 10 cent value per coupon, they failed to recover them. The firm went bankrupt.
A coupon is a form of money and its use should not be permitted in that particular sense. If those companies are willing to sacrifice 10 cents per box as an introductory offer, I would say they should be compelled to issue box lots or case lots to the merchants at a discount sufficient to enable them to quote their price 10 cents below what would be the normal price at a later date. That would be the fair way of doing things instead of what is being done now where, because some particular lady happens to bring along her coupons or because she has an accumulation of them from her neighbours who do not use that particular brand of soap, she has an advantage over the other ladies. That part has nothing to do with the actual merchandising of it. The fact remains, though, that here we have coupons being given to the merchants who take them in good faith and, having taken them, find that they cannot recover their money from the firms in question because they have either gone bankrupt or are unwilling to accept responsibility for the issuance of those particular coupons.
Then there are other unethical practices in respect of this coupon letting. I remember a particular instance-and it also took place in western Canada-in which the small merchants were going to be the outlet for a new brand of soap. The purpose was to introduce a new type of soap of one of the larger soap companies. In this instance the merchant was approached by the supervisor of the soap company and it was proposed that if he bought, let us say, five cases of soap, which would be 60 packages, he would be given 60 coupon cards. On each one of those cards he would have to put the name of one of his customers. Then it had to be sent through the mail to this particular customer. The customer in turn was to return it to the storekeeper and it could be retrieved on that basis.
What it was, in effect, was a grandiose scheme to force the small merchants to buy cases and cases of soap that they did not require. I had occasion to go into one merchant's store subsequent to the offer of this particular deal. Two years later he still had that particular soap in the warehouse. Because he had 500 customers, he obtained 500 boxes. But the soap men knew full well that only about 10 per cent to 15 per cent of these coupons are ever recovered. By this means they were able to get rid of their commodity, get the finances from the merchant who was obliged to pay for this product, and the result was

that the merchant became, in effect, an unloading centre for the manufacturer of this particular soap product.
Then there are certain other unethical procedures that are being followed in today's merchandising. We have deals between manufacturing firms and particular chain stores whereby a chain store is given a certain sum of money for a display in their store. The offer is this: If you give us this particular spot-let us say in a window-for advertising purposes, you will get $2 from our firm. But no little merchant is given the advantage of that same deal. He is never given the same offer. If he inquires about it, he is merely told that it is not open to everybody. Mr. Speaker, if it is right for a chain store to be given this particular treatment-and I call it unfair treatment as far as the small merchant is concerned-then the small merchant should be given the same treatment. We should have the same treatment for the chain store and the small merchant if we are going to keep our equal tenor of good feeling in the business world today.
I also find that if you take five cases of a particular product, possibly you get less in the way of advertising allowance than if you take ten cases, or if you give them a particular spot near the cash register which seems to be one that most of them want.


An hon. Member:: It is another form of
discount.


Frederick George Hahn: It is, in effect, another form of discount that the small merchant is not being given the privilege of enjoying. I say that the same offer should be open to the small retailer. I say that if he is willing to devote a space in his small store to the advertising of a particular product, he should be given an equal discount for it. We have the small merchant, in effect, first subsidizing the price to the chain store and, second, subsidizing the advertising of the chain store.
Then there is one other factor-and I think this is a fairly well established one-namely that no cost price is established for certain of the products that are for sale today. If it is established, certainly nobody is aware of it. We have instances were you buy five cases of a particular brand of soap. I am using soap again as an example because it is one of the most culpable in this instance. You buy five cases at a price discount. You devote a certain store space to it. You can just about guarantee that another of their products of a similar line will be down 20 cents a case the following week or even 40 cents a case. Thereby they are setting no cost value or no price value on it. Possibly between the two levels there is a cost, but because the demand 50433-195}
The Budget-Mr. Hahn is less for one product they immediately cut its price in order to increase demand, with the result that they have the small merchants coming and going in trying to arrive at an equalized price. The small merchant is always on the short end of the stick because he never has a chance to become and remain competitive with these large chain merchants who are only concerned with one thing, the elimination of the little man.
I charge that there is virtually a combine among the soap companies. They control the soap business of the country. They control soap supply. I am speaking of Lever Brothers and Procter and Gamble. There should be an examination into their unfair practices and it should be determined whether or not the same rights are being extended to the little merchant as are being given to the big merchant. It should be determined by what form of advertising or other method the soap companies are letting the little people know that the same rights are afforded to them.
This is the type of economic practice that is today killing the small retailer. As I said earlier, the little merchant is subsidizing the chain stores. Canada is today losing a share of income tax from the large wholesale outlets of these chain stores by reason of the fact that we find so frequently the wholesale firm has its own retail outlet with the result that there is not sufficient profit to require the payment of a large amount of income tax. There would be sufficient under ordinary circumstances with smaller retailers because the shareholders would require it. In the case of such large firms as Macdonalds Consolidated, Safeway and others I am not satisfied that a large enough amount of income tax is payable. I am not satisfied that is so in the case of Macdonalds Consolidated at the present time, certainly compared with legitimate wholesalers who do nothing but wholesale.
Business and salesmanship in this country should depend upon service, quality, personality, cleanliness, incentive, initiative and their related factors. It should not depend upon special privileges, agreed charges and unethical practices. The purpose of these big firms appears to be to eliminate competition and ultimately to set up a monopoly. We are unalterably opposed to monopolies. These little men are important to our country, and I say that we should examine the matter and see how we can keep them with us.


Mr. W. L. Houck (Niagara Falls):: Mr. Speaker, in taking part in this time-honoured debate pertaining to the budget and, coming from the riding of Niagara Falls where we probably have more tourists than any other

The Budget-Mr. Houck place in the dominion, I naturally feel I should refer at the very outset to this type of travel in this great country of ours. In the year 1954 there were 647,948 vehicles of the non-permit class which entered at Niagara Falls and 337,181 of the travellers' vehicle permit class. Somewhat larger figures existed at the port of Fort Erie where we had over a million vehicles entering of the nonpermit class and some 350,000 of the travellers' vehicle permit class. One cannot overemphasize the value of the tourist dollar that is left within the confines of our country.
Expenditures in Canada by travellers from the United States and other countries were maintained in 1954 at a figure close to the peak established in 1953. First estimates indicate that residents of other countries spent some $300 million in Canada during 1954, a decrease of some $3 million or 1 per cent lower than the previous year. Although slightly lower than the record of 1953, the 1954 estimate represents an increase of 9 per cent, or $25 million, over 1952. Compared with a decline of nearly 6 per cent in the volume of entries, available data on expenditure indicate slightly higher averages per visit in 1954 for some types of transportation. Travel receipts from the United States declined some $4 million from the year before but remained well ahead of the 1952 figure. Receipts from overseas countries set a record at $22 million, an increase of 10 per cent over the previous record established in 1953.
Most of the increase in expenditures byresidents of Canada returning from the United States can be traced to the automobile traffic. Canadians returning by automobile spent over $136 million in the United States during the past year compared with $133 million in 1953, an increase of over 2 per cent. Compared with an increase of 3 per cent in the number of automobiles returning, this would indicate slightly lower average expenditures.
Purchases declared under the $100 customs exemption privilege by Canadians returning from the United States in 1954 amounted to $66 million, a decrease of $6 million or an 8 per cent decline from 1953. This would indicate that a smaller portion of Canadian travel expenditures in the United States went for merchandise, a trend contrary to that of the previous year.
The total number of visits to Canada by people from other countries amounted to 26-4 million in 1954, a decrease of 1-6 million visits, or 5'7 per cent fewer than the record established in 1953. It must be emphasized, however, that these visits are made by vacationists, summer residents, commuters, businessmen and all other travellers except

immigrants. They include repeat visits by commuters and others who enter the country many times during the year. Approximately 85 per cent of the visits are for 48 hours or less. Only 15 to 16 per cent of the visits last longer than 48 hours.
I want to say I was very much disappointed the other day to hear the Minister of National Revenue (Mr. McCann), in reply to a question from the hon. member for Prince Albert (Mr. Diefenbaker), say that no redress would be given the automobile dealers on new units which they had on their hands when the budget was brought down. It is my opinion, and it is a very definite opinion indeed, that they should receive consideration. Naturally I was very happy to see the reduction of 5 per cent on new cars, as I think all automobile dealers were as well, but I think they have a justifiable claim pertaining to these new units.
The automotive industry, through its manufacturing plants, sales agencies and connected trades, garages, service stations, buses, transport, petroleum industry, rubber industry, suppliers such as steel plants, paints, glass, textiles, etc., is reported to provide over 20 per cent of the labour force of our country. So you can see that the automotive industry is a very basic one to our economic prosperity. Anything that tends to restrict the sale of automobiles is bound to show up in reduced payrolls, reduced income and corporation taxes from all the connected industries, and reduced sales and excise taxes in new automobiles, all as a direct result. Hence it is of the utmost importance that automobile sales agencies be kept healthy and working at full capacity.
In my own city of Niagara Falls nine dealers had 209 new units on hand when the budget was brought down. The average reduction in excise tax, from the smallest to the largest car, is estimated to be about $100 per unit. So the total reduction in value amounts in Niagara Falls to an estimated $21,000. On top of that there was an inventory of $370,000 in used cars. It appears that this will drop at least 5 per cent on account of the tax changes. This is another $19,000. Therefore the total decrease in inventory value is approximately $40,000.
Ward's Automotive Reports, which is a publication published in the United States, in the March 21, 1955, issue reported that 38 [DOT] 7 per cent of United States dealers lost money last year, and that the average profit of all United States dealers was three-fifths of a cent on every dollar of sale, before income or corporation taxes. We do not have the Canadian figures yet, but as a rule they follow or parallel the United States figures.

In the long run it will cost the government nothing to return this tax, because I think it will keep many dealers in business who would otherwise be forced to go out, and it will leave many others more solvent and thus able to carry on their business more freely. It will increase taxes from dealerships, factory payrolls and the extra new cars that would not have been sold otherwise, and it would be a further indication that the government really meant what it said when it proclaimed the budget as a job-producing and hence an income-producing budget.
I would also like to point out that any excise tax at all on any automobile is unfair. The government described it as a luxury tax when they imposed it. But certainly automobiles are no longer luxuries for most of their uses. And I also feel that the tax is unfair in the following respects: First, because dealers have to pay the tax when they receive the cars, and are given the extra burden of financing it for the period they have that car. They have to carry insurance on it as well. Then when it is removed the government refuses to return it on the units still in stock. And it is my firm belief that if the government would rebate the tax on the new units in stock they would get it all back in taxes on extra units that would be sold, by way of income tax from increased jobs, and from increased taxes from dealer earnings. It could quite conceivably be that they might lose considerably more than they kept if they do not do so.
The previous tax change policies are not applicable at this time because of two very important reasons, first, that the size of inventories in dealers' hands at the present time is very large. When the taxes were decreased, as we decreased them on previous occasions, dealers' profits were high enough to absorb the loss without its being any serious problem.
And now I have another matter of importance in the Niagara district-and it is very relative to the St. Lawrence development-and it is that the Minister of Transport (Mr. Marler) will have to give due consideration to the traffic through the Welland canal which, naturally, will be increased to a very great extent. We have three or four large corporations along the Welland river and because of the boats which will be coming in to these companies, loaded with materials to be used in the manufacture of their products, I think it is only right that some consideration should be given to this problem of widening and deepening the Welland river so that boats can get through a lock into this territory.
The Budget-Mr. Houck I realize this would of necessity be quite a costly venture, and I do not want to tire hon. members with too many local problems, but I think this one is of prime importance. The difference between the Welland river and the Welland canal at Port Robinson is about 7 feet, which would be the extent to which ships would have to be lifted or lowered. And the distance from Port Robinson to Chippawa is some seven miles, as the crow flies. But any development there would,. of necessity, have to straighten out the Welland river at certain points. There are at least six bridges crossing the river, four of which would eventually require reconstruction but, for immediate use, only two located at Port Robinson would have to be altered in order to bring the ships as far as the Welland Chemical and Noranda Mines Limited. The Norton and Carborundum companies are very greatly interested in such a development since, at the present time, they bring their raw material from South America by boat to New York city and break it for rail transportation to Niagara Falls, Ontario. The present canal system on the St. Lawrence permits boats of only approximately 3,000 tons to go through, and this is an uneconomical amount for them to bring in by boat all the way. If they could bring ships of 5,000 or more tons through the canal system, it brings it within the range of economic possibility and, in the case of Carborundum itself, they have mentioned that they would use at least 25 to 30 boatloads per season.
With the construction of the seaway in the lower St. Lawrence, the Welland canal area becomes the best protected harbour on the great lakes system. It might be an expensive and inconvenient method of docking if slips were cut into the side of the canal, with the added hazard of interfering with up and down shipping. One of the best solutions appears to be the use of the Welland river which gets the boats off the routine traffic of the canal into an area which could be built up industrially and where they can move up and down and turn as they like without obstructing the heavy traffic on the canal.
I recall that last year, speaking in this debate, I referred to the terrible congestion of automobile traffic at both the Burlington cutoff and the Homer bridge at St. Catharines. I can only repeat what I said at that time, that these are two of the worst bottlenecks in the province of Ontario.
I want to be fair in this matter, realizing of course that other hon. members have other traffic problems. But I must point out that at these two points we are receiving tourist traffic. They are entering Ontario and Canada for the first time; and I imagine they get pretty well fed-up, if I may use that
3078	HOUSE OF
The Budget-Mr. Houck expression, with the delays they have to endure at certain times. We as citizens in the community-and I include in this the hon. member for Lincoln (Mr. Cavers), the hon. member for Welland (Mr. McMillan) and the members from Hamilton-must be getting sick and tired of this dilly-dallying attitude between the federal and provincial governments as to whose jurisdiction it is to alleviate such problems. I note the Burlington high-level bridge is to be started shortly, but this has been in the offing now for a number of years.
I want to say that in my own experience I have seen traffic tied up from the Homer bridge back to Niagara Falls, a distance of about ten miles, with two-way traffic on both lanes waiting for the bridge to be lowered. And I feel that if we want to treat tourists as well as possible, we will have to eliminate this condition where they run into traffic difficulties within only a few miles from Niagara Falls. I am sure their impression of Canada must receive a handicap at once.
Talking about the tourists' impression of Canada, I again want to pay my highest respects to both customs and immigration officials at the ports of Niagara Falls and Fort Erie. They are the first people that the travelling public come in contact with, and I share with the department officials a justifiable pride in the way these men conduct their offices. Many a time tourists have told me how much they appreciate not only the efficiency but the co-operation and advice of these splendid officials, and I hope that their good work will be recognized by the ministers of these departments, and that soon they will receive wages commensurate with the services they render.
Another suggestion I would like to make, and I make this in all sincerity, to the Minister of Transport, is that it would not cost the government too much money to keep an ice-breaker down on the river where it enters lake Ontario. Perhaps not for another 40 or 50 years will we witness the spectacle of the ice jam we had just a few weeks ago. However, on the other hand it might happen again next winter, and if this ice-breaker were on hand when the ice starts to gather and refuses to flow out into the lake, this boat could be immediately started into operation and keep the channel open before the ice has an opportunity to jam and cause millions of dollars' worth of damage such as was caused in the last few months.
I do not want to be at all critical of the Ontario hydro commission, but I think they could well afford to pay half the cost of this ice-breaker in order to protect their very valuable hydro plants in case we have


another jam such as we had a few weeks ago. If this should go even a few feet higher, we would suffer millions and millions of dollars' damage, not only to their own hydro plants but to our manufacturing concerns, resulting in lay-off of employment because of lack of power. I make this as a very serious suggestion, that I think the Department of Transport and the Ontario hydro commission should get together to alleviate the anxiety we had this winter.
Now, Mr. Speaker, in regard to the budget, I join with the rest of my colleagues in this house in congratulating the minister on such a very fine presentation, and with it the encouragement that he has given to the people of Canada. With so much bad news coming from various sources in the world, it is encouraging to know that the Minister of Finance has predicted a good year for the people of Canada and has made a general although modest tax reduction for this year and 1956. I think the minister rightly believes, and we all join with him, that the government, business and the people of Canada must work together to ensure continued prosperity, and we all feel encouraged that he expressed the hope for a steady increase in business rather than an immediate upward thrust. The imagination and the effort of the Canadian people have brought this country to its present state of development and there is no reason to believe that it cannot continue to go forward under a government which permits private enterprise to flourish while safeguarding the nation from any monopolistic or other practices which could prove harmful.
Just a few weeks ago, some outstanding economists met to survey the state of the nation's prosperity. They studied every available index of business activity, and when they had gone over all their charts and tables, and had peered into the future through their crystal slide rules, the consensus among them was that 1955 will not be the best year in our history. It will only be the second or third best, according to their calculations.
Now the prospect of struggling through a year that is only the second or third best and most prosperous we have ever known is not exactly what I would regard as a fate worse than death. Yet if we were to believe even one-half of the alarmist talk, we could only conclude that we are sliding into a terrible depression; that Canada's golden age is past, and that our only chance of salvation is to board the first train for Ottawa and beg the government to run our various businesses for us in the Dominion of Canada.
Well, I for one am not quite ready to give this country back to the Indians, and I think

the time has come when we ought to face squarely up to the fact that most of this depression talk is inspired more by the politics of our present situation than by the economics of it.
If our national supply of common sense has not been wholly exhausted, the Canadian people will take a long, cold look at that primrose path to inflation before they travel it again; for the destination to which it leads is national ruin.
So, instead of trying to read the inscrutable future, let us turn our eyes in the opposite direction and use a little of that 20-20 hindsight with which the good Lord, in His wisdom, has so generously endowed us all.
The success or failure of our economy depends chiefly upon our people themselves, upon businessmen, labourers, farmers, everybody in Canada. The only thing that government can do is to provide a fertile field to work in; but the thing that makes Canada go-and that always has and always will-is the individual effort of 15 million people, all trying to do a little more for themselves, a little more for their families, and a little more for each generation, every fellow trying to improve his own position. The cumulative effect of all that work, by all those people, is the thing that has made Canada what it is today.
Canada today is still undergoing that difficult and sometimes dangerous transition from war to a peacetime economy, and all of us are closely watching every economic index that records a change in business activity. But prosperity, unfortunately, is not a mere statistic. It is primarily a state of mind; and if we permit anything or anybody to destroy the confidence of the Canadian people, or to undermine their faith in the future, neither we nor the government can prevent a depression.
Now it would be wonderful, of course, if our economy always grew at a steady, unfaltering pace, but that never happens in any nation anywhere. To me it has always seemed that our economic progress is a good deal like the waves that break over the beach on the incoming tide. Each one comes roaring in, spends itself, and then recedes, but in doing so it contributes to the volume and the force of the next wave, which always comes in a little farther. Yet those who spend all their time watching the waves can become so obsessed with this process that they never observe the onward movement of the tide itself. And so it is, I think, with many of our pessimists today. They simply cannot see the tide for the waves. Many times, I am sure, there must have been those
The Budget-Mr. Houck who felt that the tide had turned, but of course it never had, and it never will as long as freedom of opportunity and freedom of competitive enterprise continue to exist in this country. So let no one tell us that we have reached the end of our golden age; for this, in truth, is only the beginning. In my opinion, we stand on the doorstep of the greatest era of progress this nation has ever known. The problems ahead are difficult, but they are not insuperable if they are approached by men of good will with vigour and energy and primary dedication to the public interest.
In the state, as in the nation, there are two essentially different ways to administer government. One is to sit back and wait until difficulties become problems and problems becomes crises, waiting for these difficulties, problems and crises to solve themselves, or hoping for some easy solution to turn up. This is the easy way, the expedient way, the political way. It piles up the burdens for later years and later generations. In too many cases, time, instead of solving the difficulties, multiplies them, until they become emergencies. By failing to anticipate the problems and to plan ahead, by complacently refusing to face the facts, the problems can assume disastrous proportions. Then, instead of considered and provident action, emergency treatment becomes necessary.
The alternative way of government calls for frank, fearless and continuous looking ahead to see the difficulties before they grow into crises, and to try to do the things that need to be done to prevent them from developing into an acute stage. This calls for a calm but searching appraisal of the future needs of the people of the state. It calls for intelligent planning of how best to meet those needs, how, for example, to stimulate and encourage the necessary expansion of facilities, production and enterprise, public and private, and, of course, it calls for timely action to carry out this plan. This, in my judgment, is the only sound way of government.
I think, Mr. Speaker, we should consult among ourselves and take counsel to advance the interests of each and all. We should all examine and re-examine how we can best serve our common interests. With this as our goal and with God's help, we can move forward with boldness, with confidence and with faith. Our pride is a badge of unity and a common bond amongst us all. We should not seek to divide ourselves but to unite more closely than ever, and by uniting to knit even stronger the bonds of our common welfare.
I he ve the utmost faith in our Prime Minister, in the Minister of Finance and in

The Budget-Mr. Houck the members of the cabinet that they are steering a proper course for the development of the greatest country in the world.
Much of our future will be of our own making, but some of our success will be made by others who go on and apply the knowledge, the materials and the processes we give them to different, and perhaps greater, uses than those for which they were originally intended. So I think it is with Canada. Here we are, a young nation with a great future. Already we are the world's third greatest trading nation, the fourth ranking industrial power, and the seventh steel producer. Surely, that is a record of which any nation would be proud. But it is only the beginning.
It has been said that the twentieth century belongs to Canada. That is true, but the statement does not do anything by itself. We have to make it become a fact; we have to claim it for ourselves; and believe me, Canadians are doing just that.
Let us look at it in this way. Youth is on our side. We are stepping out with all the vigour of youth into a new era in which we are equipped to choose our own road to success. We have the resources, the skills, the will and determination to do the job. By choosing the way of initiative and enterprise, operating in a free economy, Canada today stands in an enviable position. It is a land steeped in the traditions of political, personal and economic freedoms; enjoying prosperity and standing on the brink of greater things to come; it remains an outstanding example of the achievements of a modern industrial civilization.
The late Senator Taft, a great citizen, a great senator with an illustrious father, of the United States, said just a year or so before he passed away that the financial people in Washington would be well advised to go to Ottawa to study the Canadian financial structure. That is the remarkable statement he made pertaining to the financial structure of this great dominion. I think that was a very great tribute by a great man to a great country.
During the Easter holidays I made it my business to talk to many people about the budget. I did not talk just to Liberals,
I talked to people, of all political beliefs and in all walks of life. Almost each and every one of them said to me, "Yes,'.it was a great budget; we had looked for something like that but we hardly dared to expect so much". So I say to the Minister of Finance, "Carry on, you are doing a wonderful job for the people of Canada".	ii;


Mr. J. H. Ferguson (Simcoe North):: Mr. Speaker, I have indeed been interested in listening to the hon. member for Niagara Falls (Mr. Houck). Like all Liberals, he seems to be a disciple of Dr. Coue. There is only one thing that I was impressed with and that is this: the hon. member knows the part he must play as a member of the Liberal party. He is firmly imbued with the idea that he should be ready to talk at all times on behalf of his party and about the great successes and the manner in which this government has handled the affairs of Canada.
The hon. member does not quite realize that a government is composed of two parties. After the election is over the majority that is counted is Her Majesty's loyal government. But the minority is Her Majesty's loyal opposition and they have a duty to perform just the same as the government. We in the opposition are not going to be mesmerized by disciples of Coue who are ready to go up and down this country saying, "We are well; nothing could be better; there is nothing wrong; there is no depression"

I am not afraid to use the word depression; I am not going to call it a recession-"everybody is working". As a member of Her Majesty's loyal opposition I have a duty to perform for the people of Canada.
I am not satisfied that a country with all the natural resources which our friends have enumerated, with all the great potentialities that this country has, should be in the position we see outlined in our daily papers of having approximately 600,000 men out of work. On a recent trip to Europe I visited Italy and I was informed that they had approximately 15 million people more than that country could really support, a number almost equal to the population of Canada. They do not produce coal, timber, pulp, iron, metals of all kinds and the country is a poor farming country. Here we have all that. We say that there is unemployment in Italy and the poor people are not getting much to eat. Well, there are 600,000 people in this land about which we heard so much five minutes ago who would like to have jobs so that they could eat on the basis of their being Canadian citizens.
When the Minister of Finance (Mr. Harris) was appointed to his lofty position I met a gentleman in Toronto who had never had the great pleasure I had of meeting the minister and who said to me, "This fellow Harris must be some man."


An hon. Member:: Hear, hear.


An hon. Member:: He is.


Julian Harcourt Ferguson: I said, "Hear, hear" at the time too, but I lived to apologize and blush

when I heard the budget. After the budget had been out I met this same gentleman and he said to me, "Did that fellow they appointed Minister of Finance think up that budget or was it the Liberal cabinet?" I said, "What made you think that?" He said, "If the cabinet had anything to do with it it would be the mess it is now, but I cannot just conceive of a man whom they would appoint as Minister of Finance, after having that great honour bestowed on him, thinking up a budget as rotten as this one. It must have been entirely the work of the cabinet."
The hon. member for Niagara Falls said that all the friends he had encountered during the Easter recess had said it was a wonderful budget. If they or any other Liberal in this house or anybody else in the country can possibly conceive that an automobile which formerly sold at $2,400 and which is now to be sold at $2,325 will encourage buying of automobiles, in my opinion that would be the greatest stretch of the imagination possible. Any man who had come that near to having the purchase price of $2,400 for a Chevrolet car would not wait until he got the last $75 before buying a car.
If this government thinks that it is any inducement for a man with four children to go out and cut loose, and as the Minister of Trade and Commerce (Mr. Howe) says, we are all out for it; if they believe that the people are going all out with a 17 cents a week saving on income tax; if they think that that is going to stimulate the progress of this country, then they are doing some thinking.
What this country should have and what it could have had-not a five cent cigar but a twenty-five cent cigar as suggested by the Liberals-is a much better set-up if they had agreed to co-operate with industry, with provincial and municipal governments, with the immigration officials and with financial people across this country. They could have achieved an over-all plan for our economy.
We should be ashamed in this vast country of ours, with its untold wealth, to say that we had 5,000 unemployed from one end of Canada to the other. We should be crying for immigrants to come here and utilize our natural resources. We must hang our heads in shame when we realize our present position. This government is in power. The government is the only body with the necessary power, with any degree of authority to say to the provincial governments, "Forget politics." In Ontario they may have a great Tory government while there is a Liberal government of Canada. This government should have them all meet at a
The Budget-Mr. Ferguson designated spot with the provinces of Alberta, Saskatchewan, Newfoundland, Quebec, British Columbia and all the rest. They should do what was done in the war and call in the best financial brains of the country openly and fearlessly and the top men of industry. That should be done before we have unemployment. They should attempt to widen the path of progress; they should be ready to go further along the path of progress. We are not interested in unemployment, we are interested in the development of the natural resources of this country.
What has been done? This is Liberal prosperity which the hon. member for Niagara Falls does not want me to mention as a member of the opposition. We had Liberal prosperity in 1939 when there were 800,000 people on relief. It was the greatest thing that ever happened to the Liberal government when Hitler declared prosperity for this country by calling a war. As late as December, 1939, there were 500,000 people registered on relief in spite of the fact that war had been going on for three months. The mayor of Midland came to Ottawa with a delegation and pleaded with the government to commence the building of ships at the shipyard at Midland. We had the finest shipyard on the great lakes at Collingwood, the town in which I live, and there were only 250 people working in that yard in 1940 with the war on. It took delegations, telegrams and full-page spreads in the newspapers before we were able to obtain the construction of ships for the war.
That is Liberal prosperity. Hitler called the war. Eventually this government was forced, through the war, to turn the wheels of industry. When we could export and utilize everything we could produce in this country we had about five years of prosperity. During the war we could not make automobiles and tires and we could not use many other things before our factories were changed over from war conditions. That took approximately two years. It has taken six years of the eight since the war to replenish the larders of this country with the necessities of life, and today the greatest undeveloped country in the world has 600,000 unemployed. I for one am not going to go through this country and say that we are doing a great job. We have been endeavouring to obtain manufacturing industries for this country. Pray God they do not hear about the actions of the Liberal government, or they will never come here. This is wishful thinking. When you hear these men who represent towns and who sit on the Liberal side of this house representing human beings here in parliament say that
30S2

The Budget-Mr. Ferguson we are well off and doing a great job- shame on them. They get up here and say that the Prime Minister (Mr. St. Laurent) is the greatest that Canada ever had, or that the hon. Mr. So-and-so can never be beaten. They say that he is a Canadian baby and that surely he was never born in a foreign country with intelligence like that. That is the sort of silly nonsense that you hear. The Minister of Finance until recently held the portfolio of minister of immigration. Here is a clipping from a newspaper and I presume that there is some truth in it. Twenty-six Italians entered this country by means of faked passports or forged documents of some kind obtained through government officials, and these men are being asked to return to Italy. They believed that they entered this country in good faith. They are Canadians. I believe that any people who set foot on the shores of Canada, if they are honest, Godfearing and workers, are Canadians. That to me is the mark of a Canadian, not the fact that he is born in Canada; he may be a loafer and not entitled to the name of Canadian. If there is a semblance of truth in this newspaper report and these Canadians came to this country in good faith, they should never be returned to Italy unless they wish to go back to Italy of their own accord.
Coming back from my trip to Europe, I came in to the port of Halifax, but leaving I went via Saint John. I suppose that the previous speaker would expect me to say that this was a great job. When my wife and I entered Liverpool, we left our stateroom at eight o'clock in the morning, we went through customs and immigration with people from all parts of Europe and from Australia. We had our breakfast by ten o'clock, and the boat train left the dock with passengers headed for European ports and Australia, all cleared.
When we left England and went to Europe, we landed in Calais. The Calais boat was packed with people going to various destinations throughout Europe. We went through customs and immigration, and within one and a half hours we were on the ship with passengers leaving for various destinations. On the way back from Europe, it was the same procedure.
When we arrived in the great country of Canada, which has no faults and should not be criticized, having a great government, our luggage was deposited on the docks at Halifax at three o'clock in the afternoon. At nine o'clock I was still standing freezing in the immigration and customs building, which had been built under the supervision of this government. I was there with a whole shipload of people, my overcoat on and my collar 
turned up. There was not a single spot where I could purchase any food, and all these newcomers, as well as Canadians returning to Canada, were suffering the same treatment. My luggage arrived from the dock at nine o'clock in the evening. I could obtain a cup of coffee, with milk and sugar splashed into it without any request. After I stayed 20 minutes in a line and finally reached a door that wide, I had this stuff slopped at me.


Mr. Murphy (Lamblon West):: Was it in a
trough?


Julian Harcourt Ferguson: It might just as well have been in a trough. However, I busied myself in trying to obtain cups of hot coffee for new Canadians, particularly women with little children arriving in this country. They had great difficulty standing in that line and keeping control of their children. The little souls were crying for food and were asking for water and coffee. If you can visualize a newcomer to this great Canada of ours holding two or three children and trying to balance three or four cups of coffee in her hand, that is some sight. That is in the immigration hall built by this great government of ours. The people eventually got on a train for different parts of Canada. The train was freezing cold, and every one of them wore their overcoats in the modern railway carriages in this great country of ours. You are going to get some facts, gentlemen. They slept with their coats on in this train. Two superintendents of that railway line got on the train and apologized for the conditions. Before we arrived at about twelve o'clock in Montreal-


Mr. Nicholson:: What time did you leave Halifax?


Julian Harcourt Ferguson: At twelve o'clock the night before.


Mr. Herridge:: Was it by C.P.R. or C.N.R.?


Julian Harcourt Ferguson: I am not trying to say who is to blame. I want to say what should be done by an inefficient government so that the people of Canada can really progress and unemployment will be relieved. That is all I am trying to do. I am not trying to put my finger on any group. I am trying to tell this government that it is not yet too late to reduce the number of unemployed and to proceed with the prosperity of Canada-to become more like the men who built the
C.P.R. railroad, and the other men who fought for the development of the great Dominion of Canada, the Tories. I am telling the government to try to emulate to some degree the past history of the great Conservative party of this country. If they do

so they will stay in power; if they do not they will go out at the next election, because their sins will find them out.
We arrived in Montreal at twelve o'clock. The train was shunted to the assembly unit. There was no heat in the carriages. Mr. Minister, I will secure for you a list of all the passengers on board the Scythia and send them a copy of this speech, to see whether I am telling the truth or not. They will all say that it is a fact. At approximately three in the morning a spark of heat came on in those cars. Those who were headed for Winnipeg were on the same train as I was. Another train went to Toronto. The Montrealers got off there, and I landed at Ottawa station, in the capital of Canada, with 10 or 15 people. One woman was coming to see her daughter who was married to a man in the Royal Canadian Air Force. She was approximately 70 years of age. There was not a semblance of a pbrter, a redcap or anyone else to take the luggage which they had brought with them for a two or three weeks' visit. That was not any overnight bag.
I searched around the station and found a polite and courteous railroad employee who had nothing to do with helping people to take their baggage to the warmth of the station; but he condescended or consented to take hold of a truck and together we loaded the baggage on the truck and brought the people into the warmth of the station with their baggage. These were people who could not carry their luggage. They were too old to do so. They should not have been asked to do it. That was 6.30 in the morning. That was their greeting in Canada's capital.
If the government does not know about these things, it should know about them. Those are things about which this government should call a conference and co-operate with its railroads. I am not saying which railroad was involved. But if that condition occurs on both our railroads, call them both in so that, if one is to blame, the other will not do the same thing on another occasion. Or if they are calling the provinces together, if this government is to blame, let them take the blame and see that it does not occur again. Do not worry about the premier of one province saying, "Oh, you people are always making mistakes". But the people we blame are those who make mistakes and continue to repeat them. In my opinion this government is continuing to repeat its mistakes, and has done so almost since the day it first came into power; and that is a long time unfortunately for Canada.
Today we in Canada are headed toward the same conditions with which we were confronted in 1939. I heard that the Prime
The Budget-Mr. Ferguson Minister (Mr. St. Laurent) said he did not like to hear people talking blue ruin, that conditions were almost normal and that unemployment was seasonal. I say to this government, to any provincial government or to any group of people that can alleviate suffering and create employment that this is one country on the face of the globe that should say, "We need immigrants; we have absolutely no employable person who is out of work." That is the position for Canada to be in.
We cannot be satisfied because we are a little better off than, say, England. As a matter of fact, we are not as well off as England. We cannot be satisfied by saying, "England has 100,000 unemployed and we have only 15,000 who can become employed and want employment." We are in the position where we cannot say we have 5,000 people who want to work and are unemployed, having regard to the vastness of Canada, its wealth and the millions of people who are desirous of coming here and helping us to build.
It is not too late to put ourselves in the position that Canada should be in. We should have industries that we do not have today coming from Europe and establishing here. We should be creating new industries. Our ships should be going back and forth from various parts of Europe relieving those people over there who want to live in a land of plenty, and bringing them in here to do the work that should be done, in order to build this country up in a lifetime not to 15 million but to 75 million. Those are not big figures. That is not nonsensical talk at all.
Here we are a country with 15 million people. Well can I remember my father saying this to me on Portage avenue in Winnipeg, and he was then younger than I am today when he said it. He looked at the excavation for the great T. Eaton Company store on Portage avenue on a Sunday morning and he said, "Son, when you are my age this country will have 50 million people." I am now past the age that my father was when he made that remark. Through the mismanagement of Conservative and Liberal governments, the old dotards of the past, we find ourselves with 15 million people. It will be noted that I say the dotards of the Conservative party of the past also. I am not my grandfather and neither are these men in this government their grandfathers. We are alive and have the benefit of the examples of the past and the experience of the past. Those men in the government should not do the things their grandfathers did. They should have learned that people ought not to sleep in parliament.

The Budget-Mr. Ferguson They should go ahead, relieve unemployment, encourage immigration and let this be the most prosperous country in the world.
It is all very well for us to crow about this being a land of milk and honey. But we find that people coming into this great land of milk and honey are not able to obtain work. They are capable of working irrespective of their nationalities. They are good workmen irrespective of their nationalities. They begged, borrowed or stole their passage money. They are looking for work in this land of plenty. What do they find in the year 1955? They find conditions almost equal to those of 1939. At that particular time there was in power the same government that is in power today. During the election during the war and after the war they shouted about the great Liberal prosperity. As I have said before in this house, this government takes the credit for putting the oil in the ground in Alberta and for putting the nickel in the mines in Sudbury. The Kaiser used to say "Me and God". This government does not include God. The Kaiser was at least a bit honest, but not this government. They talk about the great Liberal prosperity, the growth of Niagara Falls, the immigrants coming into Niagara Falls, Col-lingwood's growth, 1,100 people employed in the shipyards during the war. Today there are 500, and if there is no new work that is not on the boards today, by the end of July the number will be down to 250. There are 800 people registered for relief in the town from which I come which has a population of 8,000.
If the hon. member for Niagara Falls (Mr. Houck) thinks he can cow me into being quiet, he is mistaken. The Minister of Finance (Mr. Harris) laughs. He knows that is true. He knows that in the part of the country from which he comes the condition is serious. It is not a matter to laugh over. Maybe I could do so if I were minister of finance. As the hon. member for Niagara Falls said, some people think this is a great budget. But I do not think that any member of the government has any right to crow or to laugh when he knows that a town near where he was born, namely the town of Collingwood, has 800 people on its unemployment rolls today, in this land of plenty. Maybe that is a provincial matter. Maybe it is a matter of co-operation with the provincial government. But let the members of this government stand on their feet and say who is to blame. Let them say that they cannot get the provinces to co-operate. Let them say that the great industrialists will not cooperate or that the financial institutions of Canada will not co-operate. They would not

dare do that because they know it would be a challenge that would be taken up by all those governments, institutions and peoples that I have mentioned. They would come here only too willingly to do what can be done to make Canada grow, with its great wealth, to a far greater extent than it has ever grown under the guidance of this Liberal government up to date. That is my reply to the budget.


Mr. W. M. Johnson (Kindersley):: Mr. Speaker, the people of Canada, living in a desert of Liberalism, have recently witnessed a mirage. It was obvious, as the Minister of Finance (Mr. Harris) brought down his first budget, that it was one of the greatest deceits the Liberal government has ever imposed upon the people of Canada. The budget, couched in misty terms, is nothing but a mirage. The minister touted the income tax reductions and pointed out how they ranged from 13-3 per cent for those in the lower income tax brackets to 2-8 per cent for those in the higher brackets, when actually it was a 2 per cent reduction across the board. The minister placed the mirage at a distance in the hope that by the time the people became aware of the results the matters would be forgotten.
Let us examine what this hoax will give the people of Canada. A single person with a taxable income of $1,500 will save $5 this year or $10 in a full year. That is the minister's 13 [DOT] 3 per cent. If he has an income of $3,000 he will save $20 this year or $40 in a full year, whereas an individual with an income of $100,000 will save $4,000 in a full year. A married man with two children having a taxable income of $3,000 will save $7 this year or $14 in a full year. A married man with two children having an income of $30,000 will save $644. Indeed it is nothing but deception to tell the people of Canada they are being given a tax reduction of 13-3 per cent when the tax reduction is 2 per cent and ranges in amount from $5 to $7 to $40.
Had the minister wanted to give tax relief to those in the lower income brackets he could very well have increased the exemptions from $1,000 to $1,500 for a single person and from $2,000 to $3,000 for a married person. I do not think there is anyone in Canada today who can expect to live on the present exemptions allowed by the government. By increasing these exemptions tax relief would have been given directly and in significant proportions to over a million Canadians.


Mr. Harris:: How much would it cost?


Willis Merwyn (Merv) Johnson: It would have cost $60 million, according to the figures I took from the tax statistics. That is by

adding the income of all those in the $1,500 bracket as opposed to the $1,000 bracket, and in the $3,000 bracket as opposed to the $2,000 bracket.


Walter Edward Harris: Did you take that through the whole scale?


Willis Merwyn (Merv) Johnson: I took it through the whole scale. I would assume that by giving tax relief to those in the still lower income tax brackets you would have still had a figure lower than the $128 million in tax relief that the minister has granted by giving $4,000 to the man with a $100,000 income and $5 to the man with a $1,500 income. In this way tax relief would have been given to that large portion which is so urgently in need of purchasing power in a time of economic difficulty and severe unemployment in Canada. It was pointed out by my leader that if the government had desired to give relief to those really in need of it, that large and significant portion who unfortunately do not make enough money to pay income tax, they could have abolished or at least reduced the sales tax which is now levied at a 10 per cent rate on most necessities of life. The minister could have changed the social security tax so it would have some progressive features.
In looking over the minister's appraisal of economic conditions in Canada, I find that he wandered into his own mirage in assuming that the decline in the gross national product was due almost entirely to the poor wheat crop. I live in a large farming area in Saskatchewan. I do not know a single farmer who has been unable to deliver all the grain for which there has been room. We find we have a carry-over in Canada of 570 million bushels for export. I think the minister should have been aware of the fact that since the beginning of the crop year on August 1 deliveries of wheat from the farm are nearly 100 million bushels below the ten-year average.
Deliveries from the farm this year are 158 million bushels. Last year they were 268 million bushels, whereas the ten-year average is 257 million bushels. I think the purchasing power that would have been given to the farmers by this extra 100 million bushels of wheat, had they been able to deliver it, would have been a significant factor in giving our economy some purchasing power. I think it is significant that not only are deliveries of grain from the farm the lowest since the war but we also have the highest unemployment since the war. I think those are two sides of the same coin. We have deliveries at an all-time low since the war and we have unemployment at well over 600,000.
The Budget-Mr. W. M. Johnson
We find the government showing no particular concern for the plight of the farmer other than as an excuse for the decline in the gross national product. If they were really concerned I think they would be giving more consideration to the final payment on last year's crop which would at least give the. farmers some purchasing power. The farmers in the western provinces have only been able to deliver two to four bushels of low-grade wheat per specified acre. When you consider that the price of some of this wheat is 85 to 90 cents a bushel and figure what two bushels an acre will give a farmer farming on a modest scale, I am sure you can understand the plight in which he finds himself.
We had the assurance from the Minister of Trade and Commerce (Mr. Howe) that the final payment on the crop would be made before seeding. At least, he hoped so, and he expressed himself in such a manner as to remove all doubt. It is apparent that the farmers of western Canada must wait until the Minister of Trade and Commerce returns from his world tour to announce the payment. We will perhaps be lucky if the payment is 5 to 7 cents a bushel, and the farmers will not receive it before seeding. In fact, they will be lucky if they receive it before they start on their second summerfallowing operations.
Anyone who has travelled through the farming areas of Saskatchewan or who comes from there is fully aware of the hazards of farming. They are aware of the fact that an insect can plague your crop and make it disappear practically overnight or that plant diseases such as the recent rust epidemic can result in total loss. They will realize how the drought of the thirties shrivelled up crops and left nothing in the heads and how excess moisture, on the other hand, can have the same disastrous result. Then there is the damage caused by hail, wind and weather throughout every operation.
When the farmers have overcome the hazards of the weather, harvested their crops, made up their tax returns and paid their tax, they are then confronted with the greatest hazard of all, the uncertainty of the whims and vagaries of the Department of National Revenue. Upon filing your return you are assessed, but the assessment often means nothing. Perhaps you will receive the assessment from the Department of National Revenue within a year, and you will continue to make out your subsequent returns assuming that the assessment made of your revenue was correct.
However, we find that the department can go back six years from the date of the last
3086	HOUSE OF
The Budget-Mr. W. M. Johnson assessment. We find, perhaps in an unusual circumstance, that if the assessment for 1946 were received in 1950, the department can go back six years from 1946. In other words, they can go back to 1940. It is stated in the law that they can go back six years which, in effect, means seven years, since the assessment is usually made in the year after the tax year; and this will amount to eight calendar years.
I do not believe there is so much variation in the cost of production in the various tax areas throughout Canada that it should be necessary to take this length of time to properly assess a farmer's income tax. I should think that in my area of Saskatchewan, served by the Saskatoon office, it would be quite possible to process these tax returns in two years, and give a correct tax assessment.
What do we find happening to the farmer who, as I pointed out, has survived the hazards of the weather? Well, one day he might be confronted by two inquisitive gentlemen who, often without indicating their position, will proceed to question him. The standard practice is for one of them to ask the questions and the other to sit in the background with a pencil and a large notebook.
The typical approach is to ask the farmer what he thinks of the allowance for the cost of living. The farmer, having some knowledge of the cost of living, will say, "Well, gosh, I don't know; things are awfully high". The gentleman will say, "How much does it cost for you to live a year?" The farmer will say "Oh, I don't know, gosh, things are awfully high". "Let's figure it out. How much does it cost to feed your family?" "Oh, I don't know". "Well, we will put down a figure", which they do. "How much does it cost for clothing?" "Oh, things are awfully high". "Would it be about $300?" "Oh, I don't know". So then the second gentleman, who has been writing down the answers, will come up with a cost of living figure of, let us say, $3,000 a year.
Then they will divulge who they are. They will say they are auditors from the income tax branch, and they have found upon checking his returns for the last five years that he has shown a net income of $15,000. But over five years his cost of living at $3,000 a year is $15,000. "Now, what do you know about that? It is obvious that you have gypped us in income tax, and owe us a thousand dollars". Well, the farmer has admitted that was the cost of living. The man was right there writing it down, and they have assessed him on that basis.
Or they might try a different approach. They might ask him, "What car did you buy


in 1946? How much did you sell it for? What did you buy after that?" And sooner or later, knowing how good the average memory is, the farmer will make a mistake. Then the departmental inspector will point out, "Oh, no, you did not get $1,300 for that car; you got $1,900. There is a capital gain of $600", and the farmer immediately becomes confused. He just does not know what to say, or what he should not say. After this questioning the farmer is completely cowed by the brain-washing of the investigator, and in all probability he has been assessed for a figure that bears only a slight resemblance to the true figure.
It is not long before word spreads around the community that the gestapo are in town, cross checking, investigating, intimidating and frightening. And just who are these men? I am not for one moment accusing all of them of doing this with any intent of being deceitful. I think most of the income tax inspectors are trying to do their jobs conscientiously. But under the existing act there are certain procedures they must follow. They are out to collect money, and they are going to collect it.
I have obtained from the civil service of Canada an advertisement asking for auditors of income tax for the taxation division, and I was most interested in what are considered to be the desirable qualifications of those men, who are to receive $4,080 to $4,620 per annum. Their duties, among other things, are to assess farm and small business returns. The applicant must have graduation from a university of recognized standing, with specialization in commerce, business administration, finance or accounting, and at least three years' accounting experience, preferably auditing, in the office of a professional public accountant, and so on and so on.
Nowhere along the line is there any mention of any agricultural experience. They do not need to know what a tractor, or a kernel of wheat looks like. Knowing farming as I do, if you have an old Case tractor, for example, and do not have the carburetor adjusted properly, you can pour three and a half or four gallons of fuel an hour through the old brute without any difficulty. As a result gasoline consumption on your farm will be twice what it should be. If you did not keep every receipt from the company from which you bought your fuel you might be approached by this accountant, a man who might not know a Case tractor from a steam engine. He would say, "Well, you can't do that. According to accounting practice, it is so and so." And if the departmental officials

are not satisfied with the answers given by the farmer they can always ask him to make out a net worth statement.
For those who are not familiar with the net worth statement let me say that in most instances it is a complete reversal of British justice. In this connection I should like to quote from the second edition of the Canadian Encyclopedic Digest where, at page 398, they deal with making the arbitrary assessment on a net worth basis, and say:
An assessment based on the "net worth method" raises a presumption of validity in its favour that must be met by the taxpayer. The taxpayer must establish affirmatively that his taxable income was not that for which he was assessed. It is not sufficient in meeting this onus to establish a possibility that the amounts as shown in the financial statement prepared by the income tax officials are incorrect.
You can see at once the unfortunate position in which the farmer is placed when he is asked to make out a net worth statement. They will assess you arbitrarily for a certain amount and then say, "Prove me wrong." The farmer may be forced to make out a net worth statement for a period of six years, covering his assets for that period of time and contrasting those assets with those of another period of time. It is a fairly complicated procedure and, in many instances, lawyers or accountants making out these returns charge as much as $200 or $300. They are made up at the insistence of the income tax branch, which does not allow the individual to deduct the fee the lawyer charges him.
In connection with the making out of the net worth statement, I have received a copy of a very interesting form the farmer is asked to fill out. It requires information concerning personal expenditures over a period of years, and the document has eight columns. On it there are 25 items one is expected to fill in, so the income tax branch will have a complete estimate of the amount of money he has received.
This is a very interesting document indeed. "Food purchased during the year." "How much food did you buy in 1947, 1948?" and so on. "Food produced". "How much did you spend on fuel?" Well, you might have a record of it and you might not. "Clothing purchased"-and you fill this out for eight years. "How many clothes did you buy in 1946"-or 1947? "Household furnishings; household replacements; bedding; recreation; charitable donations." "Oh yes, I remember going to a show in 1947. There is 50 cents I forgot." How ridiculous can you get? Also "travelling expenses; wedding or funeral expenses."
22, 1955
The Budget-Mr. W. M. Johnson
The farmer is asked to fill out eight columns on this form covering a period of time ranging up to seven or eight years past. I am not certain just how many copies the department asks to have submitted, but the thing I want to point out is the ridiculousness of asking anyone, no matter who he may be, to make out a statement of this kind; because no one, or at least very few, would keep a record of how many wedding gifts he had given in 1947 or 1948. Therefore, why subject the farmers to such a test of their intelligence?
As I mentioned, the farmers receive their assessments year after year, with perhaps only minor adjustments. They, therefore assume that they are paying the correct tax, but five or six years later the department will disallow certain items of depreciation and bill the farmer for perhaps several hundreds of dollars. If it happens in a year like this the Department of National Revenue shows no leniency, because I hold in my hand a garnishee of an entire bank account of $609.39 of a farmer in my constituency, which was collected to pay income tax. The department will argue that the man had made the money and therefore he should pay it. No consideration is given to the fact that the farmer has marketed only two bushels of wheat per acre.
I have another statement which shows that since September 1, 22 writs have been issued by the Department of National Revenue in one of the towns in my constituency. Therefore it is apparent that the department is intent on only one thing, namely collecting money from the farmers of the western provinces. Such an unsavoury mess exists that the farmers would prefer a production tax with all its inequalities and injustices. Recently on the political scene in Saskatchewan the Gardiner machine has seemed to break down. I should like to point out that until they get the McCann machine fixed up, the Gardiner machine will continue to break down.
One of the greatest injustices that existed under the Income Tax Act was the amendment in 1949, which was made retroactive. It will be noticed that in the budget the minister brought down the 2 per cent tax reduction given to corporations was made retroactive, but in that instance the arm's-length clause was made retroactive. In Saskatchewan because of the time the province was settled, many of the farmers are reaching retirement age. We all realize the difficulty of establishing younger persons on the farm; therefore a farmer will decide to give his son the privilege of buying his farm to get him started in the farming business.

The Budget-Mr. W. M. Johnson What do we find? We find that the son gets treatment different from that given an absolute stranger. An absolute stranger can make a bona fide agreement to buy the equipment and buildings and depreciate them at the amount paid. What of the son? He cannot do that. Because of this arm's-length clause the son is not able to depreciate them at any more than the undepreciated value of the machinery as it exists. What is making it particularly difficult-and I wish the minister would look into the manifestations of this clause, because it was made retroactive without notice-is that transactions made in good faith that took place in 1947, 1948 or 1949 are subjected to the arm's-length clause, which did not exist at the time the transactions were made. If a transaction was not made in good faith and was not a bona fide agreement I could see some excuse for the department disallowing the depreciation charged. This factor is making it very difficult indeed for a son to start up and take over where his father left off.
In some instances all that needs to be done is this; and I hope there are enough people familiar with this so they can save themselves the difficulties that others have been subjected to. If it is a transaction between a father and a son, what the father does is take out the machinery and haul it into the machine agent and say, "I'll give you $5 if you will buy this machinery and sell it all back to my son at the same price." The son then takes it back to the farm. In that way he can get away from the arm's-length clause and the transaction is perfectly valid.
We find another aspect of the departmental work that is particularly annoying to the farmers in the three prairie provinces is its inefficiency. I recall a case that was brought to my attention. The farmer pointed out that he had filed his return and in a few days received a refund of $100. The department said, "You paid us too much; you did not owe that much." Well, the farmer was quite pleased, but in three months' time he received a registered letter from the department saying, "We made a mistake; you did owe us the $100. Pay it back with interest." I found that quite interesting and I asked the farmer to give me a little more information. He said, "Gosh, no; I don't want to get into any trouble with those fellows."
The officials operating under the Income Tax Act have put the fear of the Lord, or the fear of something, into the farmers of Saskatchewan. As I pointed out, they are able to deal with the weather but they are not able to deal with the various rulings made by the departmental officials. I recall 
another instance where a farmer had a building destroyed by a cyclone. He had just built it. He was forced to build it, as a matter of fact, to house his grain, and was just putting the roof on when the cyclone came along and blew the whole thing down. Had it not been blown down he could have depreciated it at 5 per cent over its useful life; but since it was blown down and no longer existed, he is allowed no depreciation and is out $4,600.
While I am on this matter of depreciation may I say that it is most unfortunate that over the past years, when we have had congestion on the farms, consideration has not been given to the rightful claims of the farmers to be given accelerated depreciation for granaries constructed on the farms. I realize that we must have a certain number of granaries to store the crops. In some instances farmers have had to build granaries to store twice the crops they would normally store, and as this congestion wears off they will have empty shells sitting on the prairies waiting for a cyclone. It will not make much difference, because they get so little depreciation now, they might as well get none at all.
If the department do not feel they should give the complete depreciation I wish they would consider giving an accelerated depreciation on a certain percentage of the buildings. Suppose accelerated depreciation were given to the farmer on all the grain storage built in addition to that required to house two-thirds of the average yield on two-thirds of his cultivated acreage. He could have the normal depreciation on anything up to that limit. Naturally, the space he would require over and above that should be depreciated in three years.
I am also interested, Mr, Speaker, in another feature of farm income tax. It will be noticed that in the United States farmers are permitted to charge off soil and water conservation against current income up to 25 per cent of the gross farm income. A very significant change has been made in the United States income tax legislation making this allowance. In Canada this is deemed to be a capital gain. You might on occasion have a deep gully washed out in your land, and might have to pay $50 to have it filled in to restore the land to its Drevious condition. But that is considered to be capital gain and you cannot deduct it for income tax purposes.
There is another very interesting aspect to income tax as it operates in Canada, and that is the tax paid by farmers in the various provinces. I should like to place on record the figures for the 1952 income tax year,

which are the latest we have and which come from the tax statistics. They are as follows:
Prince Edward Island	 S 70.000
Nova Scotia	 40.000
New Brunswick	 66.000
Quebec	 233.000
Ontario	 2.647.000
Manitoba	 1,707.000
Saskatchewan	 13.268.000
Alberta	 8.350.000
British Columbia	 1.075.000
We find that in that year Saskatchewan farmers paid $13,268,000 as compared to a total of $14,186,000 for all farmers in the rest of Canada. Another interesting aspect is the number of farm assessors in the different provinces, which is as follows:
Prince Edward Island	 3
Nova Scotia	;...	5
New Brunswick	 4
Quebec	    14
Ontario	 80
Manitoba	 31
Saskatchewan	    55
Alberta	 40
British Columbia	 11
We find that in Ontario and Quebec there are 3,024 farmers per assessor whereas in the western provinces the number is 1,973 farmers per assessor. We find that in Quebec there are 9,595 farmers per assessor as compared with 2,036 in Saskatchewan. If the minister thinks I believe the farmers of Ontario and Quebec are not paying their share of income tax he perhaps would not be too far wrong, but what I want to point out is that it is stated in the Income Tax Act that you must maintain books and records. I believe it is the function of assessors to go around to make sure the farmers are keeping books and records. I have a copy of a letter from the income tax department which points out the necessity of keeping books and records, and it concludes by asking the farmer to advise when he has complied with the above request. It would appear that the 14 income tax assessors in the province of Quebec will require additional help if they are going to call on 134,336 farmers and ask them to keep proper records.
These are some aspects of the manner in which the income tax department has been operating. I think you will agree that there are some changes and improvements which could be made. As I pointed out, the farmers have been intimidated by the departmental officials, and it is very difficult to get statements from them. They refuse to give you information. I would like the minister to see what he can do about correcting some of these most flagrant injustices.
In conclusion I should like to state that I am in wholehearted support of the amendment proposed by the hon. member for
The Budget-Mr. Dickey Greenwood (Mr. Macdonnell). I think the provisions of that amendment are most necessary and they certainly apply to the government of the day. The amendment to the amendment moved by the hon. member for Rosetown-Biggar (Mr. Coldwell), my leader, asks for governmental assistance to the provinces in connection with such things as a national health plan, a road program and federal aid to education, all of which have from time to time been emphasized by resolutions by the C.C.F. but ignored by the government.


John Horace Dickey: Mr. Speaker, it is a pleasure to have an opportunity to rise and speak in this debate. First of all I should like to congratulate the Minister of Finance not only upon his presentation of the budget this year but also upon the constructive and courageous budget he has brought before us. I think it is significant that members of the opposition groups have found a great deal of difficulty in dealing with this budget in the critical manner expected of them. Certainly if we are to judge from the general public reaction to this budget and the reaction of the leading newspapers of Canada, their task is most difficult indeed-
I think I can indicate to hon. members the general public reaction to the budget and the reaction, of leading Canadian newspapers by describing a cartoon which appeared in the Halifax Chronicle-Herald the morning after the budget was presented and which many hon. members may not have had an opportunity of seeing. This was the work of the well-known and highly-regarded cartoonist of the Halifax Chronicle-Herald, Bob Chambers. The picture depicted a newly-wedded bride who could be easily recognized as the Minister of Finance. She was placing before her new husband, representing the "little man", the public, a cake. The title of the cartoon was "Her First Cake". The look of delighted satisfaction on the face of the husband, representing the public, spoke volumes for the public acceptance of and pleasure in the budget which the Minister of Finance had brought down. I would suggest that if the minister has not received the original of that cartoon the publisher of the paper should be good enough to send it to him so he can perhaps frame it and preserve it on his office wall.


The Acting Speaker (Mr. Applewhaite):: I
am sorry to interrupt the hon. member, but it being five o'clock the house will proceed to the consideration of private and public bills.

Private Bill PRIVATE BILL
SHARP & DOHME (CANADA) LIMITED


Mr. G. J. Mcllrailh (Ottawa West) moved: the second reading of Bill No. 349, respecting Sharp & Dohme (Canada) Ltd.


Mr. Knowles:: Is the hon. member going
to explain this bill?


George James McIlraith: I was ready to do so just
as soon as Mr. Speaker had finished, but the hon. member for Winnipeg North Centre was able to voice his interjection before that time had arrived.


Stanley Howard Knowles: I wanted to be sure the
hon. member had a chance to speak. We have not heard from him for quite a while.


George James McIlraith: There are members in the
house who think it is not wise to be heard too frequently.
Mr. Speaker, the bill before the house seeks authority to grant to a patent application an effective filing date of July 20, 1950. The necessity for the legislation arises out of the somewhat technical requirements of our patent law and procedure in dealing with applications. In 1947 an application under No. 564079 was filed and dealt with. By amendments to the regulations under the Canadian Patent Act there is procedure for what is known as supplementary disclosure, covering subsequent discoveries related to any patent application pending before the patent office. In this particular case a further application by way of supplementary disclosure was made in 1950, because of further research work that had been done on the subject matter of the patent.
This application by way of supplementary disclosure procedure was rejected and it was held that a new application was required, but by the time the application by way of supplementary disclosure was rejected the statutory period for filing the new application had lapsed, and the consequence of the procedure is that the applicants are not able to have the patent granted through the regular channels under the patent legislation.
As I say, the procedure is somewhat technical, and I have perhaps oversimplified it a little. I think it would be the wish of hon. members when dealing with it in committee to go into the whole matter in some detail, but I doubt that it is practicable or possible to give a much fuller explanation at this stage that would be of a helpful nature to
[The Acting Speaker (Mr. Applewhaite).]
hon. members in considering the matter. I therefore ask for the second reading and then the reference to the committee.


[Stage Direction]
Motion agreed to, bill read the second time and referred to the standing committee on miscellaneous private bills.
The Acting Speaker (Mr. Applewhaite):: Private and public bills now having been disposed of, the house will revert to the business which was interrupted at five o'clock.




[Stage Direction]
The house resumed consideration of the motion of Hon. W. E. Harris (Minister of Finance) that Mr. Speaker do now leave the chair for the house to go into committee of ways and means, and the amendment thereto of Mr. Macdonnell, and the amendment to the amendment of Mr. Coldwell.
John Horace Dickey: Mr. Speaker, as all hon. members had an opportunity during the Easter recess to return to their constituencies and consult with those whom they represent in this house, I am sure those of us who support this government returned very much encouraged by the public acceptance of this budget. I am sure that hon. members opposite do not come back to take part in the budget debate in any way aided or comforted in the task before them.
In the debate this afternoon the hon. member for Simcoe North (Mr. Ferguson) in the course of his remarks referred to experiences which he underwent on his return from Europe a few weeks ago, when he landed at the port of Halifax. I am not going to deal in any great detail with what the hon. member had to say, not having been there at the particular time to which he referred. I am unaware of the actual facts involved. However, I do know that the building to which he referred mainly in his remarks is not only newly built but is a building which at the time he was there was, and indeed still is, under construction. I would point out to the house that the inconvenience and difficulties which he experienced were obviously the result of the upsetting and unusual conditions which always exist when a building is required to be used for its normal purposes while it is in the course of construction or substantial renovation.

I can assure the hon. member and the house that so far as the treatment of immigrants and other passengers landing at the port of Halifax is concerned, the evidence I have seen is completely contrary to the evidence that was given in this house this afternoon by the hon. member. I have on many occasions been present when large numbers of immigrants and other passengers were being handled by the immigration facilities at Halifax. I have seen the facilities provided there for them, the speed and courtesy with which the necessary formalities of customs inspection and other matters are carried out, and the general satisfaction shown by those who go through the normal procedure of landing at that port. I have seen many completely unsolicited letters written to individuals and officials at the port of Halifax thanking them for the extreme courtesy and care that has been shown in dealing with newly-arrived Canadians, particularly, and the general public as well.
Mr. Speaker, my real purpose in entering this debate is to deal with a question which is, I think, of considerable importance and interest to this house and to the Canadian people. Statements have been made in this debate by several hon. members opposite, and indeed they have been made outside this house by the same members and others, to the effect that we in this country export an undue proportion of our natural resources in the raw and unprocessed state. The hon. member for Dufferin-Simcoe (Mr. Rowe) and the hon. member for Broadview (Mr. Hees), particularly, in the last day or so have made assertions of this kind in contributions to this debate. The well-worn phrase, "the hewers of wood and drawers of water" has been used. The suggestion has been made and the impression left that government policies are at fault and that there exists a situation which is unhealthy and not in the best interests of Canada.
I want to deal with this matter on a factual basis, to try to point out just what is the real situation and then deal with some of its implications for the Canadian economy and the Canadian people. First of all I should like to make two or three preliminary points. The first is that Canada is the greatest trading nation in the world on a per capita basis. This trade and the resultant Canadian prosperity has been built up in the only way that was possible, namely by producing the things we can produce and which can be sold on
The Budget-Mr. Dickey the world market, and producing them better and more cheaply than they can be obtained from other sources.
The second point is that if we take a narrow point of view it is possible to say with truth that to manufacture completely in Canada the raw materials we produce would provide to Canada, in the form of income and employment, the maximum return which can be achieved from those particular materials. However, in my view it is not true to argue from that particular statement to the general statement and say that it follows that the maximum benefit of resources development in Canada would accrue to us by insisting upon complete manufacture of all our raw materials before they leave this country. Our experience and, I believe, that of other countries, seems to me to prove that a sound program of resources development cannot be built on such a narrow foundation. What is perhaps even more important, I think our experience proves that a broad program of resources development creates the only possible basis on which any substantial development of secondary industries can be built.
The third point I should like to make is that we ourselves are dependent on imports of raw materials. I do not think it is generally recognized or understood that we in this country are, in fact, net importers of industrial raw materials. We hear a great deal about Canada being a great storehouse of natural resources and that the world is becoming increasingly dependent on Canadian raw materials. Those statements are true. But what Canadians do not realize is the fact that we are a net importer of the raw materials that go into our industrial production.
For example, in 1953 our exports of industrial raw materials amounted in value to some $300 million. These included nickel, pulpwood, iron ore, asbestos, copper, zinc and other similar products. Our imports of industrial raw materials in the same year amounted to about $550 million, covering such things as crude petroleum, coal, raw cotton, iron ore, raw wool, crude rubber, etc. Hence we are a net importer of industrial raw materials to the extent of about a quarter of a billion dollars.
What is the explanation of our dependence on these imports? Canada has a rapidly growing industrial economy which requires raw materials which we do not produce or which we have not in this country, but which we are obliged to go out and buy, sometimes at extremely high costs. We believe in buying

The Budget-Mr. Dickey in the cheapest markets in the world, and we get our imports from the cheapest sources. But the point I want to make is that those who are critical of our exports of raw materials would do well to recognize and keep in mind the dependence of our secondary industries on imports of essential materials which we ourselves do not possess.
Let us look at the facts of our trade. I am going to use 1953 because that is the last year for which final figures are available. The principal raw materials we export are agricultural and vegetable products consisting mainly of food; animal and animal products, which also are to a large extent food; non-ferrous metals; non-metallic minerals and their products; and wood and wood products. In 1953 the proportion of our total exports which were raw materials was 32-2 per cent. The proportion of our total exports that were partially manufactured or semi-processed was 28-9 per cent and the proportion of those which were fully manufactured . was 38-9 per cent.
The first point of importance to recognize in these figures is that the largest segment of our export trade is in fully manufactured goods. The second is that the value of our exports of fully manufactured goods was $1,600 million in round figures. The value of our raw material exports was $1,328 million. In spite of all that has been said by hon. members, opposite and others, the first fact to remember is the preponderance of fully manufactured goods in our export trade. The second is that adding the proportion of semi-manufactured goods in our export trade, the total amounts to 67-8 per cent. In other words, two-thirds of our export trade consists of fully manufactured and semi-manufactured goods, combined with only one-third left for the export of raw materials.
A closer examination of these figures brings out some even more striking facts. Of our total raw material exports, approximately 80 per cent are agricultural and vegetable products, wheat, feed grains and various kinds of food products. These things are exports which must almost inevitably leave this country in their raw state because they are designed for either human or animal consumption. If we add to these agricultural and vegetable products the category of animal and animal products the proportion rises considerably more, in fact to over 85 per cent. In other words if we were to try, as was suggested by the hon. member for Broadview, to make some extreme, and I think impractical, efforts to reduce the proportion of our exports which are in the category of raw materials, we would either have to stop


exporting wheat and feed grains and that sort of thing or try to work on a mere 15 per cent of our total export trade.
One result of the speeches and statements that have been made on this subject by hon. members opposite has been, I think, to create in the minds of the Canadian public an idea that our resources development industries are in some way in the category of poor relations in the Canadian economy.
Mr. Speaker, I think nothing could possibly be further from the fact. Canada's resources industries in 1953 provided jobs for 1-6 million Canadians, or 31 per cent of Canada's total labour force. Thirty-four per cent of Canada's national income of $19 billion was earned by Canadians working in these industries, and 564 per cent of the Canadian investment program undertaken by business, amounting to $34 billion, was devoted to the development, the growth and the extraction of our natural resources from our lands, our forests and our waters.
We all recognize, Mr. Speaker, how important to the Canadian economy has been our great investment program, amounting to over $5 billion last year, and I think it would be most unfair to that great segment of our economy, the resources development industry, not to recognize that almost two-thirds of that investment program arises out of that particular industry.
I should like as briefly as I can to cite some of the reasons our resources industries are so important to Canada and to the Canadian economy. First of all there is the contribution we make to international security and prosperity. Industrial raw materials, fuels and food are the three basic economic ingredients which a free world requires in its endeavours to increase international security and prosperity. We in Canada not only have an abundance of these resources but we are developing them in an efficient manner and at a rate that is hardly matched by any other country. Therefore a broad resources base makes Canada one of the strongest natural allies in the cold war for the United States and the other countries of the western alliance.
The second matter to which I should like to draw attention is that the expansion of our resources industries is balanced with a growth of secondary industries. Our resources development in Canada has gone hand in hand with the expansion of secondary industries. Both these developments have taken place in response to long-term demands, and there has been little if anything in the way of forced or specially induced expansion in Canadian resources development or in secondary industries. The sole exception is certain

developments during and after the war for defence reasons. Notwithstanding the recent renewal in the house and elsewhere of the cry that we are the hewers of wood and drawers of water, our production of food and raw materials continues to be looked upon not only by Canadians but by our allies as very respectable occupations, and we are interested in an economic expansion that is well balanced but which will have to be on the basis of resources development as well as the industrial front.
The third point I should like to make has to do with the diversification that we have been able to achieve in our resources development, which has lessened our economic vulnerability. Canadian resources development, as a result of the program that has been carried on over the last few years, is now much more broadly based than it ever was before. In the fuel field, coal and hydro power are supplemented by the newcomers, oil and natural gas. In the mining field our traditional resources of nickel, copper, lead and zinc have been supplemented by uranium and titanium. Further, resources industries, which were of minor importance before the war, have become major factors in our industrial raw material development-for example, aluminum and iron ore. This broadening of our natural resources base has undoubtedly removed some of the vulnerability of the Canadian economy, which was inclined to suffer when world demand dropped for certain particular commodities.
The fourth matter to which I should like to refer is the contribution that resources development has made to strengthening regional economies within Canada. Our resources development program has made an important contribution to Canadian regional economic diversification and to the opening up of new land for settlement. For example, the prairie provinces used to depend primarily on agriculture for their prosperity. Now we have important oil and natural gas developments in Alberta, uranium mining in Saskatchewan, and nickel and copper mining in Manitoba, with processing and refining industries located in these regions in increasing numbers. More recently the development of mining prospects in the maritime provinces and Newfoundland is having an increasing effect. The Kitimat aluminum project, the Lynn Lake non-ferrous metal mines, the Labrador iron development, all mean the building of new railway lines into these regions and the opening up of new areas of virgin northern country.
The fifth point is the effect that the development of our resources industries has had
The Budget-Mr. Dickey on improving our balance of payments position. We have been selling as much of our raw materials resulting from these great developments that could not be used in Canada at excellent prices on foreign markets, and this has had a very beneficial effect on the Canadian economy.
The final point is the general one of the contribution to general economic stability. Canadian resources located in inaccessible regions, or difficult to prove up or extract on an economic basis, could in most cases only be developed by the making of large capital expenditures. In the post-war period substantial and for the most part increasing amounts have been invested for this purpose in this country. High capital spending for resources development has been one of the most dynamic and vital factors making possible a continuing rise in Canadian economic activities. In fact, but for the very large and diversified resources program, Canadians could not have avoided the consequences of the so-called inventory recession in 1949 in the United States to the extent we did.
Having dealt with our resources development industry, I should like to come to the vital question of whether we should process more of our industrial raw materials before export and, if so, how it should be done. This is a problem that has been given consideration for many years. When the alternative was between leaving the resources unused or selling them abroad in unprocessed form, initially at least, the answer given in this country in most cases has been, let us go ahead with the development of these resources. But this problem has remained how to increase processing at home and how to convince our customers that it is in their own as well as in our long-term interests for them to take more raw materials in processed form when they can be produced in Canada more efficiently than or at least as efficiently as in other countries.
What progress has been made in this regard? With the permission of the house, Mr. Speaker, I should like to put on Hansard two tables taken from the government publication "Trade of Canada". These tables show the total exports of Canada for 1929 and 1953, both in percentage and value terms, broken down as between raw materials, partially manufactured goods, and fully manufactured goods.


Mr. Deputy Speaker:: Has the hon. member permission to place these tables on Hansard?


Some hon. Members:: Agreed.


John Horace Dickey: The tables are as follows:



TABLE L-EXPORTS OF CANADIAN PRODUCE SHOWING THE PERCENTAGE DISTRIBUTION OF THE DEGREE OF MANUFACTURE FOR THE MAIN GROUPS, CANADA, 1929(0 AND 1953

[Stage Direction]
Item Number	Group	1929 (')	1953	Raw materials	Partially manu- factured goods	Fully manu- factured goods	Total exports	Raw materials	Partially manu- factured goods	Fully manu- factured goods	Total exports%	%	%	%	%	%	%	%I	Agricultural and vegetable products (Except	chemicals, fibres and wood)-	(a) Mainly food	80-6	(2)	19-4	1000	86-0	7-8	13-2	100-0(b) Other than food	13-2	0-6	86-2	100-0	41-7	0-3	58-0	100-0Sub-total	68-0	0-2	31-8	100- 0	79-7	0-7	19-4	100-0II	Animals and animal products (Except chemicals	and fibres)	51-3	5-5	43-2	100-0	60-1	3-4	36-5	100-0III	Fibres, textiles and textile products	17-8	17-8	64-4	100-0	6-6	17-3	70-1	100-0IV	Wood, wood products and paper	7-8	34-9	57-3	100-0	5-0	42-9	52-1	100-0V	Iron and its products	(3)	7-9	92-1	100-0	8-6	17-5	73-9	100-0VI	Non-terrous metals and their products (Except	gold)	35-8	59-9	4-3	100-0	22-5	68-2	9-3	100-0VII	Non-metallic minerals and their products (Except	chemicals)	70-3	14-7	150	100-0	34-5	57-4	8-1	100-0VIII	Chemicals and allied products	100-0	100-0	100-0	100-0IX	Miscellaneous commodities	100-0	100-0	100-0	100-0X	Grand total	38-3	19-0	42-7	100-0	32-2	28-9	38-9	100-0XI	Grand total less I and II	16-5	34-1	49-4	100-0	10-9	42-3	46-8	100-0
Source: Basic data from annual editions of Trade of Canada for the fiscal year ended March 31, 1930, and for the calendar year 1953. (0 Fiscal year ended March 31, 1930.
(2) Exports amounted to only $65 thousand which is too small to show in percentage terms.
(3) Exports amounted to only $19 thousand which is too small to show in percentage terms.
3094	HOUSE OF COMMONS
The Budget-Mr. Dickey﻿TABLE 1(a).-EXPORTS OF CANADIAN PRODUCE BY MAIN GROUPS AND BY DEGREE OF MANUFACTURE, CANADA,
1929(0 AND 1953
Item Number	Group	1929 (*)	1953	Raw materials	Partially manu- factured goods	Fully manu- factured goods	Total exports	Raw materials	Partially manu- factured goods	Fully manu- factured goods	Total exports$ million	$ million	$ million	$ million	$ million	$ million	$ million	$ millionI	Agricultural and vegetable products (Except	chemicals, fibres and wood)-	(a) Mainly food	252-3	0-1	60-7	313-1	811-9	7-4	124-2	943-5(b) Other than food	9-5	0-4	61-8	71-7	63-9	0-4	39-0	153-3Sub-total	261-8	0-5	122-5	384-8	875-8	7-8	213-2	1,096-8II	Animals and animal products (Except chemicals	and fibres)	68-2	7-3	57-5	133-0	150-8	8-6	91-5	250-9III	Fibres, textiles and textile products	1-6	1-6	5-8	9-0	1-6	4-2	18-5	24-3IV	Wood, wood products and paper	22-6	101-1	165-9	289-6	64-1	556-1	675-2	1,295-4V	Iron and its products	(2)	6-2	72-4	78-6	30-8	62-6	265-0	358-4VI	Non-ferrous metals and their products (Except	(gold)	55-2	92-4	6-7	154-3	153-0	465-4	63-1	682-2VII	Non-metallic minerals and their products (Except	chemicals)	20-1	4-2	4-3	28-6	50-9	84-5	11-9	147-4VTTT	22-4	22-4	137-9	137-9IX	20-1	20-1	124-1	124-1X	Grand total	429-4	213-3	477-6	1,120-3	1,327-8	1,189-2	1,600-4	4,117-4XI	Grand total less I and II	99-5	205-5	297-7	602-7	301-2	1,172-9	1,295-7	2,769-8
Sources: Trade of Canada Fiscal Year Ended March 81, 1980 and Trade of Canada Year Ended December 81, 1958, Vol. I.
Sum of components may differ slightly from totals shown due to rounding.
(0 Fiscal year ended March 31, 1930.
(2) Exports amounted to only $19 thousand in 1929.
The Budget-Mr. Dickey
3096	HOUSE OF
The Budget-Mr. Dickey
I am putting on the record in these tables the total proportions for 1953, and the same information is given in the table for 1929. These figures show that since 1929, by reason of natural development, we have made significant progress in increasing the proportion of natural resources products being exported in processed form, either fully or semimanufactured. The table will show that there are four main groups of exports which show substantial declines in the proportions shipped abroad in raw form in 1953 as compared with 1929. Three other main groups show somewhat smaller increases. The main decreases took place in the classification of non-metallic minerals and their products, which were down one-half, from 70 per cent in 1929 to 35 per cent in 1953; in fibres, textiles and textile products, down from 18 to 7 per cent; in non-ferrous metals and their products, down to 23 per cent from 36 per cent in 1929.
If hon. members will study these tables I believe they will see a very clear pattern emerge. From this I submit that it does not appear that we are shipping an unduly large amount of our natural wealth out of this country, in its raw state, to supply factories in other countries. It is true that we do export considerable quantities of natural resources products in their raw form, especially foodstuffs, but their relative share of our total exports is declining, and the great bulk of our non-food raw material exports is processed to varying extents in Canada.
The belief has been expressed that if Canada insisted that all her natural resources products be completely processed before being exported, unparalleled prosperity would result. Unfortunately it is not nearly as simple as all that. For example, to begin with, any attempt to compel foreign buyers of Canadian products to alter the form of their purchases would lead quickly to serious losses of our world markets. There are alternate supplies and substitute materials for most of our natural resources products, and undoubtedly other countries would utilize these in the face of any such Canadian restrictions.
Second, any such action would invite retaliation. Other countries would follow suit to Canada's ultimate detriment, as we are on balance, as I pointed out earlier, a heavy net importer of raw materials of the industrial type. If the inward flow of these raw materials were interrupted our steel mills, our textiles mills, our natural rubber and aluminum smelting industries would suffer severely. The aluminum smelting industry would be especially vulnerable, since it
[Stage Direction]

depends entirely upon imported bauxite and imported cryolite, with Canada's main contribution being abundant low-cost hydro power.
In addition, some of our exports of raw materials are really part of an exchange trade based on the economies of transportation or on the interchange of complementary products. Both these factors operate in the two-way flow of iron ore, with the totals being almost in balance in 1953, when exports were valued at about $31 million and imports at $28 million. For similar reasons of economy it may turn out that when Canada achieves a large measure of self sufficiency in crude petroleum supplies it will be done by large exports balancing large imports rather than by processing all our own crude oil.
I should like now to deal with the extent of industrialization that would be required in Canada to process all the natural resources products we are capable of producing. This may be gathered by looking at the iron and steel picture. It is expected that within a few years Canada's iron ore capacity will have expanded to 25 million tons annually. The question arises, why do we permit the export of this raw material rather than require its conversion in Canada into steel and steel products?
Superficially that is an attractive suggestion. But besides the necessity of finding markets for that steel production, there is the rather difficult problem of finding $5 billion in capital investment which would be required to create in this country that kind of steel capacity. Without assured markets I am very much afraid that we would not find capital ready to risk itself in that way.
In summary, if I may just list the reasons for the present state of our trade in raw products and manufactured goods, and the reasons for the developments which have taken place since 1929, I would say, first, that Canada is a low-cost producer of a number of raw materials for which there is a world-wide demand in their natural form, and has become an important source of supply for many of the countries which need these raw materials.
Second. Canada's domestic market for most of these materials is small, and frequently such resources would not be developed at all except for the export market. For example, the nickel developments at Sudbury would never have been made to meet the requirements of the Canadian plating industry.
Thirdly, it is usually more economic to produce in larger quantities; and selling in wider markets reduces the cost of production, which
[Stage Direction]
benefits the Canadian consumer and the Canadian manufacturer who also uses these raw materials.
Fourth, the development of natural resources often contributes to regional economic development, as I have pointed out.
Fifth, the development of Canada's natural resources for the export market usually paves the way for the setting up of domestic industries to process the resulting materials for home use, and eventually for export as well. Certainly that has been our experience in a number of fields.
Finally, the export of raw materials is a part of Canada's economic structure and any drastic reduction, whether due to restrictions on exports in raw form or not, would upset the whole economy. Any upset in the balance of payment pattern could mean large trading deficits for Canada, and eventually even the curtailment of essential imports.
Therefore I think that in respect of this, as in many other problems, the correct view is the balanced view based on the facts. I submit that the generalized and unsupported statements made very frequently on this matter by hon. members opposite have not been contributions to clear thinking in respect of the Canadian economic position today or its future prospects.
Mr. W. M. Howe (Wellinglon-Huron):: Mr. Speaker, in rising to take part in this debate I do not intend to delve into any particular aspects of the budget. They have been dealt with very ably and efficiently by some of the other members of our party. However, I should like to deal with one or two problems that are particularly applicable to my own riding and constituents and which, if promptly acted upon and dealt with in an effective way, could have a great economic effect on the whole of Canada.
I do not wish to belabour an issue that has been debated from time to time in this house, but I do notice that issues that are continually brought to the attention of the government sometimes do find their way into legislative measures. The question I am going to discuss was mentioned in the latter part of the second great war, and has been mentioned so often since that I cannot understand why some concrete policy has not been advanced by this government to assist in the decentralizing of industry.
A great deal of the buoyancy of our financial position in the world today is due to the fact that foreign capital is being invested either in the development of our natural resources or in the creation of new industrial empires. I feel that consideration should be given and planning should be done 50433-196
22, 1955
The Budget-Mr. W. M. Howe
to see that those empires will be set up under conditions and in locations that will be in the best interests of Canada as a whole.
I feel that there are three main departments of our government that would be economically affected by planning of this kind. The first department is that of transport. Indications are that our railroad systems have been operating at a tremendous deficit for the last year. In fact we know that in the year 1954 the Canadian National Railways had a deficit of $28,758,098. They find that some of this deficit arises from the fact that quite a number of their branch lines are not paying. I feel that if industry, which is being centralized in our metropolitan areas, could be distributed throughout the entire width and breadth of our country it would naturally give more business and bring more revenue to our transportation systems. I also feel that if many of these branch lines are discontinued the possibility of smaller communities getting any of these industries will become practically nil.
Another department that is involved is the Department of Northern Affairs and National Resources which, through co-operation with the provincial departments of planning and development, should take some steps to see that great industrial empires do not encroach on our very valuable agricultural lands. I speak particularly of the lands in southern Ontario, where we have been endowed by old mother nature with fertile soil, a moderate climate and all the natural attributes to make that one of the most productive fruit and vegetable districts in the world. Man can never replace these natural resources which have been given to us, and there are many districts where soil and natural conditions make it impossible to carry on agriculture economically, yet where it would be feasible to build manufacturing plants.
Then we have one other department of the government which is directly involved, namely the Department of National Health and Welfare, which has the task of promoting and developing civil defence. We hope and pray that these tense periods will pass and there will not be another great war, but we know that we must look upon this matter with a sense of reality when all the great nations of the world are doing their utmost to keep ahead in the creation of new weapons of destruction. To this department falls the task of looking after the safety of the citizens of our country in case of attack.
When so many people are gathered together in great metropolitan areas the task of protecting or removing them from these areas becomes well-nigh impossible. We shudder to think what could happen. We have seen

The Budget-Mr. W. M. Howe it happen before when our weapons of destruction were many times less devastating than they are today. Had more thought and planning been given to this situation the expensive projects that we find in our larger centres to relieve traffic congestion, such as subways and through expressways, might not have been necessary. I feel that if more direction were given, many industries could settle in smaller communities to the mutual advantage of both the industries and the communities. Today we find that people living in those smaller communities are demanding and getting all the facilities provided in more thickly populated areas. If they had more supporting taxpayers the burden of municipal taxation on property owners would be less oppressive.
The second matter I wish to speak about is also one that has been given considerable publicity in this house, but it is also one about which I feel not too much has been done. I refer to the condition of the farming industry in our country. When one looks over the budget one finds that as regards the farmers as a whole very little relief has been given to alleviate the trying circumstances in which they find themselves. It is true that the average farmer may pay a few cents less in income tax, though when I spoke to a couple of my constituents during the Easter recess I found that one indicated that his reduction in revenue from the sale of his hogs over the past year was $2,500, while in the case of the other the reduction was $1,500. Therefore I think they will find that their reduction in income tax will be very small this year because a lot of them will not have to pay any tax. The farmer may get his tires a little cheaper. If he has a car to turn in he will likely pay a little less for a new one than he did before.
A survey by Dr. MacFarlane, of the Macdonald agricultural college, indicated that according to the bureau of statistics a year's work by an agricultural worker was worth only $3,600, while a year's work by workers in other occupations was worth almost $5,000. The explanation is that while the prices of farm products have been steadily declining for several years, the prices being charged for other products have been going up. In other words the producers of our agricultural products are not getting an undue share of the national production.
I am sick and tired of the fanfare and headlines that follow declines in agricultural prices. So much has been said about our high-cost economy that when beef prices drop, when hogs, poultry, or any other agricultural products go down in price, headlines proclaim that according to the index of the bureau of
[Mr. Howe (Wellington-Huron) .1

statistics the cost of living has dropped. I do not think, Mr. Speaker, that when it is caused by only one segment of our economy it is too much to shout about, and I feel it is a very selfish way of looking at this question.
No part of our national economy can live unto itself today. If farm prices drop, the things the farmers buys are fewer, and believe me, he is willing to buy when he is making a profit on his operation. He is willing to buy such products as farm implements, clothing, electrical appliances, automobiles and many other ordinary commodities of everyday life. When the farmer stops buying the manufacturers of all those commodities find that production soon catches up with the demand and there are lay-offs that are not all caused by the dumping of commodities by other countries where labour costs are lower. They are caused partly by the falling off in the purchasing power of one of the basic industries of our country.
I say that part of the fluctuation in the farmers' prices and in our agricultural returns results from the fact that today we have no definite, genuine market on which we can depend from year to year. The United States of America has from time to time been a good customer, but under ordinary circumstances and in an average year the United States produces more agricultural products than she herself can use.
The budget gave no indication that there would be any increased promotion of trade in agricultural products with other countries. There was a time when we enjoyed access to and even preference in the British markets where, because of their tremendous population, there are approximately 30 million people to be fed every year, and which is one of the most permanent and stable markets in the world for agricultural products. There was a time when our cheese ranked first in demand by the people of Britain. How do we know that the newer generations who have grown up and who have developed an appetite for this product from other countries will have the same preference as the rank and file of British people?
In those days not only did our cheese go to Britain, but our butter, our pork and our heavy steers went to that market. We do not send any beef today, and in that connection it might be interesting to note that Britain buys 70 per cent of the beef produced in the world. I feel that a great deal of the uncertainty in our agricultural economy is due primarily to the loss of this market.
This great Liberal government tells us that one of the reasons we had to give up the

British market was that Britain did not have the dollars with which to buy the products of our farms. But did this government leave no stone unturned to see that every possible dollar's worth of defence production was spent in Britain? The report of the Department of Defence Production, January 1 to December 31, 1954, indicates that materials purchased in the United States in the period April 1, 1951 to December 31, 1954 totalled $493,731,000, whereas those purchased in Great Britain amounted to only $104,255,000. Had more dollars been spent in Britain she might have had dollars which could have been used to stabilize our agricultural economy.
This government has been telling business, which has been in straitened circumstances for years, that they are faced with another buyer's market. This applies not only to business in Canada but to business in the international field. If the farmers of our country felt that there were adequate markets for their products and that when they were ready for market there would not be a surplus they could produce more than they are producing of cattle, hogs, poultry, butter, cheese, etc., and their cost of production would be reduced while our gross national product would be increased.
In the face of continued drops in agricultural prices there is one other thing I should like to mention, a phase which was applicable not only to my own riding in 1954, but because of excessive rainfall during the harvest season applied equally to many districts, particularly in southern Ontario. It is true that last year the western provinces had an unusually wet crop year, but the farmers there have the facilities of the Prairie Farm Assistance Act to help them when needed. The farmers in southern Ontario depending on late crops such as flax, white beans, soybeans and sugar beets to get extra money to pay taxes and many other yearly debts that accumulate, particularly in these days of high production costs on our farms, found there was no assistance available to them.
I maintain that what is good for one section of this dominion in time of economic strain should be applicable and within the reach of every farmer who needs it. I should like to endorse the suggestion made by the Canadian Federation of Agriculture that we recommend the development of an adequate scheme of crop insurance with costs to be borne jointly by the federal and provincial governments and the producers.
In closing I should like to say a few words about education, a matter which I understand will be brought up before the coming dominion-provincial conference. We have no 50433-196J
The Budget-Mr. Herridge greater asset in our country than our youth, and we should leave no stone unturned to see that everything possible is done to fit them to take their place in the world of today. Most municipalities are trying to do this, but with the limited means of taxation at their disposal they are finding it well-nigh impossible.
I feel that the federal government, which now takes over 75 per cent of the tax dollar, must do more to assist this very important function of government at all levels. This was the conclusion arrived at after a research program carried out by the Canadian school trustees' association under the direction of Dr. M. E. LaZerte, a distinguished Alberta educationalist. This report indicates that to ensure equality of educational opportunity for all Canadian children the dominion government should designate special grants to the provinces for the specific purpose of assisting education.
At six o'clock the house took recess.


[Stage Direction]
AFTER RECESS

The house resumed at eight o'clock.
Herbert Wilfred Herridge: Mr. Speaker, I must say that this slender and somewhat weary Friday evening audience is not very inspiring.


Mr. Coldwell:: You have the Prime Minister (Mr. St. Laurent) and the Minister of Finance (Mr. Harris), and I am here.


Stanley Howard Knowles: You have the quality.


Herbert Wilfred Herridge: Yes. Mr. Speaker, I am also somewhat heartened by the fact that my Sunday school teacher of nearly 50 years ago is listening to me this evening.


An hon. Member:: Do you know your lessons?


Herbert Wilfred Herridge: I have learned them since that time. Mr. Speaker, I rise to support the amendment and the subamendment. The hon. member for Rosetown-Biggar (Mr. Coldwell) expressed the collective views of this group so far as major criticisms of the budget are concerned. I do not intend to weary the house by a repetition of his explanations. I merely want to re-emphasize and deal with a few matters of particular concern to working people in this country generally, and to bring to the attention of the minister a few matters of particular concern to some of my constituents! which they have asked me to raise during this debate on the budget.

The Budget-Mr. Herridge
The minister made provision for a percentage reduction of the corporation tax and a percentage reduction of personal income tax. On first hearing it sounded rather good, but on later calculating it did not look so good. I am of the opinion that it would have served the interests of the lower income groups much better if he had accepted the suggestions that have come from this party-in recent years, that he increase the basic exemption for single persons to $1,500 per annum and for married persons to, say, $3,000 per annum. The present proposals of the minister merely mean a saving of a few cents a day, and in fact afford no actual relief to the low income groups.
I suggest that the loss of revenue that would be occasioned by increasing exemptions could be made up in other ways. We in this group recognize the fact that a certain amount has to be raised by taxation. Taxes are required to pay for the things we advocate; we do not back away from that. We in this group point out what we consider a fair distribution of the tax burden in this country. In our opinion there was no necessity at all at this time for a reduction of the income tax for corporations. That would be one way to meet the loss of revenue occasioned by increasing income tax exemptions.
We think there should be the imposition of a capital gains tax, which we believe would bring a considerable sum to the treasury of this country. We think that if the minister removed the 20 per cent tax credit allowed on dividends from Canadian corporations his revenue would be considerably increased. We believe the policy we have suggested would be sound and would cover the loss of revenue occasioned by extending the exemptions to lower income group people.
We believe the minister could have assisted the lower income groups by removal of the 3 per cent floor on medical expenses. If the minister considers it proper to reduce the income tax for corporations. That would the time has come to give effect to the wishes of the House of Commons that have been expressed in this respect. The hon. member for Winnipeg North Centre (Mr. Knowles) and other members of this group have advocated the abolition of the 3 per cent floor for some years, and we hope that, even before this debate is finally concluded, the minister will again consider the proposals coming from this side of the house.
Now I should like to deal with a few matters which are of particular concern to some of my constituents and which, as I said before, they have asked me to bring to the


attention of the minister. There are many working people in Canada, both salary and wage earners, who because of circumstances are required to live some distance from their place of employment-in my constituency it is a matter of between five and thirty miles-not because they wish to live that distance away from their employment but because in many cases they are forced to live that distance away in order to obtain satisfactory housing accommodation and so on; as for instance the employees of Consolidated Mining and Smelting Company. This is a large corporation operating in my constituency, and I think the circumstances are typical of those existing in many other parts of Canada. There are thousands of those employees who have to travel from five to thirty miles a day to and from their employment. These expenses are considerable. They vary from $10 to $35 a month. They are all unavoidable expenses incurred by these salaried and wage-earning people.
I believe other members of this group agree with me that if the minister can allow the travelling expenses of a commercial traveller who goes around the country selling bubble gum or something as unnecessary as that, surely he could give consideration to allowing these salaried and working people an exemption on account of these abnormal travelling expenses. I am not suggesting that the ordinary expense of 10 or 25 cent street car rides to work should be exempted for income tax purposes, but I do think there is a sound case for consideration of those who have to spend from $10 to $35 a month travelling to and from their employment day after day. I urge the minister to give this representation consideration.
I noticed that when the minister was speaking on the budget he made some reference to special incentive provisions for certain companies. I find on page 2738 of Hansard the following:
Our tax laws contain special incentive provisions for the oil, gas and mining industries. It has been the policy in the past few years to review these provisions each year and annually to grant an extension of them. There are certain advantages in this procedure but, on the other hand, it carries with it some uncertainty for the future. In the past few months I have been giving considerable thought to the operation of these incentives and to the importance of these two industries to the future of Canada. I believe these special tax provisions have clearly established their value in promoting expansion and I now propose to make them a permanent part of our law.
I think the minister is quite correct in stating that this provision has been a special incentive in the exploration for these natural

resources. In my opinion there is some justification for giving consideration to these corporations in this respect because they are endeavouring to develop natural resources, and I think we should promote such development.
However, once again I should like to bring to the minister's attention the fact that I believe the farmers of this country should get similar consideration. If these incentive provisions are justified for these corporations which are expanding production by developing natural resources, then ethically speaking, and by the same token, I think the farmers of this country are entitled to similar consideration. Every new acre cleared, drained or irrigated increases production in this country and this increase performs the same function as does the development of natural resources performed by these companies to which I have referred. I think the farmers of this country who are increasing production by doing the things I have mentioned are entitled to exactly the same consideration as these corporations which are carrying on exploration for the development of our natural resources. I again urge the minister to give consideration to our pleas from this side of the house on behalf of the farmers of this country.
I must say in passing, Mr. Speaker, that I was pleased to note that the minister has decided on the reduction or elimination of tariffs on brooders for farm animals, certain components of feedstuffs, sweet potato seedlings, poultry eviscerating equipment and other machinery connected with agricultural production. I am pleased indeed to see that statement. While in the reading of the paragraph this announcement might not mean a great deal to some members of the house or to other people not acquainted with the circumstances, I know personally that it brings a measure of relief to some of our poultry producers and some of our farmers. I am pleased that the minister has seen fit to do this. I am glad that the representations of the farm organizations and of members of this house in this respect have received favourable consideration by the minister.
We are all pleased with the repeal of the excise tax on tires and tubes, regardless of their use, and with the 5 per cent reduction in the excise tax on automobiles. I am sure that step is welcomed by employers and employees in the automobile industry, and by a good many purchasers of cars in Canada. However, I think that the decision of the Minister of National Revenue (Mr. McCann) not to allow claims for refunds arising out of tax reduction in respect of goods upon which taxes have been paid
The Budget-Mr. Herridge occasions some injustice. In that respect I have had representations from automobile dealers in my constituency. I know a good number of these smaller dealers very well indeed and I think there is some justification for consideration of their protests and their claims.
The implementation of the budget places some of them in quite a serious position. To illustrate the effect this decision of the Minister of National Revenue has on their businesses, I am going to read one letter I have received, and it is typical. I think it illustrates the position of the average small automobile dealer. My correspondent has this to say:
In connection with the reduction in excise taxes on new vehicles, we understand that no provision has been made in the budget to take care of new vehicles in dealers' stocks prior to bringing down the budget.
This places practically every dealer in the country in a very awkward position. Every used vehicle on our lots has to be reduced proportionately, which we are quite ready to assume, of course. This is a large item in itself, as any larger dealer has in the vicinity of $50,000 worth of used cars for sale.
My firm's stock of new vehicles on hand on April 5th totalled 20 units, on which we had paid $6,315.80 excise tax. In effect, without any rebate from the department, we stand to lose $2,105.27, in addition to the revision in our used car inventories.
The argument seems to be that the last time they raised the excise tax they did not assess stocks in dealers' hands at the time. However, if I recall correctly, there were practically no dealer stocks in existence at that time-and certainly there was no request from the dealer organizations to be excused from collecting the additional tax.
We automobile dealers are responsible for the collection of vast amounts of taxes for the government-which we pay in advance long before most of the sales are actually made.
May we respectfully request you to make a serious plea to the honourable minister to implement ways and means of rebating dealers for stocks on hand as of April 5th?
I think there is some justification for the complaints of these automobile dealers, particularly the smaller ones, who will be quite seriously embarrassed by the application of the law according to the decision of the Minister of National Revenue. I urge that he give their representations further consideration.
There are one or two other matters I wish to bring to the attention of the minister. The first is one that I have brought to the attention of the house repeatedly throughout the last six or seven years. I have a number of constituents who practice forestry conservation. Some of them have wood lots; they might be termed large wood lots. Some have small timber holdings and some have holdings which are somewhat larger. But they are men who throughout the years have attempted to conserve a certain area of timber varying all the way from 100 acres to, in some cases, 5,000 acres. They have

The Budget-Mr. Herridge built roads. They have built trails. They have done thinning on their properties and they have made provision for easy access to the forests in case of fire.
In some cases these men have been doing this for 50 years. They have been conserving cutting from these natural resources throughout the years, and I know several who at the present time have more timber today than they had the day the first axe was swung in those timber holdings.
For persons who are practising conservation policies with respect to the management of timber I suggest that some opportunity should be allowed for certain income tax deductions, such as those that are allowed in the United States, for moneys expended directly in practising these policies. I know that the larger lumber companies are enabled to charge up to operations the cost of roads and certain other costs in developing large timber holdings. I think those arrangements are made with the income tax department. I have never been able to get to the bottom of that deal, as a matter of fact, but I am quite sure that a good many of the smaller timber holders are not able to take advantage of these provisions.
I believe some arrangement should be made for these smaller holders.
In our country there is going to be a much greater development-and I am very keen on it myself-of the woodlot and the smaller managed timber holding of anywhere, as I said before, from 100 acres to 5,000 acres. These people who are providing for the maintenance of the supplies of forest resources should receive some compensation for capital expended now on which in many cases they will receive no return in their lifetime. I know men who today are spending considerable sums of money in building roads and trails and practising forest management principles who will never receive full benefit from the expenditure during their lifetime. It will possibly be 50 years before the results of these conservation policies are fully effective.
I ask of the minister in his budget proposals consideration of some arrangement for these persons who can prove, by inspection or by certificate from the British Columbia forest service or something of that sort, that they are conserving our natural resources and that they are investing money for the future, so they may have an opportunity to deduct a percentage of these expenses from their income tax.
There is no question, Mr. Speaker, but that unemployment is our major domestic


problem. I am not going to rehash the unemployment debate in my brief remarks this evening but in that connection, like my leader and all other members of this group, I regret that the budget does not provide for a long-term public investment program to meet this urgent need now and in the days to come. We are very sorry about that. We believe the budget should have contained proposals for a long-term investment program in low-cost housing, a national conservation policy, improved highways, trans-Canada pipe lines, irrigation projects, power development, hospitals and grade crossing improvements. All these things are sadly needed in the country. We are sorry the budget does not make provision for at least the commencement of such a long-term program.
I must say that we welcome the announcement that the government intends to establish a royal commission to examine carefully our potential economic prospects. This is all to the good and from our point of view a very necessary step for the planning of the proper development of our natural resources. Apparently the seeds sown by the hon. member for Winnipeg North Centre (Mr. Knowles) in this respect are beginning to sprout. His speech of March 2, in which he urged the government to adopt a public investment program and to adopt a 100th anniversary committee, has been recognized and considered by the government.
At that time he urged the government to consider a committee to deal with a public investment program, so that when we celebrated our 100th anniversary we would have many things about which we could be proud. The hon. member placed a resolution on the order paper on March 17 asking for the establishment of such a committee to deal with the development of a public investment program over the years and coming to fruition at the time of our 100th anniversary. We are very pleased indeed to learn that the voice of the hon. member for Winnipeg North Centre has been listened to by the minister and the government at this time.
I should like to refer to the hon. member for Winnipeg North Centre as the Sir Stafford Cripps of the House of Commons. He is no Greek Adonis to look at, but he is certainly a good one to listen to. There is no question about it in this case, as on former occasions, the government has listened to his suggestions and advice, and we are very pleased that they have done so.
So far as the personnel of the commission is concerned, I hope it will be thoroughly representative. Naturally you have to have very well qualified persons to act in a satisfactory manner on such an important commission. I do think that, among others, there

should be qualified representatives of the working people, the farmers and the veterans of the country. There are certain aspects of this problem which these three large groups would wish considered, and I am sure that qualified representatives could make a most valuable contribution to the investigation and report by the royal commission.
However, it will take some time for the commission to complete its studies, and what is required at the present time is immediate action to meet the unemployment situation. I do not think we can ignore the fact that owing to various technological and other changes that are occurring in Canada and other countries at the present time, we are faced with the problem of a considerable amount of unemployment unless we take special measures through government action, federal, provincial and municipal, to overcome it. We believe that action should be as the result of planning, co-operation and co-ordination of activities among all levels of government.
I must say I find it very difficult to follow the policy of the Progressive Conservative party so far as their criticisms of the budget are concerned. The hon. member for Greenwood (Mr. Macdonnell), if I heard him correctly and if his television interview was correctly reported, suggested that deficit financing is not a good thing. I think the hon. member for Greenwood was expressing his personal conviction. 1 judged from his speech that he considered deficit financing a poor thing. I listened to the hon. member for Broadview (Mr. Hees), and I am quite sure anyone can fairly say that his proposals would mean a great increase in deficit financing so far as the government is concerned. Therefore I am not quite sure just what is the policy of the Progressive Conservative party with respect to deficit financing.
Personally, while small deficits may not be of serious concern, I do not think a government or a country can be run for long on very large-scale deficit financing. I think a better way is to provide for a public investment program because-


Mr. Brooks:: You agree with the hon. member for Greenwood.


Herbert Wilfred Herridge: -I think deficit financing would be more costly to the people of Canada in the long run. In my opinion it would be much sounder to establish a public investment program. I believe we should use the collective and personal credit of all Canadians for this purpose. When I say "collective and personal credit" I mean exactly this, that we should use the facilities
The Budget-Mr. Herridge of the Bank of Canada for the issue of a certain amount of credit to carry on all these necessary public works and projects I have mentioned previously, and that we should also use the personal credit of the people of Canada by the floating of low interest bond issues so the individual citizen of Canada would have an opportunity to contribute to a specific project.
1 suggest that the government would get a tremendous response to an issue of Canada development bonds. I think the government would be surprised at the number of Canadians, from the less well off to the very well off, who would like to subscribe to such a bond issue and who would like to feel they were participating in a public investment program advanced by the government. I suggest the government could very well consider discussing with the provinces when they meet here the possibilities for a planned investment program as the result of the use of the collective and personal credit of the country with close participation by as many Canadians as possible. I am sure if it is engendered in the right spirit, if we can get the federal, provincial and municipal governments working together, if we can get their purposes and objectives co-ordinated with close co-operation among all governments and the right appeal to the Canadian people, we can finance a public investment program on a very sound basis that will very soon meet the employment needs in Canada and provide for continuing employment in the years to come.
We have the unemployed representing unused human resources. We have unused natural resources. All we need is action on the part of the government to design a program related to a financial policy to meet the need that is so evident at this time. I do urge the minister to give consideration to that type of approach to the situation.
I am of the opinion that in recent years governments have overlooked the willingness of the people of Canada to respond to this type of appeal. When there was a war on the people responded to war loans. The morale of the Canadian people was high, and each put his shoulder to the wheel. I am confident that this type of program and policy, handled in the proper way and placed before the Canadian people in an attractive manner, would bring a response that would surprise the government. From talking to many people I meet, friends and others, who have some spare cash, I am sure they would be prepared to invest small sums, and that they would be delighted to have an opportunity to take part in such a constructive and progressive development if, in so doing, they
3104	HOUSE OF
The Budget-Mr. Mang felt they could assure to their fellow Canadians employment in days to come.


Mr. H. P. Mang (Qu'Appelle):: Mr. Speaker, I rise at this time to offer a few general remarks on the budget and the economic situation of our country. It would be presumptuous on my part to attempt to give a detailed analysis of either the budget or the economic situation, but perhaps I can offer a few remarks which will have some value or which, if they have no value, will at least give me some satisfaction.
There is one feature about budget debates and the consideration of budgets that has always interested me, and that is the attitude taken by newspapers, people in public life and the general public, when they seem to consider the budget of any public body as something to be considered by itself. To my mind a budget should always be associated with the work it is trying to do. All too often I find newspapers, and the public in general, either going into ecstasy or despondency over whether a tax rate has been raised or lowered; and a finance minister or a secretary-treasurer is either praised or condemned in the light of how much more or less he is providing to be spent in the conduct of the public business for which he is responsible.
This matter has puzzled me for a long time. If I were not afraid of disclosing my age I would say that as far back as 1934, when I happened to be making a speech on the budget of that time in the legislature in Saskatchewan, the same thing puzzled me. On that occasion I said it was as necessary for the people of a country to be tax conscious as to be conscious of a malady such as cancer, tuberculosis or some sickness of that nature. It has always been a puzzle to me to find that people consider expenditures or the providing of funds as something in, as it were, a separate room, apart altogether from a consideration of the things the expenditure of tax moneys is to provide.
The fact is that the two things go hand in hand. If one is fair, then he must consider it in that light, and in that light alone. The balance sheet must be looked at from both angles. To my mind the budget of a public body is much the same as the budgets we have in our own private lives. We see that we have so much money to spend, and that we have so much earning power. Consequently we decide what we are going to buy- what kind of car, what kind of radio, and all those things we wish to provide for ourselves.
When we begin talking about either reducing or increasing taxation we must emphasize in our own minds, and keep it as a background in the consideration of any budget, a clear picture of those things we desire to have.


In the budget now presented to us we must follow a similar procedure. While home during the Easter recess I interviewed a good many people. I called on municipal officials, on elevator agents, on reeves and councillors, and talked to people on the street, and I found the reaction to this budget was very favourable indeed. The impression I gained- indeed, it was told to me in so many words- was that the budget was considered honest and realistic, that it was facing the facts with which we are confronted, that it did not go off into an inflationary program but that it did the best it could to meet the prevailing situation.
People realize that we do not want any reduction in those services which, during times of prosperity, we have built up for ourselves. Those people do not want to give up any of their old age pensions or war veterans allowances. They do not want to deny themselves any of the public services that, as taxpayers in Canada, we have purchased for ourselves. Furthermore they felt that if we were to enter into an extensive program of public works the government would be acting as the agent of the taxpayers to hire those who are unemployed. It was felt that to hire
600,000	people at a time such as this would present some difficulty to the taxpayers.
These were the thoughts that appeared to be in the minds of the people. I was happy with the reception the budget received, particularly so because we in the west, where money is short, as it may also be in some other parts of the country, felt that the budget was facing up to the situation as it exists. The government in office is responsible for the carrying on of the public activities we want, those things for which in many cases we have asked and petitioned. We do not want to have them reduced. We know that moneys have to be provided for these purposes, and therefore we could not expect any great reduction in taxation.
In 1953 our national economy did not suffer greatly dollarwise. The figure, one we hear often repeated, was something over $24,500 million. According to the report of the Department of Trade and Commerce it had dropped last year to $24 billion. Since I am a grain grower and come from the prairies, it interests me very much to know that both in the budget and in the speech from the throne it is emphasized that the lack of production with respect to grain, particularly in western Canada, has had a serious effect and is indeed partly responsible for the drop in Canada's national output. To me this is very interesting, because it emphasizes the great importance of the three prairie provinces in our economy. Indeed, they are at

least the stone on the side of the keystone in the economic arch of Canada. I noted particularly the emphasis on that phase of our economy.
We did suffer last year. In the province of Saskatchewan there are places where we grew 20, 30, 40 and 50 bushels of wheat to the acre the previous year. Last year we grew 2, 3, 4 and 8 bushels of wheat to the acre. My constituency of Qu'Appelle is practically all under the Prairie Farm Assistance Act. That means that a great part of it yielded fewer than 4 bushels to the acre and nearly all of it yielded fewer than 8 bushels to the acre. This made quite a dent, shall I say, in the economy of our area, as it did all through Saskatchewan.
We are very appreciative of the help this act has given. Naturally some of us would like to have had more; who does not want twice as much, if he can get it? But we do appreciate and have appreciated the consideration that has been given to the west by this government over the years it has been in office. We do appreciate what it has done to solve western problems and the help it has given to meet them.
I have mentioned previously some of the things this government has done, which we greatly appreciate. Of course we westerners must be forgiven for some of our impatience, because we are so young. Some of our grandfathers saw the buffaloes roaming there. Our grandfathers and fathers took over the raw prairie from the Indians, the gophers and the buffaloes. That is in the memories of men still living there. We all know that the young are very impatient. That can be seen from the political performance of the twin provinces of western Canada, Alberta and Saskatchewan, who are celebrating their fiftieth anniversary this year. I do not know of any two political parties that are more opposed to each other than those two facing each other across the Saskatchewan border. One province' is Social Credit and the other is socialist at the present time.
It will not be that way all the time, of course. That is partly owing to their youth. I hope other members from other parts of Canada who are pioneers, not of the west but of Canada itself, will understand that. I think at once of the oldest and yet the youngest province of Canada, namely Newfoundland. I have been told that in that province today there are roads that were laid 350 years ago. It makes me feel very humble and very appreciative of the fact that we are young, and because we are young we make demands and requests, sometimes in very violent fashion. That is one of the reasons we do it in that way.
The Budget-Mr. Mang
We are short of cash throughout western Canada at the present time. It is not at all hopeless, however. The situation is that we bought a great quantity of goods during our prosperous times. We are just like the worker in a factory. If he gets an increase in wages he spends it the day after tomorrow, and very often it is spent on a new television set or on a new commodity of some kind that he wishes to have.
We are far from bankrupt in western Canada. Indeed, our wealth is quite substantial. A good deal of our money has been sent to Windsor, Toronto, Montreal and Oshawa. We do not regret that because we do not care so much for money out there. What we care for are goods, which are the true wealth of any land. We want a new combine; we want a new truck or a new car, and that sort of thing, but at the moment we are short of cash. If those wheat payments can be hustled along a little we shall appreciate it. I do not threaten as some people do, by shaking a finger or a fist at our very efficient Minister of Trade and Commerce. That does not make the stenographers work any faster, and it is not physically possible to get the payments out any faster. We are going to be patient. We are very patient people out in the west. We have acquired that virtue because we have learned to depend chiefly on the weather and the soil for whatever we have.
In spite of the handicap of a socialist government from which we suffer out there-I shall not mention the other government, because it does not concern us at the present time. They are getting along very well, but they are also getting help from sources outside their own borders and, of course, oil and gas-we are hoping that with the help we are getting from this government in various ways, with the other payments coming in, and with the grain moving again, we shall not have to ask the house for any special consideration.
The matter of trade has been emphasized over and over again. It has been said that we must expand our trade. The loss of some of our markets has been deplored. Of course the loss is regrettable. I was interested in the discussions on unemployment and trade. Employment in any country depends upon trade, both domestic and foreign, but that trade depends upon the consumer. Unless someone buys the thing you make, it just lies there. For example, you can have combines standing in Toronto by the acre, or trucks standing in Oshawa by the acre. They do not do anybody any good until someone starts to use them. As soon as the products of labour are brought into use you have wealth, and not before that.

The Budget-Mr. Mang
The consumer has not been emphasized enough in our discussions here. The consumers of this country, or of any country with which we trade, call the final tune. The consumer is the one who decides whether he will or will not buy. May I point out that we, as western farmers, have always tried to be reasonable in the marketing of our grain. May I give this illustration. Every manufacturing concern in the economy of Canada should consider it very carefully. When we formed the wheat pool through which we hoped to market our grain, one of the objectives of that farm organization was to try to keep the price of our grain in a reasonable relationship with what the consumer was able and willing to pay. With the exception of 1929, when many people in this country, the United States, and throughout the world for that matter, misjudged what the consumer was going to do, we have followed a policy in our sales of grain of always considering the ability and willingness of the consumer to absorb our product.
Without going into detail on that point but just to bring it into focus I would point out what happened last year, and I do this to indicate what I think industry should do. Perhaps I should not say "should do", as it is up to them, but this is what the wheat board did. First of all we recognized that the markets of the world were becoming highly competitive, and that if we were going to sell our product we would have to maintain our competitive position. We all heard the Minister of Trade and Commerce make that statement when the price reduction was announced.
This is what happened in western Canada last year when we tried to adjust ourselves to the competitive situation that had developed in the international grain market. I should like to quote a short paragraph from the Canadian wheat board report dealing with price which illustrates how we have tried to meet the international competitive situation with regard to the sale of our wheat which, as I said a few moments ago, forms such an important part of our national economy, as was recognized in the budget speech and the throne speech as well. Referring to the international wheat agreement the report had this to say:
From the agreement level of $2.03 per bushel at the start of the crop year board quotations for No. 1 northern wheat basis in store Fort William-Port Arthur declined through the course of the crop year to a level of $1,704 per bushel on July 30. 1954, representing an over-all decline of 324 cents per bushel for the year.
That was done in order to meet competition in the markets of the world. I ask industry,


which would consist of the investor, management and labour, what they have done to remain competitive in the markets of the world. In western Canada the budget resources of the farmers have shrunken, not only because of yield but because of price adjustments. When we come to consider the purchase of a new truck, a new combine or a new machine produced in eastern Canada in the centres I have named we are faced with the fact that the cost of labour has risen and profits have increased.
We in the west cannot see how our commodity is going to take the adjustment when on the other hand industry, consisting of the units I have mentioned, is permitting its returns to go up all the time. We hear of less work, more wages, better holiday arrangements and more fringe benefits. The cost of all these items is built into the price of the combine, the truck and the car which we must have to run our business of producing wheat.
I am not telling anyone what to do; I am simply posing the question. That is one reason I was glad to have it announced in the budget speech that a commission is to be appointed to look into the whole economic picture of Canada. Some hon. members have indicated that they think this might take a long time. I do not know, but if the right men are appointed and they get busy I do not think it will take too long. The Prime Minister will know more about this because he was on the Rowell-Sirois commission, which had a somewhat similar duty to perform.
I suggest that the commission should consist of responsible men. It should look into the reasons for our high costs of production which I have hinted at, and the relative influence those matters have upon our high-cost economy which is making it so hard for us to compete in a highly competitive world against West Germany, Great Britain and Japan, three of our chief competitors who within the past few years have come up by leaps and bounds. As a matter of fact, as their employment figures have increased and as their production has been poured onto the markets of the world, to that extent have our unemployment figures here in Canada increased.
This commission should make a thorough survey of company profits, investor returns, labour and transportation costs. The cost of transportation is quite an item in the wheat and pulp and paper industries. Last year it cost the pulp and paper industry something like $250 million in transportation costs alone, and we could easily figure out the cost of transporting wheat, a most vital

factor in our high-cost economy. And then there is taxation to be considered.
This commission will be able to establish facts in a way that we cannot establish them in this House of Commons. In this chamber we might be able to assess the economic situation in Canada in relation to the five points I have mentioned, but our duties are different. One group has the responsibility of conducting the business of the country; another group has the responsibility of criticizing the way in which that business is done; others offer suggestions, and so forth. The net result is that the poor public are very much confused as to what is the actual situation.
I am pleased that this matter is to be dealt with by a royal commission because above all else it will provide information to the people of Canada which is unbiased and not coloured by the political expediency of any party, or entangled with certain matters which should not enter into it at all. I would not undertake to indicate the personnel of this commission, but I was highly impressed by Mr. Graham Towers at committee meetings last year. Then there should be two representatives from the manufacturers' association, one from management and the other from the investors' side. I would certainly have representatives of labour sitting on the commission. Such institutions as banks should be included, and of course farmers, one farmer from the east and one from the prairies.
The reason I would like all these people represented is this, that they would share the responsibility for that report. You could go out into the country and give the people a factual presentation of the situation as it is, uncoloured by political bias. It would do away with the confusion that is brought about at the present time in the way these economic facts are presented to the public who are responsible for the membership of this house.
There is another point I should like to mention because it comes up so often. It came up again tonight. That is the question so often asked, if we can so regulate our economy during war that there is no unemployment, and if we can get all the money we want during a war, why not in peace? I have puzzled over that for quite a while, but I have answered the question, to my own satisfaction at least, for some time past. I do not remember much about 1914-we had no radio then-but you will remember that on the eve of the declaration of war in 1939 we had a marshalling of all the political forces of this country within one hour. I think it was from seven to eight o'clock out west, when the then prime minister, Right 50433-1974
The Budget-Mr. Mang Hon. Mackenzie King, spoke, telling the people of Canada what was happening and what had happened. Then the premier of every province spoke on the same program. The result of this was a marshalling of the minds and the will and, as a result of that, the resources of this country to one purpose. That is the first reason you can do certain things during wartime which you cannot do in peacetime. I challenge anyone to suggest that such unity could be attained even if you had a million unemployed today.
The second thing is this. With the marshalling of all those forces of the mind, of the will and of the resources, both human and natural, you have the government immediately going into action with respect to the regulating of the economy, and you institute a rigid economy to accomplish that one aim in which we all unite. You have the invoking of the War Measures Act, you have the national registration, and you have the wartime prices and trade board. You marshal the human resources, and that is why you can do those things about which the question is so often asked: if you can get all that money in wartime why can you not get it in peacetime? That is one of the reasons. You can get that kind of unity and you can solve your problems as easily as that. But you would never get it, even if you had a million unemployed, today. That is the way I answer that question for myself. Others may answer it as they wish.
The other matter concerns the profits of corporations. We live in a free enterprise economy. That of course is a term which has been kicked around almost ad nauseam, "free enterprise" or "private enterprise". Many people mention it and do not even know what it is. It simply means that a person in this country will produce the most when he is seeking his own happiness; when he has his own way of working and is using his own skill for his own profit. He may have great ambition or little ambition; he may have initiative or not, and that depends on each individual human being. A great deal is made out of so-called big business. I sometimes wonder whether it is to the advantage of the people themselves-never mind the business or the economics-to indicate to them that somebody is trying to rob them all the time. It creates a spirit of leaning on somebody else to accomplish the things which the individual actually wants to accomplish. Let us look at some of the figures. This is perhaps just one example, but it applies to others in a greater or lesser degree;
The British Columbia firm of MacMillan and Bloedel Limited, one of the world's greatest enterprises in forest products, records gross receipts

The Budget-Mr. Mang of $142 millions in 1954. Of special significance is the disposition of profits. To 4,582 shareholders there went a total of $4,189,000 in dividends.
Coupon clippers, I presume.
To governments (federal, provincial and municipal) there went taxes totalling $14,490,101. To 8,648 employees there went salaries and wages totalling $30,023,649.
. . . the owners of the business-the shareholders- got less than one-third of what went to governments in taxes, and about one-seventh of what went to workers in salaries and wages.
I am not condemning labour, those who work with their hands or work with the pen or work with their brains in management, for wanting a fair share and keeping the bulk of what comes out of that particular business. But the point I am trying to make is that we should not condemn a business as such just because it is making profits. We are all sharing in those profits, particularly today, because in the last 30 years at least the corporations have taken on a different form. The public itself is a shareholder. General Motors corporation has something like 500,000 shareholders, and you could name others.
I do not want to go into details at the present time, but the point I am making is that labour prospers to the extent that businesses prosper; it gets its share out of those profits. Remember this. In this house the Minister of Finance through his taxation powers can reduce those profits by taxation if they should get beyond all bounds or if they injure the economy by taking too much in profits out of the production of goods. The Minister of Finance and the government in that case will use those profits and redistribute them, as he is doing now.
I know there are other sides to the argument, but the point is, what is the alternative? The alternative is, of course, state ownership and state control of the means of production and distribution. If you are going to switch from this economy you will have to go to some alternative. I question very much, and I have always questioned, whether the people of Canada are of the type who want to have their private initiative controlled and governed by a body that is perhaps not endowed with any more wisdom than the average man in the land. Looking at it fairly, before we condemn the system we have and try to substitute another one therefor, we should look at some of these angles in a realistic way.
There is one more matter on which I wish to give my own view. In this house we have had mentioned very often-indeed we hear it every day-our great natural resources of forests, lands, streams and rocks. Those four basic natural resources have been mentioned.


It has been contended that because we in Canada have such an abundance of these natural resources, and an extremely energetic people, there should be no unemployment, and that all this is wealth.
I think I pointed out previously in this house, in my own immature way, of course, that these natural resources are not wealth until they are turned into something usable, and that until it gets into the hands of the consumer it is nothing. Otherwise you might as well leave the resource for the artist to paint or for the fisherman to enjoy.
To make the example more extreme, consider these combines and trucks that you see standing around that have not gone into consumption. Until they go into consumption they are not wealth. If you try to monetize them after they are built and bring them into consumption in that way, I just am not condemning the idea but I am wondering whether that is feasible or possible. Those combines and trucks might just as well have been left in the ground, as far as wealth is concerned, until some farmer buys the combine or somebody buys the truck. The combine or truck is not wealth until it goes into consumption. It can go into consumption only when an individual uses his brain and his brawn to get some purchasing power through his own efforts. Then he can turn this into wealth and something usable.


Mr. Johnston (Bow River):: Come on over here. You do not belong over there.


Henry Philip Mang: Perhaps you do not get my point. I have not time to go over it again. So we have these natural resources, but we must have the application of the stored-up wealth that we have in the form of money and the desire or the ambition and the energy-particularly the initiative and the ambition-of the individual Canadian to go out and get something for himself if we are going to keep the economy alive and build it up. If you are going to bring these products of your ambition, energy and initiative to the consumers you must bear in mind what the consumer thinks he can pay you for the service you have rendered.
We in the wheat business are trying to do that. I urge the rest of the people of Canada -particularly the labour unions, management and investors-just to take a good long look at the matter. I therefore think this suggestion of the Minister of Finance with regard to appointing a commission is a good one, together with my suggestions as to personnel. By this means I think we can bring the economic problems into focus.
It has often been stated that the twentieth century belongs to Canada. It was repeated

this afternoon. That prophecy was made at the beginning of the twentieth century. It was made by a son of old Quebec from which the original white Canadians came. By a peculiarly strange stroke of fate, in the middle of the twentieth century we have from that same province a Prime Minister who is charged with the responsibility of making a reality that vision of 50 years ago. I think we are well on the road to that progress if each individual and each section of Canada will assume his and its share of responsibility rather than throwing the responsibility on somebody else, or more particularly loading upon the government of Canada alone the responsibility for prosperity and well-being in this land.


Mr. J. A. MacLean (Queens):: Mr. Speaker, on looking quickly over the budget speeches over the years, I have found that one thing is noticeable, namely that the question of tariffs looms less important now in the budget speeches than it did a number of years ago. I suppose this situation is due, in part at least, to the fact that tariffs are not now looked upon as a source of revenue to the extent they were at one time.
I realize that I am running the risk of committing the sin of oversimplification but it would seem to me, Mr. Speaker, that generally speaking the items on which we might have tariffs fall naturally into three classes. First, there is the class of items which we are forced to import, which we do not produce in our own country. In that category, of course, fall such things as citrus fruits, spices and many other things.
It would seem to me that those items as a class should be free of duty, because any duty imposed on them is imposed merely as a source of revenue; and if duties are imposed they increase the cost of living by that amount. I think there are some items in this classification which are not duty free but which might well be. For instance, I believe there are tariffs on some such items as fruit juices, citrus fruits and items of that sort which there is no hope of ever producing in this country. I realize that there are other fruit juices that might be considered to be competitive; nevertheless I think that, generally speaking, there is a large class of goods which should remain duty free.
Then on the other end of the scale there are other items in which this country is pre-eminent and as to which there is no worth-while competition from other countries. In that group you might place nickel, asbestos, perhaps wood pulp and many other things. We do not normally import these articles anyway, because our own national industries can compete effectively with any
The Budget-Mr. MacLean imports. In these cases it would seem that duties are unnecessary. That leaves, of course, the great group of products which are produced in this country and with which imports compete. That, of course, is the group that gives us the biggest problems when it comes to deciding what items should be protected and what items should not be protected.
In connection with changes in the tariff, I am pleased to note that certain things which are used in the agricultural industry have had the tariffs removed. I refer to such things as agricultural spraying equipment and items of that sort. I feel that is a welcome move to Canadian agriculture and the Canadian people generally. I am also pleased to know that it is intended to refer the question of the tariff on potatoes to the tariff board. To my way of thinking it is a matter of pressing importance that some protection should be given to the Canadian potato grower if at all possible.
The question of arriving at what is a suitable tariff for various imports is further complicated by the fact that our country falls into four different economic areas, the Atlantic provinces, central Canada, the prairies, and British Columbia. A tariff set-up which will please one section and stimulate its economy may not be satisfactory for the others. I suppose the only way you could make everyone happy as far as tariffs are concerned would be to have the reverse of a customs union. You would have to balkanize our tariff system so that it coincided with out naturally balkanized economy. That of course would not be practical.
Therefore the only solution that remains is to try to bring the economy of all parts of the country more into balance. In this connection I think it is fair to say it would be easier to devise a tariff structure that would meet with the approval of all if industry were spread across the country, and if our industrial areas were not so dependent for agricultural products on far-away sources. I was very interested in a brief reference to a certain subject made by the Minister of Finance in his budget speech. As found at page 2730 of Hansard of April 5, he said:
There should also be an increase in construction activity in the season now beginning. Indeed, it is clear to all of us that alongside the pushing back of the physical frontiers of our country there is also taking place an expansion of urban facilities which is simultaneously making Canada a land of large cities. This trend toward metropolitan development creates special problems of its own . . .
I am very pleased that the minister recognizes that this trend creates problems. I think it is perhaps one of the most serious trends that has taken place since the war.

The Budget-Mr. MacLean If it is allowed to continue and the policies are maintained which permit it to continue, this dangerous and shortsighted program may well lead ultimately to the very destruction of civilization in this country.
If we do a little basic thinking about the matter we will realize that centuries ago, or even up until quite recent times, large cities were a necessity. They were a necessity for defence reasons in early times. In medieval times you had to put a wall around a city. It was necessary to have the people living in a very small area. Cities were necessary for purposes of communication. In those days means of communication were very crude and slow, and you could not communicate rapidly over great distances. There was also the problem of transportation. Everything had to be carried by man, animal or boat.
All these problems have now disappeared. In this connection I should like to quote from a speech delivered at Harvard University in 1930 by Alfred North Whitehead. He said in part:
Throughout the whole span oi civilization up to the present moment, the growth of condensed aggregates of humans, which we call cities, has been an inseparable accompaniment of the growth of civilization. There are many obvious reasons: the defence of accumulated wealth behind city walls, the concentration of power in the form of human muscles and, later, in the form of available heat energy, the ease of mutual intercourse required for business relations, the pleasure from a concentration of aesthetic and cultural opportunities, the advantages of a concentration of governmental and other directing agencies, administrative, legal and military . . . But, if we examine the trend of technology during the past generation, the reasons for this concentration are largely disappearing. Still more, the reasons for the choice of sites for cities are also altering. Mechanical power can be transmitted for hundreds of miles, men can communicate almost instantaneously by telephone, the chiefs of great organizations can be transported by aeroplanes, the cinemas can produce plays in every village; music, speeches, and sermons can be broadcast. Almost every reason for the growth of cities, concurrently with the growth of civilization, has been profoundly modified . . . the effect of new technologies on the sites of cities, and on transformations of cities, is one of the fundamental problems which must enter into all sociological theories. . .
There are, on the other side of the scale, very important reasons why this trend toward a few large cities in Canada should be reversed. In this atomic age large cities can be wiped out almost instantaneously by H-bombs. It would take very few of them to paralyse a very high percentage of the production and population of the country if present trends are permitted to continue. Transportation also is being complicated by the congestion of our larger cities. At the present time we have the contradictory situation of it being necessary to spend millions of

dollars in Toronto, and probably in Montreal, for the construction of underground railroads, while at the same time we have applications from our national railways before the board of transport commissioners requesting that services be discontinued in many of the outlying parts of the country because of lack of traffic.
These, Mr. Speaker, are a few of the reasons, but there are many more. I could refer at length to the many complications created by the fact that our population is concentrated in a few centres. For example, it has been calculated that the workers at the A. V. Roe company spend $12,000 a day just getting to work. It has also been calculated that traffic delays in the city of Montreal cost $30 million a year. These are figures which alone would give one reason to believe that we should contemplate doing something about the growing tendency for our industries and our population to congregate in a few large centres.
Ex-mayor McCallum of Toronto was reported in 1949 as saying that he thought his city should grow no larger, but that only senior government action could prevent it. I think that was a true statement, and that it behooves this government to give a lead in the dispersal of industry and population more evenly across the country. I do not mean by this that it would be necessary to uproot present industries, wherever they may be, and transplant them to new areas. But the continued trend to construct new industrial sites around our larger cities definitely should be discouraged.
In other countries something is being done about it. In 1940 the government in Great Britain appointed a royal commission to look into this very problem, as a result of which the new towns act was passed; so that now in Great Britain there are under construction 16 garden cities ranging in population from
30,000	to 80,000.
In the United States the problem has received government recognition. In 1948 the national security resources board issued instructions in industrial locations advocating that no new factories be built adjoining centres of more than 50,000 people. After that report was made, and perhaps partly because of it, only about a third of the new plants built in the United States since 1940 have been located in places with populations over 100,000. So it appears that in that country a concerted effort is being made to deploy the economy and the industry of the country evenly throughout the whole area.
In this connection I should like to quote briefly from an article which appeared in the

Community Planning Review for November, 1952, regarding a conference held just prior to that time. It says:
The theme of the presentation, made by members of our council to the federation of mayors last July, was that the major cities of Canada, and indeed major cities all over the world, have grown beyond the point where they are efficient in terms of industry and commerce, and also beyond the point where they provide happy and satisfactory living for those who must spend their lives in, or in close proximity to, these larger metropolitan areas.
In that connection, in 1946 a survey was taken in the United States by, I believe, Fortune magazine, when it was found that two-thirds of the people living in American cities having populations of over 100,000 were dissatisfied with the environment in which they were forced to live.
I think it should be agreed that this is an important problem about which up to now this government has taken no action. It is a problem which is becoming increasingly acute, and it is a trend which as time goes on it will be more difficult to reverse. I intend now to turn briefly to another subject, but I must say that the one I have just discussed is one I would like to hear debated in the house when the subject of civil defence is under consideration, if indeed it cannot be approached from some other point of view.
I turn now for a few moments to government accounts and to the budget, as such, presented by the minister. During his budget speech he had this to say, as reported at page 2730 of Hansard:
Assuming normal crops, and if no unforeseen adverse events occur, I would expect our gross national production in 1955 to exceed 1954 by 5 or 6 per cent; that is, it should reach $251 billion or perhaps just a bit more, and on that figure X shall base my revenue forecasts.
A little later on he had this to say regarding his predecessor's budget speech of a year ago:
In his budget speech last year my predecessor projected a scale of expenditures and revenues that almost exactly balanced. He made it clear, however, that his projection was based upon two assumptions, normal crops and an early resumption of our normal rate of industrial expansion. He said explicitly that if these conditions did not materialize there would be a deficit of 2 or 3 per cent. Well, as hon. members know, we had a poor wheat crop, the poorest in 17 years, and the resumption of a normal rate of industrial expansion has been slower than we had hoped. As a consequence we have a deficit equal to 31 per cent of our expenditures.
My reason for offering these quotations is to remind the house that during the last ten years at least we have been in a period of rising prices. Or, to say this in another way, we have been in a period when the value of the dollar has been going down constantly
The Budget-Mr. MacLean in the matter of purchasing power. Under those circumstances it is or should be easy indeed for any government to balance its budget, for the simple reason that it pays its commitments in dollars having less purchasing power than dollars had when the commitments were made.
In a period of rising prices, of course, all debtors benefit because their commitments in terms of purchasing power go down. That is a happy situation for any government to find itself in. But, like most benefits of that kind, the old rule that one gets nothing for nothing comes into play; and there will come a day when the situation will be reversed and all debtors, including the government, will find themselves obligated to meet their commitments in dollars with a purchasing power equal to that of the dollars current at the time the commitments were made.
Relatively speaking it has been a simple matter for this government to meet its commitments to the recipients of family allowances and old age pensions in dollars which have only a little more than half the purchasing power of the dollars existing when the commitments were made. The same applies to the interest on the national debt, and all other commitments of government. But from now on there is a strong possibility that this trend will not be so great, and that it may even be reversed.
Under those circumstances the minister admits that the budget will not be balanced. He places his estimate on a very optimistic outlook, so far as gross national product is concerned, measured in dollars. It seems to me that when the inflationary trend stops the actual gross national product may continue to go up as far as goods are concerned, but it may decline as far as dollar value is concerned; and after all it is on the dollar value that the budget is based. So we may be entering a time when it will become increasingly difficult for this or any other government to balance its budget.
Therefore, Mr. Speaker, I maintain that this is a time when every effort should be made to reduce unnecessary expenditures and see to it that the taxpayer gets 100 cents in value for every dollar he is forced to spend. If prices continue to rise in a spiral the cost of living will continue to rise, and that would not be a good thing. We could quite easily reach the inflationary point of no return. Already the cost of living is so high that many Canadians find it difficult to exist.
Not only is the cost of living high under this government; even the cost of dying is very high, and no change has been made in that regard. I note with regret that the Minister of Finance did not see fit to remove

The Budget-Mr. Ellis
the sales tax from such items as coffins, hearses and even flowers, which one places on the graves of deceased persons. It strikes me as almost ghoulish that the government should see fit to enhance its revenue at the expense of those who have been recently bereaved. In most families death is a catastrophe from the financial point of view, even leaving the sales tax on coffins out of consideration.
Some minor reductions have been made in the income tax, and they are welcomed. I regret that no relief whatsoever has been given to the large group of Canadian citizens whose entire tax burden is borne in the form of indirect taxes. I also regret that no relief has been given to the municipalities. The least that could have been done was to make purchases by municipalities exempt from sales tax. I should have liked to see a budget which gave more consideration to the primary producers of this country. It is those who produce goods who cause our standard of living to rise in a material sense. Too much emphasis can be placed on services. Services may be a very convenient thing and in many instances are necessary and contribute to production; but if the accent continues to be placed on services, we may as a nation get to the point where we are trying to be well off and reach prosperity by, if you carry the argument to its logical conclusion, taking in each other's washing.


Edmund Davie Fulton: A very important matter;
cleanliness is next to godliness.


John Angus MacLean: But you cannot live on it alone.
The Minister of Finance was very optimistic, or he based his predictions on a very optimistic forecast of industrial and business expansion in the year that lies ahead. I hope that in the interests of the economy of the country, the standard of living and the happiness of all Canadians, his optimism will be realized in fact. I hope that the industrial expansion in the year that lies ahead will exceed his fondest hopes. If it does, I hope he will not attribute it to the very meagre relief he has given by way of tax reductions.


Mr. Claude Ellis (Regina City):: Mr. Speaker, I believe the most important thing to consider in a debate of this kind is the role which we assign to the budget in our modern-day society. There may have been a time in our history when the budget was considered merely as the instrument by which the government raised moneys to carry on the day to day activities of government. But I believe today we have to consider that the budget is also an instrument of social and economic planning. It is a means of dealing with the

major economic difficulties facing the nation. It is on that basis that we ought to consider the budget brought down by the Minister of Finance, and judge whether or not it contributes to a solution of the outstanding problems facing Canada at the present time.
Before dealing with the broader aspects, I should like to make a very brief reference to a number of specific provisions or perhaps omissions in the budget. Great emphasis was laid on the reduction in the personal income tax but I wish to draw to the attention of the house the fact that there are a great many people in Canada who do not pay income tax, for the simple reason that they have never earned sufficient money to become liable for taxation. I checked the latest figures available, and I must say at the outset that they are 1952 figures. I do not believe percentagewise there is a great deal of difference between the figures of that year and the figures of last year.
I found that in Canada in 1952 there were over half a million Canadians, some 594,980 to be exact, who had incomes of under $1,000; there were over 403,000 Canadians earning incomes of from $1,000 to $2,000; there were some 251,000 Canadians earning incomes of between $2,000 and $3,000; and some 20,000-odd earning between $3,000 and $3,500. These figures give us a total of some 1,276,610 Canadians who, during that year, were not liable to income tax simply because their incomes did not make them liable for such tax.
Bearing these figures in mind we have to ask ourselves this question. What has the budget done for this great number of Canadian citizens? It has given them no tax relief whatsoever, and I remind the house that these are the people in greatest need. I suggest that when the government is bringing in some measure of tax relief it should be directed toward those who are in greatest need. If the government has operated on that principle there would have been a different sort of tax reduction provided for in this budget.
We have to ask ourselves, what has the budget done for our senior citizens on old age pensions? What is in this budget in the way of tax relief for our blind pensioners, for those on war pensions and war veterans allowances, or for the vast number of Canadian citizens who are on small pensions of one kind or another, such as former railroaders, for example, who are seemingly trying to exist on pensions as low as $25 a month? There is no tax relief for these people in this budget.
When the Minister of Finance brought down his budget and there was a tremendous amount of desk-thumping by supporters of

the government, it seemed to me that it was an indication of an attitude of mind. They were pleased with the budget even though it had overlooked the needs of the great number of Canadian citizens who are not earning enough money to pay income tax, and in 1952 there were over 1,200,000 Canadians in that category. As I pointed out, there is no tax relief whatsoever in this budget for Canadian citizens in the greatest need. I remind those supporters of the government who were so enthusiastic the night the budget was brought down that this budget has shown a callous disregard for the plight of many of our citizens.
I would call attention to the deceptive manner in which the government tried to get this across to this house and indirectly to the people of Canada. A great play was made on reductions in the income tax, and we were told that the income tax deductions were going to vary according to income. We were told that those in the lower income brackets were going to get a tax reduction of 13-2 per cent, and then we were told in the next breath that those in receipt of high incomes were going to get a tax relief of only 2-8 per cent.
I wonder who the government thought they were fooling with that sort of subterfuge. No matter how you figure it out it means a 2 per cent blanket reduction across the board. The government brought this in in a deceptive manner and tried to convey the impression that there was some fairness and equity in the manner in which these reductions were being made, when all the time there was plain evidence that the income tax reductions amounted to a flat 2 per cent reduction across the board.
There is no justice or equity in that sort of tax relief. A 2 per cent reduction across the board means a lot more for the big fellow than it does for the small fellow. When we look closely at the figures we find that a married man with two children having an income of $3,000 will get tax relief this coming year of $14. On the other hand the taxpayer who is in receipt of an income of $20,000 will get tax relief amounting to $354. Is that the Liberal concept of equity and fairness in a tax program, that the person who needs help, the person with a low income, gets a niggardly $14 reduction in income tax while the man earning $20,000, who certainly is not on the verge of being poverty stricken, gets tax relief amounting to $354? I ask, is that the Liberal concept of fairness and equity in a tax program?
If the government had wished to do something to reduce the tax load on the people of this country who most need relief they could have done that by reducing the indirect
The Budget-Mr. Ellis
sales tax. I would venture the opinion that the average family in Canada in the lower income groups, perhaps those at the lowest level of liability for income tax purposes, will pay about twice as much in sales tax during the year as they will pay in income tax. So if the government had been anxious to give tax relief to those who are in greatest need they would have brought about a reduction in the field of indirect taxes.
There are not too many figures available with respect to this problem in Canada, but I have noted a survey and study prepared for the United States congress in 1941 entitled "Who Pays the Taxes?" This report reveals that in the United States indirect or consumption taxes took from 16 to 20-6 per cent of the income of those receiving incomes under $3,000. For the income group earning from $10,000 to $15,000 indirect or consumption taxes took only 9-9 per cent of income. In the case of those earning $15,000 up to $20,000 the indirect and consumption taxes took only 8-8 per cent of income, and in the case of those earning more than $20,000 the indirect or consumption taxes took only 5-7 per cent of income.
Therefore it is quite obvious that the indirect tax bears most heavily on the low income group. The figures supplied in this study would indicate that indirect taxes bear about four times as heavily on the lower income group as they do on the higher income group. The reason is quite obvious. A person on a low income must spend all of his income on consumer goods, whereas the man with a higher income can afford to put money aside in savings. Therefore the lower the income the greater the amount of money spent on consumer goods.
I repeat that if this government had been anxious to provide a measure of tax relief for the lower income groups of this country they would have gone about reducing the indirect taxes.
On motion of Mr. Ellis the debate was adjourned. '



BUSINESS OF THE HOUSE

Walter Edward Harris: On Monday we shall take third reading of Bill No. 263 and then the following items in the order in which I indicate them: No. 4, National Parks Act; No. 13, Territorial Lands Act; No. 14, Precious Metals Marking Act; No. 9, respecting the Canadian forces; No. 11, Veterans Benefit Act; No. 12, great lakes fisheries convention; No. 6, resolution with respect to Canadian National Railways and No. 15, an act respecting unemployment insurance.


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

: :l ' ' '*
J !
:
[Stage Direction]
-.Uo
[DOT] f*
: -t r$
[Stage Direction]

Monday, April 25, 1955 CANADIAN NATIONAL RAILWAYS

Hon. George C. Marler (Minister of Transport):: Mr. Speaker, I should like to make a statement which I think would be of interest to hon. members concerning the Super Continental train. The management of the Canadian National Railways has advised me as follows: The number of cars making up the new Super Continental, which commenced operation between Montreal, Toronto and Vancouver on April 24, must be limited to enable these trains to hold their new fast schedules. This limitation, coupled with the very large expenditure involved in providing new equipment for and operating these new trains, has placed upon the Canadian National the obligation of deriving the fullest passenger revenue from the new service and of ensuring sufficient accommodation for all revenue passenger traffic offered. For these reasons the following restrictions have been placed on passes:
1.	No pass held by railway personnel of any rank or by other than railway personnel will be accepted for transportation on the Super Continental, unless such pass is accompanied by a special permit issued under authority of the office of the president.
2.	So far as railway personnel are concerned, such special permits will be issued only when it is considered to be in the company's interest to have the employee use the Super Continental; but, in the cases of holders of passes other than Canadian National personnel, applications for such permits will be given appropriate consideration.
The Canadian National is thus making every effort to reserve sufficient accommodation on the new train for revenue passengers, but the action being taken will, of course, in no way affect the rights of members of the Senate or of the House of Commons to use their certificates to travel on the Super Continental when it suits their convenience to do so. Special consideration will be given to applications for permits for dependents of members of the Senate and of the Commons accompanying them.
I think the last phrase is the best part of the statement, Mr. Speaker.


Edmund Davie Fulton: May I take it from what the minister has just read that members of parliament and their families will not be welcomed on board either of the new trains?


George Carlyle Marler: Mr. Speaker, I hope that when the hon. member reads my statement tomorrow he will find there is a little more warmth in it than he has suggested.


Edmund Davie Fulton: I doubt it.



INQUIRY AS TO PROPORTION OF ROLLING STOCK TO BE MANUFACTURED IN CANADA

[Stage Direction]
On the orders of the day:
Mr. O. C. Trainor (Winnipeg South):: should like to direct a question to the Minister of Transport. Can the minister state what proportion of the new rolling stock required in the operation of the Super Continental train of the Canadian National Railways will be manufactured in Canada?


George Carlyle Marler: I will take my hon. friend's question as notice. It is not the kind of information that I ordinarily would be carrying in my possession. I shall make inquiries and give him an answer as soon as I can.



COMPARISON OF RUNNING TIME WITH THAT OF C.P.R.

[Stage Direction]
On the orders of the day:
Alexander Malcolm Nicholson: Mr. Speaker, I should like to address a question to the Minister of Transport. In view of the present interest in the dieselized trains which left Montreal and Vancouver yesterday, can the minister explain why passengers on the Canadian National should spend two hours and ten minutes longer on the train going from Montreal to Vancouver than those on the competing train when, prior to dieseliza-tion, the Canadian Pacific Railway train was only able to beat the Canadian National Railways train by fifteen minutes?


George Carlyle Marler: I received notice of my hon. friend's question just a few minutes before coming into the house. I shall institute inquiries and, as soon as I have an answer, I shall communicate the information to him.

Questions



WITHDRAWAL OP HILLSBOROUGH BRIDGE FROM ENTRUSTMENT

George Carlyle Marler: I beg leave to table under the provisions of section 18, paragraph 2, of the Canadian National Railways Act, chapter 140, Revised Statutes of Canada, 1952, a copy of order in council P.C. 1955-519, dated April 6, 1955, withdrawing from entrustment to the Canadian National Railway Company the Hillsborough bridge, which forms part of the Prince Edward Island railway.



MARITIME COAL PRODUCTION ASSISTANCE ACT


George Prudham: In accordance with section 9 of the Maritime Coal Production Assistance Act, I have the honour to lay on the table statement of the operations for the year ended March 31, 1955. One new loan was granted during the year.



MINES AND TECHNICAL SURVEYS


George Prudham: I believe some hon. members would be interested to know that a French edition of the map of Canada, on the scale of 100 miles to the inch, is now available for distribution at 50 cents a copy.



QUESTIONS


Mr. Knowles:: 1.	Is the tariff board authorized to hear appeals against sales prices determined by the Minister of National Revenue as the basis for computation of the sales tax?
2.	If not, is consideration being given to the tariff board being granted such authority, or to the setting up of a sales tax appeal board to deal with this and other questions relating to the administration of the sales tax?


Mr. McCann:: 1.	No.
2.	The Minister of Finance is reported on page 2739 of Hansard, April 5, 1955, to have indicated in his budget speech on that date that it is proposed to invite a small committee to look into the present statutory provisions with respect to the base on which the tax rate applies and to study this and other technical problems and to make recommendations.



C.N.R. LAY-OFFS, ONTARIO

Mr. Howe (Wellingion-Huron):: By Ontario districts, how many employees of the car department of the Canadian National Railways have been laid off during (a) the year 1954; (b) the months of January, February and March, 1955?


George Carlyle Marler: Mr. Speaker, I have spoken to the hon. member and explained to him that the Canadian National Railways do not assemble employment figures by districts, and in consequence it is not possible to answer the question as asked. If the hon. member would care to rephrase his question, the management will give the employment information that is available.


Mr. Speaker:: Dropped.



WAR VETERANS ALLOWANCE PAYMENTS, MANITOBA

Mr. Pommer:: 1.	How many veterans in Manitoba are in receipt of war veterans allowance?
2.	Of these, how many receive additional payments under the special assistance fund?
He said: On the advice of the parliamentary assistant to the Minister of Veterans Affairs I should like permission to withdraw this question for rewording.


Mr. Speaker:: Withdrawn.



CAMP PETAWAWA SURVEY

Mr. Harkness:: 1.	Were Beauchemin and Hurter, of Montreal, given a contract to make a survey of Camp Petawawa?
2.	If so, when was this work done, what were the terms of the contract and what was the final cost?
3.	What was the purpose of the survey and why was it needed?


Mr. Blanchette:: 1.	Yes.
2.	The work was done in 1951 and 1952. The contract provided for:
(1)	A control and contour survey of the existing camp and three new areas.
(2)	Preparation of a site plan for new camp.
(3)	Preparation of record drawings of the existing camp.
(4)	Report on water, sewer, storm drainage in existing camp.
(5)	Report on the roads of the existing camp.
The cost of survey work was $45,758.20.
3.	The original purpose of the survey was to provide the necessary topographical data needed to prepare plans for a new camp to meet mobilization requirements (as indicated in "Canada's Defence Program" (1951-52) at page 14, paragraph 61). The data was actually used as the basis for the preparation of plans

for home station development at Camp Petawawa (as indicated in "Canada's Defence Program" (1954-55) at page 42, paragraph 165). It also provided a model for other surveys, particularly that at Camp Gagetown.



AUTOMOBILES-EXCISE TAX PAID

Mr. Argue:: 1.	(a) What is the estimated number of new automobiles in the hands of each manufacturing company on April 5, 1955, on which excise tax had been paid?
(b) What is the amount of the tax reduction on these automobiles?
2.	(a) What is the estimated number of new automobiles made by each manufacturing company that were in the hands of dealers on April 5, 1955, on which excise tax had been paid?
(b) What is the amount of the tax reduction in each case?


Mr. McCann:: 1.	(a) Excise tax is not paid on domestic cars in the hands of manufacturers. The tax only becomes payable at the time of delivery to the purchasers thereof, (b) Answered by (a) above.
2.	(a) No information, (b) No information.



AUTOMOBILES


Mr. Argue:: 1. (a) When was the excise tax on automobiles last increased, and by what amount? (b) What was the estimated number of automobiles at that time in the hands of each manufacturing company on which the excise tax at the lower rate had been paid, and what was the value of the automobiles in each case?
2.	(a) What was the estimated number of automobiles made by each manufacturing company in the hands of dealers at the time of the increase on which the lower excise tax had been paid? (b) What was the value of the automobiles in each case?


Mr. McCann:: 1.	(a) April 11, 1951. From 15 to 25 per cent, (b) No information as to the number. The excise tax would not have been paid on domestic automobiles in manufacturers' hands.
2.	(a) No information, (b) No information.



QUESTIONS PASSED AS ORDERS FOR RETURNS


INCOME TAX


Mr. Zaplitny:: 1.	From January 1, 1950 to date, how many court orders has the Department of National Revenue obtained for the payment of income tax, with respect to, (a) individuals; (b) corporations?
2.	What was the total amount in tax liability and interests in the case of such, (a) individuals; (b) corporations?
3.	In how many cases were seizures of property and/or personal goods made with respect to such,
(a)	individuals; (b) corporations?
4.	With respect to the individuals referred to in questions 1, 2 and 3, how many were, (a) farmers;
(b)	businessmen; (c) professional men; (d) labourers?
Orders for Returns



WESTMINSTER HOSPITAL, LONDON, ONT.

Mr. White (Middlesex East):: 1.	In what year was the psychiatric wing of Westminster hospital, London, completed and opened?
2.	What was the contract price of the building exclusive of grounds?
3.	To what company was the contract awarded?
4.	Were any changes made in the original plans and specifications?
5.	If so, what arrangements were made with the contractor as to compensation?
6.	What was the cost of these changes?
7.	What was the nature of the repairs to the building?
8.	What firm or firms have been awarded the contract for repairs?
9.	What is the total contract price for the
repairs?
10.	Was a survey of facilities at Westminster hospital made recently?
11.	If so, (a) what are the findings; (b) what plans, if any, are being made for further renovations or new construction?



RADIOACTIVITY DANGER LEVEL

Mr. Cameron (Nanaimo):: 1.	Has any agency of the government succeeded in determining the level of background radioactivity beyond which there will be danger of genetic mutation in living organisms?
2.	If any agency of the government has succeeded in determining this level of danger, has the government transmitted the results of this successful research to the governmental authorities of friendly nations and to the appropriate scientific bodies of those nations?



TEXTILES-GOVERNMENT ORDERS OUTSIDE CANADA

Mr. Cameron (Nanaimo):: 1.	Were any orders for textile goods placed by the government of Canada outside Canada in the years 1953-54?
2.	If so, what was the nature of these orders?
3.	What quantity of goods was ordered?
4.	What was the total value of these orders?



MOTIONS FOR PAPERS


Edmund Davie Fulton: For a copy of all correspondence, memoranda, etc., exchanged between the office of the Auditor General and the Canadian Broadcasting Corporation and/or the Minister of National Revenue, since January 1, 1950, relating to the accounts of the said corporation.


Mr. McCann:: Mr. Speaker, this is a rather unusual motion for the production of papers. I say that because the Auditor General informs me that a similar motion for the production of papers was moved by the hon. member for Greenwood (Mr. Macdonnell) on January 28, 1953. The Auditor General states that that was the first time in his experience that correspondence of the Auditor General

Motions for Papers
had been called for. At that time the Prime Minister (Mr. St. Laurent) stated, as reported on page 1398 of Hansard:
The Auditor General is always available to appear before the public accounts committee when his presence is desired, and it is open to any hon. member to address to him any question he may see fit to put to him directly.
The committee on radio broadcasting is sitting and I suggest that the hon. member for Kamloops (Mr. Fulton) would have the same opportunity as was indicated on that former occasion to go before the committee on radio broadcasting and ask any questions which he might desire to ask with reference to what he has in mind.
The Auditor General is presently in New York at the United Nations where he acts in the capacity of auditor, but he has signified to me his willingness to appear before the committee on radio broadcasting at any time and is prepared to answer any questions or not answer any questions which might be put before him. If that is acceptable to the hon. gentleman I make that suggestion to him; otherwise I shall have to oppose the motion.


Edmund Davie Fulton: Mr. Speaker, the suggestion made by the Minister of National Revenue is one which I do not think I can accept as dealing adequately with the situation. To my mind this is a motion which involves the rights and privileges of every member of parliament. The Auditor General is a servant of parliament. I feel that parliament is entitled to obtain the production of correspondence between the Auditor General and departments or agencies of government.
I would point out that in days gone by it was the practice of the Auditor General to include in his report to parliament copies of correspondence which he had exchanged with various departments and officials of departments. I have in my hand one copy of the Auditor General's report in which a number of letters are reproduced. I do not know when this practice was discontinued, but I do suggest that inasmuch as the Auditor General in some cases in his current report refers to correspondence with government departments, and particularly as in this case in connection with the C.B.C. he has reproduced that correspondence in part, it is perfectly within the rights of parliament, whose servant he is, to ask for the production of the full correspondence in order that we may be in possession of the facts.
The public accounts committee has not been set up for this year. I myself am not a member of the committee on radio broadcasting, and I would not consider it proper to suggest that some other member should

cease to be a member of that committee in order that I might pursue this matter there.
I rest my position on the basis that parliament is entitled to the production of full correspondence between the Auditor General, its servant, and any government department or agency.


Louis Stephen St-Laurent: I do not think that anyone would contest the right of parliament to require the Auditor General to produce any correspondence, but inasmuch as the Auditor General in the discharge of his responsibility to parliament prepares a report I suggest that it would not be in the best interests of proper administration to have him feel that any correspondence he had had with departments for the purpose of preparing his report, which it is his responsibility to deliver to parliament, would itself be subject to publication in the house. It seems to me that if we have, and I think we all have, implicit confidence in the manner in which the Auditor General discharges his responsibility as such we should not establish any practice which might hamper him in the methods he adopts to get the information which it is his responsibility to communicate to the house.
I am sure that when he attaches correspondence to his report he does so because he feels that that is proper in the discharge of his responsibility, and when he does not do so it is because in his best judgment he is otherwise giving parliament all the information which his duty requires him to divulge. I do not think it is a matter of the right of this house to insist that correspondence be produced. The house should determine in the proper exercise of its discretion whether it will make that a feature of the duties of the Auditor General or whether it will continue to leave it to him to discharge, in the light of his oath of office, the responsibility he has to parliament whose appointee he is.
Perhaps the motion could be allowed to stand while the hon. gentleman conferred with the Auditor General, as I know we all do at times. I think we are all agreed that we would have the right to make an order, but what we have in mind is whether it is desirable that this order be made or not.


Mr. Diefenbaker:: Would the Prime Minister state whether the Auditor General has indicated to him that he does not desire to produce the correspondence which he had in the course of his investigation or examination?


Louis Stephen St-Laurent: I have not been in touch with the Auditor General this time. I was in touch with him in 1953 and to my knowledge that was the first time this matter arose.

The conclusion was reached that we would have the right to compel him to produce correspondence but it would not be desirable to do so, and there was the fact that he was available to be heard before the committee to explain the situation.
I know that there is correspondence, which constitutes one of the ways taken by the Auditor General to secure the information. I would not like to have this house decide that it did not have the right to compel any of its appointees to produce anything that is in his possession as such appointee, but I would also like to have the Auditor General feel that there was no reflection upon the way in which he was discharging his responsibilities in any motion that was adopted here. I think that, if we were to allow it to stand, a solution might be reached that would respect in every way the rights of this house as one of the branches of parliament and would also avoid doing anything that might interfere with the regular discharge of the Auditor General's responsibilities.


Edmund Davie Fulton: Mr. Speaker may I say with respect that I think the suggestion of the Prime Minister is reasonable under the circumstances.
I should however say that I myself have not received any communication from the Auditor General indicating that he would have any reluctance to produce the correspondence in question. Apparently the Minister of National Revenue has had some communication either with or from the Auditor General, but I have not. I would have thought that if there was actual objection that objection would have been communicated to me. In the absence of such communication I would be surprised to find that there was objection.
However, I think the request of the Prime Minister is certainly reasonable under the circumstances, and I would be agreeable to having the motion stand for the purpose of such communication as may be deemed appropriate with or from the Auditor General.


Mr. Macdonnell:: May I ask a question of the Prime Minister in this connection? Could the Prime Minister explain the change which, I understand, has taken place, whereby the correspondence which used to be included by the Auditor General is not now included?


Louis Stephen St-Laurent: My understanding, Mr. Speaker, is that the correspondence was not usually included. There were at times included parts of the correspondence
Motions for Papers
exchanged with departments that the Auditor General felt would be explanatory of the report he was making, but there are frequent exchanges of notes which are merely initialled for the purpose of obtaining explanation about matters upon which the Auditor General feels he should report. No one could object to attaching to his report any correspondence that he felt was of a nature that would further explain the report. It is only to leave with the Auditor General a certain measure of discretion in the manner in which he feels he is properly discharging his responsibilities to parliament.


Mr. Speaker:: Shall the motion stand?


James Joseph McCann: Mr. Speaker, in fairness to the Auditor General, and in answer to the question by the hon. member for Kamloops, I must say that he raised no objection whatever. 1 have had absolutely no communication or correspondence with him, and, in talking the matter over with the officials of his department, he indicated that he was busy in New York and would not be back for some time. He indicated to his officials the stand which I have stated here, that he would be prepared to come before the committee on radio broadcasting and answer any questions that might be put forth. The hon. member, although he is not a member of the committee on radio broadcasting, could within his rights as a member of parliament appear there or be substituted for some member who is presently a member of the committee.


Mr. Speaker:: Shall the motion stand? Stand.



DEPARTMENT OF NATIONAL DEFENCE ACCOUNTS

Edmund Davie Fulton: For a copy of all correspondence, memoranda, etc., exchanged between the office of the Auditor General and the Department of National Defence or the minister or any official of the said department, since January 1, 1950, relating to the accounts of the said department.
He said:	I assume, Mr. Speaker, that
under the circumstances this motion could stand too, although I do not know whether it could be dealt with under the same arrangement as just suggested by the Minister of National Revenue, because there is no committee on national defence. Let it stand for the time being.


Mr. Speaker:: Motion stands.



BALLANTYNE PIER, VANCOUVER  ELEVATOR

John George Diefenbaker: For a copy of all correspondence exchanged between any department of government and Kerr, Gifford and Company, since the 1st day of January,

Inquiries oj the Ministry
1953, in connection with the elevator at the Ballan-tyne pier at Vancouver, together with correspondence from any elevator companies containing offers or negotiations for the rental or leasing of the said elevator.


George Carlyle Marler: I have no objection to the adoption of the motion, but I would suggest that it be amended to include the national harbours board, as I understand that otherwise no correspondence would be produced on the motion. I would therefore suggest that the motion be changed by adding "between any department of government or the national harbours board". We have no objection to the adoption of the motion.


John George Diefenbaker: I thank my hon. friend, and I would appreciate having that amendment placed before the house.


Mr. Speaker:: Shall the motion carry as amended?


Some hon. Members:: Agreed.



EAST BURNABY, B.C. POSTAL STATUS

Mr. Goode:: For a copy of all petitions and letters exchanged from June 1, 1954 to date, between the deputy postmaster general and any persons, protesting the changes in postal status of East Burnaby (Burnaby 3), British Columbia.


Mr. Kirk (Shelburne-Yarmouih-Clare):: have just spoken to the hon. member and he has agreed to amend the wording as follows "between the Postmaster General, the deputy postmaster general and other officials of the Post Office Department and any persons" and so on.


Mr. Speaker:: Shall the motion carry as amended?


Some hon. Members:: Agreed.



REPORTED CLOSING OF NOVA SCOTIA MINE

[Stage Direction]
On the orders of the day:
Clarence Gillis: Mr. Speaker, may I be permitted to direct a question to the Minister of Mines and Technical Surveys? My question arises out of a telegram received from the president of district 26 of the united mine workers, Nova Scotia, and also out of a statement which appeared in the Halifax Chronicle-Herald on the 23rd of this month. Can the minister inform the house as to what plan he had to prevent the closing of No. 1-B colliery at Glace Bay, Nova Scotia, to whom this plan was outlined, and what steps were taken to provide consultation between the union, the company and the provincial government of Nova Scotia?
fMr. Diefenbaker.]


George Prudham: Mr. Speaker, I wish to thank my hon. friend for giving me short notice of his intention to ask this question. Some two years ago the officials of the district and local branch of the union, together with representatives of the provincial government of Nova Scotia and the Dominion Coal Company, met in my office to discuss the problems of No. 1-B colliery. At that time the colliery was facing a temporary shutdown in order that the company could carry out certain mechanization. The whole problem was very thoroughly discussed at that time and it was established that the real problem was the high cost of production. The difficulties at 1-B colliery have been known to both the union and the company for at least two years. My information is that the cost of production per ton of coal in that colliery is at least $2 above the average in the district. The problem of reducing costs so that the coal can be sold competitively is a problem that only the company and the union can solve. Although, as I have said, this is a matter between the company and the union, my recent efforts have been to find out if everything possible is being done to reduce the cost of production in that colliery.


Clarence Gillis: Mr. Speaker, may I ask a supplementary question? The minister is quite correct in saying that it is not a new situation. The mine did close at that time and was reopened. Is the story in the Herald on the 23rd correct, that you had a plan to keep that mine in operation at the present time and that you had talked about it with someone from Nova Scotia who you anticipated would organize your plan in that province at that time?


George Prudham: Mr. Speaker, I have not read the story in the Herald. As I have said, I have been endeavouring to get all parties concerned together in a co-operative effort to solve the cost problem in that colliery.


Clarence Gillis: The story in the Herald carries your picture. You should have a look at it.
ILater:!



ESTIMATED AMOUNT TO BE SHIPPED FROM NOVA SCOTIA TO CENTRAL CANADA

[Stage Direction]
On the orders of the day:
Mr. W. M. Buchanan (Cape Breion North
and Victoria): I should like to direct a question to the Minister of Mines and Technical Surveys. Is the minister in a position to give the house any information on the volume of coal likely to be shipped from Nova Scotia

to central Canadian points now that the St. Lawrence river is open to navigation?
George Prudham: At this time of the year the companies desiring to ship coal up the St. Lawrence river under freight subvention usually ask for acceptance by the dominion coal board for that purpose. I have been told by the coal board that acceptances this year are well over two million tons but somewhat less than for the same period last year. However, acceptances asked for this year are considerably higher than the actual tonnages shipped last year.



REQUEST FOR DATE OF FINAL PAYMENT ON

[Stage Direction]
1953-54 POOL
On the orders of the day:
John George Diefenbaker: I
should like to direct a question to the Acting Minister of Trade and Commerce. Has any decision been made by the wheat board yet as to when the final payment for wheat of the 1953-54 crop will be made. Will the minister bring to the attention of the board the necessity of the early expediting of this payment to the end that it might be of assistance in the seeding operations of western farmers?


Hon. Robert H. Winters (Acting Minister of Trade and Commerce):: I thank the hon. member for giving me notice of his question. At the same time I have received a similar one from the hon. member for Assiniboia (Mr. Argue):
Is the inventory cut-off for the 1953 wheat crop now being made? Can the minister say how soon after the cut-off the wheat board will begin making the final payment so that the wheat producers' critical financial position can be improved?
The answer is that the wheat board has issued instructions to its agents to report as at the close of business on April 29, 1955, on stocks of wheat in their hands in order that accrued charges may be calculated.
This marshalling of information is, of course, essential to the closing of the pool and will make possible an earlier date for the commencement of payment than would be possible if the board had waited until the actual cut-off date to issue its instructions to its agents.
It will take the wheat board approximately two to three weeks to prepare and audit their accounts with respect to the 1953-54 wheat
Inquiries of the Ministry pool. As soon as the amount of the final payment is established, steps will be taken at once to distribute the cheques to the producers.
[Later:!



SUGGESTED REMOVAL OF EMBARGO ON EXPORT OF SELKIRK WHEAT

[Stage Direction]
On the orders of the day:
Mr. W. A. Pommer (Lisgar):: I should like to direct a question to the Minister of Agriculture. I did not send him notice. Has his department given any consideration to removing the embargo on the export of Selkirk wheat at this late date in April?


Righi Hon. J. G. Gardiner (Minister of Agriculture):: Yes; consideration has been
given, and we have advised that the export of Selkirk wheat should not be allowed at this time.



NATIONAL DEFENCE


[Stage Direction]
On the orders of the day:
Edmund Davie Fulton: May I ask
the Minister of National Defence whether any decision has yet been reached as to the future of the Canadian forces in Korea, and if he is in a position to give the house any information as to the continuing commitment accepted by Canada in that regard. If he is not able to do so, perhaps the Secretary of State for External Affairs (Mr. Pearson) might be able to give us some information.


Hon. R. O. Campney (Minister of National Defence):: Mr. Speaker, I hope to be able to make a statement on the matter within the next few days.


Edmund Davie Fulton: As a supplementary question I should like to ask whether the second battalion of the Black Watch, I think it is, are still standing by at their camp in the mari-times?


Ralph Osborne Campney: Yes.



EXTERNAL AFFAIRS


[Stage Direction]
On the orders of the day:
Stanley Howard Knowles: Mr. Speaker, may I direct a question to the Secretary of State for External Affairs. Has the minister any statement to make to the house concerning Chou En-lai's proposal for direct negotiations between China and

Inquiries of the Ministry the United States, and has he any statement to make on reactions over the week end to this proposal?


Hon. L. B. Pearson (Secretary of State for External Affairs):: Mr. Speaker, I do not think there is anything I can usefully say, on the orders of the day, on a matter of such great importance. On the general question, I think I said all I could say in our external affairs debate which ended last Thursday.


DOMINION-PROVINCIAL CONFERENCE UNEMPLOYMENT    SUGGESTED REPRESENTATION OF LABOUR
[Stage Direction]
On the orders of the day:
Mr. J. W. Noseworthy (York South):: Mr. Speaker, may I direct a question to the Prime Minister. Is the Prime Minister now in a position to tell the house whether the subject of unemployment will be discussed at his conference with the provincial premiers meeting this week? If so, will organized labour have an opportunity of sending any representatives to that conference?


Louis Stephen St-Laurent: Mr. Speaker, this is not a conference with organized labour. It is a conference with the heads of provincial governments. As to the first part of the question, may I say that it is my intention to suggest that relief for needy persons, whether employable or unemployable, be discussed at this meeting with the provincial premiers.


Mr. Argue:: How about work for them?


Louis Stephen St-Laurent: If the hon. member has any job available, I shall be glad to note it and to bring it to the attention of the provincial premiers.


Hazen Robert Argue: What about the other 600,000?


Edmund Davie Fulton: The opposition is always
ready to accept its responsibility. What about the government?


John George Diefenbaker: should like to direct a supplementary question to the Prime Minister with regard to the responsibility for unemployed employables. What attitude is the Prime Minister going to take at the conference-


Some hon. Members:: Oh, oh.


John George Diefenbaker: -as to the liability of
the federal authority for these people, which was accepted in 1945?


Mr.   Sf. Laureni@: Mr. Speaker, there was no liability accepted in 1941 or in 1945. There was a proposal made in 1945 which was not accepted-


An hon. Member:: By whom?


Louis Stephen St-Laurent: Not accepted by the
provincial ministers who were present at that conference.


Hazen Robert Argue: Only one.


Mr. Sf. Laurent:: It was not accepted by
the provincial ministers at that conference.


An hon. Member:: How many?


Louis Stephen St-Laurent: There were nine provinces then and there were nine provincial premiers.


An hon. Member:: He would not know
that.


Louis Stephen St-Laurent: The proposal was one
that was made as an over-all proposal to all the provincial governments, and it was not accepted. I think as Canadians we all recognize that it would be unfortunate if there continued to be uncertainty about whom needy persons should apply to for assistance when required.


John George Diefenbaker: That is the reason I
asked the question.


Jean-Paul Stephen St-Laurent: It is not so much a question of constitutional responsibility. Although we still maintain that the residual constitutional responsibility for those in need who are not covered by unemployment insurance is that of the provinces and their agencies, nevertheless I think as a Canadian that there should be some solution to this problem. I think as a Canadian that it is a problem that has to be administered by the local authorities and that people in need should not be directed from one place to another and thence to another.


Some hon. Members:: Hear, hear.


Louis Stephen St-Laurent: There should be one
authority that would deal with them, and the burden involved in dealing with them is something that should be borne as it is borne, no matter through whose hands it passes, by the Canadian taxpayers, it being a burden that falls upon the public. That has been the case. I think it is impracticable to try to differentiate between needy persons who are in need because they cannot do work and those who are in need because they cannot find work and are not covered by unemployment insurance. That is a matter of degree and opinion which, if it remains, will not remove the uncertainly as to one authority saying that a person is employable and the other authority saying that the same person is not employable and therefore should be dealt with by somebody else.
I hope we can face this situation as a humanitarian problem that concerns all of us as Canadian citizens and work out some

arrangement whereby the needy will be dealt with by one authority and the burden of having done so will then be borne in a manner that will provide for efficient and provident administration.


Edmund Davie Fulton: I should like to ask the Prime Minister whether, in view of his interesting and informative statement, he does not agree it is a pity that this government waited for nine years-


Some hon. Members:: Oh, oh.


Edmund Davie Fulton: -before reconvening the conference to deal with the problem?


Louis Stephen St-Laurent: I hope from now on that question will be dealt with by us as Canadians and not as Canadians belonging to any particular party.


Some hon. Members:: Hear, hear.


Edmund Davie Fulton: Mr. Speaker-


Some hon. Members:: Order.


Edmund Davie Fulton: -so do I, but I think it is a pity it took the Prime Minister nine years to reach that decision.


John George Diefenbaker: What did the Prime Minister mean by his last statement? What is the inference?


Louis Stephen St-Laurent: The inference is that this matter should not be a political football and that, so long as it is a political football and we do not approach it as good Canadian citizens feeling for the needs of our fellow Canadians who may be in need, I do not think it is as apt to be considered on its real merits.


Some hon. Members:: Hear, hear.


Edmund Davie Fulton: You are nine years late in finding that out.


An hon. Member:: Stop kicking it around.


POLIOMYELITIS
[Stage Direction]
On the orders of the day:
Mr. John B. Hamilton (York West):: I should like to direct a question to the Minister of National Revenue. Is the minister aware that Salk polio vaccine is being sold to the public, and has the government now made a decision as to the removal of sales tax on such purchases?


James Joseph McCann: Mr. Speaker, I am aware of what the hon. member for York West has said with reference to the private sale of vaccine. The government has made a decision that there
Inquiries of the Ministry will be no sales tax on polio vaccine. I just want to say a word or two in connection with this matter.
When the hon. member asked his question last Thursday, he had not given me notice of it at all. I told him that the matter was already under consideration by the government. The difficulty was as to how you are going to do these things. It could be done in two ways, either by remission of the tax or by a statutory change under the budget regulations whereby it would be put upon the free list. At that time the decision was not made. In this connection I might say that I was subjected to what I thought was a little bit of unfair criticism by the Toronto Globe and Mail when it said that there never should have been any delay. The delay was not about policy but rather about the method of accomplishing the desired result.


John Borden Hamilton: As a supplementary question, may I ask whether notice has gone out to the interested parties that this tax has been removed?


James Joseph McCann: Not yet; but it will be generally known shortly.


IMMIGRATION
[Stage Direction]
On the orders of the day:
William McLean Hamilton: I should like to ask a question of the Minister of Citizenship and Immigration. Has the minister issued warrants for the arrest of any of those originally named by me on April 6 as undesirable aliens subject to deportation from Canada?


Hon. J. W. Pickersgill (Minister of Citizenship and Immigration):: I do not think there is any question of issuing warrants for arrest. One of the persons who was mentioned by the hon. member on Friday has been detained and has been ordered deported.


LABOUR CONDITIONS
[Stage Direction]
On the orders of the day:
Stanley Howard Knowles: Mr. Speaker, may I direct a question to the Minister of Labour? Can the minister say whether he has replied to the request of the Canadian Congress of Labour in a letter a couple of days ago asking for legislation to extend supplementary unemployment insurance benefits to May 31? If so, what reply did the minister give?

Foreign Aircraft


Hon. Milton F. Gregg (Minister of Labour):: I have received the request referred to by my hon. friend but I have no reply to make other than that which I made immediately before the Easter recess, namely, that this whole matter had received the most exhaustive study not only by the commission but by the government and it had been decided to maintain the limiting dates from January 1 to April 15.



FOREIGN AIRCRAFT


George Carlyle Marler: the third reading of Bill No. 263, to implement the convention on damage caused by foreign aircraft to third parties on the surface.


John Borden Hamilton: Mr. Speaker, I think I might take a few moments to say that, although it has been indicated to us by the minister we are left in the position of having to accept this legislation and the schedule contained therein in full, it should at least be remarked in passing that there are some serious shortcomings in the legislation. I make that statement notwithstanding the fact the legislation is of a type sorely needed so far as the regulation of air traffic is concerned. I will be brief and will refer to individual points which I think show that in the over-all picture sufficient consideration has not been given to the various items that have been covered.
In the first instance, because of the mechanical requirements set up covering security which must be complied with by the various contracting parties, in order to cover, by insurance or otherwise, damage claims which may arise, we find that we have placed ourselves in the position that a virtual embargo may be placed upon the entry of our aircraft into another country at the whim or fancy of that foreign country. I say that because it appears that the type of security which may be offered may be rejected by any contracting party, and although arbitration is provided in some instances, it would still be possible for that contracting party to refuse admittance to our aircraft. In that respect, I would say that this condition is the same condition as has arisen in connection with some of our trade policies where we bound ourselves under agreements, and at the same time allowed some discretionary power to one of the contracting parties to admit or refuse our goods as they saw fit. In connection with that point, I may say that these provisions are set out in chapter III of the schedule to the agreement.

The second point with which I should like to deal is found in chapter II of the schedule, where we find that the compensation to be paid is tied to the French gold franc. I must say that before the minister explained the meaning of tying the compensation to the French gold franc, I had serious misgivings as to just what compensation parties in Canada might obtain under a valuation of that kind. But even with the explanation which has been given, and even with the tie-up to the French gold franc, we are still left to obtain our compensation on the basis of the amount which may be paid from time to time by the United States for one ounce of gold. Even using that type of valuation, there is nothing to ensure that in the future the number of francs which are provided to cover compensation to an injured party might not be entirely inadequate.
The third point to which I shall refer is that there is no protection afforded to parties on the ground injured as a result of accidents which occur in the use of the aircraft prior to the actual application of power for the takeoff or subsequent to the removal of power upon landing the aircraft on the runway. There is no coverage whatever in those two individual cases, from the time the aircraft touches down until it is at rest at the airport with its engine shut off, nor do we have coverage from the time the aircraft is warmed up on the tarmac and is removed to the runway for full power to be applied for the takeoff. Those provisions are contained in chapter I of the schedule. It seems to me we have been remiss in not obtaining complete coverage for people on the ground from the actual time the ignition switch is turned on in the aircraft until it is turned off after the passengers have alighted.
The fourth point is that, upon examination, we have found there is a continuing liability on the owner of the aircraft for a period of time after the complete legal disposal of title to the aircraft itself. I think perhaps in connection with this point there was the intention to provide the same type of continuing insurance coverage for injured parties as we have now provided in a number of public liability and property damage policies covering the use of automobiles. However, I feel that this provision may present a real obstacle in so far as our own airlines are concerned. As an example, in connection with Trans-Canada Air Lines re-equipment program, there may be disposal of numerous aircraft to foreign countries and we may find our government-owned airline bearing a continuing responsibility notwithstanding the removal of any legal title to the aircraft in question. These provisions are contained in chapter I of the schedule.

My fifth point concerns the question of the procedure used in obtaining execution of judgments which may be obtained in connection with this legislation. The minister has been fair in pointing out that no greater rights are obtained through this legislation than have been available to any private party heretofore in attempting to obtain execution of a judgment in a foreign country. I feel that should have been one of the main reasons for drafting this type of legislation, to ensure that in the execution of a judgment for a valid damage claim no particular impediment might be placed by the country in whose territory the assets or insurance fund lies. These provisions are contained in chapter IV of the schedule. Execution of the judgment may be refused if the judgment concerned is contrary to the public policy of the state in which execution is requested. What public policy may be in any number of South American countries, I would not know. There might be a complete inability to issue execution and obtain repayment of any damage claims.
My sixth point is that there has been a very feeble effort in chapter II of the schedule to provide some type of preference for persons who have personal injury claims. The fund has been divided into two parts, for personal injuries and for property damage. There is a residual clause that if money is available after property damage has been completely paid, that money will go into the personal injury fund. At the same time, that does not definitely cover the situation. I feel there will be numerous claims where personal injuries have been suffered and, because of the division of the insurance fund, the person who has been injured may end up by getting a payment of 10 cents on the dollar whereas someone who has suffered property damage only may receive 100 cents on the dollar.
My seventh point is the usual one. Again we are being asked to agree to proposals which have been contributed mainly by representatives of the United States. As usual, too, we are being asked to ratify the agreement before that country ratifies it. Again the minister has been very fair and has stated that only a small percentage of the actual flights over Canadian territory as of this date are going to be covered by this agreement. Until such time as the United States does formally accept this agreement, then the coverage that will be available to Canadians will be restricted to a great extent. I believe it is the responsibility of the government, in presenting legislation of this type, to see that we are not being presented with the hollow shell of an agreement which reads well but does not afford the protection it is intended to afford.
Foreign Aircraft
Finally, I may say that, on questioning in the special committee on transport, the president of the Trans-Canada Air Lines indicated satisfaction with this agreement but I was very surprised to know that this agreement was negotiated entirely without the benefit of the advice of counsel of our two major operating international airlines. It seems to me that if we are to go out in the future under the guise of obtaining some beneficial result for the Canadian public, giving them protection, which undoubtedly is the chief requisite of this agreement, in view of the thousands and thousands of dollars that are spent on delegations of this kind, we should expect that they would seek, and be glad to seek, the counsel of those airlines in our country that are having to deal with these problems day by day.
If we cannot do better than this in the future, we should call on such advice or it would be better for us to stay at home.


George Carlyle Marler: Mr. Speaker-


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


George Carlyle Marler: I certainly do not wish to prolong the debate on this measure unduly, but if I may judge from the remarks of the hon. member who has just taken his seat, he seems to fail to appreciate that there are manifest advantages in relieving persons on the surface who suffer damage from the necessity of establishing negligence. I take it that the price of not having to prove negligence is the limitation of liability for which the convention provides. As I said in the debate on second reading, I do not think anybody would suggest that this is a perfect convention from every point of view. Particularly, it might be considered that it represents an agreement reached after discussion between some 32 nations in 1952, and that in consequence it is the result of compromise on the part of those who participated in the discussion. I have no doubt it was the best agreement that could then be made.
The hon. member also referred to the fact that the compensation was expressed in gold francs, and complained that if there were a fluctuation in the price of gold, there would thereupon be a fluctuation in the limitation of the liability. Well, that may be a perfectly valid criticism, but it would have been more valid if the hon. member had indicated some means by which the amount of the compensation could have been fixed by some standard other than that which is provided for in the convention. It ties it to the gold franc consisting of 65 grains of gold of fineness 900.

Foreign Aircraft
The hon. member then went on, in expressing two or three criticisms of the convention, to complain that it did not provide for the situation where damage occurred before takeoff or after landing. I find that a little contradictory because, after criticizing the convention, he went on to regret that it did not apply for a longer period than that for which it is to apply. In effect, Mr. Speaker, I think the hon. member has failed to appreciate the fact that before takeoff and after takeoff there is no limitation on liability whatsoever. The convention does not protect the operator who causes damage to the person on the surface in these circumstances.


John Borden Hamilton: May I ask a
question?


George Carlyle Marler: Yes.


John Borden Hamilton: Of course he does not have any security either, does he, under the circumstances?


George Carlyle Marler: Well, I suppose that would depend on whether you considered the airplane itself as something having value or not. If, as is usually the case, and I should like to touch on that in reply to another comment of the hon. member, one bears in mind that these foreign aircraft do come into Canada and that there is therefore the process of executing judgment against planes belonging to the operator who has incurred a liability, it would be wrong to say that there was no security. The insurance security might not be so easily attainable, but the fact would remain that the plane would be there. It could be there, and the judgment could be executed, provided the plane was within the jurisdiction of the court which granted the judgment.
With respect to the question of the continuing liability on the owner if he dispossessed himself of the aircraft, perhaps if the hon. member had been the only person who had anything to say in making the convention it would not have contained the clause which it does contain; but, as I said earlier, this is the result of international negotiations between 32 countries, and I do not think we should condemn the convention solely on the ground of this fact of continuing liability.
The hon. member spoke also of the question of the execution of the judgment. I think it is fair to say that the provisions of the convention reproduce in substance what I would assume to be the general provisions of law in any jurisdiction with regard to the execution of the judgments of some foreign court. I do not think there is anything repugnant in the provisions and I think the

hon. member, if he were advising a Canadian airline, would be rather glad, when he was defending it against the execution of a judgment rendered in some foreign court, if, under the convention, he could invoke the grounds of defence which are mentioned in the convention itself. Certainly, I would feel much happier if I were in the position of defending one of our airlines from such a judgment if I felt I could oppose execution on the grounds set forth in the convention.
As I said earlier, so far as execution of a Canadian judgment is concerned, the house should not overlook the fact that there is always the possibility of executing against an aircraft when it touches down in Canada, not necessarily immediately but on some future occasion.
The hon. member also spoke of what he described as a feeble effort to protect or to give priority to personal claims. I am sorry that he does not seem yet to understand the provisions of the convention. When we were discussing this matter in committee the other night I tried to show him by giving him a hypothetical example of the division of the proceeds of the insurance that when the proceeds were less than the total amount of the claims those who had claims for personal injury had a priority over those who had claims for property damage.


John Borden Hamilton: I had better examples.


George Carlyle Marler: Well, all I can say is that though the hon. member may have better examples, he cannot find an example anywhere where the property claims would be paid in full without a very substantial proportion at least being paid to those who have claims for bodily injury. At all events, I do not think the convention can stand or fall on this point. On reading the convention one can see that there is no doubt whatever that there is a definite effort, not a feeble effort, as the hon. member said, to give a species of priority to those who have claims for bodily injury.
In conclusion, the hon. member said that the United States of America had not ratified this convention. He referred to the fact that only a relatively small number of flights over Canada were by foreign aircraft. Of course I think that is true. If there is a smaller number of flights there is a decreased possibility of foreign aircraft causing damage to persons on the surface.
I think the convention is a workable document and one which ought to be ratified by

parliament. I would add that both the Trans-Canada Air Lines and Canadian Pacific Air Lines have approved the signing of the convention by Canada and I think it will be in the interests of Canadian aviation to have this convention ratified.


John Borden Hamilton: I wonder if
the minister would consider one example. Take a building in which there were twenty people and this is destroyed by foreign aircraft. A total of $100,000 in insurance is involved. Each of the twenty people may put in a claim for $10,000, which would total $200,000. The property damage may amount to $50,000.
If I understand the working of the formula correctly, the fund would be divided into two, $50,000 for personal injuries and $50,000 for property damage. Under those circumstances the twenty people each with a claim of $10,000 would receive only a small proportion of their total claims, whereas the property damage would be paid for in full.


George Carlyle Marler: I have been trying to follow the hon. member as he went along. I shall give him the figures and he can go back and check them afterward. In the case which he has just given the claims for personal injury would be $200,000 and the claim for property damage would be $50,000. The indemnity under the convention is divided into two parts so that $50,000 would be immediately attributable to the claims for bodily injury. There would then be a balance of $150,000 in claims for bodily injuries which were unsatisfied. Those claims to the extent of $150,000 would divide with the claim for property damage amounting to $50,000 the other half of the indemnity, so that the property damage claim would receive $12,500 while the claims for bodily injury would receive $87,500.


John Borden Hamilton: I think-


Mr. Speaker:: I am enjoying the examples which are being given in order to illustrate certain phases of this convention but I must remind hon. members that we are considering the third reading of a bill and the minister has closed the debate.
Motion agreed to and bill read the third time and passed.



NATIONAL PARKS ACT


[Stage Direction]
The house resumed, from Thursday, April 21, consideration in committee of Bill No. 261, to amend the National Parks Act, and
National Parks Act
to establish a national park in the province of Newfoundland-Mr. Lesage-Mr. Robinson (Simcoe East) in the chair.
On clause 1-Use of water.
Charles Edward Johnston: The first part of this bill deals with the use of water in national parks and if it is the wish of the minister to have that first section passed I would agree, but I do want to discuss parks generally when we come to subclause 3. Otherwise I can go ahead now and say what I have to say about the hospitalization plan at Banff.


Mr. Lesage:: I do not know what kind of general discussion on national parks the hon. member wishes to have, but I suppose that any discussion on the administration of parks relating to matters in connection with which there are no amendments would be out of order and should be dealt with when the estimates of the department are being considered. I believe what the hon. member desires to discuss is the general situation with regard to the hospitalization plan. That would come under subclause 3. Perhaps hon. members woud agree that we consider this clause by subclauses.


Charles Edward Johnston: Perhaps the minister would rather that I waited until subclause 3 is before us.


Jean Lesage: Would it be agreeable to discuss this clause by subclauses?


William Alfred Robinson: Is it agreed that for the purposes of discussion we call the subclauses separately?


Some hon. Members:: Agreed.
On subclause 1.


Mr. Harkness:: What particular parks is this designed to cover? I presume there are certain parks to which it would apply and certain parks to which it would not apply.


Jean Lesage: This would apply to all parks, but if my memory serves me right the question was raised last year in connection with Kootenay park.


Douglas Scott Harkness: In other words, this is a provision to permit certain water to be sold to an area just on the edge of Kootenay park?


Jean Lesage: The situation may arise where we wish to sell water outside a park, which situation I believe is covered by clause 1 (4). Subclause 1 is really for clarification purposes in connection with the supplying of water within a park.


[Stage Direction]
Subclause agreed to.
Subclause 2 agreed to.
[Stage Direction]
National Parks Act
On subclause 3-Hospital services.
Charles Edward Johnston: This subclause deals with a matter of great importance to the people in my constituency, particularly those who live at Banff. I realize that this legislation will apply to all national parks and will cover Jasper as well as people who live at Banff. May I say first that I appreciate the minister bringing forward this legislation at this time as it is something the people of Banff have been working on for some considerable time.
Both the hon. member for Acadia and I have discussed this with the minister and the departmental officials in Ottawa on a number of occasions during the past year or so and we are pleased to know that the minister is now bringing down legislation which will make available to the people of Banff the general hospitalization plan which is in effect in Alberta. So that hon. members of the committee may know what we are talking about in a little more detail, may I tell them something about the plan which is proposed for Banff. I should like to quote what Mr. Lee Leavitt, the M.L.A. for Banff had to say about this, as reported in the Banff Crag and Canyon. Referring to the $1 per day, it says:
Each patient under this plan pays one dollar for each hospital day. The local hospital district and the provincial government share the remaining cost for the standard ward care on a 50-50 basis.
Then it goes on:
Then there is a separate contract which covers extras, which may be negotiated only if the dollar per day plan is in force. But such agreement is optional. After 25 per cent of the daily set cost of these extras is paid by the patient, the remaining cost is shared again on a 50-50 basis by hospital district and the provincial government.
Proposed new legislation which will be brought before the house-
Meaning the provincial legislature.
[DOT]-this session, will make some changes to these present arrangements. In short, it means that, providing a hospital district will also negotiate an agreement covering special services or extras, the cost of both agreements, as described, will be shared by the provincial government on a 40-60 basis. With the government paying the 60 per cent there will be little difference in costs between the alternative plans. The cost of the dollar per day contract, without extras covered, will continue to be shared on a 50-50 basis. The additional contribution by the provincial government will, I am sure, stimulate interest in this hospitalization plan.
Now, Mr. Chairman, you will see that this hospitalization plan is one of the most progressive of the hospitalization plans in all of Canada. Therefore the people of Banff are rightly concerned in their desire to have the federal government amend the parks legislation so that they will be able to share under this plan. It is going to affect every one of
[Mr. Lesage.l
the citizens of Banff who are taxpayers, and provision is made also for those who are nonresident if they take out a separate contract with the district and the government to share in this plan. Speaking from memory, I think that the cost of this plan is $8 per individual, or $15 per family a year, giving them access to all these services. But the people of Banff themselves feel that they have the right to share in these hospital benefits in the same way as any other person in Alberta. Of course I think that it is only right and proper that they should have it. Again I say that I am glad that the government has seen fit to come to the same conclusion.
The provincial law which exists now makes the province's share payable to the municipal authorities, and the municipal authorities must collect their own share of that revenue; but there is no municipal authority in Banff. Therefore Bill No. 261, which we are presently discussing, is to make Banff parks an eligible area under the provincial law. Alberta is amending its hospitals act to permit park contributions to be levied and collected from the Banff citizens by the parks superintendent or other person or authority appointed by the government authorities here. I want to make it clear that the amendments in the province of Alberta are making it possible for these collections to be made either by the park superintendent or by some other authority named by the government. I think that is quite clearly borne out by what the minister said the other day in the house. On page 2146 of Hansard he had this to say:
Hence the provincial laws are going to be amended to say that in the parks the contributions can be levied from the population by the parks superintendents or persons authorized by the park authorities. Our bill is to authorize the government, through the park superintendent-
May I just point out, Mr. Chairman, at that point that, as far as I can read the bill, it does not authorize the park superintendent only to make the collections.
I am pointing that out to you now because I wish to speak about that further a little later on. The bill, as I understand it, makes it possible for the park superintendent or other authority to make the collections.
Our bill is to authorize the government, through the park superintendent, to receive these contributions paid by people for these hospital schemes which would be established. They could be so established only after a referendum has been taken, according to the provincial acts, in the parks or in the townsites, I am not sure which at this time. It will be easier to follow when I have the bill.
I just bring that to your attention for the purpose which I indicated, Mr. Chairman.

The people of Banff are desirous of having this tax collected by some other authority rather than the park superintendent. Their view-and I shall give it to you categorically in a moment-is generally speaking that, if the park superintendent is one who is going to collect these fees, then of necessity he will be guided, and must be so, by the park regulations, and the people of Banff through their advisory council are of the opinion that they do not relish being under the park regulations, for reasons which I shall give. They do suggest, though, that this collection could be made by the advisory council itself, which is the body chosen by the people in Banff to represent their interests, or it could be collected by the provisional board of the hospital district which is being set up in the Banff area. In that way they contend that it would be more fairly levied and more fairly collected and greater satisfaction would come about all the way through.
I said, Mr. Chairman, that I was going to tell you exactly why the Banff people did not want this under the regulations. This may come somewhat as a surprise to the minister, but I think he will agree with me when he hears my argument that the people of Banff are quite right in what they say. Now, I am reading from a letter dated March 14 from the advisory council. Mr. Shaw is the chairman of the advisory council, and the secretary is Mr. R. E. Edwards, both living in Banff. It says in part-


Jean Lesage: May I ask the hon. member to whom the letter is addressed?


Charles Edward Johnston: The letter is addressed to me. He says if the government carries through this present plan

Those words are my own, and I am beginning to quote from here on.
-apparently this would mean the inclusion of the hospital plan in the parks regulations and this is very definitely opposed by the council. The chief reasons for this opposition are (a) The very unsatisfactory administration of the health and welfare tax and the almost certainty that the hospital tax would be administered in a similar manner, (b) The inclusion of the hospital plan in the parks regulations would render it subject to the same unjust penalties that are incorporated in the welfare tax. (c) The fact that the collection and administration of the hospital tax could be done at least as efficiently, and probably at less cost to the ratepayers, than if handled by the federal government.
They have further explained their views in their letter dated March 24 addressed to me and signed by the secretary. You will understand that they are explaining why they would rather not have the collection under the park regulations. They say:
Non-compliance with any park regulation is liable to a penalty of a fine not exceeding $500, or 50433-198
National Parks Act
imprisonment for not more than six months, and as the welfare tax is part of the park regulations the section quoted becomes applicable. In cases where a resident has become delinquent in the payment of the welfare tax, it has been the practice of the department to summon him in the police court with the result that he is fined-
And this is the unjust part of it.
-both for non-compliance with a regulation and also the amount of the tax. The section dealing with distraint of goods is not invoked, but the delinquent is really treated as if he were a criminal and in addition he is actually punished twice, which is certainly unjust.
Just in case there should be some question as to whether or not that is the actual law, may I just refer to the regulations; and may I say to you that, when I studied these regulations, I was astonished to find the severity with which this matter can be handled. It refers not only to a delinquent in respect of the payment of a welfare tax, or rather not only would it refer to a delinquent in the payment of his hospital tax, but to anyone who violates any part of the act or any regulation whatsoever, no matter how trivial. Just listen to some of these provisions. I thought I was reading something from the medieval ages when I went over this thing. I am going to suggest to the minister what should be done with it in a few moments. I am reading from page 5 of the regulations. It is chapter 189 of the statutes. It says here:
Penalties and Procedure
Any person violating any provision of this act or any regulation,-
May I stop there to say this, Mr. Chairman. There have been put in force, in the Banff park, regulations of which the people of Banff have had no prior information, and of which they have had no notice. Then when you have penalties like this imposed, the situation becomes outrageous. I am continuing to quote:
-in addition to any civil liability thereby incurred, is liable on summary conviction to a penalty of not more than five hundred dollars,-


Jean Lesage: Not more than $500.


Charles Edward Johnston: Yes; not more than $500.


Jean Lesage: It could be any amount. It could be 50 cents.


Charles Edward Johnston: It could be; but I am speaking of the act as it now reads. The minister knows very well that the court could impose a penalty up to $500.


Jean Lesage: Yes; but have you not confidence in the judgment of our judges?


Charles Edward Johnston: Do not press me too hard. I continue to quote:
-and in default of immediate payment of such penalty and of the costs of prosecution, such person may be imprisoned with or without hard labour for any term not exceeding six months.

National Parks Act


Jean Lesage: What is astonishing about that provision? It is the usual one.


Charles Edward Johnston: What is astonishing about it is this. It applies to any regulation whatsoever. The minister told me he was going to give me a lesson in fishing. Incidentally, I may say that I am looking forward to that lesson. But I would advise him not to bring along a fish hook that has three prongs on it because, if he does so, that is a violation. I am told that "two-gang" is the word. I am not a fisherman, but I will be one when the minister gives me a lesson. If you had one of these hooks in your possession, or if the police had reason to suspect that you had one of these in your possession, they can come into your house without a warrant and break into your trunk, your dresser, or into your bedroom if the door is locked and search the house, even on suspicion. Then the next heading is this:
Arrest, Search and Seizure
Any constable or any person having the powers of a constable under the provisions of this act or regulations may, (a) on view,-
That is on sight.
-arrest any person found committing an oifence against this act or the regulations or found committing within a park any unlawful act; . . .
It is an unlawful act or it is a violation of the regulations if a person fails to get that old licence for the town cat that I was talking about some months ago. If he fails to pay this $3 licence fee to have a cat in the park, he is subject to a fine of not more than $500 or to six months' imprisonment with hard labour-whoever heard of such a thing?-without even a warrant being necessary. Then part (c) reads as follows:
(c) on view, seize, whether within or without the boundaries of any park, any timber, hay, mineral, fish, mammal or bird, or any part thereof, arms, ammunition, explosives, traps, nets, rods, vessels, boats, vehicles, equipment, outfit, appliance, or any other article whatsoever that he has reason to believe are or have been possessed or used in connection with the commission of a violation of any of the provisions of this act and the regulations.
That means that if I were suspected of having had one of these fish hooks with three prongs on it-that is not the right term but you know what I mean-in the park, the authorities could come into my house in Calgary, without a warrant, and make a search of that house; they could break into any part of it which they desired to break into; and on conviction I would be liable to a penalty of $500 or six months' imprisonment with hard labour.


Tom Goode: What is the date of the regulation?


Charles Edward Johnston: It is the very latest. It is right up to date. It is the revised statutes of 1952.


Jean Lesage: Mr. Chairman, the hon. member is now seeking an amendment to section 8 of the National Parks Act. The amending bill which we are now studying does not purport to amend section 8. Moreover, the hon. member started with a premise in which he was giving his reasons why the park superintendent or the park authorities should not be given the power to collect the hospital tax; because, as he says, the council is not satisfied with the way the collection or the levying of the welfare tax in the national parks is being done. Might I refer the hon. member to the regulations governing the levying of the welfare tax in the parks and which cover Banff park. I refer especially to section 7 of these regulations which reads as follows.


Charles Edward Johnston: What page is that?


Jean Lesage: It is in the regulations. It is order in council P.C. 1954-14 adopted on the 7th day of January, 1954. Section 7 of it reads as follows:
7. Where a person refuses or neglects to pay a tax within 30 days following demand, the superintendent may levy the amount of the tax by distress and sale of the goods and chattels of the person in default together with the costs of the distress and sale.


Charles Edward Johnston: Of course; but that does not say that these other provisions I have indicated are not applicable. I was just about to say-


Jean Lesage: Mr. Chairman, may I say that section 8 has not been used in the course of levying taxes in the park.


Charles Edward Johnston: I did not catch that remark.


Jean Lesage: Section 8 has not been used in the course of levying the welfare tax in Banff park. It is section 7 of the regulations respecting the welfare tax, the section which I just read.


Charles Edward Johnston: A moment ago I said that when I got through with the discussion of this part of it, I was going to suggest to the minister what should be done. The minister has now said that these provisions have never been applied. I want to take objection to that statement. They have been applied in part on other occasions. It is no use for us to say that they have not been applied.


Jean Lesage: Not with respect to the levying of the welfare tax, and that is the only

matter with which we are concerned now. In studying the bill we are not concerned with infractions of the Ashing laws in the parks. We are interested in the levying of a hospital tax, which is what subclause 3 of clause 1 deals with. I would respectfully ask, Mr. Chairman, that, as the hon. member himself said a few moments ago, we keep in order in discussing the matter of a tax for the establishment of a hospital plan in that park.


Charles Edward Johnston: Mr. Chairman, I contend that I am perfectly in order. We are discussing the hospital plan and how it is going to be brought about and, as I have indicated, the people of Banff have written to me concerning this matter.


Jean Lesage: They should have written to me also.


Charles Edward Johnston: They have discussed it with the minister.


Jean Lesage: I did not receive any news from them recently.


Charles Edward Johnston: They have discussed it with the minister. Incidentally, surely the minister is not implying that the people of Banff should not write to their member.


Jean Lesage: No, but if they want an amendment to the act or if they want special regulations it seems to me it would be better for them to write to me as well as to the hon. member.


Charles Edward Johnston: Yes.


Jean Lesage: They had better write to me, especially since I had quite a discussion with the members of the advisory council last summer. At that time the members of the advisory council seemed well satisfied with the establishment of a poll tax which would be collected by the park superintendent, and the letters read a few minutes ago by the hon. member for Bow River come as a surprise to me.


Charles Edward Johnston: The minister is getting a little bit mixed up. He probably figured he was on one of those fishing excursions when he was at Banff-


Jean Lesage: I did not fish for votes.


Charles Edward Johnston: -because my information is the only time the advisory council met the minister when he was on that trip was for about half an hour. He indicated to the whole meeting, as I understand it, that he was in a great hurry and did not have too much time to discuss the matter with them. I understand he spoke for about 25 minutes out of the half hour and 50433-198J
National Parks Act
then, as he was reaching for his hat, he said: "Are there any questions? I have to catch a train."


Jean Lesage: That is completely unfair. I spent practically a whole morning with the members of the advisory council. We had a full discussion of the problems which the members of the council wished to raise. They presented me with a written brief. We discussed the matters contained in the brief, and the question of a hospital plan came to the fore. I said I was sympathetic to the establishment of such a plan in the parks. I said I would propose to the house at this session an amendment to the parks act to make it possible to establish such a hospitalization plan in the parks, and that is what I am now doing. But there was never any question that there would be any other system than the levying of a poll tax and that collection would be made by the park authorities. It might very well be that some other system will be adopted. But whatever system is adopted, the present amendment-


Charles Edward Johnston: On a point of order, I do not mind the minister interjecting to answer a question or to try to correct me if I am wrong, but I wish he would wait until I am through to make his speech. He has made a couple of statements that are causing me some concern. He said there was never any question of anything else except a poll tax. The people of Banff have been unalterably opposed to a poll tax. They have understood from the beginning that there was to be an assessment tax. In fact, the provincial government has gone so far as to say this plan could not possibly be put into operation at Banff on any other basis than an assessment tax because everybody else in the province of Alberta is on an assessment basis. The minister and his department know that to be true. I want to emphasize that. Do not say here that the people of Banff have always advocated a poll tax. They certainly have not. The provincial government has also made it very clear to the authorities at Ottawa that it could only be done on an assessment basis.
When he was discussing the matter a moment ago the minister pointed out that the people there wanted such a plan. Of course they want it. There is no question about that. As I said when I started my remarks, we are all grateful to the minister for bringing in this legislation-although it is only his job-and making it possible for the people of Banff to have hospital service. However, the only thing the federal government has to do is to bring in this little bit of legislation, and the people of Banff and the province of Alberta will do the rest.

National Parks Act


An hon. Member:: Let them collect it too.


Charles Edward Johnston: Certainly they would. The people of Banff want it collected either by the advisory council or by the provisional board of the hospital district which is being formed in Banff. Certainly they would do it because, as I have indicated, they do not want to come under these park regulations with these unfair penalties attached to them. In a letter I just read I indicated some of the unfair penalties that have been applied. It is no use for the minister to say that this section has never been applied or that the penalties would not be applied to the hospital plan. Of course they will. They have been applied. If these things are so outdated, why keep them in the act?
I suggest to the minister again that this section should be taken out of the act because it is so ridiculous to think that a person violating any of these regulations should be subject to a $500 fine or six months' imprisonment at hard labour. There may be several reasons why a person could not pay his tax on the date when it was due. There may be several reasons why he had a fish hook with three prongs on it in his house. But is that to say he should be subject to a fine of $500 or six months' imprisonment with hard labour? Of course that is ridiculous. I suggest to the minister he would be doing a service to himself, to the country, and particularly to the national parks of Canada and the people therein, if he would strike this penalty clause from the statute entirely.
At this moment I do not have much more to say. I have pointed out to the minister how grateful the people of Banff are that this amendment has been introduced. I have pointed out to him as strongly as I can why I think there should be certain changes. I have mentioned two very important changes. The first is that the collection of the tax should be allotted by the federal government to the advisory council, the elected body of the people of Banff. The government can do that if they want to without further amendment of the legislation. If not, the collection of the tax should be allotted, to the provisional board of the hospital district. In either case, it should not be subject to these park regulations.
In the second place, the tax, without any question, should be on an assessment basis. The provincial government has made it very clear it just would not be feasible to do it on any other basis, and certainly not by means of a poll tax. That is something that is not done in any other part of the province, and the contention is that the same practice should be followed in Banff that is followed in
.
other parts of the province. I hope the minister will take the suggestions I have made into consideration. I do not think he has made a definite decision whether or not the tax will be a poll tax or will be on an assessment basis. I hope he will give this matter consideration. In view of what I have said, in view of the fact the people of Banff do not want it on a poll tax basis but on an assessment basis, and in view of the fact the provincial government insists it shall be that way, I think the government should declare quite candidly at this time that the things I have asked for will be incorporated in the act and the regulations.


Mr. Quelch:: I am glad to see this amendment to authorize agreements with authorities in a province for making arrangements with hospitals for hospital service. I understand the main reason for introducing this amendment now is to make it possible for the people of Banff national park to come under the dollar-a-day hospitalization plan. I understand also that there is some concern now as to whether or not the sisters at Banff can continue to operate the hospital without financial assistance. On the other hand, they are strongly in favour of coming in under the dollar-a-day plan. I am sure the minister himself would agree that it would be a deplorable situation if the hospital at Banff had to close.
I attended a public meeting in September called under the auspices of the advisory council, to discuss the dollar-a-day scheme. I may say that at that meeting there was a great deal of confusion as to the method by which the money would be collected, and confusion as to the method by which the tax would be levied. Some were under the impression it would be done by a poll tax; some were under the impression it would be by a mill rate levied on property; some thought the province would collect the tax; some thought the superintendent of the park would collect the tax, and others thought the hospital board would collect it. There was so much confusion at that meeting it was decided finally that a member of the advisory council would go to Edmonton and have a meeting with the minister of health. Upon the return of this delegate, another meeting would be called and then a further discussion would take place.
Mr. Shaw of the advisory council went to Edmonton and had a thorough discussion with Dr. Cross, the minister of health, concerning the plan. Then, on October 27, another public meeting was called. At that meeting Mr. Victor Price, the business manager of the Holy Cross hospital in Calgary, was in attendance in order to answer any

questions that might be asked because he had firsthand knowledge of the operation of the dollar-a-day plan. I might mention that Mr. Price was there, not as a representative of any government but purely as a service to the people of Banff in order that they might get firsthand knowledge of the operation of the dollar-a-day plan.
When the meeting was called it was announced that if the plan went into operation it would have to be on the basis of a mill rate tax on assessed property. Perhaps to make this quite clear I should read a letter that was written by Dr. Cross to Mr. R. E. W. Edwards, secretary of the Banff advisory council. The reason the letter was written was that the people of Banff had asked the advisory council to obtain from the minister of health a statement in writing so that there would not be any more conflicting statements. During the first meeting some people said the minister of health had stated this, and others said the minister had said something different. In view of this the people wanted a written statement so that they would know exactly what the proposal was. I will read the letter that was written by Dr. Cross to Mr. Edwards, and which was made available to the people at that meeting:
Dear Sir:-
Re Proposed Municipal Hospital District for Banff National Park
Further to a meeting with a member of your council, Mr. Shaw, last week, this will advise that the only plan acceptable to the department to establish the $1 a day hospitalization scheme is by way of a mill rate tax on all assessed property within the boundaries of the park. This method is in accord with the municipal hospitals act, being chapter 185 of the revised statutes of Alberta, and the plan is in operation today in sixty-nine municipal hospital districts over the province.
We have agreed to amend the municipal hospitals act as suggested-
I should like the minister to pay special attention to this:
-by Mr. R. G. Robertson, deputy minister of the Department of Northern Affairs and National Resources at Ottawa, to make any resident of the park assessed for school taxes, a ratepayer under the municipal hospitals act. This will give your council (or park superintendent) authority to levy and collect a tax on the same basis as your school tax at present in effect: then the municipal hospital board will be in a position to requisition your council each year for sufficient funds to carry out an agreement with the sisters' hospital at Banff.
So from then on the discussion that took place in that meeting was on the definite understanding the plan would be financed by a mill rate on the assessment.
Now, Mr. Price wanted to know just how many of the people present at the meeting were ratepayers, and how many were just curious spectators. A show of hands was called, and it was found that 99 per cent of
National Parks Act
the people present at that meeting were ratepayers. When the vote was called an overwhelming majority of the people at the meeting voted in favour of the dollar-a-day hospital plan financed by a mill rate tax, on the assessment of property. I quote from an article appearing in Crag and Canyon concerning that meeting:
Following an explanation of the dollar a day hospitalization plan, a meeting that jammed the auditorium on Wednesday evening voted overwhelmingly for the establishment of Banff national park as a municipal hospital area. A request, therefore, to this effect will be forwarded to the proper authorities.
A show of hands established that over 99 per cent of those present were ratepayers-those whom the plan would most seriously affect. The only plan acceptable to the department of health as a means of financing the scheme is by way of mill rate tax on all assessed property within the boundaries of the park.
I believe that should settle clearly in the mind of the minister that any discussion that has taken place recently concerning the adoption of the dollar-a-day plan in Banff has been on the basis of a mill rate levied on property. The minister has stated it should be on the basis of a poll tax. Personally, I believe a poll tax would be a very unfair method of financing the hospital plan. I have heard it suggested that the minister has been influenced by the Canadian Pacific. I am not making that as a charge. Of course, it was made quite clear at the meeting that the Canadian Pacific would be very much opposed to a mill rate tax on property for the purpose of financing the hospital. Some of the other very large property owners were also opposed. As I say, however, 99 per cent of the people at that meeting were ratepayers and they voted overwhelmingly in favour of the hospital plan being financed by a mill rate tax on assessed property. Let us not have any more discussion as to whether the people of Banff are in favour of the poll tax or a mill rate on assessed property. They are definitely in favour of the mill rate tax on assessed property.
I am hoping that the minister will not now, at this late date, throw a monkey wrench into the works by insisting that the plan be operated on the basis of a poll tax. As the Alberta health department has pointed out, they could only do it on the basis of a mill rate. All the other hospitals are being financed on that basis and they could hardly make an exception for one hospital to be financed on a different basis. I hope the minister will find it possible to agree to something to which his deputy minister has apparently already agreed, namely that it be financed by a mill rate.


Jean Lesage: It is alleged my deputy minister agreed to that?

National Parks Act


Victor Quelch: This letter from Dr. Cross to Mr. Edwards referred to your deputy minister. I have already read this letter from Dr. Cross, the minister of health, to Mr. R. E. W. Edwards.


Jean Lesage: I do not agree that my deputy has said that.


Victor Quelch: Is the minister saying now that his deputy was not in favour of that being done?


Jean Lesage: I have here a copy of a letter from my deputy, Mr. R. G. Robertson, to Mr. McCallum, of December 29, 1954. I am going to read it later when my hon. friend has finished.


Victor Quelch: I have nothing more to say, except that I hope the government will proceed with the amendment we have before us in order that the dollar-a-day plan may be made available to the hospital at Banff. It would be a mistake to finance it on the basis of a poll tax. The mill rate on the assessment is a fairer method of taxing.


Jean Lesage: I shall just read the extract. Mr. Diefenbaker: Read the letter.


Jean Lesage: It is a very long letter. May I read only the extract which pertains to the question we are discussing now?


Victor Quelch: What is the date of it?


Jean Lesage: It is dated December 29, 1954. The extract reads as follows:
I think there is considerable merit in collecting the taxes from those who pay health and welfare taxes because there would be a wider distribution. Approximately one-third of the residents of Banff fall into the class of renters; consequently they would be excluded if a property tax were adopted, unless they came into the scheme on a contract basis.
Another factor in favour of the poll tax is that we are now collecting such a tax for the cost of health and welfare services.
It is most difficult to decide whether it should be a poll tax or a so-called property tax. As a matter of fact the property is all owned by the federal government and it is leased; but it would be a tax on the interest of the lessee in the property. You may call it an assessment tax if you wish.


Victor Quelch: It has already been done for schools.


Jean Lesage: Yes, it has already been done for school tax purposes. Therefore, it is a question of deciding whether it should be a poll tax or an assessment tax. Both the hon. member for Acadia and the hon. member for Bow River argue in favour of an assessment tax. May I say again that when I discussed the matter with the members of the advisory council in Banff last summer it 
never entered my mind that it could be anything but a poll tax that they had in mind, which would be levied in the same manner as the park superintendent collects for the welfare services.
I do not want to argue in favour of the poll tax and against the assessment tax at this time because I do not have to make the decision today. I want to study the matter very carefully and discuss it with the authorities of the province of Alberta and with the officers of the parks branch of the department, and also to consider the representations which I no doubt will receive from the residents of Banff. But it seems to me that whenever we discuss welfare measures, we should as a general principle try to have as wide a distribution of the burden as possible.
That was one of the principles which were the basis of the recommendations which were made by the committee on old age security in 1950. Whenever the benefits of a social security measure are universal, be it all over Canada, all over a province, or all over a municipality, the burden should be as widely distributed as possible over the people who will benefit from it. That is one of the principles I have to keep in mind when I make the decision whether it will be a poll tax or an assessment tax. There are other considerations; but one thing is important. It is this. The bill which is before the house now reads as follows in subclause 3, paragraph (q):
Levying taxes on any residents of a park or on the interest of any persons in land in a park in order to defray in whole or in part . . .
It permits either an assessment tax or a poll tax to be established.


John George Diefenbaker: Will the minister permit a question. In reality, does this amendment make any difference? Paragraph (q) reads;
levying taxes on any residents . . .
The old section read:
levying taxes upon the residents of a park . . .
In reality, is there any great change in these words? Further on the paragraph reads:
... or on the interest of any persons in land in a park . . .


Jean Lesage: This is not a substantive amendment. The really important amendment is subparagraph (ii) of (q).


John George Diefenbaker: Yes.


Jean Lesage: It has to do with the cost of hospital services. We had to write the whole of paragraph (q) into the amending bill. I understand the law officers of the crown profited by the fact that the bill was being amended to make changes which I do not think are any more important than the hon. member thinks they are.


John George Diefenbaker: I do not see it.


Jean Lesage: The important change appears in (ii) of subclause (q) which appears at the top of page 2 of the bill. That is the important addition.


John George Diefenbaker: The rest of the changes are merely alterations in terminology in order to make it clearer?


Jean Lesage: Yes.


John George Diefenbaker: In reality this applies to only one park, namely the Banff park?


Jean Lesage: It could apply to Jasper as well, or to Waterton lakes, because they are in Alberta where there exists this hospitalization system.


John George Diefenbaker: What about Saskatchewan?


Jean Lesage: Is there a hospitalization plan there? My officials tell me that under the provincial law as it exists in Saskatchewan now it could not apply to Prince Albert park.


John George Diefenbaker: It would not apply.


Jean Lesage: No, not according to what my officials tell me.


John George Diefenbaker: Therefore in reality this covers the situation in three parks in Alberta?


Jean Lesage: As I said, Mr. Chairman, this amendment follows the brief which was presented to me in Banff last summer by the members of the advisory council, asking that the proper amendments be made to the parks act so the provincial hospitalization system could be applied to the residents of Banff park.


Charles Edward Johnston: May I say to
the hon. member for Prince Albert that this applies only to the parks established in Alberta, because no other province in Canada is so progressive in its health measures in relation to parks. We hope the other provinces will take a lead from Alberta in this respect, as they have in other things, and make it possible for their park residents to have the same advantages of a health insurance scheme.
The minister made a point on which I wish to comment. He suggested that in his thinking on this matter, after the bill is passed he will have to give consideration to the matter, after consulting with the people of Banff and the provincial government of Alberta, and come to a conclusion regarding it. I have no objection to that. I think it is an important amendment and one that should bear fruit, but I should like to suggest to him that another point must be considered.
National Parks Act
He has already indicated that the tax should be applied to the greatest number of the people who are to receive benefit under it. When the minister is considering this matter may I suggest to him that the provincial government could not inaugurate a program of this magnitude without being reasonably sure that the revenue would be forthcoming to carry it out. It seems to me that because the population at Banff is a shifting one the revenue from a poll tax would be very uncertain. On the other hand, an assessment basis tax would be more permanent.
In addition to that, all the people in Banff who were not taxed on an assessment basis would have the privilege of coming under this legislation by entering into separate contracts, and everybody would be covered. It seems to me that an assessment basis would be the most appropriate of all, and certainly it would be the most satisfactory from the standpoint of administration and the security of the people of Banff, who are anxious to have this measure in effect. As the hon. member for Acadia has stated, they have indicated an overwhelming desire that this be as we have outlined it. I hope the minister will see fit to follow the advice of the people who are going to be concerned in this very matter.


Douglas Scott Harkness: As the minister has pointed out, this provides for levying either a poll tax or a land tax, or both. I take it from what the minister has said that no definite plan has yet been decided upon as far as Banff is concerned. Is that correct?


Jean Lesage: Yes, that is correct. We are seeking by this amendment authority to make regulations for the establishment of the system in Banff park. As I said, until lately I was under the impression that there was no doubt as to what the people wanted, that is a poll tax. However, from what the hon. member for Acadia and the hon. member for Bow River have said there would seem to be practically unanimity among the Banff residents in wanting an assessment tax. I shall have to consider the matter.


Douglas Scott Harkness: As has been pointed out, the population of Banff fluctuates considerably. During the summer time there are many summer residents there who may stay one, two or three months, and then there are a number of people employed at the hotels who may be there for a similar length of time. I am wondering whether the phrase "levying taxes on any residents of a park" would include people who are there on a fairly temporary basis. What is the definition of "resident" which is going to be applied?

National Parks Act


Jean Lesage: As I said before, in the case of the welfare tax which is already collected in Banff under provincial law, a poll tax is imposed on the residents. Perhaps I should read the regulations governing the levying of this tax. They are as follows:
3. (1) For the year nineteen hundred and fifty-four and for each year thereafter each resident shall pay a tax of one dollar to the superintendent for health and welfare services.
(2) Subsection one does not apply to
(a)	a resident who has not attained the age of twenty-one years and who is wholly dependent upon a parent or other person for support;
(b)	a resident who has attained the age of twenty-one years and who is wholly dependent upon a parent or other person for support by reason of mental or physical infirmity;
(c)	a resident who is in receipt of blind persons allowance, mother's allowance, old age assistance, widow's pension, or indigent relief under the laws of the province of Alberta;
[DOT](d) a resident who is in receipt of a pension under the Old Age Security Act (Canada) and who also is in receipt of a supplementary allowance under the Old Age Pensions (supplementary allowance) Act of the province of Alberta;
(e) a resident who pays to an improvement district taxes on freehold lands in a national park;


Douglas Scott Harkness: That still does not answer my question as to the definition of"resident". Those are the exceptions who do not have to pay this welfare tax.


Jean Lesage: Regulation 2 (b) defines resident as follows:
"Resident" means a person who has attained the age of eighteen years and who has been ordinarily resident in a park for six months of the year immediately preceding the year for which a tax is payable.


Douglas Scott Harkness: That is really a six months' residence qualification.


Jean Lesage: In the year preceding the year in which the tax is to be levied.


Douglas Scott Harkness: Then summer employees are not included?


Jean Lesage: They are not. That is one of the difficulties we have to consider in deciding as between a poll tax and an assessment.


Douglas Scott Harkness: On that basis summer residents who are there for two, three, four or five months, less than six months in any event, and summer employees who are there for the same length of time, less than six months, would not be covered by the hospital services?


Jean Lesage: They would not be covered either by the tax or the hospital services.


Charles Edward Johnston: They could be covered by a separate contract if they wanted to enter into one.


Douglas Scott Harkness: Would there be any difficulty in supplying hospital services to people in

the parks on the same basis as it is done in Calgary? In that city every owner of land

in the case of a park it would be every lessee-pays the hospital tax as part of his general taxes. Then any roomer or tenant who wishes to come under the scheme can do so by the payment of a flat fee of so much for a single person and so much for a family.


Charles Edward Johnston: That is what we are asking for.


Jean Lesage: If all the residents in the park are going to benefit the question would be whether all residents with six months' residence in the previous year should pay the tax, as they are going to benefit; or should it be paid only by those who are freeholders or who are leasing land in the park and who would therefore be paying for the whole population who would qualify as residents.


Douglas Scott Harkness: I think the minister misapprehends the system we have in Calgary, and I think this applies to other municipalities in Alberta. There a tax is levied on land, and every owner of land and his family would be entitled to hospitalization for a dollar a day. That would not include any resident who did not pay taxes; in other words tenants and roomers. But those people can be covered by the payment of a flat fee of $10 for single persons and $20 for married persons and their families. These people are not forced to come into the plan, but if they do not come in they receive no benefits and must pay for hospitalization at the regular rate. I see no reason why the same thing could not be put into effect in Banff.


Jean Lesage: As I said, I have arrived at no decision in this matter and this discussion will certainly help me. What about people who lease land in the park and occupy it only during the vacation period, say for three months in the year?


Charles Edward Johnston: Is not all land
leased?


Jean Lesage: I just want to know the answer of the hon. member for Calgary North.


Douglas Scott Harkness: The minister is referring to land in the park which is leased but which if it was not in the park would be owned?


Jean Lesage: Yes; that has to be the basis for assessment in the parks.


Douglas Scott Harkness: The man with a summer cottage would be assessed. He would pay the tax and he would be entitled to hospitalization if he required it when he was

there. The same thing applies in Calgary. A man may live in Toronto and own two or three lots in Calgary. He is assessed, he pays his taxes, and if he is sick while in Calgary he would receive the benefit of the dollar a day hospitalization. If he gets sick there he gets in on the dollar a day hospital plan. If he does not happen to get sick there, of course, he has not received any benefit out of it. Nevertheless the benefit is open to him if he wants to live in that particular area.


Jean Lesage: But my point is that he will be taxed for 12 months for a service from which he can benefit for only three months. That is the difficulty. It is no easy problem. The whole thing will have to be considered very carefully and a decision made.


Stanley Howard Knowles: I wonder if it would not be a good idea for the Minister of Northern Affairs and National Resources to discuss this question with his colleague the Minister of National Health and Welfare? It might solve all these problems if he could get his colleague to bring in a nation-wide program of health insurance.


Victor Quelch: The suggestion was that the assessment roll would be the same as for the school tax.


Jean Lesage: Yes.


Victor Quelch: There was a good deal of discussion as to whether it should be a poll tax or a mill rate on assessment. As a result of that discussion a member of the board was sent to Edmonton, and when he came back he made it clear that the only basis upon which the dollar a day plan could be put into effect under the Alberta hospital act would be on a mill rate assessment. From then on it was urged that there should be a mill rate on assessment, as the only basis on which they could get the dollar a day plan. The letter made it clear that they could only have a dollar a day plan provided the mill rate was levied on assessment.


Charles Edward Johnston: I should like to say another word about this. I think the minister is unduly concerned. He pointed out the difficulties that would arise because the people holding land that was taxed only had access to the benefit for three months a year. As the hon. member for Calgary intimated, if a person owns property in Calgary and decides to live in Toronto and visit Calgary for three months of the year, then he would have access to the service for the three months he was there. If he took sick in Toronto he would not have access to it there. There is nothing different in the implementation of this system in that province 50433-199
National Parks Act
and in the park area. It is already established in the park area that the school tax is on an assessment basis. There has been no difficulty, as far as I know, about that tax. Certainly if this were followed along the same lines there should be no more difficulty in administering it on the assessment basis for the hospitals than is found now for the schools. It seems to me that the minister should give it very serious consideration.


Jean Lesage: I shall.


[Stage Direction]
Subclause agreed to.
On subclause 4:
Mr. Yuill:: I am interested in this subject, as Jasper happens to be in my constituency, and they face a similar problem there. I have been told by the majority of the people there that they would be happy to avail themselves of this dollar a day hospitalization. I think the same rule would apply there that applies to my town. I happen to be the mayor, on my sixth term now, and we worked it very successfully there. There was direct taxation for the property owners and a tax for the non-taxpaying residents. They paid a flat rate of $8 per year. I do not see anything to worry about if there are people living in the park who do not pay rental, from the governmental point of view. Owners of property pay taxes in that respect. Every man who gets any benefit pays for it. The ordinary person who does not avail himself of the $8 privilege is out of luck so far as the dollar a day service is concerned.
I think that could work there in the park just as well as it has in my town. We have been contributing on that basis for a number of years. As a matter of fact my town provides that without any special levy, as an added service, but any non-taxpaying resident pays $8 a year for that dollar a day hospitalization. It is something that works there; I believe it would work anywhere else within a park.


[Stage Direction]
Subclause agreed to.
Subclause 5 agreed to.
Clause 1 agreed to.
On clause 2-Lands withdrawn from Water-ton Lakes national park. Lands withdrawn from St. Lawrence Islands national park.
Douglas Scott Harkness: Under clause 2, Mr. Chairman, I see the department is withdrawing 753 acres from Waterton park and attaching it to an Indian reserve or a portion of an Indian reserve which is entirely enclosed by the park. Exactly where is this situated, and what sort of land is this 753 acres? Is it a mountain or forest land?

Territorial Lands Act


Jean Lesage: It is not really bush land. It is open prairie with small brush, not very good for park purposes. I believe the best thing I can do is to send the map to the hon. member.


Stanley Howard Knowles: Put it on Hansard.


[Stage Direction]
Clause agreed to.
On clause 3-Governor in council may establish national park in Newfoundland.
Mr. Stick:: I wonder if the minister would care to give us information regarding the national park in Newfoundland. I know we have been discussing this for a number of years. Could he bring us up to date on the situation that exists today? Where are you going to put this park, when do you hope to begin, and so on? Have you any information like that?


Jean Lesage: I met the minister of mines and resources of Newfoundland, Mr. Rowe, in November or December. We discussed the matter together, and he told me that he would write to me as soon as he could have clear title to offer for the national park, the area of which was surveyed by the officials of my department two or three years ago.


Leonard T. Stick: Do you know where that area is?


Jean Lesage: Bonavista bay.


Leonard T. Stick: Is that Newman sound?


Jean Lesage: Newman sound.


Leonard T. Stick: I take it, Mr. Chairman, that as soon as the provincial government has fulfilled its obligations the federal government is prepared to go ahead with the park?


Jean Lesage: That is exactly the principle we are adopting in this clause 3 of the bill.


[Stage Direction]
Clause agreed to.
Schedules A and B agreed to.
Bill reported, read the third time and passed.


Jean Lesage: the second reading of Bill No. 282, to amend the Territorial Lands Act.


[Stage Direction]
Motion agreed to, bill read the second time, and the house went into committee thereon, Mr. Applewhaite in the chair.
On clause 1-Repeal.
Jean Lesage: The amendment to the Territorial Lands Act provides simply for the repeal of subsection 2 of section 5 of the act.
[Mr. Harkness.l
This subsection required that plans of survey had to be approved by the surveyor general before territorial lands could be sold. It applies to lands in both the Yukon and Northwest Territories. While the intent of the subsection was perfectly sound, it has raised difficulties in practice.
When a person wishes to purchase a parcel of land, he expects to be informed of the price that will be charged. While it has been possible under the present subsection to give a prospective buyer an estimate of the probable cost of the land, no formal agreement of sale could be legally entered into until after the survey had been carried out and approved by the surveyor general. Due to a continuing shortage of qualified surveyors it has usually been a minimum of two years and often much longer between the time a request to purchase was made and the time the survey was completed and approved. During the intervening period the land may well have increased substantially in value, and the original estimate of price would be greatly exceeded when the time came for the formal agreement to be completed.
By deleting subsection 2 the sale of land will be governed by the general clause in the act, namely section 4 which states:
Subject to this act, the governor in council may authorize the sale, lease or other disposition of territorial lands and may make regulations authorizing the minister to sell, lease or otherwise dispose of territorial lands subject to such limitations and conditions as the governor in council may prescribe.
It would then be possible under this general section to enter into an agreement of sale shortly after the request to purchase was made, based on an appraisal of the land in question, with a price fixed on a unit basis and with the total price to be paid subject to the completed survey. Normally the unit price -would be a price per acre. The appraisal would be made by competent officers who would make as accurate an estimate as possible of the area involved so that subsequent adjustments in the total price, on completion of the legal survey, would be kept as small as possible.
It is proposed that regulations made under the act will contain a provision that no letters patent covering the sale of land may be issued until the survey has been completed and approved by the surveyor general, so that the original intent of subsection 2 will be met.


Mr. Simmons:: Mr. Chairman, I am glad to see this proposed amendment which will repeal subsection 2 of section 5 of the Territorial Lands Act to permit sales of territorial lands to be made prior to survey of the land

and which will permit the price to be fixed at the time the application to purchase is accepted by the department.
In the past, under the present provisions of the act, I know of persons in the Yukon Territory who applied to purchase parcels of territorial land many years ago. They naturally wanted to know the cost under the present act, but officials of the lands division could not tell them what the price would be until such time as the land in question was properly defined by a dominion land surveyor. In certain cases there was a gap of several years between the time of application and the time of survey, a situation which naturally caused considerable dissatisfaction and inconvenience. In other words, under that interpretation a person would not know how much he would be assessed for the land until several years after he had decided to purchase it.
Those now contemplating the purchase of territorial land will welcome the proposed amendment which will enable the department to tell the applicant what the price of the land will be when he applies to purchase it. I am pleased to see this amendment being introduced.


Douglas Scott Harkness: I presume this amendment applies to lands in the Northwest Territories as well as to lands in Yukon Territory?


Jean Lesage: Yes. I said that in my remarks a few moments ago.


Douglas Scott Harkness: I did not catch that part.


Stanley Howard Knowles: May I ask whether this amendment envisages or involves any other change in government policy with regard to the sale of land in the Yukon or Northwest Territories? In particular may I ask whether it has any bearing on oil or mineral rights?


Jean Lesage: No.


[Stage Direction]
Clause agreed to.
Title agreed to.
Bill reported.
Mr. Speaker:: When shall this bill be read a third time? Now?


Stanley Howard Knowles: By leave.


Jean Lesage: the third reading of Bill No. 282, to amend the Territorial Lands Act.
Motion agreed to and bill read the third time and passed.
50433-199i
Canadian Forces Act



PRECIOUS METALS MARKING ACT


Robert Henry Winters: the second reading of Bill No. 306, to amend the Precious Metals Marking Act.


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


Stanley Howard Knowles: Are we not to have an explanation of the bill?


John Borden Hamilton: May we have an explanation of it?


Stanley Howard Knowles: Does not anyone on the government side know anything about this Senate bill?


Robert Henry Winters: Mr. Speaker, may the bill stand?


Mr. Speaker:: Would the hon. member for Portage-Neepawa (Mr. Weir) move the adjournment of the debate?


Mr. Weir:: Yes.
On motion of Mr. Weir the debate was adjourned.



CANADIAN FORCES ACT


Ralph Osborne Campney: the second reading of Bill No. 257, respecting the Canadian forces.


Mr. Pearkes:: Is the minister going to make a statement in connection with this bill?


Ralph Osborne Campney: Yes; a very short one.
This bill contains a series of amendments to the National Defence Act and to the Defence Services Pension Act. On March 14 last, in speaking to the resolution preceding this bill, as reported at page 2004 of Hansard of that date, I endeavoured to review generally the scope of this bill and to refer briefly to some of its salient points.
As the 26 clauses of the bill are not related to each other, and as the bill does not deal throughout with one specific subject, it is hardly possible to debate the principle of the bill on second reading, as is usually the practice. I would therefore suggest that the bill might be given second reading now and that we might then proceed in committee to consider the bill clause by clause, as has been the procedure in each of the previous years in which a bill of this type has been brought forward. I think that procedure might be more acceptable to hon. members and might at the same time expedite consideration of the bill.

Canadian Forces Act


George Randolph Pearkes: Mr. Speaker, as this seems to be an unprincipled bill I think that would be the best policy to follow.


[Stage Direction]
Motion agreed to, bill read the second time and the house went into committee thereon, Mr. Cavers in the chair.
On clause 1-Short title.
The Aciing Chairman (Mr. Cavers): Shall
the clause carry?
Herbert Wilfred Herridge: I have a word or two to say. The explanation of this clause reads as follows:
This clause would make It possible to reinstate, without a break in service, officers and men who have been released as a result of a sentence of dismissal or a finding of guilty by a service tribunal or any court, and the sentence of dismissal or finding of guilty ceases to have force and effect as a result of a decision of an appellate court or other competent authority.
I want to ask the minister this question. If a man who has been sentenced by a court martial, say in world war II, rejoins the forces, does this amendment wipe out that sentence?


Ralph Osborne Campney: No. This amendment is to cure a defect in the act which has been felt by a number of people.


John Borden Hamilton: What clause are we talking about now?


Ralph Osborne Campney: This is clause 2. We had better wait until we come to it.


[Stage Direction]
Clause agreed to.
On clause 2-Reinstatement.
Ralph Osborne Campney: At present when a man is convicted and his conviction has been set aside on appeal, he has to re-enrol in order to be reinstated. In other words he cannot be retroactively reinstated. We find, as the result of a ruling of the Department of Justice, that there is a break in his service even though, having been convicted, he wins his appeal. This provision will take care of that situation. The practice proposed here is followed in the United Kingdom. Except for this clause the break in his service would affect his pensionable time, seniority, and possibly his position in respect of progressive increase in pay. The amendment is made in the interests of the person who has been convicted and has won his appeal.


Herbert Wilfred Herridge: Thank you.


[Stage Direction]
Clause agreed to.
On clause 3-
John Borden Hamilton: The minister might explain this clause. It would seem this is a method of taking back from civilian life ex-members of the forces in order to try

them before a military tribunal. I wonder whether the civil courts could not adequately take care of matters of this kind. I am thinking about the instances of pilfering to which reference has been made. Would the civil courts not be able to take care of people who have returned to civil life?


Ralph Osborne Campney: A civil court can only deal with civil offences. The law now provides that a man who has been released from the service may still be tried under the code of service discipline for offences committed while in the service although he has left the service. That is the law now. But there is no provision in the present law stating that the man is under service discipline for the period between the time he is charged and the time he is convicted or acquitted. This amendment will mean that a man who has left the service and is charged with a service offence which took place during the time he was in service shall be under the code of service discipline from the time he is charged until the charge is disposed of. It is a purely procedural gap which we are trying to fill.


Mr. Hamilion (York Wesl):: Do I understand the purpose is to cover jurisdiction when he has in fact been taken back into the service? As I see it, there are certain offences such as absence without leave and desertion which would be peculiar to the military, but theft and other offences of that kind would be triable before a civil court just as well as they would be before a military court. Is there any indication that the intention is that all cases of that kind are to be brought back into the military courts?


Ralph Osborne Campney: No, only cases where the offence has taken place while the man was in the service would be tried under the code of service discipline, and no others.


[Stage Direction]
Clause agreed to.
On clause 4-Exclusion of time.
Francis Alvin George Hamilton: This clause deals with the period of limitation in connection with offences, and under subclause 3 (c) it would appear that it shall not include any time during which a person was serving a sentence of incarceration imposed by any court other than a service tribunal. I would assume that would be the case except if the sentence arose out of the offence for which he was being charged. Should there not be some additional words there to make it a little clearer?


Ralph Osborne Campney: If a man has been tried by a civil court, he cannot be tried and sentenced again by a military court. The purpose is to deduct from the period of three years

within which a person must be tried except for the more serious offences any period during which he is a prisoner in a civil prison, a prisoner of war, or confined in any other way which affects his liberty.


[Stage Direction]
Clause agreed to.
Clause 5 agreed to.
On clause 6-Petition in respect of delay of trial.
John Borden Hamilton: This is a very
important clause. It has to do with the number of days a man may be held prior to what we might term committal for trial either by summary process or by court martial. I think it has possibly been in mind that there could be many abuses in connection with this provision. As a matter of fact I have had some personal experience in defending men under circumstances of this kind.
Has the department given any thought to inserting a clause whereby the onus would be on the commanding officer to point out to the accused the provision which will apply consequent upon the passing of this amendment? It is fine to have it here, but from experience it seems to me it would be of great benefit if there were some provision that the commanding officer must do two things. First of all the commanding officer should be obliged to inform the accused of this provision, that is, the length of time involved before coming to trial. Second, there should be a limited period during which the commanding officer must appoint an officer to defend. It seems to me that only with these additional safeguards can we say that this amendment would be really effective.


Ralph Osborne Campney: I think there may be some
merit in the hon. member's first suggestion. I believe steps might be taken to acquaint a man with his rights, and we will give the matter consideration in connection with our regulations. With respect to the second point' raised, the man selects his own defence counsel, and I do not think the commanding officer should be involved in that particular part of the man's defence. Sometimes these cases are quite complicated, and we find that in practice it takes more than 90 days to get the evidence required to proceed to trial.


John Borden Hamilton: It has taken
six to eight months.


Ralph Osborne Campney: The same thing applies in
civil trials. It often takes a good deal longer to get to trial than one thinks when he starts. We are faced then with the position where either the man must be released or some other arrangement must be made to
Canadian Forces Act
keep him in custody. This is a discretionary power to be exercised by the minister in such cases.


John Borden Hamilton: I understand
the minister's point that the accused has the right of selection, and I think it is well taken. But would the minister consider the suggestion that a period of seven days, or whatever period might be considered reasonable, be set aside for the selection of the defending officer and that, failing that, the commanding officer should appoint an officer to defend? That is done in the civil courts in charges of a serious nature. The bench has the right to appoint defence counsel. A period of seven days could be provided for the accused to select a defending officer, and on his failure to do so, the commanding officer could then appoint one. I think that would be in keeping with our civil process where judges are quite within their rights in refusing a guilty plea and saying that they are going to enter a plea of not guilty and proceed with the trial. Only in that way can we bring the procedure somewhat in line with the rights which are possessed by an accused before our civil courts.


George Randolph Pearkes: Is the minister going to reply?


Ralph Osborne Campney: In reply to the hon. member, I might say I understand that in practically all cases a judge advocate general's officer is available to the man if he wants to select him. I am told also that under an order in council, in any serious case a man may be given assistance in obtaining civilian counsel, and the commanding officer is obliged to make this order in council known to the accused.


Mr. Cameron (Nanaimo):: What reasons have the minister's advisers given for suggesting that a man should be held in custody for three months while the authorities are deciding whether or not they have the evidence? I say it is quite preposterous in view of the practice in civil life.


Ralph Osborne Campney: The clause will not be commonly used. The necessity for it will arise in cases in which there is a good deal of evidence to check or a great deal of searching needed to get the evidence upon which to proceed to trial, such as in a conspiracy case. In my experience in civil practice, 90 days is not a very long time in which to prepare a complicated case for trial. Personally, as a lawyer, I do not see any undue harshness in it assuming it is properly applied, because the practice as I have found it in civil cases, and I understand the practice in the services has been pretty well the same, leads me to believe that every once in a while there is a

Canadian Forces Act
case that you have to have stand for a very considerable time in order to properly prepare it.


Colin Cameron: I point this out, that in civil cases the accused can apply for bail and he can be out on bail for that 90 days. This is not the case with a soldier; he is going to be in the hoosegow.


Ralph Osborne Campney: Unless it is decided to put him in open arrest; that is a matter of discipline. It is true there is no provision for bail in service procedure.


John Borden Hamilton: I would confirm what the minister has said. It is quite usual for us to wait for the spring assizes or the fall assizes in connection with a criminal offence. There seems to be nothing remarkable about that. If we have a limit here then we know we have some right, and that you cannot go beyond that limit. I believe we had evidence of people being held even longer than that during the last war.


Mr. Nesbiif:: In connection with this clause, I am not too familiar with military procedure but is there any procedure analogous to that which we have under criminal law for a committal for trial to ascertain whether or not there is sufficient evidence to hold the man for trial?


Ralph Osborne Campney: I understand that an initial investigation along the lines the hon. member has suggested is made by the commanding officer. In all cases he holds a preliminary investigation and reviews such evidence as is available and makes a decision.


Mr. Winch:: I should like to add a little to what has been said. It is my opinion that cases in which it takes the prosecution 90 days to complete its evidence, as a rule, are not the type where a man would be under open arrest. Even if he were under open arrest there is a big difference between being under open arrest and being out on bail in a civil case. In the case of open arrest you are not in the hoosegow, as the hon. member for Nanaimo mentioned, but you are confined to quarters. There is, therefore, a very big difference between being under open arrest and being out on bail in a civil case. It looks to me as though there is an undue hardship on a person who has not yet been found guilty.


Clarence Gillis: The point that sticks in my mind in relation to this subject is that if it takes 90 days for a commanding officer to secure sufficient evidence to try a man, there must be something wrong with the charge in the first place. The difference between a man *out on bail in a civil case and a man in the fMr. Campney.]
services who is confined to barracks is that the man on bail can go to his work and maintain his family, while the man in the services is deprived of his pay and allowances during the period he is under charge. I feel that 90 days is a very long time to hold' a man, even under open arrest. I do not believe he would be under open arrest, anyway. My experience with commanding officers is that they generally like to tie you down and keep you where they can get you when they want you.


Ralph Osborne Campney: I might say that a man under charge, before he is tried, does not lose his pay and allowances. I might give some examples of the need for this clause. We had several cases in Korea where serious offences were charged and we had to bring some witnesses from Canada to Korea. We have had charges of murder in Germany. It is not so easy to find out all the facts in such cases in a foreign country. This power will not be used lightly, but in serious cases it is necessary, and I think it is very necessary to the proper functioning of trials under military procedure. As I said when I was making some remarks a few minutes ago, on occasions 90 days is not a very long time in which to prepare the evidence in a serious charge.


Clarence Gillis: The pay and allowances are not affected?


Ralph Osborne Campney: Not affected until the
trial, no.


[Stage Direction]
Clause agreed to.
On clause 7-Majority vote.
John Borden Hamilton: Would the minister give us his explanation of clause 7?


Ralph Osborne Campney: This represents a change in procedural law. At the present time the judge advocate merely advises the court-martial as to what is the law. This provision would extend his duties and his responsibilities to the point where he will decide what the law is. In other words he will be somewhat in the position of a judge with a jury. The lack of this authority by the judge advocate, it is felt, has led to some unfairness to accused persons on a number of occasions where trials within trials on the admissibility of evidence have taken place in the presence of the members of the court. It is not felt that such procedure has been altogether fair to the accused.
Since normally the only official of the court who is a lawyer is the judge advocate, it is felt it would be more in the interests of the accused obtaining a proper trial if the judge advocate were made responsible for directing the court-martial as to what is the law,

and then the court-martial, having taken their law from him, can make any finding they see fit on the facts.


John Borden Hamilton: In connection with that section, does the minister see the change in procedure amounting to this. If the matter of the admissibility of evidence is raised by counsel, the court-martial board retires in the same way as the jury retires and the judge advocate hears the evidence dealing with the admissibility of the evidence and makes a ruling on it. Then the board comes back. Is that the process we see developing here?


Ralph Osborne Campney: That would be the practical result of this amendment.


John Borden Hamilton: If that is the case, do we also show the judge advocate as being removed from the court at the time consideration is given to the decision, or does he continue to sit with the board all during that time?


Ralph Osborne Campney: It is my understanding that the judge advocate does not sit with the court when it makes its decision.


Francis Alvin George Hamilton: Under the present procedure, does he not sit with the board during periods of debating the decision, even to the extent of suggesting appropriate lengths of sentences and things like that?


Ralph Osborne Campney: No. I understand a change was made in 1948.


Francis Alvin George Hamilton: I am getting to be an old man; therefore I am not up to date on these things. If there is assurance of that procedure being followed we can possibly say that this clause is satisfactory. What everyone is concerned about is that the judge advocate does not act both as judge and jury. We have talked about setting it up on the basis that it would be closely akin to the civil process of judge and jury. If it is currently in the act or in the regulations- I have not noticed it-that the judge advocate does not sit in at the time the decision is made, I think we can safely say that we have separated the law from the peers of the accused, which in effect may not be a true statement of military law, but it still does what we are trying to achieve, namely to have the accused tried by laymen.


Ralph Osborne Campney: I cannot give the number of the section offhand, but the act now provides that the judge advocate shall not sit with the court-martial when the finding is being considered.


Herbert Wilfred Herridge: Some four or five years ago it was brought to my attention that a permanent army sergeant had stolen a jeep
Canadian Forces Act
engine and that he had been court-martialled. The finding of the court-martial was that he was to lose 52 days' pay and retain his rank. This was brought to my attention by other members of the armed forces. I took it up with the proper authorities and they told me I was all wet, it was not true. Anyway, after investigation they found out that it was true. It had a rather bad effect on the other men concerned with military discipline and things of that sort. Will this section prevent the recurrence of such a situation as that?


Ralph Osborne Campney: The punishment awarded, whatever it may be, is entirely in the hands of the court. The judge advocate has no part to play, nor has he any right or duties in connection with the imposition of punishment, except to ensure that it is a legal punishment. While I do not know the facts of the case to which the hon. member has referred, it might be just a bad judgment of the court. I am not familiar with the case.


John Borden Hamilton: This is an
observation on this section. In keeping with the general trend of thought about the death penalty in connection with offences under the civil law, has the department given any consideration to making it necessary to have a unanimous verdict of a general court-martial before the death sentence may be imposed?


Ralph Osborne Campney: No; 1 must say we have not given any serious consideration to changing the law in that respect. A death penalty awarded by a court-martial must of course be approved by the governor in council, which means that a review takes place.


John Borden Hamilton: In connection with a matter as serious as this, and having regard to the legal history behind the death penalty and the jury's verdict, might I suggest that the department consider under the circumstances that the two-thirds vote which may impose a death penalty be changed to a unanimous vote of the general court-martial. I might refer to the fact that an appeal which may be made to the minister here is no different from an appeal that eventually may be made to the governor general in council in connection with criminal offences.


Harold Edward Winch: May I suggest that if the advice of the hon. member who has just spoken is followed by the Minister of National Defence, if he has any ideas on the subject whatsoever and takes the advice that has been offered he should make his representations before the joint committee of

Canadian Forces Act
the Senate and the House of Commons which is now sitting on the question of capital punishment.


Colin Cameron: I do not know whether I misunderstood the minister just now when he said that the imposition of any sentence was entirely within the power of the court. Does that mean that there is no limit on the kind of sentence that they may impose, or is there a limitation such as we have in the Criminal Code?


Ralph Osborne Campney: There are limitations. What I was trying to point out was that the judge advocate has no power to decide the question of sentence; that is entirely a matter for the court-martial. I was trying to divide the two points.


[Stage Direction]
Clause agreed to.
On clause 8-Authority.
John Borden Hamilton: Perhaps the minister will explain the reason for the addition here.


Ralph Osborne Campney: This is an attempt to cut down the time and expense involved in appeals under certain circumstances, by reducing the number of appeals. As the law stands now the court-martial appeal board may find an appellant guilty of an included offence or on an alternative charge, but in such a case it cannot impose a greater sentence than that already given. This is to provide that the minister or some other authority which he may appoint can do these two things himself rather than sending the case to the court-martial appeal board. In other words, if he sees or his officials see that a case has gone wrong and the court-martial appeal board will undoubtedly substitute another finding, he can himself do that and avoid the loss of time and the cost involved in an appeal. It is felt that this provision will be in the interests of justice and will reduce the number of court-martial appeals.


John Borden Hamilton: This clause certainly does grant fairly wide administrative powers to the minister. I can appreciate the additional wording in connection with subclause (b) (i) which reads:
The tribunal could on the charge have found the offender guilty under section 120 of that other offence,-
Here of course we have a relationship to the types of offences which are committed. Ordinarily, it is the case of the minister making a decision on a lesser offence than

that with which the man was originally charged. The second part of the additional section reads:
The tribunal could have found the offender guilty of that other offence on any alternative charge that was laid.
Here we have the situation where some other type of offence might have been laid without there being any relationship to the first offence. In all fairness we might have evidence which had very little to do with the alternative charge laid, yet the minister is to be granted full authority to convict on another charge which apparently was either set aside, was not heard or was disposed of probably in some cursory manner. Here we have the minister having the right to reinstate under this section. Is there any particular reason why those words should be included?


Ralph Osborne Campney: I should like to make three observations. First, under no circumstances can the minister increase the punishment. Second, the man may still appeal if he wants to; he does not have to accept this disposition of his case. Third, as regards an alternative charge, I understand that practically speaking that would mean a lesser charge. The two charges which the hon. member mentioned are different charges; they are not alternative charges but are based on two different sets of facts. It seems to me that the permissive power to be given under this section could not possibly prejudice the accused and it might possibly shorten his agony as to what is going to happen to him.


Mr. Nowlan:: It is clear that this can be done only with the consent of the accused; the minister cannot substitute a conviction for one offence after the accused has been convicted in error on another. I am thinking of the man who has been convicted in error, as the section says, or on insufficient evidence.


Ralph Osborne Campney: His consent is not required.


George Clyde Nowlan: Do I understand that the minister can substitute a conviction for another offence without consulting the accused, when possibly if the accused went through on appeal he could win an acquittal?


Ralph Osborne Campney: The only offence to which we need address ourselves is an included offence or an alternative offence charged in the information. If one of these lesser charges is substituted the accused can still appeal in respect of that charge.


George Clyde Nowlan: I realize that clause (a) is a recapitulation, but we are passing it now and it covers a situation where a man has been convicted illegally or where his conviction cannot be supported by evidence. That is

going a long way. In other words there is no evidence to justify his conviction, yet the minister is given the power to convict him for some other offence when it appears from the evidence the service tribunal was satisfied with the facts established. If they made an error in the first place they might very easily make an error in the second place. I think the minister should not be able to substitute a conviction where a man might want to appeal and take his chances on getting acquitted entirely; instead of being convicted of murder the minister might convict him of manslaughter, just to use a simple expression.


Ralph Osborne Campney: The powers under discussion are vested in the appeal board. This is merely a narrow selection of cases where it appeared obvious the minister might properly act. If in the circumstances mentioned by the hon. member the minister, having all the facts before him, substitutes a lesser offence he still has 14 days to appeal if he wants to.


Douglas Scott Harkness: I do not understand the phrase in line 13 which reads "if it appears that the service tribunal was satisfied of the facts".


George Clyde Nowlan: When they made a mistake.


Douglas Scott Harkness: There is no transcript made of their proceedings and observations. It might be that two members of the court-martial board might think a man was guilty and another member might not think he was guilty. There might be quite a bit of discussion before they eventually come to a majority decision. I do not see how it can be said "if it appears that the service tribunal was satisfied of the facts" particularly when you are going to change the offence. I do not see how it is possible to say that they are satisfied or not satisfied.


Ralph Osborne Campney: When a service tribunal comes to a decision, whatever it may be, I think it must be assumed that they are satisfied as a tribunal of the facts on which they have reached a decision. It seems to me that under those circumstances this clause does have a meaning, because if certain facts are required to prove a certain offence and a man is found guilty of that offence, I think one might be permitted to deduce that those facts were accepted.


Douglas Scott Harkness: I assume that what you are going to do is take the transcript of the evidence at the trial and decide from the evidence as to the facts. If the tribunal have found him guilty of a charge on which they could not properly find him guilty you are
Canadian Forces Act
going to say that the facts as shown in the transcript are correct and find him guilty on another charge.


Ralph Osborne Campney: I think the minister is limited in this case, as the tribunal would be, to the charges that are laid. He cannot substitute new charges; you have to work within the charges laid or within the included charges which are set out in section 120. You are not permitted to substitute new charges and prejudice the man's position. We must go back to the point with which I started, that consent is not being asked to permit the minister to change the charges or to give additional punishment or to do anything more harsh to the man than he is faced with under the existing circumstances.
This provision if enacted will enable the minister to obviate all the expense and time involved in holding a court-martial appeal board hearing and to come to a decision which is obviously the proper one on the facts. We have had eases where a new trial would be onerous and probably would get nowhere. By the time the matter was reheard witnesses might have disappeared and so on. I should like to give assurance that this is not an attempt on the part of the minister to pre-empt the rights of the court-martial appeal board, but to expedite decisions of cases on the facts.


Douglas Scott Harkness: Perhaps the minister could make this clearer by giving us a definite example of how this subclause (a) would apply.


Ralph Osborne Campney: The section to which I referred gives an example. A person charged with attempting to desert may be found guilty of being absent without leave. It involves a question of intent. As any lawyer will know, there are all kinds of offences where a lesser offence is included in the greater. That is where some of the judges go wrong, when they find a man guilty of a greater offence than the facts might reasonably warrant.


Douglas Scott Harkness: I think the examples the minister gave would be more applicable to
(b)	than to (a). I can see where they would be applicable as far as (b) is concerned but, unless (a) and (b) cover the same ground, I do not quite see how they apply to (a).


Ralph Osborne Campney: As a matter of fact I must say that the two sections cover largely the same field, but (b) is probably more detailed and specific than (a).

Canadian Forces Act


John Borden Hamilton: I would say it is wider.


Ralph Osborne Campney: More detailed, too.


Colin Cameron: I wonder if the minister could tell us how he defines the word "finding" in subclause (a). I am not a lawyer and I do not know, but I would have thought that in the case of a charge there are only two things that can be done; either the charge is proved and the accused is convicted or the charge is dismissed and he is acquitted. How can you bring a new finding relating to the same charge? I admit it is something I do not understand.


Ralph Osborne Campney: A man might be charged with stealing, for example, and he might be found guilty of improper possession. A question of motive may be involved. Or he may be found guilty of attempted robbery when he has been charged with robbery. They are gradations of the same basic offence.


Colin Cameron: With all respect, Mr. Minister, I suggest that you are speaking now of an alteration in the charge. Subclause (a) refers to the same charge. You have to find a new finding on the charge of robbery, not a new charge of illegal possession of goods. I submit that there can be only one other new finding, and that is the dismissal of a charge.


Ralph Osborne Campney: It has always been my understanding that if a man is charged with a serious offence such as robbery it is open to the court to find him guilty of attempted robbery or a similar crime of lesser degree than robbery on the facts as they are brought out. That is a new finding, but it is a lesser finding based on the set of facts.


Colin Cameron: Is that not what is set out in subclause (b) ? It does not seem to apply to subclause (a).


Ralph Osborne Campney: As a matter of fact, perhaps it would be helpful to the hon. member if I dealt with one other section of the act which may clear up the question of a finding in relation to a previous finding. Section 172, subsection 1, says:
The minister, and such other authorities as he may prescribe or appoint for that purpose, may substitute a new finding for any finding of guilty, made by a service tribunal that is illegal-
That is, in his opinion.
-or cannot be supported by the evidence, if the new finding could validly have been made by the service tribunal on the charge and if it appears that the service tribunal was satisfied of the facts establishing the offence specified or involved in the new finding.
That is how the section stands at present. The proposed clause would apply it to other
[Mr. Campney.)
cases where, in the opinion of the minister or an authority appointed by him, a new finding should be substituted.


Colin Cameron: So far as I can
judge it is the very same thing as we have in front of us.


Ralph Osborne Campney: I probably should have said that the part I read is the present (a) part of the section. Part (b) is only to elucidate, extend and clarify, and I do not see that any great change of principle is involved.


Douglas Scott Harkness: The only difference that I can see between (a) and (b), after all this talk about the matter, is that in (a) this change is made to a lesser finding if it appears that the service tribunal was satisfied with the facts, whereas under (b) they provide that the minister or whoever he appoints can substitute another finding if it appears that the facts prove the accused guilty of that other offence. In this first case, as I said a short time ago, it seems that if the majority of the court found this man guilty of an offence which they legally could not find him guilty of, the minister may then find him guilty of a lesser offence on the facts which the transcript of evidence would show these people had accepted. In this second case what is the situation, that the facts proved him guilty? Does the minister or the officer appointed by him just take the transcript of evidence and hold a new trial on it himself?


John Borden Hamilton: As it is now
six o'clock, could I suggest that the minister might bring us after recess an example or examples of what might happen in each one of those subsections in that section? As I see it, dealing with (b) (ii), I think there is an extension when you deal with any alternative charge.


Edward Turney Applewhaite: Shall clause 8 carry?


An hon. Member:: No.
At six o'clock the committee took recess.


[Stage Direction]
AFTER RECESS

The committee resumed at eight o'clock. The Chairman: When the committee rose at six o'clock clause 8 was under discussion. Shall the clause carry?
John Borden Hamilton: I think we had asked before recess that the minister obtain

for us some examples of the various methods of handling more than one charge under paragraphs (a) and (b) of the section.


Ralph Osborne Campney: Yes. We were all possibly getting a little bit confused with respect to this section. The hon. member for York West suggested that I might prepare an example under each of the subclauses (a) and (b) (i) and (b) (ii) illustrating how we would deal with a situation under each of those subclauses. This I have attempted to do during the dinner hour, and possibly it will be helpful to us.
Under subclause (a) a man charged with desertion may, under the power granted by section 120 of the National Defence Act, be found guilty of absenting himself without leave. If a man is convicted of desertion and, on review, it is found that there is no evidence of intention-something which is, of course, an essential ingredient of the offence of desertion-the minister may, under clause
(a)	, on the same facts substitute a finding of guilty of absenting himself without leave.
If I may, I shall now turn to subclause (b) (i) and consider the case of a man charged under section 76 with using threatening language to a superior officer, but who could be found guilty of behaving with contempt or of using insulting language to a superior officer. If he is convicted of using threatening language and there is not sufficient evidence to establish this fact, there may, however, be sufficient evidence that he behaved with contempt or used insulting language. Under clause (b) (i) the minister could, under such circumstances, substitute a finding either of using insulting language or of behaving with contempt, whichever the record appeared to support.
To come to subclause (b)	(ii), a man
charged with theft and alternatively with negligently failing to account for property set out in the theft charge, might be originally convicted of theft. But the record might disclose that the evidence adduced in support of the theft charge actually showed a failure to account, and that this failure arose out of negligence rather than from wilful misappropriation which is, of course, an essential ingredient of a conviction for theft. If it was felt that the record did not support a finding of wilful misappropriation-that is theft-the minister could, under subclause
(b)	(ii), substitute a finding of guilty on the charge of negligently failing to account.


William Alfred Robinson: Shall the clause carry?


Edmund Davie Fulton: No, Mr. Chairman. In the light of the explanation given by the minister, * does it not appear as a fact that the minister
Canadian Forces Act
may in effect quash a conviction where a charge has been laid in the alternative? Where the court has found that the accused is not guilty of one branch of the alternative but is guilty of the other, does it not follow that the minister could quash that conviction and sentence the accused on the charge on which the court found him not guilty?


Ralph Osborne Campney: I am informed that the practice is that where a man is convicted of an offence the alternative offences are not dealt with. The first review, as a matter of fact, of every conviction is made by the judge advocate general. Each conviction is reviewed by him, and the judge advocate general advises me if there is any reason to do so. This section is for the purpose of permitting expeditious handling of certain cases where the facts and the record warrant a change and where it is obvious what will happen if the case goes on through the long procedure to the court-martial appeal board.


Edmund Davie Fulton: The thing that bothers me is this. If a man is accused of alternative charges, one the major charge and the other the lesser, I should like to know what the explanation is of the fact that if the court finds him guilty of the lesser charge the minister may nevertheless in effect quash that finding because it is illegal, or because it cannot be supported by the evidence, and find him guilty of the major charge. That is the thing that bothers me.


Ralph Osborne Campney: Practically speaking, it is not open to me as minister to find a man guilty of a major charge if the court has found him guilty of a lesser charge. In practice it works only the one way. I can find him guilty of the lesser charge if, on the advice of the judge advocate general, I do not think the facts warrant a conviction on the greater charge.


Edmund Davie Fulton: I am glad of that assurance, but I wonder if the minister could just carry it one step further and point out to me-and I am sorry to be obliged to delay him-the basis upon which he says it works in that way. I shall be glad to think it works in that way, and I shall be glad to know it works in that way. I just want to be convinced that you can only substitute for the sentence of the court a conviction on a lesser charge.


Mr. Churchill:: While the minister is thinking about that matter, may I ask this question. Would not the word "lesser" substituted for the word "other" meet the suggestion of my hon. friend?


Edmund Davie Fulton: Why not substitute "lesser offence" for "some other offence".

Canadian Forces Act


Ralph Osborne Campney: I am informed that the use of the word "lesser" would mean changing a whole series of sections throughout the act. The phraseology in this particular clause agrees with the general phraseology of the act. I think it is quite clear that where a number of charges are laid the major charge is the one on which the man is tried. If the court does not reduce the charge to a lesser one, then it is still open to me to do so, on the advice of the judge advocate general, after perusing the record.


Edmund Davie Fulton: What I am asking is this. On what authority, under this clause, does the minister say that he cannot quash the finding of the court and direct a finding that the accused is guilty of the major charge? Suppose he is charged with A. I am not using legal phraseology here. Suppose he is charged with A or B or C, and that A is the major one. Suppose the court finds him not guilty of A but guilty, let us say, of B. What I want to know is this. Where is the authority for the statement the minister has made that he cannot quash that conviction and direct a verdict of guilty under A? The minister has told me that he cannot do it. I shall be glad to be convinced that he cannot do it, but I want to know the authority for it.


John Borden Hamilton: Might I interject at this point that if I read section 175 properly, even though the conviction might be on a higher charge, as I understand section 175 the punishment could be no greater than that which was previously handed out on the alternative sentence.


Ralph Osborne Campney: That is right. Under no circumstances could I increase the punishment.


John Borden Hamilton: That would answer my hon. friend's question.


Edmund Davie Fulton: No, it would not answer it at all. I say that with respect. I am sorry to differ with my hon. friend. I think it is an important principle that a man should not be found guilty and convicted of a major charge w'here the court itself has convicted him of a lesser one. I want to know on what authority the minister said he cannot convict him of a greater charge. That is all I want to know. I am not concerned with sentences.


John Borden Hamilton: Under those circumstances my observation would not apply. I think my hon. friend is quite right.


Ralph Osborne Campney: I must say that charges are not set out in the act as greater and lesser. While it is theoretically possible that the minister might find a man guilty on what some people would call a greater charge, the governing factor is he could not give him a greater sentence than that given at the first
[Mr. Fulton.1
trial. Practically speaking the charges would be graded downward. If the minister were to find that a man had been properly convicted on a major charge he would let the conviction stand. It is only where he thinks the major charge, if you wish to call it such, has not been proven that he might find the accused guilty of the lesser offence.


Edmund Davie Fulton: What happens in a case where a man pleads guilty to one of these alternative charges? Can the minister find that the evidence does not warrant that plea, reverse the plea of guilty and direct a plea of guilty on one of the other charges?


Ralph Osborne Campney: I do not see how that case could arise, because there would be no evidence at all taken for the minister to review.


Edmund Davie Fulton: Oh, yes, there might be. A plea of guilty might be entered after the prosecution had completed the submission of its evidence. I will put it this way. I was not able to follow the reasoning of the minister as to why the word "lesser" could not be substituted for the word "other". The minister referred to a whole series of sections and said that the wording would require changes. But as this itself is an amendment why would that be necessary? Why would the word "lesser" not be accepted?


Ralph Osborne Campney: I think for the simple reason that throughout the act offences generally are not graded. They are bracketed in groups, but they are not graded under the terms "lesser" or "greater", or any such terms. If you insert into the act the word "lesser" you will be in a good deal of trouble with respect to other sections.
Clause agreed to on division.
Clauses 9 and 10 agreed to.
On clause 11-Exercise of chairman's powers by other members.


George Randolph Pearkes: Clause 11 enables the chairman of the court-martial appeal board to delegate his powers and functions to any other member of the board but, as set forth in section 190 of the act, there are certain qualifications laid down for the chairman of the board. Under subsection 2 (a) the chairman must be a judge of the exchequer court or of a superior court of criminal jurisdiction. It is not necessary for all members of the appeal board to have those qualifications. Surely if the chairman of the appeal board is going to delegate his powers to another member of the board that member should at least have the same qualifications as are required of the chairman.


Ralph Osborne Campney: The act provides that certain procedural matters are to be dealt with

by the chairman of the board. As a matter of fact he has found it very difficult at times to arrange hearings, sittings and so on. It is only his powers as chairman that are involved, not his powers as a member. He has found it very difficult at times to make such arrangements promptly, bearing in mind his other duties. The present chairman is Mr. Justice Cameron of the exchequer court, and he has asked that some provision be made so that interlocutory matters, disposition of details of hearings, subpoenaing witnesses and so on, may be dealt with by one of the other members of the board.


George Randolph Pearkes: I quite understand the
desirability of an alternative chairman or some other member of the board being able to assume the duties of the chairman, but surely that other member should have the same qualifications as are laid down for the chairman, because the act says very clearly that the chairman must be a judge of the exchequer court or of a superior court of criminal jurisdiction. You might have a member of the board who was not a judge of the exchequer court or of a superior court of criminal jurisdiction who would be acting chairman. It seems to me if you are going to delegate the powers of the chairman you should at least delegate them to somebody having the same qualifications as are required of the chairman in the first instance.


Ralph Osborne Campney: Subsection 2 (b) of section 190 provides that a member of the court-martial appeal board other than the chairman must be a judge or retired judge of the exchequer court or of a superior court of criminal jurisdiction, or a barrister or advocate of not less than five years' standing.


George Randolph Pearkes: Exactly; so that you might have a barrister or advocate with five years' experience acting as chairman when the chairman himself must be a judge.


Ralph Osborne Campney: I do not see that any prejudice is created by the fact that the actual chairman, who has superior qualifications if you like, is temporarily otherwise engaged. The work of the court must go on.


Edmund Davie Fulton: Would it meet the point the minister and the department have in mind and at the same time preserve the principle the hon. member for Esquimalt-Saanich has in mind if you inserted the word "administrative" before the word "powers"? I take it what is in mind there is merely to give to someone else power from time to time to administer this board so the personal attention of the chairman will not always be necessary while the chairman is engaged in his duties as a judge of the exchequer court.
Canadian Forces Act
Would, therefore, the insertion of the word "administrative" meet the one point while preserving the other principle?


Ralph Osborne Campney: I do not know what the definition of that word would be in this act.


Edmund Davie Fulton: I am thinking of the intention.


Ralph Osborne Campney: It seems to me that the calibre of the chairman of the court-martial appeal board is such that the matter can be safely left to him. I have told hon. members what is the view of the present chairman, and what he has in mind. I think the same would also be true of any subsequent chairman. I do not see that any prejudice will arise from this power of delegation which is being sought at the request of the present chairman.


George Randolph Pearkes: I still come back to this point. Could the section not be limited so as to provide that the acting chairman must be a judge or ex-judge, and not merely a barrister or advocate of not less than five years' standing?


Ralph Osborne Campney: In view of the difficulty we have now in finding judges for extra work of this nature, we ought not to make it more difficult. I am very sure in my own mind that this power will only be used by the president of the court in a reasonable and sensible way, and I do not think I would want to change the scope of this authority.


Edmund Davie Fulton: The minister may not appreciate the point that the original intention of the act was to appoint a person of judicial experience as chairman of the board. Then to assist him there may be appointed as members of the board those who have had judicial experience and, as additional members, barristers who have had at least five years' experience as practising barristers or advocates. In other words, the whole effect of the scheme is to ensure that as chairman and senior members of the board there will be persons who have already had judicial experience.
This section, if the proposed amendment carries in its present form, opens up the possibility that in place of the chairman, who must now be a judge of very considerable experience, you may appoint a man who has had no judicial experience at all. This might not be the intention, or the minister might believe it is something that will never take place, but it is a possibility. I submit in all seriousness that we have to examine what may be the effect of the statute. I am sure it would not be a desirable effect if the power and functions of this man of experience and judicial capacity be capable of delegation to a person of no judicial capacity.
3150	HOUSE OF
Canadian Forces Act


John Borden Hamilton: I should like to add to the remarks of my learned friend -at least, my hon. friend-


Edmund Davie Fulton: Learned and honourable, I hope.


John Borden Hamilton: Both. I think his argument is very sound, especially in view of the fact we lead up to this clause through a maze of sections giving what might be described as very wide discretionary powers, considerably wider, I think, than one would find in most legislation dealing with our civil courts. With all due respect to the members of my profession, I do not believe any of us would be very happy to place in the hands of a man who is qualified to be a member of this appeal board on the basis of having had five years' experience as a barrister the wide powers which have been set out for the chairman of the board. I believe the criticism is on very sound ground. I believe it should be indicated in this legislation that the person to whom the powers were to be delegated should have the same qualifications as the chairman himself.


Ralph Osborne Campney: As a matter of fact-


George Randolph Pearkes: I was just going to call attention to this, that this court-martial appeal board has only recently been set up. I feel it is an excellent measure which was introduced about two years ago. Prior to that the appeals went to a very senior and experienced army, navy or air force officer, as the case might be. These are appeals from general courts-martial on which one would expect senior officers with experience to be sitting, with legal advice behind them. In years gone by when there was an appeal by the man who was convicted that appeal received the most careful consideration from very experienced senior officers.
This appeal board is an alternative way of dealing with the appeal. I have no objection to it, in fact I believe the appeal board is good. But I do believe some degree of experience should be expected from the appeal board, and particularly from the chairman of that board. In fact the original act provides for that by saying that the chairman must be a judge. This amendment is going to allow a barrister or advocate of very junior capacity to act as chairman. All that is required is five years' experience as a barrister, and he may be a man junior in experience and in age to the chairman of the original court-martial. It seems to me that in order to do justice to the serviceman who is appealing, the serviceman should have the right to have his appeal heard by a man of eminent judicial capacity.


Ralph Osborne Campney: The chairman of the court-martial appeal board has, I think, three main duties. First, he has the duty under section 195 to make the rules of court which have to be approved by order in council. This is not necessarily a continuing function, although he must continually observe and determine whether any changes are required.
Then under section 190 he has to preside at all sittings of the board unless he delegates another member to preside in his place.
Again under subsection 4 of section 190 we find:
The minister may require the court-martial appeal board to sit and hear appeals at any place or places, and the chairman of the board shall arrange for sittings and hearings accordingly.
This is where the chairman finds that he gets into difficulty sometimes, because he cannot devote his full time to checking these detailed arrangements. It is in regard to that particular section that he would like to have the authority to delegate his power. In respect of the first two powers, if he wants to change the rules such changes must be approved by the governor in council, and on the question of presiding he can now nominate any of his co-members to be chairman for the time being.


[Stage Direction]
Clause agreed to.
Clause 12 agreed to.
On clause 13-Execution against officers and men.
John Borden Hamilton: I gather that this section is designed to enlarge the rights of creditors against members of the armed forces in so far as the execution of judgments obtained in the civil courts is concerned. Perhaps the minister might let us know if this section does provide an opportunity to garnishee wages, or if that is excluded? I cannot tell from reading the section whether or not there is any restriction in that respect. If the section does permit that, is it something that is desirable?


Ralph Osborne Campney: The proposed amendment does not permit garnishee proceedings, the reason being that in garnishee proceedings you are really suing the crown. This amendment does not alter that position.


John Borden Hamilton: Clause 13 reads:
No judgment or order given or made against an officer or man by any court in Canada shall be enforced by the levying of execution on any arms, ammunition, equipment, instruments or clothing used by him for military purposes.
This would appear to be an all-inclusive restriction and the only one which would confront a creditor. Is there a restriction

on the pay contained in some other legislation that the minister may be able to inform me about?


Ralph Osborne Campney: I do not think any section of this act deals with that matter. It is just a general principle of law that you cannot garnishee the crown. This proposed section exempts from execution only those articles of equipment of which the man has possession.


John Borden Hamilton: The net result is that we have a situation where the ordinary creditor has access for execution to everything except what might be considered military equipment, but is there a restriction in the general sense on proceeding against it.


Ralph Osborne Campney: According to the section.


[Stage Direction]
Clause agreed to.
On clause 14-Offences committed outside Canada.
Douglas Scott Harkness: This clause has to do with the jurisdiction of civil courts. Can the minister tell whether this is a practical sort of provision? I am wondering, for example, how the witnesses to a crime committed outside of Canada, we shall say, perhaps in Korea, in Germany, or some place else, could be brought here to give evidence before a court in Canada? This provision provides that a civilian with the forces who commits a crime outside Canada can be brought to Canada and tried in any court in Canada. It does not seem to me to be a practical provision from the point of view of witnesses.


Ralph Osborne Campney: This is in the nature of a permissive section. In each case it would have to be decided whether in the interests of economy, availability of witnesses, etc., it would be better to have the trial overseas or have it here. For example, this fall we shall be rotating a whole brigade. There might be some outstanding litigation involved. With respect to the air force, the change is gradual; it goes on all the time. There are cases where it would obviously be better and more effective to have the trial here although the offence took place abroad. The purpose of this section is to permit the decision to be made as to where the trial shall take place, on the grounds of economy and effectiveness.


Wallace Bickford (Wally) Nesbitt: I have a question to ask the minister on procedure. When it is decided that the trial shall take place in Canada, who sets the venue for the trial? Has the accused any appeal respecting the change of venue if the place of the trial does not suit him?


Ralph Osborne Campney: I think the ordinary rules would apply. In the first instance the judge
Canadian Forces Act
advocate general would select the place where the charge is to be laid. The accused can then always apply for a change of venue, just as in civilian procedure.


John Borden Hamilton: I am wondering whether there is a tendency toward extraterritorial effects in this clause. That is, in the first instance will the accused have any choice as to whether he should be tried by the courts of the jurisdiction in which the offence takes place? I assume he would be regarded in the category of a civilian attached to the armed forces, and the charge would simply be laid under the armed forces act and he would have no choice as to where he would be tried.


Ralph Osborne Campney: I do not think the accused would have any choice as to whether the trial should be here or abroad, if I understood the hon. member correctly. In most cases, practically speaking, it is the judge advocate general who would elect. There is no desire to interfere in countries abroad with which we have treaties. But as I said a few moments ago, there may be a few cases where it would be better to have the trials here.


Wallace Bickford (Wally) Nesbitt: This goes back to a question I asked the minister a bit earlier. I am curious about this, since I presume from what the minister said that the judge advocate general sets the venue. Would it be set on the principle that it should be held some place near national defence headquarters, around Ottawa, or what would motivate the judge advocate general when he set the venue? I believe the minister said that if the venue of the trial were not suitable to the accused he could move under the ordinary rules of procedure to change it; but he could only change within the province where it was originally set, according to our rules of criminal law. It brings up the question whether this whole clause legislates with regard to procedure rather than substance. For instance, if for various reasons the judge advocate general picked Ottawa, which is in Ontario, as the venue, and the accused wanted the venue moved to British Columbia, under our present rules he could not move for a change outside of the province in which he lives.


Ralph Osborne Campney: I think the jurisdiction, if you wish to call it such, of the judge advocate general would be purely administrative. This has to do with civilians and the information in each case would naturally be laid in the place from which the person came. But someone has to decide this matter. If a civilian

Canadian Forces Act
went abroad from Kingston the charge in all probability would be laid in Kingston. It is just a case of someone having to be responsible for initiating the matter.


Wallace Bickford (Wally) Nesbitt: I follow the minister's remarks. That part is quite clear. But suppose the charge was laid in Kingston, as the minister suggested in his example, and the accused desired to have the venue changed to Winnipeg, let us say, which is outside of Ontario, under what procedure could that be done?


Ralph Osborne Campney: It could not be done. If he came from Kingston he would not be tried in Winnipeg. You do not change the venue from one province to another except under very exceptional circumstances.


Wallace Bickford (Wally) Nesbitt: I gather from the minister's remarks that under ordinary circumstances, if the charge were laid in Canada under this clause, it would normally be laid in the province from which the accused came.


Ralph Osborne Campney: That would be true, yes.


John Borden Hamilton: In connection with the jurisdiction under this legislation, is there generally an agreement among the various countries covering the situation so there is no dispute as to the jurisdiction in which the actual offence took place? I am thinking of an alleged murder taking place in the United States when a group of our forces may be down in Seattle or some place like that. Is this type of clause and this type of jurisdiction recognized by the United States in a case of that kind?


Ralph Osborne Campney: Yes, Mr. Chairman; the NATO status of forces agreements which have been signed by most of the countries concerned set out in detail the jurisdiction and powers.


[Stage Direction]
Clause agreed to.
On clause 15-Woman deemed to be widow.
George Randolph Pearkes: Clause 15 deals with amendments to the Defence Services Pension Act, and the first amendment introduced in this clause is to make provision for the common law wife of an officer in the services to receive a pension on the death of the officer with whom she had been living.
It will be recalled that the Defence Services Pension Act is divided into five parts. Part I deals in the main with army officers; part II has special reference to the navy; part III has special reference to the air force, and part V deals with those personnel who entered the service since March, 1946. Therefore this particular amendment deals
[Mr. Campne.v.l
solely with the common law wife of an officer who joined the army prior to March, 1946.
I regret exceedingly that the minister should have even thought that it was desirable to introduce such an amendment. The reason given is that this act is being brought into line with the Public Service Superannuation Act, but I submit that there is all the difference in the world between a gentleman holding the Queen's commission and who is expected to exercise powers of leadership, and an ordinary civil servant.
An officer's character should be unquestioned. I do suggest that if an officer is living with a common law wife then his character might very well be open to question, and he will not be able to exercise the same qualities of leadership as a man whose domestic life is above reproach. We know that common law wives are recognized in many respects, and no doubt they came in during the frontier days when a man had to live under pioneering conditions and quite often would take unto himself a native woman.
While life in the army may be considered in some respects as living on the frontier, especially in our northland, the fact is that there is ample opportunity for officers stationed in the north to return to civilization in order to have carried out the ordinary religious ceremony of marriage. There are in the services today hundreds of chaplains of all denominations, and there would be no difficulty whatever in an officer having a priest or chaplain of his own denomination available to carry out the marriage service.
I think it is fundamentally unsound and unwise to lower the high standards required of an officer who is expected to lead men in battle. I know that sometimes during wartime it is necessary to lower some of these standards, when you have to have a wide expansion of officer personnel; but this is dealing with regular army officers, career men who have entered the services with the idea of setting high standards for others to follow. I cannot believe there are many regular officers who were in the services prior to 1946 who would require this particular amendment.
This pension to the widow is not paid as of right, it is paid as a compassionate allowance and is granted under certain definite conditions. There are limitations as to those who may receive a widow's pension. Section 26 of the Defence Services Pension Act sets out the qualifications. First, an applicant must be in the opinion of the minister worthy of a pension. If in the opinion of the minister the applicant is wealthy she will not

receive a pension. And there are other qualifications. Surely high moral qualities are of more importance than wealth. I take strong exception to this amendment, and I hope the minister will see his way clear to withdrawing it inasmuch as it applies to the regular army officers in peacetime.


Ralph Osborne Campney: Mr. Chairman, first I should like to point out to the hon. member that clause 23, which I hope we will be coming to shortly, carries the same provisions in respect of part V.


George Randolph Pearkes: I know that.


Ralph Osborne Campney: The purpose of this clause
probably is not as narrow as the hon. member may be inadvertently suggesting. With the variation in divorce laws, even as between Great Britain and Canada, as well as other parts of the world, we have cases where people have regarded themselves as properly married throughout the great part of their lives. Then the man dies and it is found out that because of the interpretation of the laws of divorce in this country the widow has no pension.
These are not just cases of people living together in defiance of all the laws and conventions of society. A certain number of cases exist such as I have mentioned, where on the death of the spouse the widow finds herself faced with great hardship and difficulty, especially if she is left with a family. I think this principle has been well recognized in our procedure in Canada. It is approved in the Pension Act, the superannuation act, the War Veterans Allowance Act and was also approved in the dependents' allowances regulations.
I think it is well recognized that men and officers serving throughout the world serve under many difficulties, especially abroad, and occasionally find themselves in the position I outlined a moment ago. I would think that a provision of this kind, the principle of which has been well recognized for many years in other acts in Canada, would prove of considerable benefit for officers and men in the services and their dependents.


George Randolph Pearkes: What is the position of a legitimate wife, still living, under the first paragraph of this amendment? Will she get a pension also?


Ralph Osborne Campney: I am informed that a legitimate wife living apart from her husband, unless she is living in such circumstances as would disentitle her to alimony or other support, would normally get the pension. In that case there is no question who would get the pension. There would be only one pension. I think we even fixed that last year for elderly generals.
Canadian Forces Act


Mr. Jones:: What limiting factor is there regarding the service of the officer? Supposing an officer got his commission and served for five years and died; would the widow get the pension?


Ralph Osborne Campney: It would be governed by the rules with regard to pensions. I think the minimum period is 10 years.


Owen Lewis Jones: It is rather misleading to mention seven years where the limiting factor is 10. I am going to suggest that this clause be altered and that the limiting factor be made 10 years. I have in mind a case of a young man, a corporal, who served in Germany for three years. He was killed in an accident, unfortunately, and his widow and two children cannot get a pension or allowance because he had not served for 10 years. Nevertheless he had given his whole life to the service of his country. That is not governed by any act. I think this act should eliminate the 10-year penalty.


William Alfred Robinson: Shall the clause carry?


Owen Lewis Jones: No. I would like the minister to answer.


Ralph Osborne Campney: If I heard the hon. member rightly, I think the situation to which he referred would not be a matter for the Defence Services Pension Act which we are now amending but the Pension Act itself.


George Randolph Pearkes: Surely service under part I is for 25 years. He must serve 25 years, unless he is compulsorily retired at 20 years.


Alfred Johnson Brooks: I was going to ask, Mr. Chairman, about subclause 2. It seems rather drastic. It says:
If, upon the death of an officer or former officer, it appears to the treasury board that the widow of that officer had, for a number of years immediately prior to his death, been living apart from him under circumstances that would have disentitled her to an order for separate maintenance under the laws of the province in which the officer was ordinarily resident, and if the treasury board so directs, having regard to the surrounding circumstances, including the welfare of any children involved, she shall be deemed, for the purposes of this act, to have predeceased that officer.
That section, Mr. Chairman, really makes the treasury board the judge. It says, "if it appears to the treasury board". It does not have to be proven to the treasury board, and there does not have to be a court order or anything of that kind. The treasury board can simply say that this widow in their opinion is not entitled to maintenance and can even take it away from her children. I wonder if more proof is not required than seems to be suggested in this section. Surely there should be a court order of some kind.


Ralph Osborne Campney: From my experience I would say that the treasury board has to be

Canadian Forces Act
thoroughly satisfied as to the rights and merits of any case before it acts. If I read this section correctly it makes it possible for the treasury board, where such action is indicated, to take the pension which a widow would have received and give it to the children. It seems to me that may be a desirable provision. Someone has to make a decision, and the treasury board is familiar with such matters. I would think they can be safely relied upon to make a proper judgment in a matter of this kind.


Owen C. Trainor: May I ask the minister if this provision applies to officers only and not to other ranks?


Ralph Osborne Campney: Clause 23 makes this applicable to other ranks.


Mr. White (Haslings-Fronlenac):: I should like to ask the minister this. Subclause 1 (a) refers to a period of seven years, and <b) refers to a number of years. Would the minister please tell me what is meant by "a number of years"? Is that two or more?


Ralph Osborne Campney: In this subclause, any number of years in the discretion of the treasury board.


George Stanley White: In the
first case, under subclause 1 (a), there would have to be a period of seven years, whereas under subclause 1 (b) two years would be sufficient?


Ralph Osborne Campney: I understand the reason for the seven years in the first part of the clause is that the wife might be entitled to the pension.


George Stanley White: Why is
there any difference in the period of years if we are going to apply this in principle?


Ralph Osborne Campney: Because, I think, the expectation under (a) is that there is a wife, and under the other that there is not.


George Stanley White: But at the
same time under (b) there is nothing to prevent the parties from getting married, whereas there is something in (a), as one of them is married. You are making it much easier under (b).


Ralph Osborne Campney: The two cases are dissimilar because in one case there is a wife to be protected and in the other presumably there is not.


George Stanley White: In regard to the question asked by the hon. member for Royal in regard to the discretion of the treasury board, is there such a thing as an appeal to any court from a decision of the treasury board under this section?


Ralph Osborne Campney: No, there is no appeal from a treasury board decision of this kind.


George Stanley White: Does the minister think that is absolutely fair?


Ralph Osborne Campney: I think experience has proven that it is reasonably fair. I have not heard many complaints about treasury board decisions on these matters. The really important fact in regard to treasury board decisions is that the board has personal knowledge of the regulations and assess these matters carefully. I think their work is done thoroughly and their decisions are completely unbiased. I have not heard any complaints about them.


William Alfred Robinson: Shall the clause carry?


George Randolph Pearkes: On division.
Clause agreed to on division.
Clauses 16 to 26 inclusive agreed to.


[Stage Direction]
Title agreed to.
Bill reported, read the third time and passed.


Ralph Osborne Campney: the second reading of Bill No. 278, to amend the Veterans Benefit Act, 1954.


Alfred Johnson Brooks: Mr. Speaker, is there any comment which the minister wishes to make on this bill?


Mr. C. E. Bennett (Parliamentary Assistant to the Minister of Veterans Affairs):: Sections 8 and 12 of the Veterans Benefit Act, 1954, make available to certain ex-service personnel the benefits of the Reinstatement in Civil Employment Act and of the Unemployment Insurance Act, respectively. Originally, the reinstatement in civil employment provisions were restricted to those who were specially enrolled for the purpose of serving in the special force, or who belonged to the reserve forces and served on the strength of the special force.
In the case of unemployment insurance the provisions were extended to the same two groups and also to members of the regular forces who served on the strength of the special force in a theatre of operations and were discharged on medical grounds while on the strength of the special force.
In 1951 the benefits of the Reinstatement in Civil Employment Act were extended to all persons enlisting for service in the regular forces and who did not serve for more than

three years; and in January, 1953, the provisions of the Unemployment Insurance Act were so extended. It is now felt that circumstances have changed to the point where the granting of these benefits should be restricted to those who have had service in a theatre of operations or who are now members of the regular forces and qualify under the conditions which I have outlined above. The latter are aware that they have this coverage and it is proposed to cover all who will have enlisted before July 1, 1955.
It has never been the policy to consider as veterans those who serve in the regular forces in peacetime and who do so for a career. The other statutes mentioned in the Veterans Benefit Act apply only to veterans who were enlisted for the special 18-month engagement or had service in a theatre of operations.
I might repeat, Mr. Speaker, that the proposals will not affect any entitlement which those now serving may already have under the Veterans Benefit Act.


Alfred Johnson Brooks: Mr. SpeaKer, as I understand it this bill is to be referred to the committee on veterans affairs and no doubt it will be discussed in detail there. As we all know, the Veterans Benefit Act has been amended a good many times. It has been amended practically every year since 1950. As the parliamentary assistant has told us, it was passed in order to allow benefits which were given to veterans of world war II to be given to members of the special force who served in Korea during the Korean war, if we can call it that. I am sure everyone here will agree that this situation is as it should be. Korean veterans should receive and are receiving, we are glad to know, the same benefits as those which were given to veterans of world war I and world war II.
I think it is quite appropriate at this time to mention the fact that these veterans of the Korean war have given a good account of themselves. The last of the troops are now returning from Korea. As a matter of fact I think the last battalion has returned to Canada, and the other troops in Korea will soon be returning home. As we all know, these men gave a good account of themselves, as I have mentioned, in an extremely difficult fighting area, perhaps one of the most difficult in which men have ever had to fight. They have maintained the high standard that Canadian troops have always maintained in war, both in the first war and in the second war.
As to this particular bill-and as I said a moment ago it will be before the committee-there are two outstanding features.
Veterans Benefit Act
One is that it discontinues the benefits under the Reinstatement in Civil Employment Act. The second is the discontinuing of the benefits under the Unemployment Insurance Act. These benefits are discontinued on July 1 of this year. Up to July 1 any man who enlists in the Canadian army will receive the benefits of the Unemployment Insurance Act. Those who enlist after July 1 will not receive those benefits. In other words we shall have two groups of men serving in the Canadian army, namely one group of men who will receive benefits under the Unemployment Insurance Act-and these are of great value-and another group of men who will not receive those benefits.
On the face of it, Mr. Speaker, I must say that there seems to be discrimination there. A soldier coming back now or being discharged from the army, as I understand it, is entitled to 90 days' benefits under the Unemployment Insurance Act. Hence all these men up to July 1 will receive that benefit. It is my understanding that these benefits will not be available to soldiers who enlist after July 1.
I should like to ask the minister just why July 1 was decided upon as a cut-off date. I should also like to have his comment on the criticism I have made on the score of unfairness. I should like to know whether there is some substitution which is being made for the benefit of these men who enlist after July 1 in order to compensate them in the same way as those who enlist before that date. After being in the army for three years, a man turned loose in Canada even at the present time, when we have considerable unemployment, would have a difficult time to carry on and obtain a job.
The parliamentary assistant spoke about the men serving in peacetime. The peacetime as we have it today is entirely different from the peacetime we have had in the past. Today we have what is known as the cold war. Today a young man who enlists for three years might well expect to be thrown into a hot war in a short time. I think these men might be considered. I believe it would be a good thing to continue the unemployment insurance benefits for the men who are enlisting. It would give them a sense of security after their three years' time was up and they retired from the forces. I should like to have from the minister or the parliamentary assistant some comment on these criticisms I have made.


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


Colin Emerson Bennett: Mr. Speaker, there is no particular significance with regard to the date

Veterans Benefit Act
of July 1, 1955. I should like to point out to the hon. member for Royal (Mr. Brooks) that this date applies with reg.ard to men going into the service. Anybody who enlists on or before July 1, 1955 will be covered by those provisions in the Veterans Benefit Act. As the hon. member knows, men are being enrolled and enlisted for terms of three, five and seven years. Hence a person enrolled in the regular forces now would still be covered for the next three years. The date of July 1, 1955 was set so it would not be unfair to anybody. Anyone who enrols or enlists in the regular forces up until July 1, 1955, is covered. The date was set far enough in advance so there would not be any unfairness.
As the minister said when he introduced the resolution, and as I said in the statement I have just made, it has never been the policy to consider as veterans those who serve in the regular forces in peacetime and who do so for a career. The other statutes mentioned in the Veterans Benefit Act no longer obtain or apply to people serving in the regular forces. I do not think the hon. member believes that the unemployment insurance statute or the civilian employment statute should so apply. It is on that principle, that people who follow a regular force career should not have the benefit of the Reinstatement in Civil Employment Act or the Unemployment Insurance Act, that this act is now being amended.


Alfred Johnson Brooks: In reply to what has been stated, may I just say that we now have the Unemployment Insurance Act which covers practically all civilians. We did not have that at one time when men joined the armed forces, but we have it now. My point is that a man who serves for three or five years in the army, and that has been his employment, should be treated just the same as the man who is employed in civilian life. In these days, when we are bringing everything up to date, I think we could very well include men in the army under our unemployment insurance scheme in the same way as we try to include our civilians. That is the point I was trying to make.


Colin Emerson Bennett: Regardless of the merit of the hon. member's suggestion, I think he will admit that it does not come under the jurisdiction of the Department of Veterans Affairs. I would point out to him that the act as it now stands applies only to persons enrolled in the regular forces for three years. At the present time many of the engagements in the regular forces are for five years or seven years, and this act does not now apply to them. If there is any merit in the hon. mem-

ber's suggestion I think it could be raised on. the estimates of the Department of National Defence.


Alfred Johnson Brooks: I shall raise it in the committee.


[Stage Direction]
Motion agreed to, bill read the second time and referred to the special committee on veterans affairs.


Hon. Hugues Lapointe (for the Minister of Fisheries) moved: the second reading of Bill No. 279, to implement a convention on great lakes fisheries between Canada and the United States.


Mr. J. Watson MacNaughi (Parliamentary Assistant to the Minister of Fisheries):: Mr. Speaker, the purpose of the bill is to approve the ratification of the convention on great lakes fisheries between Canada and the United States, and to provide implementing legislation to carry out Canada's obligations arising thereunder. The convention was signed at Washington on September 10, 1954, after prolonged negotiations extending over a period of many years. The fishing interests of Ontario and the government of Ontario were consulted on all aspects of the convention and were represented in the negotiations leading up to the signing of the convention
The purpose of the convention is to improve the great lakes fisheries through co-ordinated action of governmental agencies in Canada and the United States. Over a period of years the decline in some of the principal stocks of fish in the great lakes has been viewed with concern on both sides of the border. The causes of the decline are not adequately known. The sea lamprey has been greatly increasing in numbers and threatening some of the valuable fisheries. The lake trout in particular have suffered from the deprada-tions of this parasite.
At present research in the great lakes area on the Canadian side is being carried out by the federal government and the government of Ontario. On the United States side the federal government and eight state governments are engaged in similar research activities. One of the principal aims of the convention is to co-ordinate all these activities and direct them to common purposes.
The minister made a very thorough and complete statement at the resolution stage, and I do not believe I can add anything at the present time to what he said on that occasion. It is my intention to ask one of the members of the government to move that the

Great Lakes Fisheries
bill be referred to the standing committee on marine and fisheries when it receives second reading.


Joseph Warner Murphy: Mr. Speaker, in view of the fact that the bill not only involves the great lakes area but also involves the federal governments of two countries and the governments of the province of Ontario and eight states in the United States, I should like to make a few observations. The parliamentary assistant has just said that he is going to ask that the bill be referred to the standing committee; therefore I am going to limit my remarks and make them as brief as possible. We on this side of the house welcome the convention and regret that it did not come into existence years ago.
I am one of the members of the house who happen to live on the shores of the great lakes. I live on the shore of lake Huron, and in front of where I live the fisheries are carried on which are the concern of this parliament and are involved in this proposed legislation. Having lived there for some 25 or 30 years I must say that I am a bit more familiar with the difficulties that have been encountered by the fishermen than many hon. members of the house. Figures already placed on the record have revealed a condition that must be corrected, and only through research and co-operation among the higher levels of government will that result be attained.
People have the idea that all a man needs to do is obtain a fishing boat, set out a few nets, haul in the fish and sell them. I have become very well acquainted with some of these fishermen over the period I have lived there, and I know from experience that fate has not been very kind to the fishermen of lake Huron because of the damage caused by the sea lamprey which we are now attempting to overcome. I noted from the minister's statement of last March that some research work has been done. I think it was done around Manitoulin island as a joint co-operative effort of the federal government and the Ontario government, and I believe some degree of success was achieved. I thought the amount of money spent on the project was terribly small for the task involved, because the annual loss to fishermen is in the millions.
I think no one will disagree with me when I say that the fishermen and the two governments had plenty of notice of the condition, and that some measures should have been undertaken at least 15 years ago. The condition is becoming worse. I do not intend to put a lot of figures on the record because I know the department in Ottawa,
through its research facilities, has all the figures available over the years as to the catch of the respective types of fish in the different lakes. But there is one point I should like to mention here. In looking at the figures I have seen it seems to me that some lakes and some particular species of fish are affected more than others. It would seem that the fishermen of lake Huron and lake Superior-no doubt lake Michigan too, though 1 do not know anything about it- have suffered more than the fishermen on the other lakes.
Fishing is not a highly paid profession to begin with. I recall that years ago the fishermen made good money when they could get a decent price. The unfortunate part about the industry is that while there are certain times of the year when they get high prices, immediately after Lent, for instance, whitefish or pickerel for which the fishermen have been getting 55 or 60 cents a pound drop to 5, 10 or 15 cents a pound, and at times cannot be sold at any price. This is startling but true. You cannot see the result of that in the retail stores, but there it is. The fish caught by the fishermen of the great lakes go to great centres such as New York and Chicago. I know that a lot of lake Huron fish goes to New York.
This is an interwoven picture, but I want to deal with Ontario. I believe the Ontario government grants licences to the fishermen and tells them how many nets they may set out. I believe such licences cost about $50 per net and entitle the fishermen to lawfully fish these waters. The minister made a statement that can probably be clarified in committee, because I do not understand it. He said that in Canada fisheries are the responsibility of the federal government. I suppose in so far as the great lakes are concerned that might apply to the distance from our shore United States fishermen may come, and things of that sort. I cannot quite grasp what the statement really means.
I am going to place two or three figures on the record to substantiate the argument that this convention should be operative just as soon as possible. I cannot give the name of the newspaper that was the source of this clipping, but apparently it is from some reliable newspaper. I believe the figures have been reported before in this house. No doubt the department also has figures which substantiate the fact that there has been a severe drop in the catch over the last few years. I recall that years ago we did not have anything preying on these fish, but now each year the catch seems to get less and less. These figures corroborate what the minister said, and certainly substantiate completely the

Great Lakes Fisheries facts put on the record by the hon. member for Elgin (Mr. McBain) in his fine presentation during the resolution stage.
I believe the house will be alarmed to note that in the Georgian bay area, which is part of lake Huron, there was a decrease of 38 per cent in the catch in 1954 as compared to 1953. Certainly this is an alarming situation that commercial fishermen in that area are facing. There was a drop of 41 per cent in the catch of whitefish and that is the fish which, along with pickerel, brings the best price. I am quoting the figures for 1954 as compared with 1953. In northern inland waters there has been a reduction of 10 per cent. In other parts of lake Huron one special type of fish shows a reduction of 8 per cent, and there are greater reductions in the catch of other types of fish.
I just wish to emphasize that these are figures which I know the department will have, together with a great many more. I am satisfied, and I know the department is too, that over the years the figures will show that this curse of the fishing industry has been increasing. I know that today some fishermen even hesitate to set their nets.
There is another item I wish to mention, Mr. Speaker. I realize it is something that probably should be mentioned in a provincial legislature, but because the province is tied in with this government through this convention I think I will make this observation in order that it may be on the record. It is this. Down where lake Huron flows into the river St. Clair at Sarnia or Point Edward we have an alarming situation which is a proper matter for research. These big boats, sandsuckers I think they are called, are allowed to suck up sand and gravel from the bottom of the river. Many people may think that a few boatloads of sand or gravel would not amount to very much. I can only tell you what the fishermen tell me, and they have two complaints about it.
In the first place they say it takes the sand off the beaches in that area for probably 20 miles. It so happens that the only good sand beaches are on the Canadian side and there is a good deal of shale on the other side, so it is our area that is affected. Coupled with the high water we have a terrific erosion problem which is costing the people of this country millions of dollars a year. On other occasions I have mentioned the erosion damage caused by the high lake level, and I have maintained there should be some correction because this high water is caused in part by man-made diversions into lake Superior.
In some areas I have noticed that the fishermen have registered complaints about


these sandsuckers with the Ontario government. It is said they are doing a great deal of damage to the shore line. I say this subject is related to the fulfilment of the desire expressed in this convention. The subject matter may be connected with civil rights and may be under provincial jurisdiction, but since through this convention the provincial government are agreeing to having the federal government act for them in this connection, I am mentioning the matter in the hope that it will be discussed.
There is another matter which is also connected with research that the fishermen in my area complain about. I do not know whether it is the whitefish or trout or pickerel that spawn in the shallow waters along this area, but they are affected by the large amount of sand removed every year by these sandsuckers. Instead of the fish roe being kept in a position where it would hatch, we lose the resultant new fish for lake Huron and other places every year. This process is seriously affected by the removal of this sand and gravel. There are companies who operate fleets of these boats and remove millions of tons of sand and gravel every year. One can readily understand the concern of these fishermen when they see it causing a disturbance to their successful fishing operations.
Everyone would concur in what the minister had to say when he introduced this resolution on March 21, as reported at page 2242 of Hansard. He said that the principal duties of the commission are as follows:
(1)	to formulate a research program with a view of determining the need for conservation measures in respect of any stock of fish of common concern to the fisheries of Canada and the United States;
I think what I have just now said would be concerned with this particular research program. I continue to quote:
(2)	to co-ordinate research and to undertake any research by the commission where necessary;
(3)	to recommend appropriate measures to the contracting governments based on such research;
(4)	to formulate and implement a comprehensive program for the purpose of eradicating or minimizing the sea lamprey menace.
There is no use enlarging upon what the minister said. The facts speak for themselves. I am sure we shall have some further information when we go into committee. I am sure that, because of these paragraphs I have just referred to, this act will bring about more co-operation between the government and the fishermen. I need give only one illustration. The success of this legislation will depend to a great extent on the co-operation of the shore fishermen in distributing small fry, and so on.
In my area we have an unfortunate situation. In Lambton the shore fishermen do not

have proper facilities for launching their boats. We do have there quite a wide stream. This convention will deal properly with the plight of the fisherman, particularly with regard to streams that may have polluted water, and I hope that will include the one to which I refer and have mentioned in previous debates. Some consideration must be given to this branch of our economy so that something is done to provide aid in the areas where the fishermen do not have proper access to the lake. It is feasible and I know the economics will stand it, so I am sure that problem can be solved so the fishing industry of this country may be encouraged. We must provide for them the same facilities that we provide ordinary businesses, that is, access to their business operations. I hope that when this convention becomes operative this one stream, which is very wide and which at one time carried down sugar beet disease, will be kept open as part of the program for promoting a better and healthier fishing industry, not only in Ontario but in all Canada.


Mr. L. E. Cardiff (Huron):: Mr. Speaker, I wish to express my appreciation of the provisions of this bill. Perhaps I should read into the record one of the sections of the bill so that hon. members who are not informed will know what we are talking about. Article I of the convention reads:
This convention shall apply to Lake Ontario (including the St. Lawrence river from Lake Ontario to the forty-fifth parallel of latitude) Lake Erie, Lake Huron (including Lake St. Clair), Lake Michigan, Lake Superior and their connecting waters, hereinafter referred to as "the convention area". This convention shall also apply to the tributaries of each of the above waters to the extent necessary to investigate any stock of fish of common concern, the taking or habitat of which is confined predominantly to the convention area, and to eradicate or minimize the populations of the sea lamprey (petromyzon marinus) in the convention area.
It will not be necessary for me to place on Hansard the figures with respect to the depletion of the trout and whitefish in lake Huron; they have already been placed on the record by the hon. member for Elgin (Mr. McBain), as may be seen at page 2242 of Hansard for March 21. The hon. member for Digby-Annapolis-Kings (Mr. Nowlan) also spoke on the resolution, and a few minutes ago the hon. member for Lambton West (Mr. Murphy), who is situated right on lake Huron, also dealt with the matter.
I do want to inform the house how important it will be to the fishermen of lake Huron if the provisions of this bill are carried out. For the benefit of those who are not acquainted with the county of Huron, may I say that we have between 75 and 100 miles of shore line bordering the county on the southwest side. We have several small
Canadian National Railways harbours that are used especially for refuge by small craft in time of storm. As the hon. member for Elgin has already told the house, lake trout and whitefish have almost disappeared owing to the presence of sea lamprey in these waters, as mentioned in the bill. No doubt they destroy all kinds of fish, but the fact that trout and whitefish have almost disappeared is evidence that the lamprey prefer the best we have, namely trout and whitefish.
With the assistance mentioned in the bill and the agreements to be entered into by the dominion and the province of Ontario, hundreds of Huron fishermen in a very short time, we hope, will be able to get a creditable catch of trout and whitefish in lake Huron.
We in Huron need a lot of money spent on our harbours, but that has nothing to do with this bill. At a later date, I shall have something to say on that. Men in Huron depend on fishing to make their living. This bill will help them greatly. I sincerely hope that when the bill goes to committee, if amendments are found necessary the minister will give careful consideration to them. Like our forests, we must conserve our fish if we are to continue to enjoy them as a necessary part of our diet.


[Stage Direction]
Motion agreed to, bill read the second time and referred to the standing committee on marine and fisheries.


George Carlyle Marler: that the house go into committee to consider the following resolution:
That it is expedient to introduce a measure to consolidate the various enactments relating to Canadian National Railways into one statute, also, to provide that the Canadian National Railway Company may operate a telecommunication system, to authorize officers and employees of the Canadian National Railways to act as directors of partially-owned companies, to authorize the company to construct short lines without specific parliamentary authority and to operate motor vehicles and further to make provisions for extinguishing charters of constituent corporations.
Motion agreed to and the house went into committee, Mr. Applewhaite in the chair.


George Carlyle Marler: Mr. Chairman, the primary purpose of this proposed legislation is to consolidate the legislative provisions relating to the Canadian National Railways. These provisions are to be found in a number of statutes, the Canadian National Railways Act, Canadian National-Canadian Pacific Act, Canadian National Railways Capital Revision Act, and various other laws which include

Canadian National Railways legislation relating to railway financing and construction of branch lines, and even old acts relating to the Grand Trunk Railway. As it is often found necessary to refer to these provisions in order to determine powers and obligations of the company, the management has represented to the government that it would be of great assistance if these statutes could be consolidated into one. I am sure the advantages of such a step are so obvious to all hon. members that it is unnecessary for me to make any argument to convince them.
I should perhaps add that the decision to effect this consolidation does not result from any change in government policy concerning the Canadian National Railways. As I said at the beginning of my remarks, the primary purpose of this legislation is to consolidate the various legal provisions relating to the Canadian National Railways.
I should like to explain that it is intended also to effect the following changes in the various enactments applying to the company. First, it is proposed to give the Canadian National Railways authority to operate a telecommunication system. At present these powers are exercised by the railway through its subsidiaries, and it is thought it would be desirable if these powers were given to the parent company.
Second, it is proposed to authorize officers and employees of the Canadian National Railways to act as directors of partially-owned subsidiaries. Third, it is proposed to give the railway the power to construct short branch lines without specific parliamentary authority. Fourth, it is proposed to establish a simple procedure to extinguish the charter of any company comprised in the Canadian National Railways. Fifth, it is proposed to give to the railway the power to operate motor vehicles in conjunction with or in substitution for rail services under their management or control. At the present time this power is exercised through subsidiaries of the railway.
As I think it is manifestly in the interests of the railway that its charter be consolidated and that these additional powers as outlined should be given, I urge the committee to adopt this resolution forthwith.


Mr. Green:: Mr. Chairman, the minister's
statement has made it clear that considerable study will be required in order to consolidate these various statutes, and I am wondering whether he has in mind referring the bill to a committee of the house. It would seem that the standing committee on railways, canals and telegraph lines would be a suitable committee to undertake this task. It js quite obvious that witnesses from the

company should be called to explain at least some of the implications of this consolidating statute, and that of course can be done only if the bill is considered by a committee.
The minister has said that the railway company is to be given the power to construct short branch lines without coming to parliament. I would ask him to explain what is meant by a short branch line. In recent years several branch lines have been constructed by Canadian National Railways and also one by the Canadian Pacific Railway, and in all cases the proposal was brought to the house. I think that is a very wise course to follow.
For example, there was the extension from Sherridon to Lynn Lake in northern Manitoba, and another from Terrace to Kitimat on the British Columbia coast. Then last year there was the extension to Chibougamau. Probably the minister has read or has been told that there was a great deal of controversy over the branch line from Beattyville to Chibougamau. Parliament also granted the power to build an extension from Chibougamau to St. Felicien in the Lake St. John area, and many of us felt that the railway should have completed the line right through to Lake St. John rather than merely going to Chibougamau in the first stage and then taking the position that it may be able to build the Lake St. John half of this branch line at a later date.
There was considerable feeling in the Lake St. John area against that proposal, and I think rightly so, because the plan of the government had the effect of tapping the Chibougamau district by the line from Beattyville, whereas I believe that area is served at the present time by a highway from Lake St. John. The question of access to the port of Chicoutimi was also involved.
The government faced some rather difficult questions over this proposed branch line, and there was considerable debate in the house and in the committee. I think the government was under some difficulty in justifying its policy with regard to that branch line in so far as it did not contemplate completion right through to St. Felicien at the time the line was extended to Chibougamau.
I am wondering whether the proposal to do away with the requirement that the Canadian National Railways come to parliament for approval of the building of branch lines is the result of the criticism last year. If that is so the proposal is without justification, because I believe it is wise to have both railways come to parliament for approval of the building of branch lines. Otherwise they would have the power to expropriate in order to put a line through an area

without the consideration of parliament. I think that coming to parliament is the practice which has been followed in Canada for many years.


George Carlyle Marler: If my hon. friend would permit me to interrupt him I am sure it would make possible a curtailment of his argument. The short lines to which I referred a moment ago, as he will see in due course, are lines intended to serve industrial customers. The bill will provide for a limitation of six miles, so my hon. friend need not worry that we are trying to legislate to cover the St. Felicien branch line or others by merely calling them short branch lines.
If I may say one other word in connection with the suggestion made by the hon. member it is that the bill will be referred to the standing committee on railways, canals and telegraph lines.


Howard Charles Green: Perhaps the minister will
explain to the committee why parliament should not sanction the building of branch lines even though they are only six miles in length. Surely the railways should come to this house for approval of the extension of their lines. As I said before, they have the right to expropriate property and six miles of line may be of extreme importance to many people, particularly if it is in a metropolitan area and I presume that that is the type of extension the minister has in mind.
What is the objection to having both the C.N.R. and the C.P.R. come to parliament for approval of extensions of that kind. If such an extension is not to be made on property they already own then the rights of other people are going to be affected. I should like to have an explanation as to why it is felt the railways should be given this right to build such lines without getting parliamentary approval.


George Carlyle Marler: If I am to enter into a series of explanations with each hon. member who might wish to make some comment on the resolution the debate will be more or less unending. I would prefer to try to give my explanations when the debate has proceeded further.


Stanley Howard Knowles: Mr. Chairman, I believe the minister was correct when he said that the advantages of consolidating these various enactments into one statute are so obvious that he did not need to spend much time trying to convince the house that this step should be taken. I am sure we all agree it would be a good idea to have all the legislation respecting the Canadian National Railways in one place, at least so far as that is possible.
Canadian National Railways
I was glad to hear the suggestion made by the hon. member for Vancouver-Quadra, to which the minister has agreed, namely that after second reading this bill should be referred to one of the committees of the house so that it might be thoroughly studied.
I also was a bit concerned over the phrase in the resolution which suggests that short lines might be constructed without parliamentary approval. I confess that the minister has removed my concern to a considerable extent by making it clear that there will be a specific limitation in the bill as to what constitutes a short line.
The minister, in speaking to this resolution, said that it involved no change in government policy so far as the Canadian National Railways are concerned. It seems to me that there is one matter of policy, whether it be government policy or Canadian National Railways policy, which does need to be reviewed at the present time. I refer-and the minister knows that many of us in this house feel strongly about it-to the employment situation on the Canadian National Railways. This legislation is designed to take a look at the whole picture so far as the Canadian National Railways are concerned, and I suggest that one of the things sorely needed at the present time is some positive kind of assurance to those who work for this railway and are its mainstay that the terrible cloud of insecurity and uncertainty that hangs over them will be removed.
I am not asking merely for the kind of statement we have had from the minister and his predecessor from time to time, namely the hope that we are at the end of lay-offs on the Canadian National Railways. In fact I have upstairs a letter from one C.N.R. employee in Winnipeg who says that every time the Minister of Transport assures us there will be no further lay-offs, all the employees of the C.N.R. tremble. So often has that been said only to be followed by another lay-off that they do not want that kind of statement made again.


George Carlyle Marler: I am sure the hon. member is honest enough to admit that I have given him no such assurance.


Stanley Howard Knowles: The Minister of Transport has not given such an assurance in his own name, but he will admit that he did place on record on the 7th of February the statement of one of the Canadian National vicepresidents that no further staff reductions were anticipated.


George Carlyle Marler: That is correct.


Stanley Howard Knowles: The minister placed that statement on the record in response to a request of mine that he give the assurance
3162	HOUSE OF
Canadian National Railways that we were at the end of the lay-offs. However, what is required is not just the settling of a debating point between the minister and myself. What is required is not just another ministerial statement or vicepresidential statement or presidential statement. What is required is a policy with respect to this matter.
It used to be thought that if a man got a job with one of the railways in this country and got in a few years of employment and a few years of seniority and did a good job, he had a reasonable measure of job security. Now it turns out that even men who have 10 years' service on the railway, and who thought there was that measure of job security, face every week the uncertainty as to whether that employment will be continued.
We recognize that changes are taking place. We recognize in particular that there is a dieselization program now in progress, but surely something could be done, whenever a change-over such as that is being pursued, to recognize the rights of the men. After all, some of us feel that their rights are just as important as the concern which some people feel for capital investment, for the maintenance of equipment and for all the other factors which go into the running of the railway. It is our feeling that there is something lacking in government policy and in Canadian National Railways policy with regard to the employees of this great system. I strongly urge that this matter be gone into in the consideration of this legislation.
I am glad to know, as I have already said, that after second reading the bill will be referred to a committee. I note that the minister proposes that it go to the committee on railways, canals and telegraph lines, rather than to the committee on railways and shipping owned, operated and controlled by the government. That means that a group of members different from those who generally look at Canadian National matters in committee will have a look at this situation. I hope some policy can be worked out in

that committee, when it is considering this bill, which will protect in a way that is not now effective the rights of the employees of this railroad.
In addition to the lay-offs which are taking place and the insecurity which arises because of that fact, there are certain other matters of policy in relation to the railway that I think call for review at this time. Perhaps I had better suggest that you call it ten o'clock so I can go into those other matters the next time this resolution is called.


Edward Turney Applewhaite: Before I leave the chair, I was going to ask hon. members to consider between now and the next time this committee meets on this resolution the wording of the resolution. I am making no ruling at the moment, but I am of the opinion that there may be a large number of matters connected with the operation of the Canadian National Railways which are not appropriate subjects for discussion under a resolution which says that it is expedient to consolidate the existing statutes and to make certain other provisions. I am not undertaking to rule at the moment. I am suggesting to all hon. members that because this resolution consolidates the statutes dealing with the Canadian National Railways, it may not necessarily open for discussion every phase of the operation of the Canadian National Railways system.
Progress reported.



BUSINESS OF THE HOUSE

Walter Edward Harris: Tomorrow we shall take whatever third readings are available, then continue this debate, and take second reading of the bill respecting Unemployment Insurance, and the second reading of the bill to amend the Blind Persons Act, and then move to go into supply.


[Stage Direction]
At ten o'clock the house adjourned, without question put, pursuant to standing order.
[Stage Direction]
Tuesday, April 26, 1955