1955-05-10

[Stage Direction]
Eighth report of standing committee on railways, canals and telegraph lines.-Mr. McCulloch (Pictou).


Mr. Pierre Gauthier (Porineuf) moved: that the first report of the special committee on broadcasting, presented on May 9, 1955, be now concurred in.


[Stage Direction]
Motion agreed to.


Right Hon. C. D. Howe (Minister of Trade and Commerce):: Mr. Speaker, by leave of the house I move:
That the report of the Canadian wheat board for the crop year 1953-54, tabled on February 23 last, together with the report of the board of grain commissioners for Canada for the year 1954, tabled on April 6 last, be referred to the standing committee on agriculture and colonization.


[Stage Direction]
Motion agreed to.


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On the orders of the day:
Mr. H. R. Argue (Assiniboia):: I should like to direct a question to the Minister of Justice. Has the government been informed by Senator Alexander Wiley, chairman of the American Senate foreign relations committee, that stock racketeers are peddling phony securities from Canada to American investors? If so, what action is the government taking, and are such phony securities being peddled in Canada?


Hon. Stuart S. Garson (Minister of Justice):: Ordinarily communications of this sort coming from representatives of another country are addressed to the Department of External Affairs, and I think it would be more appropriate for my hon. friend, the acting minister, to reply to the question.


Hon. Paul Martin (Acting Secretary of Slate for External Affairs):: Mr. Speaker, the government has not received any official information to indicate that a United States congressional committee intends to investigate the sale of stocks from Canada in the United States. However, Senator Wiley, the minority leader in the Senate committee on foreign relations, wrote the Canadian ambassador on April 16 asking for the opinion of the Canadian government on ways and means by which our respective nations can further cooperate towards the end of protecting investors. I do not think it would be appropriate or helpful for me to comment on a possible Senate investigation until we are in receipt of definite information that such an investigation in fact is planned.


Hazen Robert Argue: Is any investigation being considered in Canada?


Mr. Marlin:: I should think that normally that might be a question for the attorneys general of the provinces, but as this aspect of the matter more appropriately concerns the Department of Justice I might throw the ball back to the Minister of Justice.


Stuart Sinclair Garson: Mr. Speaker, this almost seems like a tennis game. My hon. friend the acting minister of external affairs is quite right in his suggestion. The responsibility for the administration of the security laws which are passed by the provinces is that of the provincial authorities, as is also the responsibility for enforcement of the Criminal Code. Therefore it is only in those cases in which extradition is being sought of some American offender who, having escaped into Canada, has been apprehended here, that the facilities of the federal department are invoked.


SUGGESTED INTERVENTION TO SECURE RELEASE OF 16 POLISH WAR VETERANS
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On the orders of the day:
Mr. Donald M. Fleming (Eglinlon):: May I
put a question to the Acting Secretary of State for External Affairs? On April 26 I asked the Secretary of State for External Affairs if he had received from the Polish ex-combatants' association in Canada an appeal that the government intervene to seek the release of 16 war veterans who were leaders of the underground movement and who have served terms of imprisonment imposed by the Russian authorities, which

Inquiries of the Ministry terms have expired. May I ask the Acting Secretary of State if he has now received from the rally of the Canadian Polish congress held in Toronto last Sunday a similar appeal and, if so, what action the government proposes to take on this very meritorious appeal?


Paul Joseph James Martin: I have been advised that as yet no request of a formal character has come from any Canadian Polish organization in Canada to inquire about the fate of 16 Polish underground leaders who were arrested by the Soviet union in 1945. The government, however, is very much interested in finding out what has happened to these men. Some are believed still to be imprisoned in the Soviet union, although the sentences imposed upon them in 1945 should by now have expired, and others may be in jail in Poland. Hon. members may have noticed newspaper reports of a request made by the United States government to both Poland and the Soviet union on April 21 for information about the fate of these men. We expect to receive further information about the progress of this inquiry.


DOMINION-PROVINCIAL CONFERENCE AVAILABILITY OF COPIES OF REPORT OF PRELIMINARY MEETING
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On the orders of the day:
Mr. Gordon Churchill (Winnipeg South Centre):: May I ask the Prime Minister when copies of the report of the preliminary meeting of the federal-provincial conference, which has been printed and was distributed to the press last week, will be made available to the library, the distribution office and members of the House of Commons?


Right Hon. L. S. St. Laurent (Prime Minister):: There was a report printed of the public meeting that was held. I was under the impression it was available to any member of either of the houses of parliament who might be interested in securing it. I will ascertain if that is the case, and if so I will let the hon. member know to whom he may apply for a copy.


POLIOMYELITIS
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On the orders of the day:
Mr. E. G. McCullough (Moose Mountain):: I should like to direct a question to the Minister of National Health and Welfare. Can the minister give assurance, in view of the experience in the United States in connection with polio vaccine, that all sources

of vaccine allowed for distribution in Canada will be under strict government control?


Paul Joseph James Martin: I suppose by "government control" my hon. friend wishes to imply, has the government taken steps or is it taking steps to make sure that a strict investigation is made of the imported vaccine. The answer is yes.


REQUEST FOR ANNOUNCEMENT OF INITIAL PAYMENT
[Stage Direction]
On the orders of the day:
Mr. D. S. Harkness (Calgary North):: should like to direct a question to the Minister of Trade and Commerce. When will the minister be able to make the announcement which, up until last year I think, was nearly always made before the end of April as to the initial price of wheat, oats and barley for this coming year?


Clarence Decatur Howe: My hon. friend is quite mistaken about that announcement usually being made in April. It is usually made about the first of July.


Douglas Scott Harkness: It was last year, but it was not in previous years. The minister has not answered my question as to when we might expect that announcement.


Clarence Decatur Howe: I will consult with the wheat board and later with my colleagues, and endeavour to make it as soon as conditions warrant.


REQUEST FOR STATEMENT AS TO FINAL
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On the orders of the day:
Mr. J. G. Diefenbaker (Prince Albert):: Possibly the minister will be able to say when the farmers will find out how much they are going to get per bushel for the 195354 wheat crop?


Clarence Decatur Howe: The cut-off was made on April 29, Mr. Speaker. The auditors of the wheat board are working night and day endeavouring to ascertain the value of each of the many grades of wheat. The price, of course, results from a mathematical computation and nothing else. As soon as the mathematics are finished, the results will be announced.


John George Diefenbaker: Will the minister allow this further question? Now that they are going to have a summary of the various grades of wheat that are on hand, would the minister be in a position, after they have

that, to furnish the house and the country with a record of the amount of wheat of different grades that is actually in storage?


Clarence Decatur Howe: Well, Mr. Speaker, I take it my hon. friend is referring to his question on the order paper, and that question is being dealt with.


THE BUDGET
[Stage Direction]
The house resumed, from Monday, May 9, 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.
Mr. A. R. Lusby (Cumberland):: At the outset, Mr. Speaker, I should like to add my congratulations to those numerous congratulations which have already been extended to our new Minister of Finance (Mr. Harris) during the course of this debate, both upon the content of his budget and upon his very excellent presentation of it. It is natural, I think, that anyone from Nova Scotia should have a particular interest in the finance portfolio. First, of course, we have a strong Scottish leaven in our population, and as you know the Scot is a notoriously canny financier. Secondly, if you consider the list of distinguished men who have held that portfolio from time to time since confederation you will find that on that list there is a surprising sprinkling of the names of Nova Scotians, beginning with Tupper and coming down to as recent a time as Mr. Ilsley's. Consequently, we from Nova Scotia have a very particular interest in any incumbent of that position. I think I can pay the present minister no higher compliment than to say that on the basis of his budget he has left no room whatever for doubt that he is a worthy successor, not only to his immediate predecessor the Hon. Douglas Abbott, but also to all those capable and distinguished statesmen who have in the past carried out the onerous duties which now devolve upon him. I offer him my most hearty congratulations.
Compared with the budgets of the last few years this one in contemplating a deficit has an element, I think, of boldness, of experiment and of flexibility. Certainly it should silence that cry which we occasionally hear from the opposition benches that this administration is too set in its ways ever to depart from the beaten path. I think this is a departure. Then, too, in the light of the public reception which this budget has been given
The Budget-Mr. Lusby I think it has been amply demonstrated that this government is still intent upon carrying out the wishes of the people, a fundamental principle of our democracy. In spite of whatever the opposition may choose to say, my observations over the course of the last few weeks have convinced me this is definitely a popular budget. It has received considered approval from the vast majority of Canadians and, whatever opposition members may choose to think, the people are usually right- or else how could our democracy survive?
Indeed, when I contrast the public reception which has been accorded to this budget with the railing from the opposition benches against it-here I am not in the least impugning their right to rail, and perhaps it is even their duty-I am inclined to wonder how the opposition members could dare to trust in the validity of their own arguments. Naturally, when the budget debate is on, the order of the day in the opposition ranks is, "curse the budget", if I may say that. But I wonder if many of the opposition stalwarts, as they go to work loyally in this debate, have not entertained feelings somewhat akin to that ancient biblical character Balaam, incidentally a false prophet, when he was invited to curse Jacob and defy Israel. He did not fancy the assignment. In any event, to curse what the people have not cursed, to denounce what they have approved, is never an easy task in a democratic country such as this, and those who are attempting it are meeting, I think, with a deserved lack of success both within this chamber and without.
In my opinion, this budget has gained the approval of the intelligent and informed citizen in this country, not primarily because it represents a substantial saving to him in income and other taxes but because he is firmly convinced that these changes which it has brought about will achieve their primary purpose of stimulating the national economy. I agree with that belief; I expect these changes to exert a substantial influence in this regard by virtue of the additional purchasing power which they make available. As the minister indicated in presenting the budget, national fiscal policy is an important means of promoting economic stability and expansion. I am convinced that in his capable hands it will prove to be an instrument skilfully and successfully applied for that purpose.
There are one or two points upon which I am not entirely in accord with the provisions of the budget. For example, I should have preferred to see the special excise tax on soft drinks and the like eliminated or at least further reduced, so as to avoid any suggestion of unfairness. Not strictly in the budgetary

The Budget-Mr. Lusby field but arising out of the measures taken there, is the question whether, in view of the reduction of 5 per cent in the excise tax upon automobiles, the dealers across the country should not be given some relief in respect of any losses they have sustained in connection with vehicles purchased by them before the budget was brought down. I realize that the decision of the Department of National Revenue, as announced by the Minister of Finance, is in line with the usual policy in such situations. But I have since had representations from a number of dealers in my constituency, and I suppose the situation is very much the same all over the country, and I find that substantial amounts are involved in each case. And as between the practical impossibility of making a rebate in every case of a reduction in excise or sales tax and the exigencies of the situation in which the automobile dealers now find themselves, it is my thought that possibly, without setting any binding precedent, some suitable ground of compromise might be found in this instance.
In presenting the budget the Minister of Finance (Mr. Harris) made an announcement to which, as a representative from a maritime constituency, I pay particular attention. That was the announcement that a royal commission is to be appointed to examine carefully into and report upon the future economic prospects of this country. The minister has mentioned among the contemplated aspects of the commission's work such matters as the charting of probable developments both in our productive capacities and our external markets, an examination of population growth, and the magnitude and nature of our future requirements. Although, as he said, it is not intended that the commission shall make a long series of detailed policy recommendations, I assume that one of its fundamental purposes will be the assembling of material upon which the government may base its economic policies of the future.
It seems to me that this sort of national inventory and stock-taking at this time with regard to our economic future is an excellent project indeed. And in this connection I should like to point out that one of the greatest of the internal problems which this country faces, and must continue to face, is that of effectively maintaining a reasonably equitable balance of economic development and activity in all its parts. I said a moment ago that as a representative of a maritime constituency I took a particular interest in the minister's announcement that this commission was to be set up. Why? Because I see the possibility that through its work may come some positive indication as to how this government, in conjunction with

our maritime provincial and municipal governments, and all other bodies which may be concerned, may best work in order to ensure for the maritime provinces their fair share in that mighty economic and industrial development and expansion already far under way in so many parts of this country- a development and expansion which, barring perhaps the disasters of war, will continue as surely as the sun is going to rise tomorrow.
In its over-all national aspects, our future is such as to rejoice the heart of every Canadian. But I need hardly say, Mr. Speaker, that it is of relatively little importance to an unemployed coal miner in Nova Scotia, for instance, to know that the oil industry in Alberta is flourishing, and its prospects are bright. And I have referred to the oil industry only as an example. It is imperative that some means be found, some policy adopted, which will ensure to the maritime provinces a fair share in the prospective national economic and industrial development, a reasonable level of prosperity as compared with those provinces which, by virtue of greater population, central geographic position-which is one of the most important items-endowment of natural resources, or other advantages which we in the maritimes lack, are now far in the lead.
Perhaps I should say here, Mr. Speaker, that I do not wish to be accused of pessimism. I am not at all unmindful of the many bright spots in the maritime picture. Just last night the hon. member for Gloucester (Mr. Robi-chaud) gave us a description of the astounding development of base metal mining in northern New Brunswick, which is now in assured and immediate prospect. That is perhaps the most encouraging event that province has ever seen. The intensive search for similar metals in Nova Scotia, which has been carried on for some time and is still being carried on, gives ground for hope that at least to some extent we may enjoy a similar boon.
It is my firm belief, too, that in the years ahead our forest industries, our fisheries and our tourist trade will grow to be of increasing importance, and will reflect a far higher level of activity than has generally been the case in the past. Nor am I one to fear that any development in some other part of Canada-and at the moment I am thinking particularly of the St. Lawrence seaway development-taking the long-term view, will injure us in the maritime provinces. My view is entirely to the contrary.
But in certain aspects, notably-and I think this is the chief one-in the field of the development of manufacturing and other secondary industries, I think it is perfectly

true to say that our economy has not overcome its traditional lag as compared with other parts of Canada.
Therefore I suggest to the Minister of Finance, to the government and to the House of Commons, that one of the first and fundamental objectives of any such royal commission as is proposed should be the assembling of all available facts and figures which may make possible the formulation of policies designed to redress, so far as conceivably it can be done, that regional imbalance of economic development, industrial activity and resulting opportunity and prosperity which now exists as between various regions of this country and which to my mind, as I have said, is one of the real internal problems which beset us as a nation.
In an earlier speech in the house during this session I made the suggestion that some permanent federal agency might well be set up or designated to keep under constant watch the peculiar difficulties with which we in the maritimes contend in our economic and industrial life and, acting in conjunction with all provincial or other bodies having the same interests, to devise and recommend such measures as from time to time may seem advisable further to overcome those difficulties.
The royal commission outlined by the Minister of Finance is not, I take it, intended to be a permanent body, or even a quasipermanent body, although I assume its activities will be carried on over a considerable period of time. However, I do urge most strongly that it be directed during its lifetime to devote a full share of detailed attention to the economic prospects of the maritimes, the bright as well as the dark. Indeed, I think it might well set up a distinct subcommittee to deal with that aspect of its work.
One or two aspects of our maritime economic and industrial life, however, require in my opinion an entirely separate study. First of all is the state of the coal mining industry, which urgently-and I repeat the word "urgently"-requires immediate consideration. Such consideration would consist largely of correlating known facts and, upon the basis of those facts, making recommendations for action. The urgency of the situation is starkly emphasized by the threatened closing of No. 1-B colliery at Glace Bay, Cape Breton, which is one of the most important coal mines in the province.
We know of course that the first problem of the coal industry in Nova Scotia is the increasing competition from other fuels. We
The Budget-Mr. Lusby also know, however, that coal is still the chief source of fuel energy in Canada, and that in the event of war assured Canadian sources of supply would become vital at once to the safety of this country.
In certain fields, such as that of the coal fired gas turbine engine, there is the prospect-unfortunately at the present time it is not much more than that-that coal may again become fully competitive with oil. There is the possibility that new and more efficient processes may be discovered for the extraction on a commercially profitable basis of the endless variety of chemicals and other by-products which are known to be available from coal.
Then we have the often repeated forecast of the dominion coal board that by the middle 1960's, if our coal industry survives the difficult intermediate period, Canadian industrial expansion, in spite of the inroads of other fuels, will provide an assured market for coal sufficient to maintain activity in our mines at least at something like its present level. I hardly need add that a coal mine once closed is very unlikely to be reopened. After considering all these things, Mr. Speaker, I submit that the preservation of the Canadian coal mining industry-and I of course am thinking more of the Nova Scotia segment of it, upon which the livelihood of perhaps a fifth of our total provincial population depends-is a matter of national concern and merits the utmost efforts of all, management, labour, the provincial government and the federal government. Each one of these has its part to play if the industry is to be preserved.
If the forecast of the dominion coal board is correct-and I think for the present we must assume that premise-the problem is to tide the industry over the difficult years immediately ahead. I suggest a concerted effort by all those concerned to devise a workable plan for the preservation of the industry at approximately its present level over that period. Call it a ten-year plan, if you like. That may be slightly reminiscent of our friends in Russia, but certainly if such a plan can prevent poverty and unemployment in the coal industry you cannot find a better defence against the inroads of communism.
Another matter which is of some concern, at least of some interest, to the maritimes- and which I strongly think deserves a separate study by a separate royal commission-is the construction of the Chignecto canal. Such a study would determine once and for all the benefits which might reasonably be expected to accrue to this country and particularly to the maritimes if the canal became a reality. No such commission has been appointed by the federal government since the

The Budget-Mr. Lusby 1930's. In view of the great changes that have taken place, I believe a thorough study of present-day conditions should be made by such a commission. Once and for all it would settle the question whether the benefits which would accrue would justify the cost of construction and maintenance. I have urged before in this house the desirability of such a study by such a commission as the only proper means of settling this longstanding question. Only the other day my friend and colleague, the hon. member for Westmorland (Mr. Murphy), whose constituency, when the canal is completed, will be on the bank opposite to mine, raised the matter at some length in this very debate. I have no wish to repeat the statistics which he has placed upon the records of the house from time to time, but I do wish to say that there are weighty arguments in favour of the canal which deserve the careful and sympathetic consideration of a competent and authorized body.
Before I conclude, Mr. Speaker, I should like to say I am happy to note that the budget makes several tariff reductions which will be of benefit to this country's farmers. Agriculture remains, in my opinion, the real foundation of this country's economy. 1 should like at this time also to commend the Minister of Agriculture (Mr. Gardiner) upon the further extension of the price support program for butter, a measure which is of very real assistance to the dairy farmer.
In my constituency the role played by the federal Department of Agriculture in the promotion of efficient farming methods is particularly well known because we have a dominion experimental farm at Nappan, on the very edge of the marshlands which are the subject of the maritime marshlands reclamation project. During the Easter recess I had an opportunity to visit the farm and to find out something about the work that is being carried on there in order to promote the raising of beef cattle, not only on those marshes but elsewhere in Nova Scotia. In fact, on that very day there was a well-attended group meeting there of farmers interested in these subjects. It was just a coincidence that I was there.
Since it is highly desirable that the most profitable use available shall be made of the reclaimed marshlands, I hope the department will continue to carry on and expand its research into the possibilities of beef raising on those lands as well as on other lands in Nova Scotia.
In conclusion, I should just like to say that the work of such a royal commission as the Minister of Finance has in contemplation would certainly be far from complete if it
IMr. Lusby.]
did not include as one of the most important items on its agenda a thorough study and assessment of the future prospects and possibilities of agriculture in every part of this country where arable land is available.


John George Diefenbaker: Mr. Speaker, I do not propose to traverse much of the ground which has been covered already. However, there are a number of matters to which I intend to refer which up to the present moment have not been dealt with or, if dealt with, have been dealt with only generally.
I want to say immediately to the minister that I congratulate him on having brought in his first budget; as Harris came in, Lord Keynes went out. There has been a complete transition in the philosophy that heretofore activated the government, a change of point of view, an alteration of direction and in effect an admission of the validity of the criticisms which we of the official opposition have been advancing in recent years.
At the beginning I am just going to say a word in regard to employment. Strangely enough, there has been no serious answer from the government regarding the unemployment problem that still fills the hearts of many Canadians, no answer whatever as to what is to be done now by the government, except a speech by the Prime Minister at the dominion-provincial conference as to what is to be expected at a further meeting to take place this coming fall between the federal and provincial authorities. For some reason or other the plans of 1945, the green book of that day and all that it stood for and the principles which in a measure contributed to the success of the government at the polls in two subsequent elections, now have been set aside, departed from, forgotten. Indeed, the great and abiding principles that were to bring about a new millennium in dominion and provincial relations now have been embalmed in the records of history.
I intend to make a general reference to the budget, and to mention a few suggestions as to matters that might be dealt with and should be dealt with at this time. First, I wish to make reference to a purely western condition. After years of drought periodically occurring in the western provinces, today we in Saskatchewan, and to a lesser degree in Manitoba, have suffered a disaster, the like of which I have not seen in the many years that I have been in western Canada. During the days of the 1930's larger areas were devastated by drought; now there is need of immediate action by the federal government because of floods. I see no reason why there should be such unnecessary delay in determining whether or not what has taken place

is a national emergency. I believe that what has taken place in Saskatchewan, and to a lesser degree in Manitoba, is far and beyond any responsibility that should rest upon the provinces. The costs of rehabilitation should be assumed in considerable measure by the federal government.
There were great hopes on budget night. The minister made his speech and reports went across the country that income taxpayers would save 13 or 14 per cent across the board. However, when examined in the light of the actual circumstances and reviewed carefully, as it was by the hon. member for Greenwood (Mr. Macdonnell) in his opening speech, the hopes of budget night have been dissipated in subsequent days.
The sales tax stays upon the needs of the home and upon almost everything but food. The hon. member who has just resumed his seat referred to the help being given to agriculture in the tariff reductions. There are a few reductions which will benefit limited areas of agricultural endeavour, but generally speaking the budget holds out no material benefit for Canadian agriculture or for reductions in the cost of production of Canadian agriculture.
As far as the income tax is concerned, the meagreness of the reductions will be realized only when the deductions commence to be made-small, trivial, unimportant. The reduction in the excise tax on automobiles is a worthy step, but it is only a step. With automobiles being the necessity they are, a 5 per cent reduction in no way meets the situation and the government ought to have gone considerably further than they did.
As I mentioned a moment ago, the sales tax remains, and the taxes on television and radio remain. The costs of government are on the increase in every department of government as far as I can read the record, with the exception of agriculture, defence production and national defence. There are increases in expenditures when there should be reductions. Agricultural expenditures are reduced by some $25 million; defence production by $28 million; and national defence by $118 million. The total reduction in expenditures this year for all departments is $95 million, which indicates that in the other departments of government there have been substantial increases.
I think one of the purposes of this budget was to spread plenty of little among many, not to attack the need for immediate action to be taken which would bring about the restoration of lost markets and provide an impetus to trade within our country by reducing costs through lower taxes, but simply to thinly spread a series of small
The Budget-Mr. Diefenbaker benefits to the few. The budget will not have the effect of bringing about a restoration of impetus and an encouragement to initiative.
Some have spoken of Canada receiving a shot in the arm by the budget, but on examination it is shown that what Canadians have received from this budget is merely a scratch on the arm. There has been plenty of little spread among the many but without sufficient emphasis in any particular to encourage the expansion and development of industry.
Costs of government have not been cut.
I should like to quote what Mr. J. A. Calder, president of the Canadian Manufacturers Association, said in a statement he made in St. John's, Newfoundland. The article states:
He said that in five years, from 1943 to 1953, government spending rose to 18-1 per cent of the gross national product from 11-5 per cent.
He went on to point out that corporate taxes had not been reduced to any extent.
I remember so well past years when Mr. Abbott referred to the dangerous situation when corporate taxation was exacting almost 50 per cent of the amount being made by corporate business. Such high taxation establishes a socialist system under the free enterprise system. Mr. Calder went on to say that there were not sufficient economies in government; there was no lowering of corporate taxes which would attract more venture capital which would mean increased productivity and lower prices, which would mean increased sales, which increased sales would more than offset any loss of government income.
The government has chosen to do very little at a time when drastic action is necessary. There are three or four things which I think the government could have done at this time and should have done. I have mentioned one, the removal of the sales tax upon the needs of the home. The cost of living continues to rise. According to the records of the bureau of statistics of May 4, there had been an increase in the previous month to 116-1 from 116. It reports rising prices for flour, tea, eggs, potatoes, fresh fruits, gasoline, etc. There can be no justification for the maintenance of the unusually high sales tax upon the needs of the home.
What business needs to meet the challenge of international markets, of improved techniques of production, is tax relief for programs of research. West Germany is once more in the family of nations, a step forward which may establish the certainty of peace in Europe, an act of faith which is already having its effect. It must be realized that West Germany is the third trading nation in the world, and as she will now be free to establish her steamship lines, her air lines and

The Budget-Mr. Diefenbaker the like, the competition of recent months and years is bound to be intensified.
Last year business in the United States spent more than $3,000 million upon research designed to enhance competition in export markets, to preserve the domestic market against the competition of low-economy countries, and to meet the problem of dwindling resources. Canada can do no less. The government of this country should give encouragement to research development on the part of industry by extending the degree by which such expenditures may be deducted when determining liability for income tax. If Canadian industry is to compete it cannot afford to be a mere rubber stamp producer of commodities developed by research in the United States. Encouragement should be given to an extension of the field of research so that expenditures in that direction may be deducted as a proper expense.
Third, one means of encouraging the expansion of jobs is to encourage industry to expand its physical equipment in the form of buildings, machinery and the like. That can be achieved and was achieved during the days of war by accelerated depreciation allowances. The same course is needed now to provide the encouragement that expansion will assure and also to increase employment within this country.
Statisticians say that it requires a million dollars of capital investment to provide 117 extra jobs. If all the savings that are to be effected this year by the 2 per cent reduction in corporation tax were translated into jobs, it would mean an increase of only 3,000 jobs in toto. If the government would give encouragement to industry to expand in this way, many jobs would be created.
Fourth, I regret that the minister has not seen fit to reform the obsolete, unjust and unjustifiable provisions of the succession duty act. There is an act that represents in some particulars a disregard of the rights of the individual. There are anomalies. Anyone who has had experience with the operation of the act knows of them. There is the injustice that affects many people in this country, whereby if one's share is $1 less than $50,000 there is no liability, but if it is $1 over $50,000 the full amount becomes liable to the impact of the tax. There are also provisions regarding pensions and annuities being capitalized which were never intended to be interpreted in the manner in which they are today. They have the effect of operating as a bar to the development of our country and also a discouragement to those who, through thrift, endeavour to better themselves and protect their dependents.
fMr. Diefenbaker.]

There are many members of this house with ability that is not being used, reservoirs of capacity that are available, who understand the operation of the succession duty act. A committee could be set up of such members who would hear the representations made by the officials of his department and of the Department of National Revenue and it could recommend changes in the act that would maintain to a greater degree the equities that should prevail and would also assure to a greater extent justice in the administration of the act.
Next, I am one of those who believe that, to discourage the drift toward socialism, something should be done to encourage individuals in this country to save so as to build up their own pension systems, by permitting them within limits to deduct the annual payments they make for the purpose of providing themselves with retirement pensions. I went into considerable detail in this matter with one of the outstanding chartered accountants in western Canada, M. E. G. Gery. I would like to place before the minister not only my suggestions but those that have come from representative organizations of chartered accountants across this country.


Mr. Harris:: I have them.


John George Diefenbaker: At the present time the employer may deduct a total contribution not to exceed $1,500 of approved schemes; for past services an additional amount regulated by the terms of the approved scheme; and in respect of retirement allowance, a lump sum payment made in the year of retirement. The employee may deduct a percentage, usually 5 per cent of the employee's wage, but in no case exceeding $1,500; and, as far as past services are concerned, an amount not exceeding $1,500 a year in respect to past services when he was not a contributor.
The privilege of tax deferment on the above basis is open only to employees of employers who have arranged for an approved scheme. The result is that many private individuals across Canada are denied an opportunity to follow a similar system

farmers and fishermen, small business concerns operated chiefly by proprietors or partners, professional men practising singly or in groups, and employed persons whose employers have not provided an approved pension scheme.
I feel that something should be done in order to encourage people of this type to do what those under approved pension systems may do, namely purchase now for their security in the future. I believe that a system could be evolved, and I would be prepared to submit to any committee set up for

the purpose a series of suggestions in that regard which would bring about equality with those in approved pension plans for those who do not come within such schemes; so that many people who are now denied the opportunity of doing that which employers and employees under approved schemes are able to do would thereby be encouraged to save and make provision for themselves for the days ahead.
I know one of the criticisms of the plan I suggest, that one type of saving should not be singled out for tax exemption. Well, it is being done now in the case of approved schemes. It is argued that a widespread extension might seriously affect the economy of the country in lowered tax revenues. My answer is that the plan evolved would have to be within restrictions and subject to regulations.
There are others who claim that it would deny expansion in our country, that it would dry up the sources of moneys that are necessary for development purposes. My answer to that argument is that such pension funds would be available to be loaned to industry and the like, in much the same way as loans are made by credit unions. I believe that, if this type of thing were brought into being and extended to the groups I have mentioned, it would be an encouragement to savings, it would pay off dividends in the future, and it would bring about equality which is being denied, when one section of the community is allowed to do this while others are denied the opportunity and the privilege of so doing.
I suggest those four matters for consideration by the government, matters that do not receive any attention to speak of in the budget. I know there are those who say we can soak the rich in this country, and that corporate taxation can be continued indefinitely. I can think of nothing that would encourage greater development today, when it is so necessary and when we face deficit financing, than a very considerable reduction in the amount of corporate taxation and an increase in the personal exemption for income tax purposes.
Look at the record, which reveals how the purchasing power of money has gone down in recent years. Compare 1938 with today. On the basis of 1938 an income of $2,000 has a purchasing power today of $1,103. Present income of $3,000 has a purchasing power of $1,567, and a present income of $4,000 has a purchasing power of $2,020. An income of $6,000 today has a purchasing power of $2,955, in every case after taxes have been paid. That indicates the answer to those who speak of the higher prices the farmer receives
The Budget-Mr. Diefenbaker for his wheat compared with the prices in 1938. The other day the hon. member for Calgary North dealt with that matter and showed that one of the reasons agriculture now finds itself in a difficult position is the fact that the purchasing power of a bushel of wheat is less than it was in 1938.
There is nothing in the budget to indicate a realistic approach to conditions in Canada The government sits in its supremacy. It does not even accept any more the recommendations of its own party friends in convention assembled. When only recently the national executive of the Liberal party recommended something that we of the opposition have suggested over the years, the setting up of an administrative body to govern relations between the C.B.C. and the private stations, the answer given by the Prime Minister the next day, using the words that I had placed before him in the question, was that such a body was not desirable or necessary.
Demands for reductions in taxation have come to the government not only from the opposition groups but also from various Liberal organizations across the country, and the attitude of the government is in effect, "After all, we know what is best." The budget indicates that the government follows the myth of its own self-satisfied perfection which its publicists across Canada so often indicate it possesses, and refuses to act realistically. There is nothing in the budget that will start the wheels of industry turning. There is nothing that will bring back into employment the thousands who are unemployed.
Do we receive any reply from the Prime Minister when we ask him what is to be done for labour and the farmer and industry? What stand are you going to take, what encouragement are you going to hold out to the Canadian people? We have gone through a long budget debate. No minister has yet stated during this debate what is to be done to encourage the expansion of employment in this country. The attitude of the government is the attitude of those who, during the days of private buccaneering in the United States, used to say, "The public be damned". That has been the attitude of this government in these days. We have wondered on occasion why the government resents being criticized. They do resent it.
A few weeks ago Mr. Duncan MacTavish stated in Edmonton at a party meeting that there is no danger in the one-party state as long as the one party contains such fine men as there are in the government now. One can only say that the government did not regard that as eulogy. They regarded it as unadulterated fact. At the national Liberal

The Budget-Mr. Diefenbaker federation meeting, in the accents of dictatorship, he asked himself some questions. What about these opposition members? They speak of unemployment, and they do this in the hope of improving their chances of capturing the federal government. Has it become one of the major sins in a democracy for the opposition to believe that ultimately it will become the alternative government? Then he went on to say:
Mischievous little boys who play with fire and cause public damage can be punished . . . But mischief committed in the guise of free speech... escapes the punishment it deserves . . .
Shades of Mackenzie King, Mr. Speaker! These are the accents of dictatorship. These are the thoughts of those too long in power. They are not only the views of Mr. MacTavish but also the views of the Prime Minister. Recall that he has not disavowed that outrageous doctrine enunciated by the president of the national Liberal federation. In a speech he made on the same occasion the Prime Minister, dealing with the criticism of unemployment, said:
That sort of talk can easily lead to defeatist thinking and can destroy that buoyant confidence which has been so large a factor in building our nation.
Not only did the Prime Minister not disavow what Mr. MacTavish said, he actually adopted it when he himself spoke. These are dangerous views on the part of any government and reveal what happens when governments become all-powerful and remain in power beyond the term that governments ordinarily remain in power. I ask the Prime Minister: Is he going to tell the people of Canada before this debate is over what is going to be done, what plans he has in mind, what hope there is for the unemployed?
The Minister of Finance has his own views on the subject. He has even become saturated with a similar philosophy. He spoke the other day at Toronto and I have his words here. He said-and he can deny it if I misquote him in any way-that he did not believe there was much unemployment.


Walter Edward Harris: I did not say that.


John George Diefenbaker: I will find the quotation in a moment. He said he did not believe there was much unemployment because if there was the government would not be as popular as it is. I hope I have the quotation available. It has to do with a speech the minister made in Toronto within the last two or three days on the subject of unemployment, and is taken from the Toronto Star. I had it before but I do not have it at the moment. However, I will certainly see that the minister gets it so that he will be in a position to deny its accuracy. He could not understand that unemployment was as

serious as it had been pictured to be. He could not understand that situation at all. According to the Toronto Daily Star this is what the minister said:
Turning to the federal field Mr. Harris said he did not think unemployment in Canada is as bad as opposition spokesmen say it is.
Opposition spokesmen say so, and so do the bureau of statistics and the employment bureau.
"If it were, if, as the opposition claims, people are really suffering, which I doubt, then I would like to ask the opposition how it is the government retains its popularity."
In other words, instead of admitting the seriousness of the situation as revealed by the bureau of statistics the minister says in effect, "It cannot be because, after all, look at us-a government the epitome of all popularity, the acme of all the perfections." When the people of Canada need a shot in the arm, they receive a scratch on the arm. Then the minister went on to say this:
"I have never known a time when any grievances the people had were not reflected in their opinion of the government of the day."
That is a sorry answer to the unemployed across this country. As to the future, they are simply told that the records may reveal unemployment but so far as we are concerned, look at us; we know what is right and are the personification of' all popularity.
Mr. Calder suggested the need of economy in government; what is being done in that regard? The minister mentioned economies of some $4 million out of non-defence expenditures amounting to some $2 billion. No serious endeavour whatever has been made to meet the situation. One could quote examples, and the opportunity will come when the estimates are being considered.
A few years ago Gladstone, that revered leader of Liberalism, said "Public economy is a public virtue." A mere $4 million cut off such vast expenditures outside of defence and defence production does not indicate that serious regard for economical government that ought to characterize good government. The explanation given by the minister for the reduction in national productive income was the failure of the western wheat crop last year. Trade has disappeared and our wheat exports have been decreasing during the last year. They went down last year, although in the last few weeks there has been some degree of increase over and above last year's corresponding period.
What do we find so far as the farmers are concerned? The Canadian farmer faces one of the most serious challenges to his continuance. His costs are rising and the prices of the things the farmer has to sell are going

down. During the five years between 1949 and 1954 farm costs in Canada increased by 17 per cent; living costs by 13 per cent; and farm prices in general across the board were down by approximately 21-6 per cent. The explanation given for this condition is the failure of the western farmers' wheat crop, and that is nothing but an excuse.
The western farmer suffered a serious crop failure in 1954. The farmers' income in 1954-55 has been maintained through the sale of the wheat and other grain products that were produced earlier. It will not be until this year that we will begin to realize the terrific impact of last year's failure of the western farmers' crop on the Canadian economy. One of the main reasons for the depression in the national income last year was the fact that we lost our markets abroad for wheat. The annual report of the Canadian Pacific Railway which came out in the middle of April so states in regard to the reduction of the traffic volume:
The greater part of the reduction in traffic volume was accounted for by a decrease of about one-third in the movement of grain and grain products because of reduced export demands.
The Regina Leader-Post says this:
The government budget white paper confirms that wheat export difficulties were the major factors in the dislocation of our economy in 1954.
I emphasize those words. It was not a fall-off in farm production in 1954 that caused the farmers' reduced income; but was the result of the government's inability to sell wheat. Grain exports dropped by almost $300 million in 1954, an amount greater than the total decline of all exports in 1954 of $223 million. While exports of motor vehicles, primary iron and steel and defence materials also declined, there were significant offsetting increases in other export categories. I repeat that it was not the failure of the western wheat crop in 1954 that reduced national income; it was not climatic conditions in western Canada in 1954, but it was the failure of this government to take any effective action to assure the preservation of our wheat markets abroad.
As of March 9, according to the Saskatoon Star-Phoenix, 143,900,000 bushels of wheat are stored on Saskatchewan farms. Whenever agriculture suffers and the farmers' income goes down, it immediately disrupts the economy everywhere within the dominion. In 1953 Canadian exports of wheat and wheat flour amounted to 385 million bushels; in 1954, they amounted to 255 million. Because there was no export market there was no sale for the farmers' wheat at the local elevator. During seven months, the period for which I have been able to secure the information, from August to February in 1952-53, there
The Budget-Mr. Richardson were 207-8 million bushels of wheat exported by Canada. In 1953-54 for the same seven-month period the export was 152-7 million bushels. In 1954-55, for the same seven months, the export was 152 million bushels. In other words, the fall-away since 1952-53 in both years for the seven months was approximately 54 million bushels. Canada's carryover on August 1, 1953, was 369-2 million bushels, and on August 1, 1954 it was 582-7 million. So it is all nonsense to explain that the reason for the fall in the national product was in large measure due to the failure of the wheat crop on the prairies last year.
The situation may also be viewed from another angle, a reference to the actual sales of wheat made by farmers between August 1 and April 20 in two succeeding years. Between August 1, 1953, and April 20, 1954, the sales amounted to 270,080,000 bushels while between August 1, 1954 and April 20, 1955 it was 167,490,000. I repeat that in large measure the fall in national income was due to the fact that the western wheat farmer took the rap, through the failure of this government to provide and maintain markets abroad.
Again, I make the appeal I have made on other occasions, for the intensification of the campaign to sell our wheat in the markets of the world. How is this to be done? That is a problem, a tremendous problem; but it is worthy of note that when in 1950 and 1951 this party made motions in the house to the effect that there should be convened British commonwealth trade conferences, and pointed out the danger to the markets of Canadian farmers in respect of wheat and other grains, each and every member supporting the government ridiculed the suggestion and voted down the motions. I believe one thing that could be done even now, with Australia, the United States and the Argentine securing a larger share of the world wheat market than they secured proportionately three years ago, would be for Canada to begin now to place in each of our embassies-and they are spread all over the world-agricultural market representatives whose duties would be the intensification of a campaign for the sale of our wheat.
Sir, my time has expired, and I will now conclude.
(Translation) :


Mr. Claude Richardson (St. Lawrence-Si. George):: Mr. Speaker, it is only proper that, at the outset, I should speak in the language of the majority of the people of the province of Quebec, being one of its representatives, for it is the language of people who have had such a glorious part in the development of this country.
3618	HOUSE OF COMMONS
The Budget-Mr. Richardson
As you are aware, Mr. Speaker, I was born in Acadia, in that region now known as the province of Nova Scotia, a fact of which I am proud. I have however chosen to live in the province of Quebec, where I have been residing over the past 30 years.
My French being far from excellent, my colleagues-those from this side of the house at least-will no doubt allow me to continue my remarks in my native tongue.
(Text):
Mr. Speaker, there are few observations of real value that a member entering this chamber for the first time can probably make. Your new member for St. Lawrence-St. George has made a solemn pledge with himself that certainly, for at least one session-this session- that member shall not use up the 40-minute allotment, but shall restrict himself, as well as he can, within, say, 15 or 20 minutes. Therefore, Mr. Speaker, when hon. members opposite see the hands of the clock approaching 20 minutes after four I ask that they call "time" upon this speaker.
The member for St. Lawrence-St. George is essentially and basically a man of peace, but he suggests that on this sunny afternoon we declare war. Now, I do not mean by that the Secretary of State for External Affairs (Mr. Pearson) should enter the chamber and state solemnly that no longer are we at peace with a certain country. But, with greatest respect, sir, and fellow members, following the example set by the government on many occasions, could we not, man for man and regardless of party, renew our declaration of war upon waste of human personality in Canada, waste of effort, waste of our great natural resources and, without wishing to show any disrespect to hon. members to whom I have listened for four months-and, may I say, with great profit to myself-waste of time.
Without any desire to transgress the rule I have laid down for myself, and not wishing to waste even one of the 20 minutes I have allotted to myself, on some future occasion I should like to pay my respects and the respects of the constituency of St. Lawrence-St. George to at least three of my predecessors- those since 1921. I refer first to the distinguished Sir Herbert Marler, the great brother of a distinguished member of the present cabinet. Then there comes to my mind a name which, when uttered, may cause some of my confreres on this side to shudder -that great and distinguished giant, Charles Cahan who, in the traditions of his party and according to his lights, at his particular time made, as did Sir Herbert Marler, and other predecessors, great contributions in this

chamber. Last but not least-because only too recently has he moved from the public scene-the man who in this chamber from the dread days of 1944 on to 1954 administered with relentless devotion not one department but two great departments. You all know his name, because it is a simple one: Brooke Claxton.
In any forum of debate in which human beings congregate we all, perhaps with some rare exceptions-and they may be on the other side, where it may be alleged there is the greater degree of intelligence-make mistakes in our terms. May I at the outset pay my respects to the hon. member for Winnipeg North Centre (Mr. Knowles) because, listening to him a good deal, I have concluded that he is a great repository of information. We recall that when the Minister of National Health and Welfare (Mr. Martin) was making that informative address about a week ago, the hon. member interjected, "Are your figures in constant dollars?"
How frequently in all forms of debate, not only in the House of Commons but throughout Canada, do we fail to compare dollar with dollar when we begin making comparisons in modern life. We also frequently fail to recognize the significance of the terms we use- and nowhere more frequently than in this very chamber. For instance, not always do we recognize what you and I and our fellow citizens mean by the word "government". While in the technical sense we know what a government or a cabinet is, many of us, while we walk on the street, read our newspapers or chat with our friends, fail to realize that when we ask the government to make expenditures it means that somebody somewhere in Canada has to pay a price, and usually vast numbers of us do.
Again, and I shall not go on for long because I want to be well within my limited time, the term "wealth" is used so frequently that people believe one can stretch into the air and pull down currency or gold. But wealth, after all, is a very simple thing to understand. It is human work or productivity, mechanical or other forms of power, applied to natural resources.
In the ambit of just those few terms may I, Mr. Speaker, with some temerity as a freshman in this house, now relate my remarks to four speakers on the opposite side? I refer first of all, with great respect, to a friend and colleague of long standing, the hon. member for Greenwood (Mr. Mac-donnell). I regret that he is not here at this time. I wish he were so that I could direct

my remarks to him. face to face. He said, as reported at page 2947 of Hansard:
You may be able to do it on budget night and get away with it. but it catches up with you.
Later on he said:
The press is catching up. It is interesting to note that a loyal, stout-hearted supporter of the government-I think I am describing them correctly-the Toronto Star, ignores the minister's exhilaration and evidently feels, indeed it calls, the *outlook uncertain.
Then he quotes the Toronto Star as follows:
"Mr. Harris' maiden speech will come as a disappointment to the many Canadians who hoped it would stimulate production and reduce unemployment."
I continue to quote, Mr. Speaker. The hon. member for Greenwood said:
I continue to read from the Star: "Taken as a whole it is really an unimaginative stand-pat budget that in itself will provide little relief from our present economic problem.
The hon. member for St. Lawrence-St. George has almost within the confines of his constituency two great papers, perhaps some would say not as great as those which are published in another large metropolitan city of Canada, but they are very good papers. One of them is the Montreal Gazette which has, if I correctly observe Canadian history, never been known to be tremendously *enthusiastic over the people who now sit on this side of you, Mr. Speaker. As a matter of fact, I rather think, if my political history is right, that the destinies of that great paper for many years were presided over by Mr. Robert Smeaton White, who was a venerable member of another political party in this house.
May I digress for a moment to say that the editor of the Montreal Gazette long adorned our press gallery. I refer to Mr. John Bassett. When I met one of his associates a day or two after the election-Mr. Bassett happens to be one of my neighbours and constituents -he asked me how I liked the editorial that had appeared two or three days before November 8, which made very kind reference to the Minister of Transport (Mr. Marler) and myself. I said:	"If my friend, now the
Minister of Transport, and the present member for St. Lawrence-St. George, had died and passed to their fathers on November 8, we should have got, I suspect, a much longer obituary in your Montreal Gazette than we did in your editorial, but it was very kind and very helpful."
This is the editorial from the Montreal Gazette of April 6, the heading is:
Easing the Burden
Hon. Walter Harris has decided to use tailing taxes as a weapon with which to fight falling revenues. It is a courageous course.
The Budget-Mr. Richardson
Particularly notable in last night's budget was the decision to cut corporation taxes.
This is an important decision, for it shows a sound perception of the role of corporations as the foundation of Canada's prosperity.
I now come to the end of the editorial:
But the important thing is that Mr. Harris has shown a readiness to count upon Canadians, in their business and as persons, to take a hand in improving their own future, and he has made some leeway in government tax demands to enable them to do so. This is a far sounder approach than to try to improve conditions by still more government activity and a still more entangled tax jungle.
The losses that the government will take in its revenues, as a result of the tax cuts, are regarded by Mr. Harris as a calculated investment in the country's future. The economic lift they will give the economy may, in due course, produce new sources of revenue, by broadening the base.
This is, surely, the right approach. And surely it comes at the right time.
May I now turn to another section of the chamber. Again I regret that the hon. member is not present, not that he would gain much from my remarks, but I fail to see the leader of the party of which the hon. member for Winnipeg North Centre is a supporter. I refer to the hon. member for Rosetown-Biggar (Mr. Coldwell). As I read the debates of last year I find that he made a mistake in a tax observation, and he repeated, and made doubly bad, this year that very same mistake. May I, with all due deference to a member who has great intelligence, a great heart and great personal integrity, I am sure, say that he failed to tell the whole truth in this chamber when he dealt with this particular subject. I should like to refer to page 2957 of Hansard. The hon. member for Rosetown-Biggar, in dealing with the dividend credit said:
In 1949 the tax credit allowed receivers of dividends from Canadian corporations was first introduced. In 1953 this tax credit was increased to 20 per cent producing, as I pointed out at the time, the fantastic result that a married man with no children who received all his income from clipping coupons could receive up to $9,760 free of personal income tax. That was the position in the 1954 taxation year.
Then he went on to say that as a result of the changes this year the minister will have increased the $9,760 free of income tax to $11,133.33, which the coupon clipper may receive in dividends before paying any personal income tax. I particularly note the use of the word "personal"; but may I suggest that some people throughout Canada, and in fact some members of this house, may be under the impression that from a tax point of view that is the whole story. I submit, Mr. Speaker, it is not. 1 shall try to demonstrate that in a few sentences.
At the bottom of page 2957 of Hansard the hon. member for Rosetown-Biggar gave

The Budget-Mr. Richardson a table and he assumed that this particular taxpayer to whom he referred had unearned income of approximately $11,000. Now, there is exactly where certain terms that I referred to earlier are misunderstood. Certainly, Mr. Speaker, my fellow colleagues of the bar will join me when I say that a corporation is a legal fiction; it is an artificial creation. But to create the wealth, the goods or the profits which a corporation must produce you must have men and individuals to do so.
Let me make the case extreme. Assume that the company is owned by one individual. Before that individual gets this unearned income, being dividends of approximately $11,000, there must be net profits of the company, and before there are any net profits there must be gross profits. It is relatively simple so far. But the profits, after certain deductions if you like, are shared, as every member of this house should know, by the taxpayers of Canada, sometimes called the government. Up to now all other taxpayers shared in those profits to the extent of 49 per cent, leaving this one individual who owned the company, who gave forth his efforts in establishing the corporation, to get the remainder of the net profits, 51 per cent. So in order to produce approximately $11,000 of dividends this individual had to have his corporation earn profits of $21,830, of which his fellow Canadian taxpayers got $10,696. That is the amount which our friend the shareholder had to pay indirectly, through the corporation, to his fellow taxpayers of Canada.
The example given by the hon. member for Rosetown-Biggar would have been more appropriate if under his heading of coupon clippers instead of "none" as the tax paid by him, the member had shown this $10,696 as a comparable figure. Mind you, no man in this chamber will stand up and say that I am on the side of the coupon clippers only rather than of all those who make the real wealth of the country. The member for St. Lawrence-St. George has justified his own living by good, hard manual work. I do not share in the criticism, and I will stop it in advance, from anyone who says this example is given to protect the coupon clipper.
This coupon clipper pays to his fellow taxpayers, through the government, $10,696, whereas the salaried worker or the wage earner pays, as the hon. member for Rosetown-Biggar has well said, $1,817. Our friend who is the shareholder of the corporation pays approximately six times as much after assuming the risk of losses as well as profits, after establishing the company with initiative and pioneering spirit, and engaging the salaried man and other wage earners.


An hon. Member:: Time.


Mr. Johnston (Bow River):: The hon. member has had 20 minutes. The hon. member asked us to call his attention to the time.


Claude Sartoris Richardson: Thank you very much. I shall sit down in just a moment. I know I have had 20 minutes but I will stop in just a minute. The May 5 issue of Financial Counsel published in Toronto and Montreal had this headline:
T.V. Boom Continues to Roar Ahead.
The booming industry of manufacturing television sets shows no signs of slowing down despite the hectic pace of expansion in recent years. In the first quarter of 1955, a new sales record of 116,462 sets valued at $51,419,791 was established.
Then on page 3 of the same issue we find an item stating that Canadian International
The Budget-Mr. Richardson
Paper Company is to erect a $2 million plant, and the paragraph continues:
Another step in the capital expenditure program of Canadian International Paper Company will soon be taken when a start is made in the near future on a $2,000,000 plant at Pointe Aux Trembles, Quebec, just east of Montreal. This new plant will produce special containers and will employ several hundred people when it has reached the final stage, according to latest reports.
And again:
Present building program involves an increase in pulping capacity and installation of the world's largest machine for making kraft liner board at La Tuque.
Mr. Speaker, I shall finish now if you will allow me just one minute of my remaining 18 minutes' time.
The budget is of course a report to the shareholders of Canada, who are all taxpayers including ourselves. I have two suggestions. One is a relatively simple and inexpensive way to let all of us taxpayers know exactly what we are paying in the way of income tax and for what purpose. On the reverse of the assessment notice which goes out to all of our four million taxpayers in Canada there could, without any great expense in printing, be put the seven major items of expenditure; defence, welfare and pensions program, public debt charges, provincial payments, resources and industrial development, national overhead and miscellaneous. Against those seven descriptions there could be placed the exact amounts that are spent. Another column could show precisely the percentage, for example, about 40 per cent for national defence.
There could be another-the last-column on the right where any taxpayer, even those who are in this chamber, with a pencil, may relate his percentage which is to be paid for national defence. If it is estimated at 40 per cent, the taxpayer will know that out of his total tax bill of $1,000, $400 will be spent on his behalf for defence. That is a relatively cheap price at the moment to pay for security within Canada. Each taxpayer will know precisely what his share of the income tax burden is with regard to national welfare benefits, with regard to the debt charges and other features of our national administration.
Although at first glance this may seem a little strange, many taxpayers in Canada are anxious to have-and certainly need-information of this character. I do not believe we have any interest in prolonging the debate here, but my own view is that we should inform the taxpayers who are our shareholders. I submit that the Minister of Finance and his department might give this suggestion full examination.
3622	HOUSE OF
The Budget-Mr. Quelch
Mr. Speaker, I listened with great interest to the hon. member tor Prince Albert this afternoon. I want to say that, as the member representing the constituency of St. Lawrence-St. George, I think it would be the wish of my constituents that the Minister of Finance give careful and renewed consideration to making the amount of $50,000 totally exempt in respect of all succession duty assessments. I subscribe very largely also to the view of the hon. member for Prince Albert that pension plans for selfemployed people should have come long ago in our Canadian legislation.
I am grateful, Mr. Speaker, to fellow members for overlooking my transgression of my self-set period of 20 minutes, and I now resume my seat.


Mr. Victor Quelch (Acadia):: Mr. Speaker, I think the hon. member who has just taken his seat will realize now that he may have been somewhat rash when he began his speech with the statement that he was only going to take 20 minutes, as he spoke for about double that length of time.


An hon. Member:: What about the hon. member for Prince Albert?


Victor Quelch: In regard to the budget, it is interesting to note that from 1945 to 1953 we had in this country generally a sellers' market, bringing an expansion in both production and income. The job of the Minister of Finance during that period was comparatively easy. The economy was forging ahead, and it was only necessary for the minister to apply the brakes from time to time. Today the economy has slowed down and there is a very definite need to push sales in order to maintain the expansion in both production and income.
I would say that the present period provides the first real test of the government's ability to maintain an expansion of production in the face of somewhat adverse conditions. One might say that today the home market has been very definitely neglected.
I think the Minister of Finance will agree that the home market is the best market we have, because it has to absorb an amount of goods equivalent to the total production of the country. I would also say it is the best market, because it is the only market over which we have absolute control. But it has been sorely neglected in the past, and it can be argued that it is being neglected today.
Certainly we have in Canada today a tremendous potential market consisting of the people receiving low incomes. The minister stressed the sustaining force of welfare


payments. I think the minister will agree that those payments could be still further expanded without laying themselves open to the charge of extravagance. Expanding those payments would strengthen their sustaining force in so far as the economy is concerned.
I regret that the Minister of Finance did not see fit to reduce the sales tax, which would have helped to expand the purchasing power of those people who are in greatest need of having their purchasing power expanded. It would also have helped to expand sales by reducing the prices of commodities, and that would have been of special value in the international market, because we are constantly being told that our prices are not competitive.
In his address the minister blamed the short wheat crop for the decline in the Canadian economy. Obviously that cannot be the case. By the end of 1954 we had not even sold the 1953 crop. If we should happen to have another crop failure this year I think the government will realize the seriousness of the situation because, having had a crop failure last year, another crop failure this year would bring about a drop in farm income which would be exceptionally serious.
What the minister should have said was that the decline in the Canadian economy was due largely to the drop in the farmers' income. Agriculture today is undoubtedly facing very difficult times, owing to falling prices, the difficulty in selling farm produce, and adverse weather conditions.
The bureau of statistics, in its publication "Farm Net Income, 1954", demonstrates the effect of these conditions. It is important to note that the figures I am quoting are of net income. Whenever you refer to the situation with regard to agriculture you should always use the net income figures rather than gross income, because gross income in itself has little significance. You must take into consideration the cost involved and what is left afterward. That is the income the farmer has left to spend.
In 1951 the net income of the farmers was $2,154 million; in 1952, $1,923-5 million; in 1953, $1,699-6 million; in 1954, $1,125-6 million, a drop of over $1 billion in four years. So we find today that the farmers, representing approximately 16 per cent of the population, are only receiving 6 per cent of the national income. The whole economy is suffering as a result. I think the minister would agree that everything that can possibly be done to halt that downward trend must be done. It is not merely the farmers who will suffer; the whole Canadian economy will suffer as a consequence.

We believe three things are essential in order to strengthen the agricultural situation. We believe the price support program should be strengthened. We believe definite action should be taken to expand markets for agricultural produce both at home and abroad. We believe the government should take the initiative in establishing a crop insurance program in co-operation with the provinces.
I am only going to deal with the question of support prices at this time. I shall be dealing with the other two matters at some other time, probably on the agriculture estimates. However, before going on with this matter I wish to refer to a statement made by the hon. member for Assiniboia when he spoke in this debate. He stated that the C.C.F. was the only party in Canada advocating that support prices should be at full parity, that is parity prices supported rigidly on that basis. I would point out that it is true they are the only political party, so far as I know, advocating that policy; but it is also interesting to note that none of the major farm organizations is advocating that support prices should be maintained at 100 per cent of parity. If there is any doubt on that point, perhaps I should quote from the brief of the Canadian Federation of Agriculture.
It is also interesting to note that when the hon. member for Assiniboia spoke he referred to the brief of the Canadian Federation of Agriculture as a very excellent brief. This is what they have to say regarding the proposal of the C.C.F. to maintain support prices at 100 per cent of parity, as found at page 7 of their brief:
We do not believe it is sound or practical to look to a price support program to guarantee the farmer prices which represent a full fair or parity relationship for each individual product. The result of such 100 per cent guarantees, if attempted, would inevitably be a high degree of government direction and control over agriculture. We do not believe farmers wish to submit to such extensive government participation in their business, nor do we believe it is reasonable to ask the government to undertake such a commitment. We believe that a parity position for agriculture can be achieved not only through a clearly defined price support program, but through the development of producer orderly marketing programs and the full co-operation of governments in all essential features of sound farm, economic and trade policy.
It is interesting to note that in their brief the Canadian Federation of Agriculture advocates partially flexible support prices being maintained at between 65 and 85 per cent of parity. The hon. member for Assiniboia says their brief is very excellent, so apparently he is in favour of maintaining support prices
The Budget-Mr. Quelch at not more than 85 per cent of parity. On the other hand, in his own speech he advocated 100 per cent of parity.


Charles Edward Johnston: A little confused, that is all.


Victor Quelch: The hon. member for Assiniboia went out of his way to criticize what the leader of this group had had to say regarding parity prices. If it had not been for that I probably would not have mentioned the subject at all. At page 3459 of Hansard the hon. member had this to say:
In his opening speech this session the leader of the Social Credit party had some remarks to make about parity prices. He said that his party was in favour of flexible parity prices, in other words, prices that were only a percentage of parity and which did not give the farmer the full equitable treatment he deserves.
Let me say that statement is absolutely false. I am not suggesting it was deliberately made as false; nevertheless it is an absolutely untrue statement. Unfortunately I think the hon. member for Assiniboia has allowed his political astuteness to pervert his mind in this regard. The trouble with the hon. member for Assiniboia is that he apparently does not understand the meaning of the word "flexible". He takes it for granted that the word "flexible" means less, but of course it can mean more or less, above parity or below parity. If it were considered desirable to expand the production of any one commodity and reduce the production of another, then it might be considered desirable to increase the support price above parity on the commodity you wanted to expand and decrease it on the other. There is no indication that by flexible support prices the leader of this group meant price supports below parity. Then the hon. member for Assiniboia went on to say:
In case the hon. member may think I am misrepresenting what he said-
Let me point out there is no doubt about that.
-I shall quote his exact words as reported on page 47 of Hansard for January 10, 1955:
"There is a very good case that can be made in favour of the adoption of such a flexible system here in Canada, the percentage of parity that is used of course to depend upon the amount of incentive which ought to be provided to achieve the amount of production that is required to meet the need.''
That is the statement on which he bases his contention that we were advocating less than parity and an inequitable treatment of the farmers. If he had gone on a little further he could not possibly have fallen under that delusion. Let me quote from the same page

The Budget-Mr. Quelch he quoted from as to what the hon. member for Peace River (Mr. Low) stated:
The problem we face In this country is to adopt some policy and some technique which will guarantee the farmers their fair share of the national income. The figures will bear out what I say. The farmers who make up approximately 20 per cent of the population of Canada, received in 1953 only 99 per cent of the national income . . .
I say the problem to be faced in a country like Canada is to adopt a policy which will guarantee the farmers a fair share of the national income. It would be only just and right if the farmers as a class make up 20 per cent of the total population of our country, they should receive something like 20 per cent of the national income. There has hardly been a time in the history of this country when this has been the case.
To achieve that, we advocate flexible parity prices based upon a two-price system, and I will be dealing with that later in my remarks. I think that is all I need to say to clarify the situation regarding the charge of the member for Assiniboia that we are advocating parity prices of an inequitable nature. He did suggest to me that I should straighten that out when I spoke.


Hazen Robert Argue: I suggested that you should straighten out your leader.


Victor Quelch: There are a number of points that are generally raised in connection with the subject of parity prices. If you are speaking to people down east about western agriculture they will invariably say, "What right have the farmers of Canada to expect the government to underwrite their prices?" I think it is quite a reasonable question. To answer it you have to go back a number of years. You have to go back to the depression years before the war, when farm prices were at a very low level, far below parity. When the farm organizations protested about the low prices they were told that the cause was the international situation, that prices were low in the world market and the farmers could not very well expect to get more than the prices in the world market. So prices continued at a low level in those pre-war years.
Then the war came and within a couple of years the prices of farm products started to rise, but the government considered it desirable to place a ceiling on those prices. Let me point out that you cannot have it both ways. If you say the farmers should take low prices when world prices are low, then surely the farmers are entitled to high prices when world prices are high. But they were not allowed to have those high world prices. Ceilings were placed on them at the very time when the farmers had an opportunity to make up the losses they suffered when prices were so low in the depression years.

The government of the day apparently realized the situation was not fair so far as agriculture was concerned, and the prime minister of the day, Right Hon. Mackenzie King, had this to say in a radio broadcast on December 4, 1943:
I wish tonight to thank the farmers of Canada for their magnificent contribution to the battle of production. I wish again to appeal to them to continue to help hold the front line against inflation by continuing to support the price ceiling. If, to help win the war, the farmers are asked to accept a ceiling on prices, we believe they are entitled to a floor under prices to ensure them against an agricultural depression after the war. As an essential part of its post-war policy, the government intends to ask parliament at the next session to place a floor under the prices of main farm commodities.
The government lived up to that promise and instituted the Agricultural Prices Support Act. Under that act the principle was established that prices for farm products should be maintained at a level that bears a fair relationship to the prices of other commodities. The question, of course, that is in the minds of many farmers is whether the government today is living up to that principle.
I was interested in that point. I was wondering whether the support prices of farm products today were in line with the principle laid down under the Agricultural Prices Support Act, so I wrote the chairman of the agricultural prices support board. On a former occasion I had written to the bureau of statistics but the Minister of Agriculture told me I had written to the wrong body, and I should have written to the agricultural prices support board. This time, therefore, I wrote to the board. The letter was as follows:
Dear Mr. Shaw:
Could you please send me a list of the commodities that are being supported today and the level of the support price.
In addition, could you also give me what the price of these products would be if the price of farm products today bore the same relationship to the prices of other commodities as existed in the base years 1943-44-45.
I would like to get that information on cattle, as well as hogs, eggs, cheese and butter.
I received a very courteous reply from the agricultural prices support board, and I will just quote the last three paragraphs. They read as follows:
In connection with the second paragraph of your letter I am not quite certain as to the interpretation but I assume you are referring to the basis of relationship mentioned in subsection (2) of section 9 of the Agricultural Prices Support Act which states:
"The board shall endeavour to ensure adequate and stable returns for agriculture by promoting orderly adjustment . . . and shall endeavour to secure a fair relationship between the returns from agriculture and those from other producers.''

In order to illustrate the relationship on the basis of the five commodities which you mention the following table shows the position of each commodity mentioned as well as indicating the United States prices which, while not exactly comparable may be used as guides to prices in that country. The United States market prices for the last four years have been included as a basis of comparison. You will also be aware that eggs and butter have been under price support continuously for several years.
I might mention that I did not ask for the prices in the United States, but I can quite understand that he was anxious to put in a
The Budget-Mr. Quelch little plug for the government because the comparison was quite favourable in so far as the government of Canada is concerned. I want to comment briefly on the table so I was wondering, Mr. Speaker, if I could place it on the record and then comment upon it.


Mr. Deputy Speaker:: Has the hon. member permission to place this table on Hansard?


Some hon. Members:: Agreed.


Victor Quelch: The table is as follows:
Year
Estimated parity
using 1943-45 as	Average	United Statesbase period	market price	market price
Cheese-
(cents per pound Toronto)
Plymouth-Wisconsin
1951..	.
1952..	.
1953..	.
1954..	.
21.5	21.5	_33.4	38.8	39.535.4	32.9	37.934.9	31.4	35.134.3	32.5	31.2
First grade creamery butter-
Butter-grade A
(cents per pound Montreal)	Wholesale New York
1943-45.
1951..	.
1952..	.
1953..	.
1954..	.
43.0	43.0	__66.9	65.0	73.670.7	62.4	71.569.7	61.0	65.568.6	59.8	59.0Good steers-	(up to 1,000 pounds-dollars per cwt. Toronto)	Chicago1943-45	11.64	1951	1952	25.15 19.97 19.53	1953	1954	20.77
Hogs BI dressed-
(dollars per cwt. Toronto)
Barrows and gilts dressed carcass Chicago
1951..	.
1952..	.
1953..	.
1954..	.
17.35	17.35	
27.00	32.85	30.1228.54	25.70	25.3228.14	30.82	30.1527.69	31.10	30.48
Eggs grade A large-
1943-45	
1951		
1952		
1953		
1954		
This table gives the estimated parity price for a number of commodities, using 1943-45 as the base period. Taking cheese, we find that in Toronto in the year 1954 the parity price should have been 34 [DOT] 3 cents per pound and the actual price was 32-5 cents. This would be 95 per cent of parity. The parity 50433-229
Midwest mixed
(cents per dozen Montreal)		fancy heavy weights New York
42.9	42.9	
66.7	66.2	59.270.6	54.2	48.169.6	64.8	54.268.5	52.1	40.4
price for first grade creamery butter at Montreal should have been 68-6 cents per pound and the actual price was 59-8 cents. This was 87 per cent of parity. The support price for butter was 58 cents, which was only 84-6 per cent of parity.

	I.U me lacK Oi balance between
present producing capacity and effective demand does not lie in the restriction of production. The world needs enormous quantities of food and ,At the /fme time it should be recognized that' temporarily, important shifts in production could be made to advantage and should be made
And again:
The conference recommended that governments of countries possessing unwieldy surpluses take steps, where practical, to dispose of some surplus stocks in their domestic markets-by improved marketing efficiency, special welfare programs special feeding programs for certain vulnerable groups, etc.

Canada Grain Act
And again:
The IFAP agreed that, while some sales of products abroad at less than domestic prices may be inevitable for some commodities under present circumstances, every effort should be made to use the consultative machinery referred to above in respect to any new programs in order to avoid damage to the interests of friendly countries.
And again:
It recommended that priority be given to disposal of surpluses in underdeveloped countries, which is particularly important where such disposal programs are linked with programs for general economic development.
And again:
The concluding thought, however, which refers to many of the recommendations already mentioned, is that the best answer will be found on the side of demand-in those programs and program features which aim to widen and improve distribution and raise purchasing power to provide effective demand.
Mr. Speaker, as it is now five o'clock, perhaps I might be permitted to continue my comments after we have disposed of private and public bills.


Mr. Deputy Speaker:: Order. It being five o'clock the house will proceed to the consideration of private and public bills.


CANADA GRAIN ACT
[Stage Direction]
The house resumed, from Tuesday, May 3, consideration of the motion of Mr. Argue for the second reading of Bill No. 22, to amend the Canada Grain Act.
Mr. Rene N. Jutras (Provencher):: Mr. Speaker, on Tuesday when we were discussing this bill I was interrupted at six o'clock. Since then I have had the opportunity to read the speech made on that occasion by the sponsor of the bill, the hon. member for Assiniboia, and in the few minutes left at my disposal I should like to refer briefly to one statement he made.
First of all let me say that I was struck, when reading his speech, by the number of times the word "arbitrary" appears in it. It seems that the hon. member was carried away by his eloquence in the course of the discussion.
I wish to refer more particularly to the statement which appears on page 3412 of Hansard, and to quote the last sentence of the second paragraph and the last sentences of the third paragraph. In referring to the action of the government, the hon. member said the government-
__has permitted the transport controller to
step in and block the farmers' action by cancelling the car order book.

The same thing is repeated in the third paragraph in different words, as follows: Apparently there is no one in the board of grain commissioners or in the ranks of the cabinet who wishes to restore to the farmers this fundamental right. They would far rather continue this conspiracy to deprive the farmers of a fundamental Canadian right.
The hon. member went as far as he could without being unparliamentary, because there are certainly imputations of improper motives here. The suggestion that the controller or the government deliberately set out to deprive the farmer of a fundamental right is, of course, nonsense in this instance.
This takes us back to the time when the car order book was suspended. It would be well to put on the record the facts of that particular case. Surely the hon. member for Assiniboia knows very well what were the reasons for the suspension of the car order book at the time. They were certainly not the reasons suggested in these two paragraphs. At that time, as we all know, there was a demand for a particular grade of grain, a grade other than the prevailing grade of grain that was produced in that area.
The result was that the Canadian wheat board found themselves in a difficult position because they were unable to obtain, or could not readily get, the particular grade for which they had sales. Therefore they had to issue special shipping orders to get that particular grade wherever it was available. Consequently, under conditions such as these the car order book was very difficult to operate.
I believe the controller suspended the car order book at the request of the Canadian wheat board. At any rate, at that time everybody agreed that it was the logical thing to do and it was done by the controller in order to fill the orders the board was getting for the sale of that grade of grain.
Surely everybody still agrees that it was wise for the wheat board to try to sell as much grain as possible. These were the only reasons the car order book was suspended. Last year, as the situation changed, the pools were the most insistent on having the car order book reinstated.
As we all know, the minister suggested last year that the car order book be reinstated, and it was reinstated. I understand that after a year's experience with it the pools are contemplating requesting that it be suspended again. The suggestion that the transport controller, or any other agency, and the cabinet ministers had purposely set out to prevent the farmers from getting box cars through the car order book is simply ridiculous. It is not a fair statement to make.



Again and again in his speech the hon. member referred to the government directly or indirectly denying to the farmer the right to deliver to the elevator of his choice. He even went so far as to suggest that in this instance the government had taken away the right of the farmer. Earlier in his remarks- and this is what I want to refer to before I conclude-he proceeded to give advice to the people of eastern Canada on this question of box car distribution. I think I should reread for the record the remarks of the hon. member, since he is a member of the socialist group. He said, at page 3411 of Hansard:
The right is that any Canadian, when he decides to sell his produce-whether it be agricultural produce or whether it be his labour-has a right to sell that product to the firm of his own choosing. To say that western farmers today have that freedom would be to deny the truth of the statements by thousands of farmers that have been received by members of parliament and by the government.
We know that other people of whom the hon. member spoke in a derogatory way later on in his speech have been using this very statement in their publicity. Apparently everybody agrees on that, but if the purpose here is to clarify the situation for the eastern members, we might as well state the facts exactly as they are.
As far as the selling of our products is concerned, a few years ago we all agreed and I think we still agree-or at least a very large majority of the farmers of western Canada agreed-that they would forgo the right to sell to any particular firm. By instituting the Canadian wheat board we agreed to let that board be the sole agency to buy our products, and we retained the right to choose the firm to handle our grain. We all have the same right today. It has not been denied to anybody; it has not been taken away by anybody. The situation today is that in some instances we find that the exercise of this right has been curtailed to some degree. It has been curtailed in varying degrees, depending on the area and the place. For quite a few years it has never been possible to exercise that right in full, because no matter what we do, what distribution we make or what scheme we have, in a centre where there is only one elevator the farmers cannot have the right until that situation changes. Therefore, in effect, no matter what anybody does, this right will be curtailed and has been curtailed to some degree.
If there are enough box cars we all have the right to deliver to the elevator of our choice. If there is more than one elevator in a centre we may have that right again. But, I repeat, if there is only one elevator we have not the choice because, under the quota system, it has not been possible to devise a means by
10, 1955	3629
Canada Grain Act
which a farmer can deliver to more than one point at a time. Therefore the various suggestions, including the bill introduced by the hon. member for Assiniboia, may improve conditions in some ways but the problem will remain with us to some extent as long as there is an acute shortage of box cars.
As I said, we have been circularized and presented with another suggestion by the Saskatchewan wheat pool. It is suggested that this matter go before the agriculture committee. There is no doubt that it will be discussed at some length, but I suggest that if we passed this bill we would preclude consideration of the suggestions of the pool. It would not be timely. I suggest that this be left until we have a chance to hear more of the details of the other suggestions that are being made by the pool.
I am convinced that Bill No. 22 is not workable and cannot be made workable, and there is also some question as to its being constitutional. At any rate, the matter of the distribution of box cars will come up for discussion in due course and some further light will probably be thrown on the subject.


Victor Quelch: Mr. Speaker, I should like to congratulate the hon. member for Assiniboia upon bringing this measure before the house again, because it is of vital importance to the grain growers of western Canada, especially so long as the quota system continues. On previous occasions we have always supported similar amendments, and we shall do so at this time because we believe the farmer should have the right to deliver grain to the elevator of his own choice.
The hon. member for Provencher pointed out that the farmer never had that full right, and he gave as an example that there might be only one elevator at a certain point. That might be true in a particular case, but we know there is more than one elevator at the majority of points in western Canada. Simply because there might be only one elevator at one point should not deny the farmer the right to deliver grain to the elevator of his own choice.


René Jutras: I am sure the hon. member does not want to misinterpret what I said. I was not using that as an argument against any of the schemes, but simply to indicate that a full choice was not always available.


Victor Quelch: I quite understand that the hon. member was not presenting it as an argument, but I assume he was considering it as a factor in the case or he would not have mentioned it. He must have had some reason for doing so.

Canada Grain Act
The principle of this amendment has been endorsed by all the major farm organizations in western Canada such as the Canadian Federation of Agriculture, the interprovincial farm union and the three western pools. We support it on the ground that the farmer should have the right to deliver grain to the elevator of his own choice at the time a quota is established.
Second, this would help to restore competition in the purchase of grain by elevator agents. Many of us who have had experience in the marketing of grain in western Canada know that at times the popular elevator will be plugged and if a farmer wishes to market his grain he must take it to one of the other elevators. I know it will be argued that all farmers will be treated in the same way, but that is not quite the case. We know that all elevators look after their special patrons. If an elevator should be plugged and a car is available, the agent will phone his special patrons and tell them to bring in some wheat. Those farmers will load up two or three trucks and bring them in and by the time the other farmers hear about it the space is gone. I am not blaming the farmers for that situation, nor do I blame the elevator agents; it is just a situation that exists.
The whole problem arises from the fact that cars are allocated on the basis of one car per elevator. I know it has been argued that this is not a fact, and it may not always be true; but so far as I know that is the general practice. I have been told that it is the general practice at a number of points. This practice is not followed as far as manufacturing establishments are concerned. The factory with the large production will get the greater number of cars; but in the case of grain elevators, no matter how much wheat farmers may want to take to a specific elevator they all get the same number of cars. This is the result of a state of congestion. As a result of this practice farmers are forced to take wheat to elevators other than those of their own choice if they desire to market their grain.
This amendment would help to restore competition. At the present time there is little if any competition because an agent knows quite well that the grain will come to him when the other elevators are full. Consequently he is free to undergrade, underweigh and overdock because he knows he is going to get the grain in the long run. Farmers are quite often forced to haul their grain to a particular elevator even though they do not like the way it will be handled.
No doubt this is one reason the overages in country elevators are so large. Some
'Mr. Quelch.]
people may say the pool elevators also have overages. This is true, but the farmer knows that if he hauls his wheat to a pool elevator and there are overages he will get the benefit of those through patronage dividends at a later date. That is why so many farmers are anxious to haul their grain to pool elevators. They are not satisfied with the way their grain is being handled by the other elevators. If they haul to a pool elevator they will benefit from any overgrading or underweighing that may take place when the final settlement is made.
If this amendment carries, cars will be allocated to elevators in keeping with the farmers' individual expressed preference. The railways say they are quite willing to do this and are merely waiting for direction from some source. The wheat pools have suggested a somewhat different procedure through an amendment to the wheat board act and the grain act. I am not at all certain in my own mind whether this amendment or the amendments suggested by the wheat pools would be best, but I think we could all agree on the principle of this bill, that the farmer should have the right to deliver his grain to the elevator of his choice.
It seems to me the best thing the house could do would be to approve the principle of this bill on second reading and then send it to the agriculture committee, where it could be amended in line with the best interests of the farmers without changing the principle. We would be able to bring down representatives from the pools and other farm organizations and try to whip this amendment into the best possible form.


Mr. G. H. Caslleden (Yorkton):: Mr. Speaker, in rising to support Bill No. 22 I want first to comment upon the fact that the hon. member for Provencher has said repeatedly that we ought to let this matter stand for a little while longer until we see what the committee is going to do about it. I suggest to him that the wrongs and injustices which have existed in this field have been allowed to go on too long. This bill should have been passed three years ago, and the right of the farmer to deliver grain to the elevator' of his own choice established.
When you take that right away from him you stir him very deeply, particularly when the elevator which he has built represents years of struggle and sacrifice, education and fight. We do not want to go back to the old days when the Winnipeg grain exchange controlled the price of grain when purchased from the farmer and the price at which it was sold to the ultimate consumer or to other

parts of the trade, and then pocketed the difference. As stated in the explanatory note:
The purpose of this act is to remove discrimination in the allocation of box cars by providing in a new section of the car order book a rule for the fair allocation of box cars among elevator companies at a marketing point where the car order book, as presently constituted, is not in effect.
By allocating their seeded acreage among the elevator companies at a marketing point, producers themselves will determine the distribution of box cars at that point.
Many people are somewhat at a loss to understand why there should be so much noise about the right of a farmer to deliver his grain to the elevator of his choice as, after all, he is selling it to the wheat board, and the wheat board is the sole agency to handle it. But there is more than that involved in this. The farmer, in continuing the fight he has carried on for some 30 or 40 years, has established this elevator system to which he wants to deliver. He has been delivering his grain to his elevator for many years. It is part of his life; it is part of his struggle; it represents years of work. He sees a tremendous injustice when box cars are allocated to the elevators at that particular point, and he finds when he wants to deliver grain to his own elevator that there is no room. Why is there no room? Because somebody, in spotting the cars that came in, spotted the cars in front of the other elevators.
The effects of the situation are shown clearly in the annual figures of the Saskatchewan wheat pool, which is the one mostly affected in the past. They found that the annual percentage of business which they have been able to do has gradually fallen off until this year the figure is below 40 per cent. The hon. member for Provencher this afternoon made the point that if you have a siding with only one elevator you have no choice. That is true, but this is what has aggravated the farmer. He finds that if it is a siding with one line elevator that is where he and the farmers in that district deliver their grain. Eight miles further down the line there may be another siding with another elevator, but in this case it is the wheat pool elevator, his own elevator. He finds that the cars are not spotted at the elevators in the right proportions. Sometimes there are two or three times as many cars going to the line elevator company as to the point where there is only the wheat pool elevator.
After they have taken out all the allocated grain which is under quota for that line elevator point, the farmers throughout the country cannot make further delivery. Then suddenly this point is opened up and farmers are allowed to deliver where there is only
Canada Grain Act
one elevator, and that is a line elevator. The result is that farmers are unable to sell the grain. They are short of money. They cannot deliver the grain because no box cars have been delivered at their point. They have no cash and they cannot pay their taxes. Finally in desperation the farmers are forced to deliver the grain to the line elevator company.
Figures show that gradually, in the last four or five years, this business has gone from the wheat pool. The percentage going to the line elevator companies is increasing. They are gaining in strength. These companies were the foundation and the basis of the old Winnipeg grain exchange. This stirs up within the farmers the fear that perhaps the wheat board will be thrown out when the big line companies get strong enough again, when they are handling a large enough quantity of grain that they will be able to re-establish the grain exchange.
The farmers are afraid that the wheat board will be done away with and that, after fighting for 50 years, they will be left to the mercy of the line elevator companies and the grain exchange. This is a battle that has been going on for many years, and the farmer will fight desperately to keep himself out of the clutches of the line elevator companies.
When the wheat pool first started, years ago, the line elevator companies tried to meet their competition but were unable to do so. The wheat pool has grown over the years. In the province of Saskatchewan over 1,100 co-operative wheat pool elevators are handling the business for co-operative farmers. Now they find they are unable to deliver their grain there.
Something must have prevented them from doing so, and it was not competition. They beat the line elevator companies in competition every time they met, and they drove the line elevator companies out of business at many points by doing business better and by returning to the farmers the profits of their organization. The farmer got his profits on the grain he delivered there in proportion to the business he did. But somehow, through machinations in the allocation of box cars- this is the weapon which the opposition to the wheat pool has used-the pool elevators find themselves strangled.
We have been trying to find out who was responsible for the allocation of box cars. The transport controller denies that he is responsible. The railway companies say that they do not get any instructions from anybody, and it is simply that freight crews go down and happen to leave a box car at one place or another. They may say all the

Canada Grain Act
elevators are filled and so, if there are four cars, they will send one to each elevator. That means that the farmers' co-operative is only getting 25 per cent of the business and that is all it can get. Perhaps 75 or 80 per cent of the farmers have been delivering their grain to that point. They want to deliver their grain to their own elevator but they have to haul it to the line elevator companies.
Those in control of the line elevator companies have exploited the farmers. When the farmer is forced to deliver his grain to the line elevator companies, the agent will say, "We will give you a good grade on this. I think you had better bring your permit book here, so we will handle all your grain." A regular battle has gone on for some time to win over the farmer.
We can easily understand why the Winnipeg grain exchange wants to get back into business. If they can handle the farmers' grain again and manipulate prices to suit themselves the farmer will have to take the price offered him. They will be permitted to manipulate the price and nobody will be interfering with the principle of private enterprise. They say that the law of supply and demand will be operating again. The wheat pools and the wheat board will be out of the way. The statement of the president of the Winnipeg grain exchange in the past year showed very clearly that what he is aiming at is to restore the line elevator companies and bring back the open market set-up that existed before.
The farmer is alive to that. The chief obstacle to the old grain exchange is the cooperative wheat pool and the Canadian wheat board. The farmers see in this serious behind the scenes set up, where nobody seems to understand the basis upon which the allocation of box cars is made, a sinister move to destroy their organization. That is why they are aroused. That is why they are putting in their protests.
I think the Minister of Trade and Commerce knows that thousands of letters of protest have come from the farmers of Saskatchewan. At any rate hundreds have come to the desks of members of parliament, urging them to support a bill which will give the farmer the right to deliver his grain to whatever elevator he wishes. If he wants to deliver his grain to his own elevator he should be allowed to do so, because it can easily be done. It could be based upon the seeded acreage which each farmer has in the district. It could be arranged in such proportions that each permit holder would tell the station agent at that point exactly the acreage he is seeding and how much of that grain he
[Mr. Castleden.l
wishes to deliver for the crop year to his own wheat pool, into Pacific, or into Federal Grain or the U.G.G. or whatever company it is.
On that basis, with the cars coming to that point, the local station agent can allocate them to the elevators proportionately. It might not be exact, but at any rate it would give the farmer the right to deliver his grain to the elevator of his own choice as nearly as it is humanly possible to do so. We had difficulty presenting this case in the standing committee on agriculture last year. We had difficulty making people understand that underneath this whole thing was a basic principle for which the farmer was fighting, and which he wanted established because he saw without it great danger to his own organization and his own rights.
The matter was brought before the committee at the meeting of the 20th of May, 1954, I believe. The question of congestion was explained, but it still did not prove to us why, if the wheat pools wanted to do 70 per cent of the business at a particular point, they should not get 70 per cent of the box cars and should be allowed only 40 per cent. The box cars were there. It is the farmer's own business, and surely he should not be compelled to take his business to the opposition. I think the people of Canada doing business would protest most vehemently if they were compelled to do business with other than their choice. At that time the Minister of Trade and Commerce said, as found at page 517 of the proceedings of the committee:
I think the problem in the farmers' minds is: how much grain can they market, not with any one particular agency, but how much grain can they market? That is the over-all problem.
That was a problem too. They can still deliver the same amount of grain through the same box cars. The pool elevator agent will get out the box cars just as quickly as the line elevator company if they are spotted in front of his elevator. The minister went on to say:
We are going to try to solve this problem of car distribution, but if we do not solve it no great principle is going to be violated. No one is going to have any serious loss.
There may be no serious loss in any one year. Perhaps it is only 4 or 5 cents a bushel, but bit by bit it adds up. The minister said no great principle was being violated. I should like to inform the house that we and the farmers feel a very serious and basic principle is being violated. The farmer sees a personal right being taken away. He sees the organization he has established being ruined. I should like the house to understand that the operations of the Winnipeg grain exchange probably represent private industry carrying on

business at its worst. If the people who support private enterprise want to know why the western farmers are against private enterprise, the best evidence they can find is the way private enterprise operators on the Winnipeg grain exchange have become millionaires over the years at the farmers' expense.
The only weapon the farmer has with which to fight is the co-operative organization built by himself. That is the means by which he has fought the battle throughout the years. When he sees his organization being destroyed by any means at all, but particularly when it seems to be in an underhanded way and he cannot get at the root of the trouble, then he feels very deeply about it. I have a letter here from a farmer in my constituency. He says that car distribution is terrible at that point, and goes on to say that the local agent has dropped from about 42 per cent last year to 28 per cent. In other words, he used to be getting 42 per cent of the grain at this point and it has dropped to 28 per cent. It used to be one of the best co-operative points in the whole district, but the agent is down to 28 per cent this year.
The rest of the wheat pool farmers in that district have been compelled to deliver what grain they have delivered to the private companies which have been their opposition. What disturbs them is the danger that this situation may become permanent. It is getting worse and worse. Each year the wheat pool reports a smaller and smaller percentage of the grain handled going through their elevators. More and more each year wheat pool farmers are compelled to deliver to the other elevators where there is space. The space is there because of the allocation of box cars. Wheat pool elevator points have found the situation particularly difficult, even in the areas where they are the only elevators at the particular points. They find that box cars are sent to other points and not to them.
The situation looks rather serious to the farmer and the wheat pool because they feel that through the allocation of the box cars their whole business is threatened permanently. They see what the Winnipeg grain exchange and the line companies would like to do. Their attack on the wheat pools is an effort to discredit the wheat pools and the wheat board. You can discredit the Canadian wheat board if you can get the farmers feeling that there is something wrong. You can discredit the wheat pools if the farmers think there is something wrong with the way cars are allocated.
We feel that a serious mistake was made in the past year in that through some machinations the Canadian wheat board 50433-230
Canada Grain Act
undertook to allocate orders to the various grain companies on a particular basis. We have had difficulty in finding out exactly how the board does operate, but I understand that when they sell a certain quantity of grain they allocate the grain orders to the various companies. If they allocate so many hundreds of thousands of bushels to the wheat pool they say, "You are to send us 400 cars of No. 4 wheat".
I understand that the wheat pool, as nearly as I can find out, is then supposed to say where it will get the No. 4 wheat and the different points to which the box cars should be sent. As a result the farmers in one area will say that they are in the wheat pool elevator at that point and cannot get any cars. Apparently the head office has sent the box cars somewhere else. I do not think any better method could be found to make the wheat pool committees and supporters angry at their own head office. If that is the system under which the matter is being handled, then I suggest it is time something was done about it.
Earlier this session I put certain questions on the order paper in an attempt to find out what was the basis under which cars were being allocated to the various companies. These are the three questions I asked:
1.	What is the basis for the allocation of grain shipping orders to the various elevator companies, as now used by the Canadian wheat board?
I just asked what the basis was.
2.	When was the present system of order allocation put into operation?
3.	How were the percentages for shipping orders as between elevator companies arrived at?
Has it been a 10-year basis? Have they taken any one particular year? Have they taken a free delivery year? The farmers would like to know the basis under which the wheat board is operating, because that will determine to a large extent the percentage of the business the wheat pool now is allowed to do. If they are only going to get 48 per cent of the shipping orders then they are only going to do 48 per cent of the business that year. If the wheat board decides under this system that they are only to get 42 per cent, then that is all the business they can possibly do even though 60 per cent of the farmers in the province of Saskatchewan may desire to do their business with the wheat pool.
That is where the danger lies. These are the replies I received:
1. It is not the policy of the Canadian wheat board to disclose details of its current operations nor the competitive position of various elevator companies in their capacity as agents of the board.
The answers to questions 2 and 3 were, "See answer to No. 1." I was not asking them

Canada Grain Act
to disclose their current operations. I wanted to try to find out by some means how shipping orders were at present being allocated, on what basis, and how the board determined which elevator company would be chosen. I say that because they can determine permanently whether an elevator company will grow or will be wiped out, through the allocation of these shipping orders and box cars. This is the kind of information we want.
The thing that makes farmers particularly suspicious about this is that in past years the box cars that went to various points were apparently taken there by the elevator company, and apparently the elevator company shipped them out to the particular districts under the orders of the transport controller. The man who was on loan as transport controller was a member of the board of grain commissioners. Now, that member of the board of grain commissioners was previously president of the Winnipeg grain exchange, and as transport controller he had wide powers. We cannot find out today who is responsible for this thing; we can only look at the result. The result has been that the line elevator companies have been increasing in power and the wheat pool cooperative organization has been decreasing in power.
The farmers see in this a threat to their organization built around the establishment of the old co-operative, the only weapon they have with which to fight for justice. It is for this reason we are introducing this bill now for the third time. Under the provisions of the bill the allocation of box cars at delivery points would be made according to the farmers' wishes. It is only a simple, basic right. Surely its administration is not too difficult. If cars were going to be delivered to a point they could be delivered at the elevators in proportion to the farmers' wishes. It does not help to hide the whole thing behind a screen of uncertainty, or to say no one knows whose responsibility it is. It does not help to give answers like this, that it is not our policy to disclose the operations of the board. I was not asking for disclosure of the operations of the board, but surely the allocation of box cars and the allocation of business is the business of the farmer.
The members of the farm co-operative organizations are aroused. For years they have accepted the excuse that the trouble was due to congestion and nothing could be done about it. They were told, "You want to sell grain, and we are doing what we can. We might not get all the cars out to each elevator." The farmers have taken that excuse for five or six years and each year the
IMr. Castleden.]
result has been exactly the same. They have ended up with less and less business and the opposition has had more and more business.
Today the wheat pool is making its protest. In the past year at their annual meeting the members of the wheat pool organization protested loudly and stated they felt there was an injustice to them; their patience was exhausted. They have heard excuses. They have heard people passing the buck and saying, "It is not my responsibility, it is his." Another says the responsibility belongs to the railways, and the railways say it is the transport controller. The transport controller says, "I have nothing to do with it."
I am going to say, Mr. Speaker, that in this fight the farmer is not going to give up easily. There is a basic right here that he feels is being violated. It is a right that should not be denied to any Canadian. It is part of his fight for existence. He has seen years of toil go into the production of wheat which he had to sell at less than half of what it cost him to produce. On the other hand, in the years before the wheat board he has seen the annual crop of millionaires coming out of the Winnipeg grain exchange and he is not going to see the wheat board wiped out. He is going to fight through his co-operative organization.
If this protest is not enough, he will make a more violent one. In this fight I can say this, that we are all very proud to be on the side of the farmer.


Mr. Irvin Sluder (Swift Current-Maple Creek):: It is somewhat disadvantageous to have only one hour for the discussion of a matter of such great interest to the farmers of western Canada. The hon. member for Provencher took about 10 minutes of this hour, the hon. member for Acadia about 10 minutes and the hon. member for Yorkton between 20 and 25 minutes. Since hon. members on the government side of the house are always invited to express their opinion, it does not leave too many minutes in which we may do that. I can assure you that I shall try to do so in less time than it has taken the hon. member for Yorkton.
Much of the discussion has centred around the wishes of the farmers in western Canada. During the last several weeks many of us have received letters from farmers, not relating so much to this particular bill but merely expressing the opinion of those who wished to deliver to the elevator of their choice. I do not think there has ever been any government that has been more susceptible to the wishes of the western farmer than this government. Unfortunately what we are trying to decide, or at least what I am trying

to decide, is how many farmers in western Canada want this bill. Who are the farmers in western Canada who asked the mover of this bill to introduce it in this House of Commons? That is what I want to know, and that is what I am going to find out.
During the course of the last few weeks we have received a great number of letters. The letters are not all in agreement. I think they are mostly from pool members, and some of them are from pool delegates. Some of them are from farmers saying they want the right to deliver not only to the elevator of their choice but to more than one elevator. They happen to be living between two towns, and they want the right to change from one town and elevator to the other. It would seem to me, from the contents of the letters, that the farmers are somewhat fearful of being frozen to one elevator. Unless they choose one elevator and stay with that elevator for a crop year, then I see no advantage whatever in permitting an amendment to the Canada Grain Act that will allow a farmer to stipulate the elevator of his choice.
We want more unanimity of opinion on this matter. I do not know of one Liberal member who has received one letter from any grain grower in Alberta or Manitoba favouring this bill or suggesting that he be allowed to choose an elevator. Now, shall the government enact legislation to suit one area of this country, or shall the government take into consideration the wishes of the farmers of western Canada, or of all Canada for that matter? They are all affected. I would suggest to the farmers of western Canada that they get together and make a decision as to what they want. After they have made that decision they will not find any government that will be more sympathetic to their wishes.
We have heard about the wishes of the farmers of western Canada. We have heard that the farm organizations of western Canada are in favour of what is here proposed. I want to know what farm organization asked the hon. member for Assiniboia to introduce this bill into this House of Commons. Would he kindly stand up and answer? What farm organization in western Canada asked the hon. member for Assiniboia to introduce this measure into this House of Commons; that is what I want to know. I am waiting for an answer. If there is not an answer, then there is only one conclusion, and that is that the farmers of western Canada do not want it. Because if they did want it they would not ask an opposition member who has no responsibility, particularly a socialist member who has absolutely no influence in this House of Commons or 50433-2304
Canada Grain Act
anywhere else, to bring a measure of this kind before a responsible government.
If farm organizations did ask him to do that, then why do not those same farm organizations go out into Saskatchewan and ask the Liberal opposition members in the legislature to bring the Rand formula, or any other measure for that matter, before the socialist government in that province? If a Liberal member ever did that, then I say such legislation before the socialist government in Saskatchewan would last about as long as a snowball in hades.
I want the hon. member for Assiniboia to tell us what organization asked him to bring this measure before the House of Commons. And if he was not asked, why has he brought it here? I would ask him what political organization asked him to bring it here. Perhaps he will say it was the farmers' union. The situation that has been described here is one that would lead us to believe that the farmers in western Canada are very mad. Personally I would like to deliver to the elevator of my choice, because I was brought up with farm organizations. I was one of the original signers of the wheat pool agreement, and I have never missed an opportunity to support not only the wheat pools but other co-operative organizations.
If the farmers are mad now, then I would not like to face them two months after this legislation, if it were accepted, was brought into operation. I would not like to see their looks if there was a shortage of box cars, with one elevator full of grain and other elevators empty and the farmers without money. If they were not given the right to move around, then I would like to know how long this legislation would last in western Canada.
So I say the farmers would be a whole lot madder after the passage of legislation of this kind, if severe congestion conditions developed. Such conditions would not be the result of government policy, or government organization, but would be the result of natural conditions that could not be eliminated or helped by anyone. It might be that some would favour those conditions, because we have had some crop during these last years, for which most of us are grateful. But why attempt to compel the government to enact legislation to correct a situation that natural conditions brought about? After those natural conditions have passed I do not think anyone in western Canada would suggest that those same conditions would often be repeated. They have not, up to this time.
The wheat pool organizations have had as high as 53 per cent of the wheat in western

Canada Grain Act
Canada, and they are now reduced to about 43 per cent, or a 10 per cent reduction. The farm grain handling organizations in Manitoba and Alberta perhaps would do even better under the present distribution of box cars than they would by an allocation of box cars through designating the elevator of one's choice.
That is why we do not receive letters from pool members in Manitoba and Alberta. That is why we do not receive letters from pool low-point deliveries in Saskatchewan, where the pools have been receiving only 23 per cent of the grain during these past years. Those pool members would like to increase their deliveries at those points. What works in one place works differently in another. But the over-all picture is one of reduced handling by pool elevators.
If there is any member in the house or any member of any organization in western Canada-any grain handling firm, pool organization, farmers' union or anyone else -who is willing to take on the allocation of box cars in this country, let us have his name and we will give that name every consideration, and wish him good luck in his new position. Because immediately he will have to endeavour to satisfy everybody in western Canada. This does not mean that we are indisposed. All we are looking for is something that will work in the interests of all the people of western Canada. We have no guarantee that this will work; and until we do have, then I do not think any socialist or any other government would consider legislation that at least would not have some assurance of success, or that would have to be repealed within a very short time.
If the farmers of western Canada cannot agree on what they want in the matter of deliveries at grain handling points, then do not expect the government to force agreement upon them. The initiative must be left with the farmer. That is the place to apply it, with the farmers themselves. They should decide what they want. It should not be just one group of farmers or a certain number of farmers in any organization. It should be all the farmers, before any responsible government can cater to their needs. I repeat that no government is more willing to give consideration to the matter than this one.
So I say to the hon. member for Assiniboia that his bill does not come here with the authority it should have. I say to the hon. member for Assiniboia that he should withdraw the bill on his own authority, personally, if he has no authority from any farm organization.


An hon. Member:: You are afraid to vote on it.
[Mr. Studer.l


Irvin William Studer: Name your farm organization, and we will show you what we are afraid to vote on. Get up and name it. Be a gentleman. I hear no one. I take it silence gives consent to what I have been suggesting. Whenever legislation is presented in the interests of the farmers you will And all the Liberal members voting wholeheartedly in favour of it, because we are anxious to satisfy and please the farmers.
The government accepted the wheat board, and it did not accept the wheat board simply because a majority of the people of Canada wanted it to do so. It accepted the wheat board for the welfare and the interests of the farmers of western Canada. With the world organizations we now have in connection with the handling of grain, and the trading in that commodity, the government does much of the business that co-operatives formerly endeavoured to do. All of us will remember that when the co-operatives, such as the wheat pools, endeavoured to find a solution to the problem connected with the disposal of their grain-"From producer to consumer"; that was the slogan in those days

we ran into difficulties. The government' came to the rescue of the wheat pools. It was a Conservative government that came to the rescue, a Conservative government in Saskatchewan, by guaranteeing the losses and the continuation of the farmers' own organization in western Canada.


Some hon. Members:: Six o'clock.


The Acting Speaker (Mr. Applewhaite):: At
eight o'clock the house will resume consideration of the business interrupted at five o'clock.
At six o'clock the house took recess.


[Stage Direction]
AFTER RECESS

The house resumed at eight 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.
Victor Quelch: Mr. Speaker, just before five o'clock I had quoted from a speech by Dr. Hannam regarding the conference of the international federation of agricultural producers held at Nairobi. We in this group agree with the findings of that conference. We feel

that surpluses should not be eliminated by a reduction in production but rather by an expansion of markets through distribution of goods to needy people. At home we feel we can expand markets by increasing social services and welfare payments; and to the extent that expanding markets and private enterprise fail to provide jobs, national projects should be instituted by the federal government in conjunction with the provincial and municipal governments, thereby expanding the purchasing power of the people and still further sustaining demand.
Abroad, when foreign exchange and balance of payments difficulties occur, we should be prepared to accept sterling and in certain cases also currency of other foreign nations. In the United States of America, under the agricultural trade development assistance act, $1 billion is being made available for that purpose. Goods worth $1 billion can be sold for foreign currency. Unfortunately, in the United States they allowed the situation regarding these surpluses to get out of hand before instituting proposals of that kind.
Instead of continually criticizing the United States for making surplus goods available to foreign nations by means outside the ordinary channels of trade, we should do likewise in this country. We should give strong support to the proposals that have been made from time to time by the food and agriculture organization to set up a world food board, or agencies such as the international commodity clearing house. We believe the adoption of a two-price system would help to stabilize farm prices at a fair level; but the only real solution is to provide a total market. That would require a change in our financing so that a deficiency of purchasing power, resulting in a lack of effective demand, could be met by financing through the Bank of Canada.
(Translation) :


Mr. Gerard Legare (Rimouski):: Mr. Speaker, the budget speech delivered to the house in April by the Minister of Finance (Mr. Harris) opens the door to an innumerable variety of subjects for discussion. The press has had a great deal to say about the budget and comments have been largely favourable. It has even been likened to an election budget, or a convention budget, as the member for Broadview (Mr. Hees) said, among others.
Had the present government not enjoyed the confidence of the people for such a long time, and were not this confidence continuously increasing, I hardly think the budget would be such as to save an administration
The Budget-Mr. Legare in distress. It is a practical budget, based on present economic conditions and possibilities for the current year. The new minister, then, deserves the congratulations of the house and of the whole country for this, his first budget. A greater tax reduction would have been quite popular but anyone familiar with the present international situation and mindful of the threat of aggression will admit that, against its will, parliament has still to devote large amounts to national defence which could be used for a number of other purposes if peace were established.
I shall limit myself today to two topics only, immigration and the economic survey, announced in the budget speech.
The present government policy with respect to immigration causes me to wonder somewhat. Should we continue to admit some
150,000	immigrants a year to Canada until such time as the employment situation is. more stabilized?
Some economists believe that immigration* even intensive immigration, is the key not only to our expansion but to our economic progress. We are told that our natural resources are plentiful, that our production should be larger and that an increase in population would mean a greater number of consumers. So far so good, and the majority of the people will go along with that equation.
But what price that equation when we read in the newspapers that thousands of immigrants are out of work in western Canada, while hundreds of others are looking for work in the province of Quebec.
It seems that a large proportion of immigrants turn to seasonal jobs, such as farming in western Canada or mining or forestry in the province of Quebec. Consequently thousands of men, with a large proportion of immigrants, are thrown on the labour market during the off seasons.
On the other hand, we cannot contemplate offering permanent jobs to the immigrants while leaving the seasonal jobs for our present population.
Therefore, so long as our climate remains as changeable as it is today, our seasonal industries will keep on disturbing our labour market.
Quebec was once in a much more favourable position than it is today, especially when lumbering operations were conducted in wintertime. Our farmers or their sons, as soon as the crops were in, were then making for the forest to take up lumbering. Many

The Budget-Mr. Legare labourers from our urban centres also took advantage of the interruption of public works and house building during the winter to take up wood-cutting. Today, as I already mentioned previously in this house, the procedure is reversed, and lumbering operations often start in the summer, with the result that the number of unemployed is much larger in the winter. There are also the Ungava mines where operations are to be interrupted during the winter on account of the temperature which prevails during that season; thousands of workers, of whom many are immigrants, will become unemployed. And these are only a few examples. The problem, in my opinion, is more complicated than one would imagine and the co-operation of all the industrial leaders and the governments will be required in order to bring it to a solution.
I am in favour of immigration as long as the country benefits from it and its present population does not suffer from it. The immigrant himself, who has been attracted to Canada by the popularity of our country abroad, does not deserve to suffer the hardships of unemployment, particularly if he left a regular and permanent job in his own country.
When too much attention is given to the economic aspect of immigration, the human aspect is often forgotten. Our country needs consumers and is able to absorb millions of them, but these consumers represent an asset for us only as long as they produce and are not unemployed.
This problem which is one of the main causes of concern for the government should be placed on the agenda of the royal commission which is going to examine our economic position and its future. Our economy is linked to our productivity, which in its turn is dependent upon our population and foreign markets. Today, there are two seemingly weak links in the web of our economy: our production cannot find enough consumers and our consumers do not enjoy stable enough employment.
In my humble opinion, the proposed royal commission should more particularly try to find the causes of unemployment, study the effects of seasonal industry on the labour market and suggest the remedies which would help not only to give employment more stability, but to find work for a greater number of immigrants.
Until then, if the hon. Minister of Citizenship and Immigration (Mr. Pickersgill) or the

hon. Minister of Labour (Mr. Gregg) can bring evidence before the house to show that our immigration policy does not tend to increase the number of unemployed, I know they will render a great service to many hon. members in this house.
I have listened closely to the brilliant speech of the hon. member for Cartier (Mr. Crestohl) in favour of immigration, and, despite his many quotations, he was unable to dispel my doubts.
As I say, Mr. Speaker, I am in favour of increasing the population of this country by all accepted and acceptable means, but only when it can be proved, otherwise than with theories, that the arrival of immigrants, far from increasing unemployment, is creating new jobs.
I am satisfied that the opinion I have just expressed is shared by a number of my fellow citizens. They do not know what to think of our immigration policy, and they are right.
To go in for selective immigration, to attract here foreign skilled labour which is not to be found in this country, that is fine. But that we should admit and attract from overseas unskilled workers, farmers who have never in their lifetime so much as touched a farm implement, jacks of all trades without a trade, as we now have them in this country by the thousands seeking employment, that is what many people cannot understand.
Oh, I know very well that the Progressive Conservatives in this house would like to see the government intensify immigration. We never take in enough immigrants, according to them. Instead of 150,000 we should admit 200,000, 300,000 and 400,000 annually. But who is it, in this house, who have been crying blue ruin because we have thousands of people out of work? Who, among them, could tell the house where the unemployed are capable of finding work at this time and where the thousands of immigrants who are about to disembark will find jobs?
Mr. Speaker, I will conclude by expressing the hope that soon the government will be in a position to show the house with figures to prove their contention that immigrants are not responsible for the present employment situation and that the present immigration policy is such that it is truly beneficial to this country.
(Text):


Mr. R. R. Knight (Saskatoon):: Mr. Speaker, the subject under discussion is supposed to be the budget. I use that expression because

I think almost everything has been discussed in this debate as well as the budget. This budget does not seem to inspire any particular enthusiasm. I have heard it dissected by those who are opposed to the government; I have heard it praised by those on the government benches, and I still lack enthusiasm for it. It is not an inspired budget. It is a milk and toast budget. It is a wishy-washy budget. It does not get anyone very excited, least of all myself.
I was interested in hearing the comments of my own townspeople in regard to it, and I found the same apathy there I have noticed elsewhere. However, I should like to report one or two of the things some people talked to me about in regard to these financial measures. One was the injustice of the $60 ceiling on the contribution toward old age pensions under the income tax. In my opinion that is unjust, and most of the people with whom I talked agreed with me.
Another thing they talked to me about was the refusal of the government to make medical expenses deductible from the first dollar for purposes of income tax, as has been recommended at various times in measures introduced by the hon. member for Winnipeg North Centre (Mr. Knowles). When we talked about the fact that there was a little easement in income tax the question immediately arose as to why the level of exemptions was not raised; why that method was not used rather than the other. To the man with the small income the actual dollar relief is small indeed.
Those are some of the things they talked to me about in connection with the budget. Then I had a visit from some of my friends who are automobile dealers and who indicated to me that they felt they had been treated with some injustice. While they welcomed the remission of 5 of the 15 per cent excise tax on automobiles, they resented the fact that they had some new cars on hand on which they had already paid the tax and there was no means by which they could get back that tax money unless this government was prepared to return it. They approached me as they have other hon. members. I have heard their plea put forward here by members of all political parties, including the government party, that something might be done in that regard.
As one might suspect from my treatment of the budget, I rise tonight to say a word or two about something else, namely the catastrophe that has just occurred in my own province and city. We had entered upon this year of 1955, this fiftieth anniversary, with pride and high hope, and it was a tremendous disappointment to us that we had to
The Budget-Mr. Knight suffer at the hands of the weather as we have done during this past week. I am referring to the storm which occurred in Saskatchewan.
My city was in the path of that particular storm, which did a great deal of damage. Hon. members no doubt have been reading the headlines in the papers. I have one here, but I would draw attention to the fact that these headlines refer not to the day after the storm but to the day before the storm, or to the day on which the storm occurred. The storm completed the devastation. The Saskatoon Star-Phoenix of Tuesday, May 3, indicates that there will be a drastic cut in wheat acreage amounting to an estimated one-third to one-half in some areas.
We are told that this was the wettest April on record. The normal precipitation is -5 inches, but this month we have had 3 [DOT] 38 inches. Anyone who has lived in Saskatchewan as long as I have, which is 45 years, will appreciate that this is a most unusual occurrence in the month of April. Generally all through the spring we look with anxious eyes at any cloud formation and hope we may get a good shower before June, or better still in June after the crop has been seeded. To start out in a welter of water such as there is this year is something so completely unusual that it has created a great deal of astonishment.
In a different column of this paper it is stated that cattle are being drowned in the Meadow Lake district in the overflowing streams, and that most roads in the province are impossible quagmires. These are some of the things that have happened to us this springtime, which we usually think of as being a warm and beneficent time of year. This year it has become something frightful and menacing.
As to the city of Saskatoon itself, there was an immediate disorganization of power, light, telephone and some transportation facilities. When the transportation broke down the mayor of the city declared a state of emergency. All three radio stations were off the air for some 15 or 20 hours. All this makes one think about what might happen in case of a war emergency. We all remember how the city of Montreal and some of the eastern cities were tied up by the great snowstorm of five or six weeks ago. This makes one realize what the danger would be if something more harmful than a snowstorm happened to one of these cities.
The city of North Battleford and some of the towns close to Saskatoon get their power and light from that city. When the power went off in those towns and cities they immediately tried to wire or phone Saskatoon

The Budget-Mr. Knight to find out what the trouble was, and ot course they discovered they could not get through. All means of communication-and when I say "all means" I mean it-had broken down. There was no way of getting any information as to what had happened. It was the next day before the people in those towns and cities knew what had happened to our city.
This storm is calamitous in more ways than one. If there had not been so much wind, as well as the snow, sleet and rain, we might have escaped comparatively free; but we had a combination of rain with sleet and snow. May I say that sleet, although it is common in this eastern part of the country, is very uncommon in the west. When the sun came out again people got around and tried to assess the damage. In the city communications began to be restored, traffic got under way again, and the temporary isolation was put to an end.
Here one should pay tribute to the people who handled that crisis; the city engineering departments and people who, I am told, worked for as long as 48 or 50 hours without a break, and the citizens who co-operated with these departments by lending their trucks and cars, the men of the Saskatchewan Power Corporation and of the Saskatchewan government telephone company, working unselfishly to establish communications.
How must one assess the damage from this particular storm? The provincial government was probably the public body which suffered most, because the provincial and municipal roads were washed out and in many cases impassable. The Saskatchewan Power Corporation, which supplies power and light to a great part of the province, and the telephone system were crippled. For miles the poles were down on the roads. The high voltage wires were down, which in itself formed a danger to the community. The damage to farms is incalculable and certainly, as yet, uncalculated, particularly in the eastern part of the province where there is water everywhere.
I have seen only one estimate of the damage, and that is by Professor Harrington, who is the head of the field husbandry branch of the University of Saskatchewan. His estimate was $50 million in terms of loss of the potential wheat crop. Notice that I said "wheat crop". We are well aware-in fact, it has been stated here today by one or two members who have spoken-of the important place wheat occupies in our national economy. On the basis of that loss alone one might claim that what has happened in our province might be termed a national disaster.

There are three ways, of course, in which this water will produce loss of wheat. The first is that land flooded in the low places will not be able to be seeded at all this year. Second, although they may dry up later, it will be too late to sow the flooded lands to wheat and they will have to be sown to coarse grains instead. Third, the late seeding of lands will produce a decreased yield and will make the crop a great deal more liable to an epidemic of rust, which hurt the province to such an extent this last year. The same thing, of course, applies to frost. There is no particular date when wheat should be seeded in the province of Saskatchewan, within a week or two, but Dr. Harrington estimates the date that wheat should be seeded is about May 7.


An hon. Member:: How would you know when to seed wheat in Saskatchewan?


Robert Ross (Roy) Knight: Would my hon. friend do me the courtesy to keep quiet? I have listened to his silly drivel often enough, and I have never interrupted him. I may say that I was growing wheat in this country when my hon. friend was coming across from North Dakota. Mr. Speaker, I beg your pardon for laughing, but my hon. friend always amuses me.


Mr. Gardiner:: He should make you angry.


Robert Ross (Roy) Knight: I do not want to get into an argument with the Minister of Agriculture. May I be allowed to continue. The sad part of this storm and the resulting damage is that a great many people who suffered last year are going to suffer again this year. I am thinking of the northeastern part of the province, Carrot River, Kamsack, and Nipawin districts where they suffered greatly last year and where this year the situation is going to be even more difficult. Perhaps this catastrophe will affect a greater number of people over a greater area than any of the Canadian catastrophes of late years.
If there is one good thing about catastrophes it is that they engender in people a spirit of help and co-operation. They bring people together. When a catastrophe happens, one remembers the pioneer days. When a person's barn was burned down or there was a prairie fire, or something of that kind, people came to help. In these catastrophes we may expect some assistance, and we are certainly expecting some assistance, from the dominion government.
I know it is not a popular philosophy, and in this house of practical men I almost hesitate to advance it, but perhaps we do at times emerge from hardships or struggle better and stronger for the suffering we have endured.

As 1 have said, that is not a popular philosophy and I do not expect my hon. friends to accept it. But we do need help, from our neighbours and friends. I believe that Saskatchewan, after this catastrophe, will once again prove its resilience. It is not the first time we have suffered catastrophes, whether of drought or of hail or of rust or of grasshoppers, and we have won through. In fact we have been able to contribute help to other parts of the country that have suffered the same sort of thing.
To come to the practical angle of this help for which we must ask the dominion government, we have been told in the last day or two that the premier of our province, Mr. Douglas, has been in touch with the Prime Minister in regard to this matter. Let me say that I thought the Prime Minister's attitude was reasonable when he stated that we must have an assessment from the provincial authorities as to what the damage actually is. Then we hope favourable consideration will be given by the dominion government, who might be reasonably expected to contribute a considerable amount in the way of help.
That is my plea and the reason I rise tonight. I have said something about the loss of provincial services, roads, light and power wires, and so on. Losses to individuals will of course be heavy. When I read about people, for instance, who have lost their cattle, I presume there will be property compensation for the loss of cattle, for buildings damaged by water, etc. But actually the great loss will be suffered by those to whom the making of a livelihood by the growing of grain will be denied for this year. We may as well face the fact that these people are going to be in dire straits by next winter, and the government may count on that in planning their assistance.
Someone has suggested an immediate start on a drainage program, and I think that is a good idea. So far as the land in the northeastern part of the province is concerned, I do know that the provincial government instituted a work and wages program in that region to compensate the people for the loss of their incomes last year. I hope that will be continued, but I suggest it will have to be continued on a much larger scale. I think the northeastern part of the province has some of the finest land in the world, certainly the finest land I have seen, but under present conditions it will have to be drained to be used at all.
That is one place where co-operation between governments might result in an immediate start which would have, as well
The Budget-Mr. Hellyer as its ultimate objective, the result of providing some work for people who for this year at least will not be able to make their usual living from their farms. Therefore my plea is that the government should co-operate immediately with the provincial government in starting some such program. That is the immediate necessity. In the long run the government should give generous consideration to whatever claims for assistance may be advanced by the province of Saskatchewan after some assessment of the damage has been made, and should render such assistance as may be judged reasonable in view of the experience with similar disasters in the past.


Mr. P. T. Hellyer (Davenport):: Mr. Speaker, I should like to take this opportunity to say that I for one was very pleased with the budget brought down on April 5 by the Minister of Finance.


Some hon. Members:: Hear, hear.


Paul Theodore Hellyer: I think it was a definite step in the right direction and will provide a very beneficial stimulus to our economy generally.


Some hon. Members:: Hear, hear.


Mr. Knowles:: Are they the ones who helped you write your speech?


Paul Theodore Hellyer: The additional purchasing power left in the hands of individual taxpayers will form the basis of increased demand for consumer goods and services. Inventories will be depleted and the tempo of our giant industrial machine will be accelerated.
The reduction in corporation tax will have a beneficial effect too, but only subject to the following conditions. If the increased profits are used for further industrial expansion it will provide jobs, while at the same time increasing our productive potential even further. If, on the other hand, the tax reductions are passed on to the consumers through lower prices for all products where there is an elastic demand, consumption and hence employment will increase.
Helpful as these improvements are, even coupled with the upswing in economic activity which appears to be taking place at the same time, it may still be necessary for something further to be done in order to provide jobs for those unemployed at the present time and those entering the labour force. There are many ways in which economic stimulus can be provided, but some of them are much more effective and more suitable than others. I should like to discuss one of these possibilities.

The Budget-Mr. Hellyer
I think the time has come when the federal government should embark on the construction of a system of federal roadways, and I should like to suggest that $2 billion should be earmarked for this purpose, to be spent over a five-year period. The reason I say a federal system of roadways is that I believe only in this way can a country of ten individual jurisdictions hope to have a consistently adequate arterial road system. It is true that a start has been made in the form of the joint enterprise known as the trans-Canada highway. It is because of the experience associated with this road that I propose that the federal system should be built, financed and maintained by the federal government. Some of the provincial governments have shown considerable ineptitude in getting proper value for money expended on highways, in particular where the money was raised by the federal government and handed over to them. I think we could expect good value if such a project were administered by this government, and there is no one better qualified to direct such a project than our own Minister of Public Works.
What are the implications of such a system? They are material to a number of individual problems, and it is necessary to examine several of them. First let us consider commerce. There is no need of reciting all the developments which inevitably follow new transportation routes. I do not think anyone will deny that along such a system of roads would spring up new towns and cities, new factories and facilities, new enterprises and developments of all kinds. The stimulus to our commerce generally would be so substantial that it is difficult to project. It can be safely stated, however, that it would be sufficient to warrant the expense and in the long run would repay the cost many times over.
A direct and immediate function of such a system of arterial roads would be a tremendous improvement in our civil preparedness. There are those who state that in this day of atom and hydrogen bombs civil defence is merely a myth. I cannot and will not subscribe to such a theory of hopelessness. There is an excellent possibility that we would obtain three or four hours' notice of attack by any prospective enemy. With even such a short notice, provided the necessary highways for egress from our cities had been built and our civil defence organizations had been properly trained, we could hope to evacuate a large proportion of the inhabitants from any or all of our major cities.
Under today's conditions any plan would be very difficult to implement. An attempt to evacuate the city of Toronto at the present

time would cause one of the most fantastic traffic jams in history, and it would take hours to untangle it and get the people either out of or back into the city. To be effective and even moderately adequate we would need three or four eight-lane limited access highways leading out of the city in various directions. This would involve a number of arterial collector roads running through the city itself, such as an extension southward of the present highway 401, an eight-lane Don valley expressway from the waterfront right north to the city limits and beyond, the Spadina road extension, and a widening of the Toronto by-pass highway to a minimum of eight lanes.
It is interesting to note that the usual lack of foresight has been shown in respect to this last-mentioned road, which is only four lanes and will be inadequate 48 hours after it has been opened from the Queen Elizabeth highway to the Kingston road. The eight-lane provision would have to extend outward from our major cities at least 200 miles, because otherwise the congestion at the end of the wide road would work backward and destroy its usefulness. By having several such roads leading from each city it would be possible to use all of them, with the exception of the one over which severe radioactive fall-out would be expected, having due regard to the direction of the wind at the time of any imminent attack.
These facilities for egress should be provided for all our major cities, and proportionate facilities for any others which could reasonably be expected to become even secondary targets. This would certainly include Halifax, Montreal, Ottawa, Toronto, Hamilton, Windsor, Winnipeg, Edmonton, Calgary, Vancouver, etc. Should an attack come and as a result of our lack of foresight the necessary escape routes not be available, it would be a dreadful thing to feel responsibility for such a grievous error.
A third important aspect of a continentwide highway system would be our tourist trade. It was most disturbing to me to note that in the year 1954 we had an adverse balance with the United States in respect to tourist business. Something must be done to reverse this situation. An examination of the complaints of United States tourists shows that only two are significant, our roads and our accommodation. We have so many wonderful attractions which our United States friends are anxious to enjoy that it seems a shame we are our own worst enemies in making it so difficult for this great luxury loving tourist inflow.
The first half of the problem would be overcome by a really adequate system of

transcontinental and defence arterial highways. The system would, of course, have to be joined to the United States system at all important border crossing points such as St. Stephen, New Brunswick; Rouses Point and Stanhope, Quebec; Cornwall, Niagara Falls, Fort Erie and Windsor, Ontario; Emerson, Manitoba; Estevan, Saskatchewan; Coutts, Alberta; and Pacific Highway port in British Columbia. There may be others, new places, which would also be worth while connecting up. It should also, of course, be connected with subsidiary highways into our various playground areas.
The other half of the tourist problem is, of course, to encourage the building along and throughout the system of great new accommodation centres such as our United States friends patronize and enjoy. These centres should be complete with facilities for sleeping, eating, automobile servicing and, where possible, recreation. Naturally such new and modern centres would be appreciated not only by our visitors but by our own citizens as well. Their building and maintenance would provide a great number of new job opportunities. We could, at the same time, further develop the art of service which is so apparent in some countries which specialize in the tourist business. We should also specialize in Canadian foods and fly the Canadian flag as our United States friends come here to enjoy something different and not just to witness an endless repetition of facilities similar to their own.
It is a fair question to ask how we could finance such a system of roadways. I propose that they should be paid for not out of current revenues but rather by having the cost amortized over a period of 20 or 25 years. The mechanics of this method of financing would have a tremendously stimulating effect on our economic set-up and the results, direct and indirect, would be most gratifying.
In conclusion, Mr. Speaker, I think it is reasonable to affirm that any project which would have such a beneficial effect on our commerce, provide the foundation of civil defence and safety for millions of our citizens, and in many parts of our country increase our tourist trade three or fourfold, while at the same time providing directly and indirectly tens of thousands of new jobs for our people, is so important and so urgent that it should be proceeded with as quickly as properly engineered plans can be prepared.


Gordon Minto Churchill: I propose discussing tonight, Mr. Speaker, the subject of dominion-provincial conferences. This subject is closely related to the Minister of Finance's budget speech,
The Budget-Mr. Churchill because he devoted several paragraphs to federal-provincial relations. I know that the word "dominion" has become a rather naughty word but it is not yet an unparliamentary expression, so perhaps I shall be able to use it during the course of my remarks. As I have consulted the reports of earlier conferences, I have found that until very recent years they were called dominion-provincial conferences. I find it so much easier to use that term.
I want to talk about what I call Canada's other parliament, that is the dominion-provincial conference which assembled in Ottawa just two or three weeks ago and which will reassemble in October. Canada's other parliament is composed of the Prime Minister and the 10 provincial premiers, assisted by their respective cabinet ministers. At the meeting on April 26 there were in attendance approximately 80 persons, representing all the provinces and the dominion government.
You will recall that meetings were held in the railway committee room. The first meeting was open to the public, with the result that there were more members of the House of Commons sitting in as observers than there were in this chamber. In fact for the two days of the conference the House of Commons could very well have been adjourned. The Prime Minister, and I presume the senior cabinet ministers, were either in constant attendance or very close at hand. I believe we were not able to continue the budget debate on Tuesday because the Minister of Finance wanted to be present at that conference. The press gallery had no other interest except the conference, and the public at large was awaiting with eagerness the reports of the conference because it was recognized that on it hinged much of great importance to Canada as a whole.
The Prime Minister recognized the great interest that was taken in the conference and, thanks to his kindness, I have in my hand a copy of the proceedings at the preliminary meeting. It is the unrevised edition, and the only words I propose to quote from it will be the words of the Prime Minister himself. Since he is present this evening, if there is anything wrong with the quotation he can make a correction. I notice on page 4 that he said:
Though this is only a preliminary meeting for the 1955 conference, it seems to have attracted a large amount of attention outside as well as inside this chamber.
I certainly agree with that; it attracted a great deal of attention. I propose to examine for a few minutes the history and purpose of dominion-provincial conferences. I will suggest that serious thought must be given to

The Budget-Mr. Churchill their development and to the long-term effect on the prestige, authority and development of the parliament of Canada, with particular reference to the House of Commons.
My attention was directed to this subject for two reasons, the first of which I have given; that was the intense interest in the conference which assembled here at a time when the House of Commons was in session. The second reason was that at that conference the Prime Minister took the opportunity of making a considered statement with regard to unemployment and set out certain proposals of the government.
Consider the circumstances. Parliament was in session, and had been sitting since early in January. The subject of unemployment had been under debate for a very considerable time on an amendment proposed by Her Majesty's loyal opposition. Eight days of debate had been devoted to that subject and many members on both sides of the house had spoken. Time after time the Prime Minister was asked to make a statement, to disclose government policy, but remained silent. Yet on the opening day of the dominion-provincial conference, in his opening address to the assembled delegates the Prime Minister dealt at some length with the subject of unemployment and presented the government's plan to deal with the emergency.
This to my mind, or in my experience, was one of the most outstanding instances of bypassing parliament. Frequently members of the opposition complain when cabinet ministers make statements of government policy at public meetings, or by means of press releases, when the House of Commons is in session. We think they should inform the House of Commons first. On this occasion the Prime Minister declared his policy first to the dominion-provincial conference.
The question arising, then, is this. Is the dominion-provincial conference a superior governing body in this dominion? Before that question can be answered one should look at the history of dominion-provincial conferences. That is exactly what I have done, and I shall pass on to the house the information I have gained. The subject, of course, is large and all-embracing, and the time at my disposal this evening is limited. I do not propose now to deal with all the aspects of dominion-provincial relations or go into detail to any great extent on some of these conferences; but here is the history I have found.
There were no conferences of this nature during the first 20 years after confederation. Then in 1887 the premier of Quebec invited

the premiers of the other provinces to attend an interprovincial conference in the city of Quebec. Ontario, Nova Scotia, New Brunswick and Manitoba accepted the invitation. Eight days were spent in deliberations among the premiers who were there, and the subjects they discussed were annual subsidies paid by the dominion to the provinces -which they wanted to have increased-and amendments to the British North America Act.
Fifteen years later, in 1902, at the same place, another interprovincial conference was held. Five premiers and nine cabinet ministers from the provinces were present, and the same topics were discussed.
In 1906 the then prime minister, Sir Wilfrid Laurier, was persuaded to assemble a conference at which the premiers of all nine provinces were present, along with their advisers. The conference, however, was mainly provincial. There were sessions at which members of the dominion cabinet sat in with the provincial premiers. The subjects discussed were subsidies, and a resolution was passed urging that the conference assemble annually.
Then in 1910 and 1913 two further interprovincial conferences were held, at which no representatives of the dominion cabinet were present. Similar subjects were discussed, plus representation in the House of Commons which, at that time, affected Nova Scotia particularly.
Then in 1918 Sir Robert Borden called a dominion-provincial conference. He and nine of his cabinet ministers were present. For the first time the chairman at one of these conferences was a dominion cabinet minister, the then minister of public works, Mr. Carvell. The conference was assembled just one week after the armistice, and the subject of postwar development of Canada was naturally of some importance. The main subjects which came up at that conference were soldier settlement, general land settlement, and the return of the natural resources to the prairie provinces. As nine cabinet ministers were present the opportunity was taken, during the course of the four-day conference, to discuss such matters as demobilization, reconstruction, employment, civil re-establishment, taxation, housing, technical education and highways. At the conclusion of the conference Sir Robert Borden thought it was rather useful, and suggested that similar conferences might be held at 10-year intervals.
In 1926 a three-day conference was held, attended only by the premiers of the provinces and their cabinet ministers. There was no representation from the dominion. Again they discussed subsidies and taxation.

The year 1927, Mr. Speaker, was the turning point or the watershed in so far as dominion-provincial conferences are concerned. The seven preceding conferences I have mentioned, with the exception of the one in 1918, had been interprovincial, and in the matter of agenda and subject matter had been largely under the control of the provincial premiers; and attendance, except for a few dominion cabinet ministers at three sessions in 1906, had been limited to provincial representatives. The year 1918 was the exception.
Since 1927 there have been seven dominion-provincial conferences, if I may count the two in 1950 as one. They have been called together on the initiative of the dominion government, and the conferences have acquired an importance in national affairs greatly exceeding their importance prior to 1927.
It was at the 1927 conference that the dominion government exercised its full weight and influence. Of the 46 persons present at the conference of cabinet rank, and I include premiers in that term, 18 were from the dominion. Similarly, in the conferences of 1935 and 1945 the dominion cabinet as a whole participated. These three conferences, those of 1927, 1935 and 1945, set the pattern of procedure and organization of dominion-provincial conferences. I am omitting reference to the conference of 1934, which was very briefly reported; I could find very little about it. I am omitting reference to the conference of 1941, which lasted two days, and I am omitting reference to the two conferences of 1950, one of which assembled in January to discuss constitutional matters, and the other in December to discuss fiscal arrangements.
These three conferences, of 1927, 1935 and 1945, have established a pattern for dominion-provincial conferences which is well worth examining. For example, in 1927 seven days were taken up in a discussion of a total of 40 subjects. These were grouped under three main headings, constitutional, financial, social and economic. Some of the subheadings selected at random are as follows: Senate reform, regulation of aircraft and flying operations, federal subsidies, taxation, customs and excise duties, agriculture, health, immigration, old age pensions, fisheries and Canadian nationality. In one form or other, all these subjects are under discussion almost every year in the House of Commons.
In 1935 the conference lasted five days. Six committees were set up to consider separately the following subjects: tourist traffic, mining development, agriculture and marketing, constitutional questions, unemployment and relief and financial questions. All of these
The Budget-Mr. Churchill again are subjects familiar to the House of Commons. The purpose of the committee discussions and reports of 1935 may be discovered in the words of Mr. Dunning, who was then minister of finance. He said, and I quote from page 37 of the 1935 report:
We are receiving these reports in order that they may be submitted to the appropriate legislative and administrative authorities as a foundation upon which these authorities can base effective policy.
In other words the conference was designed to provide a guide for the development of legislative programs. At the same conference the then prime minister, Mr. King, looked forward to establishing the dominion-provincial conferences on a permanent basis and this is what he said at page 9 of the same report:
This arrangement of continuity and permanence is necessary because co-operation between the dominion and the provinces is too vital a matter to be left entirely for intermittent conferences, and to correspondence between governments. Our secretarial arrangements and our proposed organization are based upon this desire to have permanence and continuity.
At the conference of 1945 dominion-provincial relations burst into full bloom. It was the twelfth in the series, the largest in attendance, the lengthiest and most impressive in subject matter. Sixty-eight persons of cabinet rank were present, assisted by 140 advisers and officials. Their printed proceedings cover 624 pages. They sat here in the House of Commons part of the time and in the Senate chamber on other occasions. The general topic of that conference was reconstruction, and the dominion proposals were put forward under these headings: financial arrangements, public investment, health, old age pensions, unemployment assistance and tax rental agreements. Once again I point out that these are subjects frequently mentioned in debates in the House of Commons.
The year 1955 has seen the commencement of another dominion-provincial conference which after a two-day session in April to draft and set the subjects for discussion in the fall, is due to reassemble in October. The subjects suggested by the various premiers as proper for the conference to consider cover almost the whole field of House of Commons activities. I have listed them all here, but I have not counted them, they are so numerous. However, there were notable exceptions; for example, external affairs, defence. The conference apparently decided to deal with unemployment, fiscal arrangements or taxation, resources development, health and welfare, and most likely will give consideration to holding more frequent conferences. Ever since 1887 the provincial premiers have been suggesting this, and a permanent secretariat.

The Budget-Mr. Churchill
Well, Mr. Speaker, I suggest this survey raises this question. Why are these dominion-provincial conferences necessary? The answer briefly seems to be that there is something wrong in the confederation that is Canada. These conferences seem very similar to international gatherings such as the United Nations, NATO, or commonwealth conferences. Heads of governments or cabinet ministers representing sovereign states meet together to solve pressing problems. Many of these international gatherings end in frustration. Some people have suggested that a federal union would be better for some of these purposes, for example, among the nations comprising the Atlantic community or among the nations of Europe.
Here in Canada we are reversing the process. We already have a federal union with elected representatives from all the provinces. Why then must the heads of the 11 governments of Canada meet in conference to make plans for the country as a whole? Not content with 11 governments for a population of 15 million, we are now engaged in an attempt to establish a twelfth government superior in functions and importance to the other 11.
The root of the problem seems to be in the field of taxation and administration. And, as I have noted, in all the conferences since 1887 the problem of fiscal arrangements, taxation or subsidies, has come to the fore. In 1945 the present Leader of the Opposition, (Mr. Drew) who was then premier of Ontario, summed it up as follows, and I quote from page 11 of the report of that year:
There is one fundamental weakness in the British North America Act which lies at the root of many of our difficulties. While the legislative powers of the dominion and provincial governments were defined with reasonable clarity, the division of taxing powers was left in a much less satisfactory position. The provinces were empowered to levy taxes in the field of direct taxation . . . whereas the dominion government was authorized to raise money by any form of taxation. We therefore have the anomaly that, while the powers of the provincial governments have been extended by judicial interpretation of their statutory powers, the dominion government has found it necessary over the years to occupy more and more the only field of taxation which was made available to the provincial governments.
The recurring theme throughout all these conferences from 1887 to the present day has been that these provincial responsibilities have been increasing while the financial resources have not been adequate, hence the conferences, hence the suggestions for more frequent meetings and for a permanent secretariat, hence also the growing importance of the conferences and their overshadowing of parliament.


The problem is clear; the solution has not yet been found. For the last 70 years provincial premiers and prime ministers have been attempting to solve this problem without success. It may yet be done through the medium of a dominion-provincial conference, but in the process we may witness, if these conferences are to continue at short intervals for another 70 years, the decline of the prestige, influence and power of the House of Commons.
The reason I say this, Mr. Speaker, is that the conferences, ever since 1927, are tending to range over the whole field of public interest and endeavour. What purpose is there in debating the subject of unemployment in the House of Commons if the policy in that regard is to be announced first to a dominion-provincial conference and the decision thereon to be dependent, perhaps, on the deliberations of that body? What purpose to debate the development of our resources if that is a subject for the conference in October? Why bother in the House of Commons with the subject of health and welfare if the conference has that on its agenda?
I do not suggest that provincial comments are not necessary and desirable on these and many other matters, but is a full-dress conference the best way to get provincial approval or disapproval? I notice that in his introductory remarks at the conference in April the Prime Minister mentioned that there were other means. He is reported at page 3 of the proceedings as follows:
Taking place between these main conferences, there have been many meetings of provincial and federal representatives on other and more specialized subjects. I think we may say that there is now more continuing and frequent contact between our government and their officers than ever took place before.
In my judgment there is ample opportunity for the dominion government to get the information it desires. Consider our position here under the federal union. The Canadian federal system is designed to give protection to the provinces through a fixed quota of members in the Senate, and to provide membership in the House of Commons through representation by population. The cabinet by custom and tradition recognizes the provinces in the distribution of portfolios. I doubt if the House of Commons has at any time since confederation been without a number of former premiers and former provincial cabinet ministers in its membership. In the two houses of parliament, if all vacancies are filled, there are 367 persons, each of whom has some knowledge of the problems of the province from which he comes. In every area of Canada there are officials of

the dominion government. Between the provincial capitals and Ottawa passes an endless stream of correspondence. The telegraph, telephone and aeroplane have made communication reliable, speedy and convenient.
It would be interesting to determine the results that have come from the twelve conferences which preceded the one called for this year. What new ideas, what new policies have been advanced following these conferences? Has anything happened at them that could not have been accomplished in the House of Commons? It would be interesting also to know the cost to the taxpayer of these conferences.
I am not unaware of the fact that the desire for dominion-provincial conferences originated with the provinces, nor that suggestions for such conferences have been put forward frequently in the House of Commons. Until April 26 I had not considered the implication of these conferences and their probable effect on parliament. I now entertain grave doubts as to their purpose and value if they follow the course of the conferences of 1927, 1935 and 1945, and if they become a permanent feature of our system of government; certainly so if we are to become dependent on them for the forming of policies for this dominion.
The purpose of these conferences, in so far as I can judge from reading the proceedings, particularly those since 1927, has been to set forth matters of policy, to prepare for legislative programs either dominion or provincial; and in this connection I referred to the remarks of Mr. Dunning at an earlier conference. I suggest that the proposals put forward at many of these conferences involved taxation, and taxation is a problem which concerns this House of Commons. Parliament should decide the amount of taxes to be levied on our people, not a dominion-provincial conference which has quite often indirectly set figures and quotas which resulted in taxation.
I am suggesting that by dealing with dominion-provincial conferences the executive here, the cabinet, is not fulfilling its responsibilities to the House of Commons itself. This is a place where government programs should first be put forward, not at conferences.


Mr. Philpoti:: Would the hon. member permit a question?


Gordon Minto Churchill: I have just about completed my remarks.


Elmore Philpott: In view of the proposal made at the opening of the recent conference, which involved co-operation among the dominion and provincial governments, would not the hon. member agree that it was a good thing
The Budget-Mr. Churchill for the dominion to take over part of the responsibility for the unemployed employables, and that this proposal had to be made at the particular kind of conference at which it was made?


Mr. Lennard:: That is almost a speech.


Gordon Minto Churchill: That is an easy question to answer, but with due respect to the hon. member I think it is hardly applicable to the suggestions I am putting forward. Certainly the problem of unemployment had to be dealt with, and dealt with quickly, but these suggestions could have been put forward here in the House of Commons. I am directing attention to the general problem of dominion-provincial conferences and their effect upon the House of Commons. An interruption with regard to a detail like that in my opinion is not in keeping with the thoughts which I am attempting to put forward.
I am putting these matters forward seriously, and with the hope that people will examine these suggestions I am making and perhaps be able to destroy them by their arguments. On the other hand, historians may discover later that in 1927, 1935 or 1945 occurred the beginning of the decline of the influence of the House of Commons, which we have heard mentioned on many occasions in the last few years.
However, I am coming rapidly to a conclusion. Throughout the course of these latest conferences mention was made that what was being held was just a conference, that there was nothing partisan about the discussion, that the parties were there to co-operate for the good of Canada as a whole. If they were just conferences, if there was nothing of a party nature about them, why have they been restricted just to government representatives?
I think sometimes we forget that our parliamentary system is dependent upon two forces interacting on each other. There is the government side, and there is the official opposition. I would suggest that conferences of this nature should be attended not only by the heads of the 11 governments of Canada but by the leaders of the official oppositions in the legislative assemblies of this country, along with their advisers.
If you carry this idea of dominion-provincial conferences to a logical conclusion, what happens? You have a government set up over and above the ones we now have, and the result would be a sort of small united nations assembly of Canada. What disturbs me is the effect of all this on the House of Commons.
I will conclude with this statement. Dominion-provincial conferences may continue to be a necessity for Canada. If so,

The Budget-Mr. Boucher they should be restricted to the core of the problem, the division of administrative responsibility between the dominion and the provinces, and the division of fields of taxation. Unless complete breakdown of the federal system is threatened, such conferences need not be held except at intervals of many years for any necessary review that may be required due to changing conditions. Dominion-provincial conferences established on a permanent basis holding more frequent meetings, conducted after the fashion of the conferences of 1927, 1935 and 1945, will develop into another parliament for Canada, and will result in the decline of the influence of the present House of Commons.


Mr. Jean Boucher (Chaieauguay-Huniing-don-Laprairie):: Mr. Speaker, in rising to participate in this budget debate I would like to congratulate the Minister of Finance on the presentation of his first budget. This budget was proposed to give us income tax reductions ranging from 2-8 per cent to 13-3 per cent, and gives at least 80 per cent of Canadians reductions ranging from 12-6 to 13 per cent, effective July 1 of this year.
I believe the Minister of Finance realized that business also needed a shot in the arm and consequently reduced corporation taxes, which will encourage manufacturers to expand plants and production, thus offering more jobs to Canadians. Corporations and businesses are like individuals in some respects. If the incentive is taken away because of exorbitant taxation and the shareholders are not getting a fair return on their investment, financial support is withdrawn, followed by loss of sales and loss of production which leads to lay-offs and unemployment.
This is a time to loosen up and encourage business to expand. The tax cuts are needed in Canada at the present time. We have a marvellous country, a marvellous future, and an almost incredible potential wealth. Our foundations are sound. But the government does not create one single item of tangible wealth. It does not grow any of our wheat, nor does it produce any of our steel, nor does it make any of the thousands of items that create what we now call our material standard of living. The government redistributes the people's wealth. It chooses where the taxes will come from and where the proceeds will go. The hon. member for Eglinton said the other day, and I quote, "This is a budget without any pattern. This is a budget that is not founded upon any principle".
Mr. Speaker, a shot of tonic was needed in our economy. We have had balanced budgets for 10 years or so, which is commendable.
fMr. Churchill.1
But this does not necessarily mean that we always have to have a balanced budget. The hon. members of the opposition in past years have been asking repeatedly for a reduction in income tax. Now, when the time is ripe for such a reduction, they claim it is a rosy budget and that the government is putting too much faith in the ability of the Canadian nation to develop our immense resources.


Donald Methuen Fleming: Nonsense! Utter nonsense!


Jean Boucher: As far as I am concerned I am satisfied that the majority of the people living in the constituency I have the honour of representing in this house approve of this budget. Mr. Speaker, the constituency of Chateauguay-Huntingdon-Laprairie is a typical Canadian constituency where English and French-speaking Canadians live together in peace and harmony. Even if industries are a big factor in the economy of our constituency, agriculture remains its most important one, and the dairy industry its backbone. Forty per cent of the population of Chateau-guay and Huntingdon depend directly upon the dairy industry, and a much larger proportion of their population derive their income from it indirectly.
Those farmers are industrious, diligent and are attached to their work. Whenever one travels through their well-kept farms one has the impression that those farmers are prosperous. But we must not forget that last year's crop was very poor, almost to the point of failure. In many cases it will be necessary for my people to buy feed for their cattle and seed to sow this year's crop. For that very reason I wish to thank the Minister of Agriculture for taking positive action in the maintenance of the price of butter at 58 cents a pound. I know my constituents will appreciate this very much.
(Translation):
Because our farmers are progressive, because they are always anxious to add to their farm equipment as a means of increasing crop yields, they sometimes have to borrow. Our government, through the Canadian farm loan board, is trying to help farmers by making it easier for them to secure loans. Loans are granted up to a maximum of $10,000, which seems quite reasonable. The various systems of refunding those loans also seem quite favourable. Still, I wonder whether there is not room for improvement in certain particulars pertaining to the qualifications required for securing such loans.
For example, the Canadian farm loan board will not lend to farmers who hold parttime jobs elsewhere. But, is it not a fact that

most farmers who apply to the Canadian farm loan board are precisely those who wish to improve the yield of their lands, so as to make farming their full-time work. Is it not true too that those farmers who take part-time work in this way do so to earn extra cash because, as a result of inadequate equipment, they do not make enough out of farming to live on.
Those farmers have no other purpose than to practise farming exclusively, but not unless and until their lands can support them and their family adequately.
I am therefore of the opinion, Mr. Speaker, that these loans should be placed at the disposal of the farmers, even if they have to do part-time work outside the farm. It seems to me too that the farm loan board is far too strict on the score of mortgage guarantees required of applicants. As a notary practising in an agricultural district where lands are highly productive, I have had several opportunities of noticing how stringent were the board's requirements in this connection.
To my knowledge, a number of farmers have tried in vain to get loans from the Canadian farm loan board. After being turned down, they managed to borrow money from private sources, retired people with private means or from businessmen who would certainly have refused the loan if they had thought for a moment that the property to be mortgaged was of insufficient value to cover the amount of the loan.
I hope those remarks will receive favourable consideration so that in future our farmers will be able to obtain such loans without mortgage guarantees in excess of those asked for by private lenders.
A moment ago I was saying that the Chateauguay-Huntingdon-Laprairie riding derives its prosperity from the excellence of the work done by our farmers and the diversity of the industries established within its limits.
Therefore, I cannot defer to the arguments put forward by members of the various opposition groups who would have us believe that Canada is in the midst of a depression.
At times we may be faced, as in a few parishes in my county, with seasonal and temporary unemployment. However, I have no doubt that its present policy will enable the government to solve this problem once and for all. Already, in our region, we see a strong economic upswing.
The Budget-Mr. Boucher
I had the opportunity just recently of visiting a large textile mill in the Huntingdon district. I was pleased indeed to note a feverish activity in that mill. I take this opportunity to ask the government to consider seriously the problems facing that industry.
The leaders of the textile industry in my constituency are animated with the spirit of the pioneers of this country. They took chances with their money and placed at the disposal of their fellow citizens their great experience, so that today in Huntingdon we have mills providing employment to a great proportion of the population. The leaders of the textile industry were criticized for insufficiently modernizing their equipment. That criticism could not be levelled at the owners of the textile industries in my riding, because their equipment compares favourably with that of other manufacturers in this country and abroad. Labour is also excellent. Obviously, and it is all to the credit of the present government, our standard of living is equalled or surpassed only by the standard of living in the United States.
It will be readily admitted that it is not up to the government to come to the rescue of the lords of the textile industry who have failed to run their business efficiently. The others should, however, not suffer from unfair competition by nations less privileged in their standard of living. I submit these few remarks on the textile industry, because I am certain that the government will give them serious consideration.
The name of the other part of my riding, the Laprairie district, is now in everybody's mouth. This county, which, historically speaking, goes back to the seventeenth century, has always enjoyed great prosperity. The completion of the St. Lawrence seaway opens up the prospect of gigantic industrial development and, consequently, a much greater prosperity. Many industries are already paying fabulous prices for property adjacent the St. Lawrence river. Home building is growing apace and creating many jobs. Yet, these changes cannot but raise many problems, and I seize this opportunity to commend the government for having appointed as chairman of the St. Lawrence seaway project a man of such experience and such capacity for work as the Hon. Lionel Chevrier, who has proved his mettle for many years in and outside this house. The appointment of the hon. Minister of Transport (Mr. Marler) should also be men-

The Budget-Mr. Boucher tioned. His vast knowledge and his long parliamentary experience in the Quebec legislature had marked him for such a post. No doubt that under their leadership all the problems relating to the St. Lawrence seaway project will be solved.
Among those problems there is the price that should be granted to the land owners to be expropriated. Located in one of the most enchanting districts, across from the Lachine rapids and near the metropolis of Canada, these properties have an exceptional market value. And here, Mr. Speaker, allow me to make a special reference to the farms which are being expropriated. Apart from having an excellent market value, due to their privileged location, for housing projects, these farms are also considered to be among the best for market-gardening. Deals concerning market-gardening farms located in the same area are abundant proof of my statement, since the average price arrived at in these deals was about $1,500 per acre, without any buildings. I have no doubt that the St. Lawrence seaway authority will take these facts into consideration and adequately compensate the people who are being expropriated.
Before resuming my seat, I wish also to draw the attention of the seaway authorities to the fact that the very great majority of those expropriated will not yet have been paid when the time comes for them to leave their homes, about the first of June next, if my information is correct. I am told that in the past, in similar circumstances, the government has agreed to pay at once an amount representing 80 per cent of his offer when the parties had failed to come to an understanding. It would be unfair, I feel, to tell those people of whom a sacrifice is being asked in the general interest of the community, those people who did not wish to move elsewhere and change their way of living, who have worked on those farms for many generations since the time when our country was but a colony: "Go away, that is the law; whether you have money or not, you must move elsewhere; it is not our problem, it is up to you to agree to a settlement". Such a stand is not that of a Liberal government; I am convinced that the seaway authorities will understand their duty and thus maintain the confidence that the citizens of Chateauguay-Huntingdon-Laprairie have had for such a long time in the Liberal party.

(Text):


Charles Edward Johnston: It was
not my intention, Mr. Speaker, to take part in this debate. I sometimes wonder why some speakers when they are addressing this house, especially of late, go out of their way to make provocative statements, which sometimes they know are not true. I often wondered if it were not the intention of the government purposely to create this impression so the work of the house would drag on. This type of speech only causes members of the house-forces them, in fact-to get up and reply.
As I said the other day, I was well aware of the fact that there was going to be a speech here against the Social Credit party.


The Acting Speaker (Mr. Applewhaile):: Order.


Irvin William Studer: I rise on a question of privilege, Mr. Speaker. Did I hear the hon. member say that the statements I made in my speech were not true?


Charles Edward Johnston: You certainly did, without any question.


Irvin William Studer: But I was reading from
Hansard.


Charles Edward Johnston: Your hearing has improved.


Irvin William Studer: I ask that the hon. member withdraw those remarks.


The Acting Speaker (Mr. Applewhaile):: was listening to the hon. member for Bow River. I think he did make a remark about members of the house in general which I would have felt, had it been applied to a particular member, would have been the cause of that member rising on a question of privilege. However, I did not hear the hon. member for Bow River refer to any of his colleagues in this chamber by name or by constituency, so I did not interfere.
The hon. member for Bow River knows, without me having to tell him, that stating that any member of the house made statements which he knew were not true is unparliamentary. I did not hear the hon. member for Bow River make that statement with reference to anyone in this chamber. If he is now making it with reference to the hon. member for Swift Current-Maple Creek (Mr. Studer) I have no alternative but to insist that he withdraw that remark. I have said that I did not hear him make it, and I did not understand him as making definite accusations against any individual member.


Charles Edward Johnston: You are quite right, Mr. Speaker. I did not say the member made a statement that he knew to be wrong, because I will give him credit for not knowing just what he was saying. When I say, though, that a statement was made which was incorrect, I think that is quite within the rules of this house.


Irvin William Studer: I was reading from the Hansard record; that is all I was doing.


Charles Edward Johnston: I shall be reading the record to you in just a few minutes.


The Acting Speaker (Mr. Applewhaite):: The
hon. member for Bow River has made it quite clear that he did not accuse the hon. member for Swift Current-Maple Creek of making a statement which he knew to be untrue. Therefore, the hon. member for Bow River should be allowed to continue uninterrupted.


Charles Edward Johnston: It is necessary at times for some of us in'this house to get up and put the record straight. There are occasions, too, when elections seem to be in the offing, when some members get up-I would not say they do it intentionally-and make statements which when the record is read over are not just as true as they might be. It is my purpose this evening to make corrections in some of these statements. I hope when I have done the hon. member for Swift Current-Maple Creek will be gracious enough to get up and acknowledge that the statement he made was made in utter ignorance of the true facts.
I want to refer, Mr. Speaker, to some of the statements made by the hon. member for Swift Current-Maple Creek as reported on page 3511 of Hansard for May 5, 1955. He said:
I have heard nothing from the Social Crediters who seem to be feeling more or less happy these days with regard to what their prospects may be in connection with future government here in Canada, the financial ability of the people and of the services that they may be in a position to offer to the people of Canada.
Well now, Mr. Speaker, we are quite well aware of the progress Social Credit is making. We are not alarmed about it. The only ones who seem to be afraid are the hon. member for Swift Current-Maple Creek and possibly some of his colleagues. In his desperation he makes statements to this house which are contrary to the facts, and though he may have made them in ignorance, I think he should realize his inability to recognize the truth when he sees it.
Then he goes on, Mr. Speaker:
But before you can offer any social service to the people of Canada, there is one thing that you must do about it. You must vote for it.
The Budget-Mr. C. E. Johnston


Irvin William Studer: Absolutely right.


Charles Edward Johnston: I continue:
No one can obtain a social service in this country unless through this parliament we vote for that social service. If we vote against the social service, certainly none will be applicable.
He has taken very great pains to say that we voted against a social service. In a few minutes I want to show the hon. member where he was so far wrong that he himself need not be ashamed of it. He went on to say this:
I think the Social Credit party is active throughout the whole country-
He can be assured of that.
-in connection with advocating family allowances, leaving people with the impression that Social Credit was possibly the originator of these family allowances and-
He can again be assured of that; it is true. I do not know how he got the truth in there, but he did.
-as they were possibly the originators they should be entrusted with the responsibility of increasing them.
Of course, Mr. Speaker, we have always supported the principle of family allowances, and that is only too clearly shown in the record. Before I turn to the record, I want to quote just a little more from the hon. member's speech of the other day. I turn over the page to 3512, at the bottom, where he said:
-in regard to the adoption of the family allowance measure-
Now, notice that.
[DOT]-in regard to the adoption of the family allowance measure-


Stanley Howard Knowles: It was no such thing.


Irvin William Studer: -the following names are written, and they are written there in indelible ink. There is nothing that any Social Crediter can do that will erase it. They are written there at page 364.


Irvin William Studer: Could I ask the hon. member a question, Mr. Speaker?


Charles Edward Johnston: No, you have said enough for a while. You can talk all you like afterward.
Now, Mr. Speaker, I shall produce page 364 in a moment to show that there was no recorded vote on the adoption of the family allowance measure; that is very clear from the record. The hon. member continued:
The nays are as follows: Blackmore, Bryce, Burton, Castleden, Coldwell, Dorion, Douglas (Wey-burn), Fair. Gillis, Hansell, Hlynka-[DOT]


Charles Edward Johnston: Ten o'clock, Mr. Speaker.


Irvin William Studer: -Johnston (Bow River), Knowles. Kuhl, Maclnnis, Marshall, Nicholson, Noseworthy-
Now, Mr. Speaker, we shall refer to the record. If the hon. member had taken the trouble-

The Budget-Mr. C. E. Johnston


Mr. Pickersgill:: I am rising on a point of order, Mr. Speaker.


An hon. Member:: Another country heard from.


John Whitney Pickersgill: Is there not a rule, sir, in the house against tedious repetition?


The Acting Speaker (Mr. Applewhaile):: The
hon. member for Bow River (Mr. Johnston) may continue.


Mr. Patterson:: You put your foot in it again.


Charles Edward Johnston: There is no one in this house who should be better acquainted with that practice than the hon. member who has just spoken.
The reason I am taking the time of the house on this occasion is to ensure that these tedious misrepresentations of the facts will not be permitted to continue. Sometimes it is necessary to go to some length in regard to matters of this kind.


Stanley Howard Knowles: Ask the Minister of Citizenship and Immigration (Mr. Pickersgill).


Charles Edward Johnston: When the debate on the address in reply to the speech from the throne was taking place in 1944 the hon. member for Acadia (Mr. Quelch) spoke. And may I say, when we are discussing the speech from the throne, that the hon. member for Swift Current-Maple Creek (Mr. Studer) is entirely wrong when he makes reference to items which he says are included in that speech; because when the address is given we find quite clearly, as is indicated in this year's speech from the throne, that the hon. member moving the address in reply said, as reported in the translation of his remarks at page 11 of Hansard:
That the following address he presented to His Excellency the Governor General of Canada.
To His Excellency the Right Honourable Vincent Massey, C.H., Governor General and Commander in chief of Canada:
May it please Your Excellency:-
And this was what we were voting on.
We, Her Majesty's most dutiful and loyal subjects, the House of Commons of Canada, in parliament assembled, beg leave to offer our humble thanks-
And so on. We were not voting on any particular item in the speech from the throne. We were simply offering our thanks to the Governor General for having addressed us. It may be that the hon. member does not know this. However, we will come to that a little later on.


Irvin William Studer: When the hon. member voted to defeat the government, would there have been family allowances if his vote had defeated the government?

COMMONS	*


The Acting Speaker (Mr. Applewhaile):: Order. The hon. member for Bow River may continue.


Charles Edward Johnston: When we did vote on that we were voting confidence or non-confidence in the government. I have never, in the 20 years I have been here, voted confidence in this government, and I do not intend to start now.


Mr. Byrne:: That is why you voted against family allowances.


An hon. Member:: He did not.


Charles Edward Johnston: The speech from the throne in 1944 said this, in part:
The family and the home are the foundation of national life. To aid in ensuring a minimum of well-being to the children of the nation and to help gain for them a closer approach to equality of opportunity in the battle of life, you will be asked to approve a measure making provision for family allowances.


Irvin William Studer: And you voted against it.


Charles Edward Johnston: The Governor General himself has said there was no measure in his speech dealing with family allowances, but that "you will be asked". The hon. member for Swift Current-Maple Creek does not know his grammar sufficiently well to recognize the future tense. But this clearly says, "You will be asked to approve a measure", and of course that statement was true. Again the hon. member for Swift Current-Maple Creek cannot understand English when he sees it.
Now, when we come to speaking on the address in reply, if the hon. member for Swift Current-Maple Creek had taken the trouble to read the record he would have got it straight. The hon. member for Acadia, speaking at that time, said this as reported at page 153 of Hansard for February 3, 1944:
I very much welcome the government's proposal to pay family allowances. This is a step in the direction we have been advocating for a number of years. We first began to advocate something of this kind in this house in 1936; and I think most hon. members will recall how the suggestion that money should be paid directly to individuals outside the industrial system was scoffed at in this house. We were continually told that we were advocating something for nothing. However, apparently the government now see the light and are proposing to issue money directly to consumers instead of having it paid out through industry.


James Allen (Jim) Byrne: And you voted against it.


Charles Edward Johnston: I did not vote against it at all. Apparently you did not know what you were voting for in the speech from the throne, and apparently you do not know even yet. For the edification of some of these individuals who do not understand what the speech from the throne is, 1 shall

refer again to the debate in reply to the speech from the throne, and the reference at page 259 of Hansard for February 8, 1944, to the subject of family allowances.
How people can be so stupid as to be able to read and not understand simple English is quite beyond my comprehension. If the hon. member for Swift Current-Maple Creek had turned to page 259 of Hansard of 1944 he would have read this-and these are my own words:
That purchasing power can be made up in several ways. A large portion of it can be supplied through industry, which pays the wages and salaries, but there is never enough paid out by industry in wages and salaries to begin to buy back the products of industry, and so there is always a lag. We have advocated the issue of national dividends to make up that lag. Every other party in the house has criticized and ridiculed this principle of national dividends. In view of that, it is amazing now to see in the speech from the throne mention made of family allowances.
It will be noted that I used the proper expression when I said that mention was made of it, but no proposal was ever included in that address; and that is where the hon. member's mind has been wandering.


An hon. Member:: His beard got caught in the previous page.


Charles Edward Johnston: I quote further:
In view of that, it is amazing now to see in the speech from the throne mention made of family allowances. I have not heard anybody criticize them. Family allowances are in part a national dividend, but only to a very selected portion of our citizens. I am waiting with a great deal of interest to hear what the rank and file of the
The Budget-Mr. C. E. Johnston Liberals supporting the party which proposed these family allowances have to say about that.
This is the part of my speech to which I draw the attention of the hon. member for Swift Current-Maple Creek:
The principle of the family allowance is sound.
We have never taken any other stand.
Then, Mr. Speaker, when we come to page 362 of Hansard for February 10, 1944, we find the vote recorded and, of course, as this was a non-confidence motion we voted nonconfidence in the government.


An hon. Member:: You voted against
family allowances.


An hon. Member:: Shame.


The Acting Speaker (Mr. Apple whaite):: Order. It being ten o'clock, perhaps this would be a convenient place for the hon. member to move the adjournment of the debate.


Charles Edward Johnston: Yes, because I am now turning my remarks from the address in 1944 to the problem to which it refers, namely the family allowances measure.
On motion of Mr. Johnston (Bow River) the debate was adjourned.



BUSINESS OF THE HOUSE

Walter Edward Harris: Mr. Speaker, we are enjoying this so much we shall go on tomorrow.


[Stage Direction]
At ten o'clock the house adjourned, without question put, pursuant to standing order.
[Stage Direction]
Wednesday, May 11, 1955