1955-03-22

[Stage Direction]
Mr. H. B. McCulloch (Piclou) presented the first and second reports of the standing committee on railways, canals and telegraph lines, and moved that the first report be concurred in.
Motion agreed to.


Hon. W. E. Harris (Minister of Finance):: Mr. Speaker, subject to the usual reservations with respect to unforeseen contingencies, I propose to bring down the budget two weeks from tonight at eight o'clock.


Hon. George A. Drew (Leader of the Opposition):: In view of the reservation that the Minister of Finance has made as to the possibility of events changing the announced budget date, I should like to ask the Prime Minister if, having regard to the date announced in relation to the date which has also been put forward as the probable date of adjournment, the government will not reconsider the matter and advance the date for the consideration of the budget. This move would be in the public interest, and would allow the ordinary procedure of our system of parliament to present itself and allow an adequate opportunity for at least the preliminary presentation and the response to that presentation before we recess.
I would point out to the Prime Minister that the date that has been announced denies the ordinary opportunity for consideration of the budget and the reply, and in effect denies the basic proposition that this parliament is made up of two sides, the government which presents what it proposes to do and the opposition which, on behalf of the public not represented by those who have supported the government, seeks to put forward certain considerations.


Right Hon. L. S. St. Laurent (Prime Minister):: I am sure the Minister of Finance has been acting just as expeditiously as possible in preparing the budget. I do not think it would be possible to bring it down at an earlier date. I do not gather from what the hon. gentleman has said that he would wish to postpone it until after the Easter adjournment. In any event, the hon. gentleman's remarks will be taken into consideration and I can assure him that there was nothing sinister in the suggestion of this date. The idea was to have the budget published just as early as it was possible to get it into shape.


George Alexander Drew: Just to clarify the point made by the Prime Minister, may I say it is certainly not my suggestion that the presentation of the budget should be delayed. It is my suggestion it should be advanced. I imagine the preparation has proceeded to the point where the minister would not find difficulty in advancing the date a few days, which would then make possible the adoption of the ordinary procedure under which the case of the government is presented, and then at least the preliminary statement in regard to that case is made by the opposition in the usual way.



PRIVATE BILLS


[Stage Direction]
Bill No. 264, for the relief of Lorraine Bella Spegel Weisberg.-Mr. Hunter.
Bill No. 265, for the relief of Frances Kellerman Rappoport.-Mr. Hunter.
Bill No. 266, for the relief of Eleanor Grace Jones Graham.-Mr. Hunter.
Bill No. 267, for the relief of Gabrielle Dallaire Boulet.-Mr. Hunter.
Bill No. 268, for the relief of Phyllis Elizabeth Warner Collins.-Mr. Hunter.
Bill No. 269, for the relief of Margaret Gwendoline Turner Williams.-Mr. Hunter.
Bill No. 270, for the relief of Mary Ferguson Wynter.-Mr. Hunter.
Bill No. 271, for the relief of Sheila Win-nifred Richardson Hiscock.-Mr. Hunter.
Bill No. 272, for the relief of Anne Roitman Aronovitch.-Mr. Hunter.
Bill No. 273, for the relief of Kathleen Gertrude King Laffin.-Mr. Hunter.
2250	HOUSE OF
Inquiries of the Ministry
Bill No. 274, for the relief of Gardner Hinckley Prescott.-Mr. Hunter.
Bill No. 275, for the relief of Ethel Cope Veary.-Mr. Hunter.
Bill No. 276, for the relief of Gordon Stewart Norris.-Mr. Hunter.
Bill No. 277, for the relief of Lucille Grenier Desjardins.-Mr. Hunter.

[Stage Direction]
On the orders of the day:
Mr. Stanley Knowles (Winnipeg North Centre):: Mr. Speaker, may I direct a question to the Secretary of State for External Affairs. What is the government's attitude toward the request of the United States, as reported in this morning's Montreal Gazette, that the United Kingdom, Canada and certain other nations denounce certain clauses in the Korean armistice? Will Canada join with Britain in opposing any such repudiation?


Hon. L. B. Pearson (Secretary of State for External Affairs):: Mr. Speaker, I have read the report to which the hon. member refers and it does not seem to me to reflect accurately the present situation in Korea. That situation is a difficult one because of violations by the North Korean government of article 13d of the armistice agreement which prohibits the importation into Korea of military equipment and because of the inability of the neutral nations supervisory commission set up by the United Nations, which has two communist members out of four, to take effective action to control such imports. Proof of the violation of this article was indicated on February 5 when communist jet planes attacked a United States aircraft. These jet planes were based on North Korea, though there had been no jet planes based on North Korea before the armistice. In the circumstances, therefore, we have sympathy with the efforts of the United States and the Republic of Korea, the two governments with the greatest responsibility in the area, to correct the situation, and we will support any reasonable proposals to ensure that the armistice agreement is observed, or at least that it does not operate so preponderantly to the advantage of the North Korean communist government. Discussions on this matter are still continuing and no decisions have yet been reached.


[Stage Direction]
On the orders of the day:
Mr. Donald M. Fleming (Eglinfon):: In view of the importance of the subject, I wonder whether the communique tabled in the house yesterday by the parliamentary assistant to the Minister of Trade and Commerce with respect to the new Geneva trade agreement can be printed as an appendix to the proceedings of the house, so that we may have the complete communique and the release.


Right Hon. C. D. Howe (Minister of Trade and Commerce):: I would ask that that be considered by the house, Mr. Speaker.


Mr. Speaker:: Is there unanimous consent to have these documents printed as an appendix to Hansard?


Some hon. Members:: Agreed.
(For text of documents, see appendix, pages 2292-95.)


[Stage Direction]
On the orders of the day:
Mr. H. R. Argue (Assiniboia):: I should like to direct a question to the Minister of Trade and Commerce arising out of the report that the United States has been given freedom to restrict farm imports into that country whenever they threaten to affect domestic commodities in the United States. Is Canada making any direct representations to the United States in the hope that the current restrictions will not be extended?


Clarence Decatur Howe: The statement of my hon. friend is not correct in saying that the United States is free to shut out Canadian products whenever it suits them. It is true that, over our objections at Geneva, they were given a waiver from the GATT agreements affecting agricultural commodities. However, they are required to consult in advance before applying any restriction, and I am sure that they will do so.
I think the situation is really unchanged, because under section 22 of their agriculture adjustment act they are required by congress to take certain action in certain events and they have been doing so in spite of GATT. The only change is that if they do so in future such action will not be a violation of the rules of GATT. The present quotas against Canadian products will expire this year automatically, and certainly Canada will make representations before any new restrictions are applied.


Mr. E. G. McCullough (Moose Mountain):: I should like to ask a supplementary question. Does that mean then that under the agreement it will be lawful, as a breach of GATT, for the United States to take action against the importation of Canadian products?


Clarence Decatur Howe: That is true. Action that they may take in the future, similar to the action they have taken in the past, will no longer be a violation of the rules of GATT.



PRAIRIE FARM ASSISTANCE


[Stage Direction]
On the orders of the day:
Right Hon. J. G. Gardiner (Minister of Agriculture):: Yesterday the hon. member for Prince Albert asked me for some information concerning the payments of prairie farm assistance which I did not have before me.
I have it here now, and will give it. As of March 11, payments were made to 1,896 townships; the number of persons paid totalled 54,470. The total amount paid up to that time was $13,287,852.25. This was a week ago, and payments were being made at the rate of about a million and a half a week.


Mr. J. G. Diefenbaker (Prince Albert):: Would the minister say what the expected total will be for this year?


James Garfield Gardiner: It is something over $20 million. I have not the exact amount.



WINNIPEG AND ST. BONIFACE HARBOUR COMMISSIONERS AMENDMENT RESPECTING QUORUM AT MEETINGS

Hon. George C. Marler (Minister of Transport) moved: the third reading of Bill No. 195, to amend the Winnipeg and St. Boniface Harbour Commissioners Act.


Stanley Howard Knowles: Mr. Speaker, I shall speak only a few minutes on third reading of this bill.
I had hoped that at this stage the Minister of Transport (Mr. Marler) would have indicated his readiness to meet the request I made when we were dealing with this bill on second reading. I pointed out then that the change in the legislation which is made by this bill is quite acceptable and should have the support of this house. However, it does seem to me that legislation of this kind should not be left in such a way that, in order to find it, those who are interested have
22, 1955	2251
Winnipeg and St. Boniface Harbour to delve into the statutes of 1912, the statutes of 1938 and now the statutes of 1955. I feel it is unfortunate that this statute has not been included in the Revised Statutes of Canada at any time since it was first enacted.
As I suggested the other day, this point could be met by the government introducing a bill which would repeal chapter 55 of the statutes of 1912, as amended by chapter 17 of the statutes of 1938 and as amended by this statute, and by substituting therefor a new bill providing for the constitution of the Winnipeg and St. Boniface harbour commissioners with the entire legislation in one place. As I say, I had hoped the minister would consider that point between second and third readings. Apparently, he has not seen fit to do so as yet. I hope that even yet consideration might be given to the introduction of another bill that would put this legislation all in one act.
I have made certain inquiries since we debated the matter on second reading, and I find there are expert legal authorities who agree with the point I made on March 17. It has been suggested to me that the only substantial reason why the government does not follow this course in a case of this kind is the fear that the new bill might be debated at length. I can assure the minister that if he meets my point and introduces another bill simply consolidating this legislation into one act, there will be no debate on it so far as I am concerned.
I have one other point, Mr. Speaker. As I indicated when we were at second reading the purpose of this bill is to make it possible for the board of the Winnipeg and St. Boniface harbour commissioners to meet more readily by reducing their quorum to a majority of the members, and that is desirable. I should like to point out to the minister that there are important functions with which this board deals in addition to supervising all the shipping in and out of the so-called Winnipeg and St. Boniface harbour. This board also patrols the rivers within the limits of Winnipeg, St. Boniface and the surrounding municipalities to try to prevent drownings during the open season. I was disappointed in noting a few days ago that the Winnipeg city council found it impossible to increase the grant to this board to enable it to do that work more effectively this coming summer. I hope that that point might yet be met. The point I wish to make is that, in its own way, this board is an important one, doing an important job in our area. And, as I said at the beginning, I think it is important enough to have the legislation which is its constitution

Canada Grain Act
in one place. I hope that may yet be done, rather than leaving it in this piecemeal fashion.


Mr. L. Langlois (Parliamentary Assistant to the Minister of Transport):: Mr. Speaker, I have only one word in reply to the hon. member. The suggestion he made the other day was carefully considered and we have come to the conclusion that, although a consolidation might be desirable, we cannot meet the suggestion at this time, because if we did so we would have to do the same thing in respect of any other act where a similar situation obtains.


Mr. T. H. Goode (Burnaby-Richmond):: Mr. Speaker, I have no comment to make on the bill, because it is a local one. However, I would ask the parliamentary assistant one question. As I recall the debate, there are seven members on the board. How many of these represent municipalities and how many are appointed by the governor in council?


Mr. Speaker:: Has the parliamentary assistant unanimous consent to make a reply because, having spoken earlier, he has exhausted his right to speak.


Some hon. Members:: Agreed.


Tom Goode: Then I would ask the Minister of Transport.


George Carlyle Marler: My understanding is that all members are appointed by the municipalities.


Stanley Howard Knowles: That is correct.
Motion agreed to and bill read the third time and passed.



CRIMINAL CODE


Hon. Stuart S. Garson (Minister of Justice) moved: the third reading of Bill No. 242, to amend the Criminal Code.
Motion agreed to and bill read the third time and passed.



CANADA GRAIN ACT


Clarence Decatur Howe: the third reading of Bill No. 245, to amend the Canada Grain Act.


Hazen Robert Argue: Mr. Speaker, I rise at this time to make a final protest against the Loptson appointment to the board of grain commissioners, and against the passage of this measure which provides for increases in the salaries of members of the board.

We have had considerable discussion about the circumstances surrounding this appointment and, as the discussion went on, it became more and more clear that in fact it was a straight political appointment. That, in itself, is bad enough; but when added to it is the provision in the measure that the salaries be increased, then I believe the house is fully justified in voting against it and in making protest against the circumstances surrounding the appointment.
The minister said earlier in the debate that when he made his mental decision to make the appointment he did not know the political connection of the gentleman in question. Then he said later that he did find out about his relationship with another well-known political figure, and made that discovery about the time the appointment was made. Later in the debate the minister said that hon. members in this group were objecting to the appointment of Liberals to such boards. As I said at that time, I have no objection whatsoever to the political affiliations of the members of any government boards, but I do believe that in making such appointments they should be made on merit and upon the recommendations of the farm organizations concerned. Certainly in no way should they be based upon political affiliations.
I see a report in the Saskatoon Star-Phoenix of Friday, March 18, which confirms the contention of this group that political considerations were a very important factor in making this appointment. To show that the Liberal party in Saskatchewan considers that when such a vacancy appears, as happened in the board of grain commissioners, it is in fact an opening for a political appointment, one needs only to read this report which says that the Saskatchewan caucus of the-


Mr. Speaker:: Order. I am sorry to interrupt the hon. member, but I do not think he should read a newspaper article commenting on what has been said in the house. I would refer the hon. member to citation 265 in Beauchesne's third edition, which is as follows:
It is not in order to read articles in newspapers, letters or communications emanating from persons outside the house and referring to, or commenting on, or denying anything said by a member or expressing any opinion reflecting on proceedings within the house.
I would ask the hon. member to be kind enough to adhere to this citation.


Hazen Robert Argue: So far as I can tell, from
reading the report, it does not comment on anything said by any hon. member in the house. However, it does report some of the history of considerations given by that body

to the appointment which took place some weeks ago. The comment in the newspaper is to the effect that the caucus of the Saskatchewan Liberal M.L.A.'s-


Mr. Speaker:: Order. I am sorry to interrupt the hon. member again, but what he is about to say does not seem to relate in any way to the bill now before the house. I do not see any reference here to what might have been said at a caucus of Liberal members in the Saskatchewan legislature. The hon. member began to say that some arguments had been made to the effect that someone who was appointed had received his appointment because of political considerations. He is now proceeding to argue against that principle and, in order to support his position, he offers the comment of a newspaper. I suggest to the hon. member that citation 265 prohibits his using that quotation.


Hazen Robert Argue: I am passing the paper back
to my colleague, Mr. Speaker, who sits at the desk behind me. My reason for attempting to refer to it was to set forth our position in opposing the increase in salaries of the board of grain commissioners as set out in the bill now being considered. My whole point is that if appointments to this board are to be political, then there is no justification whatsoever for any increase in the salaries, such as here proposed, and there is no justification for giving the bill third reading. And, to verify my statement that such appointment was because of political considerations, I was endeavouring to inform the house of reports of what had gone on at a Liberal caucus meeting which was held perhaps a long time ago-certainly long before the debate in the house on this measure-and therefore I suggest could not reflect on proceedings in the house. However, I may be wrong in that.


An hon. Member:: You are.


Hazen Robert Argue: Mr. Speaker says I am wrong. Well, I have been wrong before.


Mr. McCann:: And you are wrong again.


Hazen Robert Argue: This kind of appointment has, far too long, been considered a political plum that can be passed around to political friends by the government. Reports from Saskatchewan as to political considerations that have been given to such appointments in the past show that, among the body to whom I have referred, this appointment is considered political.
I rise at this time, as I have said, to make a final protest against the circumstances surrounding the appointment, and against the proposed increase in salaries granted to the board. If we are to have competent personnel
Canada Grain Act
in the board of grain commissioners administering this very important act, then the government should endeavour to get the very best qualified personnel to man that board, and political considerations should have nothing to do with the appointments that are made to it.
I am afraid that once again the Minister of Agriculture (Mr. Gardiner) has shown his political astuteness, ahd that he is still the driver of the Gardiner machine which, substantial and powerful, has ridden over the wishes of the local Saskatchewan Liberal party.


James Garfield Gardiner: The hon. member has been reading reports of speeches made in the Saskatchewan legislature. Write your own speeches.


Hazen Robert Argue: I thought there might be some hope of a rebirth of democracy in the Saskatchewan Liberal party after the results of the last election. It is clear that now, as in the past, the Minister of Agriculture is in control of the Liberal political machine in western Canada.
Because we object to this bill I wish to move, seconded by the hon. member for Mackenzie (Mr. Nicholson):
That Bill No. 245 be not now read a third time, but that it be referred back to the committee of the whole house for the purpose of reconsidering clause 1 thereof.
Clause 1 provides for an increase in salaries.


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


Mr. Speaker:: Shall the main motion carry?


Some hon. Members:: On division.
Motion agreed to on division and bill read the third time and passed.



EMERGENCY GOLD MINING ASSISTANCE ACT


Hon. George Prudham (Minister of Mines and Technical Surveys) moved: the third reading of Bill No. 190, to amend the Emergency Gold Mining Assistance Act.


Mrs. Ann Shipley (Timiskaming):: Mr. Speaker, I do not wish to delay the important business of this house but I feel compelled to comment upon certain statements which have been made.
The hon. members for Cape Breton South (Mr. Gillis) and Comox-Alberni (Mr. Barnett) in the course of their remarks during the second reading of this bill stated that they were astonished that in supporting this bill my concern appeared to be solely for the mine operators and that I completely ignored the rights of the workers. Now, Mr. Speaker, if this were true I would consider it a most serious accusation because some of these miners are relatives who are very dear to me, and hundreds, indeed thousands of the others, are my very good friends.
I would like to point out that the measure before us today provides emergency aid for the gold mines. This government, in my opinion, has a responsibility in the plight the gold mines find themselves in today in that the sale of their product had certain regulations applied to it in the national interest. I tried to make it clear in my support of the bill that there was a responsibility on the part of the government. Furthermore, I tried to indicate that if the aid were not given to the extent set out in the bill there would be dire results. I mentioned that those dire results would affect the inhabitants of the community; those are none other than the miners themselves. Gold mining offers the only source of employment to these people as those of us who come from gold mining
Howe (Port Arthur) Roberge
areas, and some others, realize.


It has been suggested by the hon. members lor Cape Breton South and Comox-Alberni that the government should not give this aid without imposing certain restrictions to bring wages and working conditions in the gold mining industry to a level where they would compare more favourably with wages and conditions in base metal mines. There is no question that the wages and possibly certain other fringe benefits are not as great in the gold mining industry as they are in the base metal industry, but there is a valid reason for that. When we had the money the employees in the gold mining industry topped the list with respect to wages and working conditions; however, that is beside the point.
I wish to point out to those hon. members who habitually suggest that this government should incorporate certain rules and regulations, which in my opinion are solely the responsibility and come within the jurisdiction and rights of administration of provincial governments, that in this case their proposals cannot come within the federal jurisdiction. It is not the habit, indeed it is not the custom of this government, to interfere in any way with provincial rights or to create any infringements.
I could go on in detail and question certain statements made with respect to the working conditions in the gold mining industry, but as I do not believe that that is the question before this government today, important as it may be, I will simply say that 1 support the bill. Without this aid many mines might have to close and could not possibly operate. If this aid were not given, the miners certainly would be in no position to negotiate under the provincial rules and regulations to improve what my hon. friends in the opposition have referred to as extremely poor working conditions. Thank you, Mr. Speaker.


Mr. J. W. Noseworthy (York South):: I shall not delay the house for long. When speaking at the resolution stage of this bill I pointed out that the payment of subsidies to the gold mines was not the answer to the problem confronting them because, as I mentioned, it is deep-rooted and would not be solved simply by the payment of subsidies.
My colleague, the hon. member for Cape Breton South (Mr. Gillis), dealt at some length with measures he suggested should be taken in addition to the payment of subsidies if we are to right the wrongs that exist in the gold mining industry. I shall merely touch upon one or two of these.
In the first instance the gold mining operators are in a peculiar position as far as labour is concerned. Most of the gold mines, and
22. 1955	2255
Emergency Gold Mining Assistance Act particularly the Ontario gold mines, are located in northern Ontario where gold mining is the only industry available. The mining of gold is therefore the only occupation available to workers living in that part of the country. Consequently, the operators do not have to compete in an open market for workers as do manufacturers in urban centres or mine operators in many other parts of the country engaged in mining basic minerals.
As the hon. member for Timiskaming (Mrs. Shipley) has just indicated, improvement regulation is a provincial matter. In order to remedy the situation I think we need first of all provincial legislation which will introduce a labour code requiring employers in the gold mines to adopt the same standards that are adopted in comparable mining fields in other parts of the country. Because the mining operators have a form of monopoly so far as employment is concerned, because the miners have not the wide choice that other industrial workers have, because the expenses of moving from the mining field to other fields of employment are excessive, mine operators are able to get help much cheaper than the operators of other mines, and they are taking advantage of that situation.
There is another point I think we should keep in mind, namely, that gold mining is not unprofitable. When the gold mine operators find that they are going to lose they proceed to mill a grade of ore that will bring them a return on their investment. Before the price of gold was raised to $35 an ounce our Ontario gold mines were content with extracting one-third of an ounce of gold from each ton of ore milled. When the price of gold was raised to $35 an ounce they immediately proceeded to mill ore that, on an average, produced only one-quarter instead of one-third of an ounce of gold per ton. When the Canadian dollar was at a discount they proceeded to mill ore that produced slightly less than one-quarter of an ounce of gold per ton.
I suggest, Mr. Speaker, that if we were to raise the subsidies or the price of gold we would simply be encouraging the mine operators to mill ore that would produce less than one-quarter of an ounce. That may very well be in the interests of the mining industry. It may be in the interests of the country that we extract every last fraction of an ounce of gold contained in a ton of ore. I do not know, and I do not think anybody else knows. I do not think a serious study has ever been made whether it is in the national interest that we should continue to mill these lower grades of ore.
I think that this bill is an improvement and will help some of the mines that need
2256	HOUSE OF
Emergency Gold Mining Assistance Act help more than the previous measure did. To that extent I think it is good. I am merely pointing out that if we are going to get to the root of the trouble in the gold mining industry, and we are going to have further trouble-our troubles are not over in the gold mining camps and subsidies are not going to prevent trouble recurring-then in my opinion we must insist, whether or not it is a matter of provincial rights, that certain employment conditions be observed. Surely the federal government has a right to lay down certain conditions under which public money is paid to any industry. We do that in other fields. Whether or not it be a provincial field, I suggest that if the gold mines are dependent on federal subsidies then the payment of such subsidies should be worked out in such a way that they are paid on condition that the gold mine operators adopt the labour standards and working conditions that prevail in other mining camps where the work is of very much the same nature as in the gold mines.
The hon. member for Cape Breton South gave dominion bureau of statistics and Department of Labour figures showing the differential that exists today in hourly wages and conditions. I could go on at great length to describe the conditions under which some of the people in the mining camps live. I could refer to the housing conditions in some of the camps. Nobody knows them better than the hon. member for Timiskaming (Mrs. Shipley). The hon. member for Timiskaming tried to assure us that her interests were with the miners rather than with the mine operators. I do not think anyone questions that. What we do question is the conflict of loyalties on the part of the hon. member for Timiskaming as between the political party that she supports and the miners themselves.


Mr. Croll:: Oh, no.


Mr. Speaker:: Besides the fact that these remarks are not relevant to the bill, they are somewhat offensive. They impute motives to a certain degree, and I am sure the hon. member does not wish to do that.


Joseph William Noseworthy: I realize that I am not to impute motives to the hon. member. May I say that in my opinion the hon. member was attempting to justify the actions of the government in this respect and to emphasize the government's actions rather than the needs of the people who dig the gold from the mines.
I shall support the measure. I congratulate the minister on attempting to improve the situation. I merely want to point out to him that in my opinion, if we are going to avert trouble in the gold mines, we are going to have to have to do something more than pay subsidies with no strings attached to the gold


mine operators when they continue to allow present working conditions to exist and to pay the wages they are paying at the present time.


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


George Prudham: Mr. Speaker, I wish to say a word or two to correct what I think was wrong information given by the hon. member who has just spoken. I appreciate his expression of support for the bill. It is usual of course for members on the opposition side to say that a measure does not go far enough. On other occasions they criticize the government for spending too much of the taxpayers' money. However, in this case I think everyone who has spoken has favoured the continuation of gold mining assistance and the formula that is imposed under the legislation. The hon. member who has just spoken suggested that the gold mines vary the milling grade of their ore to suit changed conditions. I happen to have the record here over the ten-year period from 1942 to 1952 giving the ounces per ton of gold produced by all lode gold mines in Canada. The figures are as follows:
Ounces of Fine Gold Produced Per Ton of Ore
Year	Amount in ounces per ton
1942	  .240
1943	  -240
1944	  -230
1945	  -230
1946	  -230
1947	  -240
1948	  -230
1949	  -230
1950	  -230
1951	  220
1952	  -240
In the ten-year period, the maximum variation has been only 2/100 of an ounce of gold per ton. I believe this shows conclusively that the ore mined has not been affected by the varying amount of payments under the gold mining assistance act or any of the other conditions to which my hon. friend referred.
At this point I should like to say that I did not like the tone nor the import of the speech made by the hon. member for Cape Breton South (Mr. Gillis), not because of what he said about the gold mining industry but because of his reference to the mining industry in general. I believe he said that he hoped the day would come in this and every other country when every last man could be taken from underground and the shafts sealed. He said it was no place to earn a living, and he hoped these men could some day be placed in factories and plants where they could enjoy the sunshine and fresh air, and work at production that would be useful to mankind.

I do not think there is any industry in Canada that is more fundamental to our prosperity and progress than the mining industry. I believe firmly that the people who are engaged in that industry are the very best class of people we have, and that they are working in that industry from choice and not because they are forced to work under conditions which my hon. friend describes as less than ideal. These are the adventurers, the people with initiative, who go forth to develop our great resources. They leave the comforts of the city and the more settled parts of the country to go to the wilderness and establish new towns, to provide new wealth for our country. I firmly believe that the prosperity of Canada, now and in the future, is very much dependent upon the development of our mineral resources. Agriculture has been developed, not fully but to a great extent. Our forest reserves have been exploited to the point where we are going to have to practise conservation. Our fisheries have been fairly well developed, but mining-


Mr. Speaker:: Order. I have to guide myself by the latitude I could have given to other members since the beginning of this debate. We are on third reading now and the principle has been adopted. We must deal with what the bill contains, and nothing else. I would have stopped other members from dealing with working conditions in the mines. I watched the hon. member for York South (Mr. Noseworthy) very carefully, and he almost went into that field but he made only a passing reference to it.
Now, the minister is closing the debate and he should not deal with remarks with which perhaps he should have dealt in closing the debate on second reading. Let us keep the record on third reading as clear as it must be.


George Prudham: I am sorry that I was carried away, Mr. Speaker. Speaking to the bill I would say that the mining industry will know for two years what the government assistance will be. This will enable the industry to plan for development as well as for current needs, which will give the stability that the industry has been requesting.
Any mine with costs over $26.50 per ounce will be eligible for assistance in a varying scale, depending on their costs, with a limit of $12.33 per ounce. I do not think anyone will argue very strongly that mines with costs below $26.50 really need assistance. While the gold mines are not paying the highest rate of wages in the mining industry, they are not paying the lowest. They have done an excellent job of cutting their costs, and have improved the production per man day. The credit for this goes to the miners as well as the operators.
Public Service Superannuation Act
My hon. friends have suggested the government should impose conditions on the mines receiving assistance. I believe that on other occasions they would argue against this, or any other government, imposing conditions on one section of the industry which would prevent the free operation of collective bargaining. Any government that takes the power to impose conditions on one half or one section of the industry will also have the right to impose conditions on the other section. I do not think that either management or labour would like controls.
As I have said on previous occasions, there is another partner in this mining game who is quite often overlooked, and that is the investor. Perhaps I am straying a little, Mr. Speaker, but the investor has an interest in this gold mining assistance. I would just say that I believe the industry would go completely out of existence without the steady flow of new investment capital that comes into it. Management has a responsibility to both labour and the investor. The investor, of course-


Mr. Speaker:: I am sorry, but I see that from the list of speakers who took part in the debate on second reading the minister did not avail himself of the opportunity to close the debate. I think perhaps he is trying to do it now on third reading. I am afraid that he is taking us too far away from the bill. The principle has been agreed upon, and all we have to deal with now is what is contained in the bill, which is the extent of the assistance during the years 1955 and 1956.


George Prudham: Well, Mr. Speaker, I shall close my remarks by thanking hon. members for their support of this measure.
Motion agreed to and bill read the third time and passed.



PUBLIC SERVICE SUPERANNUATION ACT


Walter Edward Harris: the third reading of Bill No. 189, to amend the Public Service Superannuation Act.


Mr. W. M. Benidickson (Parliamentary Assistant to the Minister of Finance):: The
debate on second reading of this bill occurred last night, and as reported at page 2240 of Hansard the hon. member for Greenwood (Mr. Macdonnell) raised a question with respect to clause 13 of the bill which proposes to extend the time in which a contributor may elect to pay for prior service beyond the one-year period as provided in the basic act. He raised the question as to whether or not it
2258	HOUSE OF
Public Service Superannuation Act was necessary or desirable to have a firm, inflexible one-year limit in this respect. Under the proposed amendment there would be an additional year. I assured him consideration would be given to his point, and it has been given. It is considered that he is stretching the interpretation of the act when he says, as appears at page 2240 of Hansard, that the effect of this is that the door is not only banged, but barred and bolted.
It is true that at the end of a year it is proposed to close the door for elections for payment of prior service, without penalty. But I pointed out last night that the door is not really bolted, and that upon payment of interest, after medical examination, and provided the employee is still in the public service, an election could still be entertained.
Since the debate last evening I have again perused a pamphlet that has been given to all members of the public service. It is written in laymen's language and is entitled "Your Superannuation Plan". At page 12 of the booklet this information is given to each employee with respect to the matter of time limits on elections:
If a person wants to count service for which he failed to elect within the normal one year time limit on becoming a contributor to the superannuation account, he has to pass a medical examination and he has to contribute on the basis of his salary at the time the election is made and not, you will note, on the basis of his salary at the time when he was first employed.
The purpose of the penalty is to protect the superannuation account from actuarial selection against it, in other words, abuses. If there was no penalty, certain people, for example those who had several promotions, would be able to gain valuable protection at very little cost.
The fact, however, that such service can be picked up later, even at a penalty, is an important new benefit-under the Civil Service Superannuation Act a person who failed to elect for back service within a year usually lost the opportunity for all time.
In addition, it occurs to me it should be pointed out that much beyond the originally contemplated year is being offered. The terms of this new bill were made known in the session of 1952-53. The bill was sent to the banking and commerce committee, and representatives of civil service organizations appeared. It was not proclaimed to come into force until January 1, 1954, and under the provisions of this amending bill an additional year for election is given beyond the time originally contemplated.


Mr. J. M. Macdonnell (Greenwood):: Mr. Speaker, I am grateful for the further consideration given to the point I raised. I am


glad to accept the assurance the parliamentary assistant has given that he is satisfied the point I had in mind is covered. I have nothing further to add.
Motion agreed to and bill read the third time and passed.

The house resumed, from Wednesday, March 16, consideration of the motion of Mr. Harris for committee of supply, and the amendment thereto of Mrs. Fairclough, and the amendment to the amendment of Mr. Regier.



UNEMPLOYMENT

Mr. C. W. Carter (Burin-Burgeo):: Mr. Speaker, in my remarks before the adjournment of the debate last Wednesday I attempted to do three things. In the first place I tried to emphasize the fact that unemployment is the result of many complicated forces, and for that reason no easy or speedy solution is possible.
To indicate how difficult and complicated the problem actually is, I listed some of the contributing forces under the four headings of natural forces, industrial forces, economic forces and human forces.
Then, in the second place, I endeavoured to show that the industrial, natural and human forces, together with those economic forces which originate in foreign countries, are entirely beyond the control and influence of the federal government, or of government at any other level.
I then went on to point out, third, that the influence of the federal government is confined mainly to those economic forces which originate inside Canada, and that even here there are limitations imposed by the taxpayer at home and by conditions abroad. The role of the federal government is to keep these internal forces in balance, not only with each other but with the external forces as well, so that the Canadian economy will always be able to adjust itself easily and quickly to constantly changing influences and conditions.
Some hon. members opposite have blamed this government for doing nothing but talking. Well, I do not see what any government can do with regard to forces utterly outside its control. And I must say that, although I have listened carefully, I have not heard any constructive suggestions from the opposition benches. In an effort to offset the forces of nature this government has brought in a number of measures designed to protect

the farmer against crop failures and storm damage, and to help bolster farm income.
The hon. member for Spadina (Mr. Croll) has also suggested a measure to encourage the construction industry to expand its winter operations, and I hope this suggestion will receive serious consideration. But, so far as internal economic forces are concerned, if my hon. friends want to know what this government has done over the years, and is still doing, all they have to do is to turn to page 1634 of Hansard and study the policy outlined on Tuesday, March 1, by the Minister of Trade and Commerce (Mr. Howe). I have condensed that policy into 12 main points, and I should like to place them on record here, because I think they are worth repeating and worth keeping in mind. They are as follows:
1.	A gradual lowering of income tax, sales tax and excise tax over a period of years;
2.	Easier money with lower interest;
3.	International trade conferences to try to stabilize world trade;
4.	Increased export credit insurance;
5.	Increased unemployment benefits and other social security payments to bolster consumer purchasing power;
6.	Orderly marketing of grain products;
7.	Price support on farm products;
8.	Storm damage assistance;
9.	Aid to fish production;
10.	Subsidies and subventions to the mining industry;
11.	Anti-dumping regulations, and,
12.	Increased public works expenditures and the provision of federal funds for construction projects to offset the decline in defence expenditures.
I suggest to my hon. friend from Burnaby-Coquitlam (Mr. Regier) that these are more than mere talk. This is action. This is a program that has been carefully planned and carried out for years as the policy of the Liberal party. It is a policy designed to create the kind of economic climate that will not only permit but encourage free enterprise to exercise all its initiative and resourcefulness, and to co-operate with government and other agencies so that all may make their greatest contribution to the solution of the unemployment problem.
The stability of the Liberal party and the soundness of Liberal financial policy have created faith in Canada and in Canada's future. This faith is reflected in the evergrowing confidence shown by investors at home and abroad. The Minister of Trade and Commerce and his colleagues have done for Canada a job that has not been paralleled
Unemployment
anywhere in the world. That does not mean that nothing more can be done. The hon. member for Spadina (Mr. Croll) made a suggestion that accelerated depreciation be permitted to those industries which manufacture goods for the export market and which are capable of expansion. This, too, seems to be a good suggestion and I hope it will be adopted.
Before closing, Mr. Speaker, I should like to say something about those human forces which in many ways are the most important of all, because they very often control and determine the intensity and direction of other forces that affect the unemployment problem. Fear of working himself out of a job very often causes the worker to loaf or to slow down, thus contributing to higher building costs and higher rentals. Fear of loss or greed of gain often determines whether firms will continue to pile up inventories or unload them on the public out of all normal proportions. Selfishness on the part of an individual or of a group who insist on taking their pound of flesh, regardless of who is to pay the price, can set off a chain reaction that will hurt every other group in the country.
It will be seen that these human forces are associated with the root causes of unemployment because they underlie the motives of everything we do. In many respects, unemployment can be regarded as a moral disease. There is not much that government, any government, can do about that because a moral disease requires a moral remedy. An economic prescription may alleviate some of the symptoms but it can never effect a cure.
We have often heard it said that the trouble with the world is that man has developed scientifically and technologically much faster than he has progressed morally and spiritually and I think we all accept that more or less as a fact. But why is that so? Why has man's scientific progress so greatly outstripped his moral and spiritual progress? I believe the answer is this. Scientists use only the highest and best standards they know. Scientific standards are as exact and accurate as human skill and mechanical precision can produce. Under fixed conditions of temperature and pressure, scientific standards are always constant and unchanged. They never vary from day to day nor from one place to another. A gram weight at normal temperature and pressure is the same in Asia as it is in Europe. A cubic centimetre at normal temperature and pressure is the same today as it was 200 years ago and in every part of the world. Furthermore, scientists are never satisfied with their standards, however good they may be. They

Unemployment
constantly seek to improve them, to search tor still better standards; standards that are more accurate, more precise, more nearly approaching the absolute. Does anyone think that there ever would have been a motor car, an aeroplane or a radio if scientists had been satisfied with comparative standards? But when it comes to human behaviour we are too often content with comparative standards. Comparative standards constantly change and vary as we compare ourselves with someone else, usually to our own advantage. And when our behaviour fails to measure up to the highest we know it is very easy to rationalize it on the ground that it is not very serious, or because after all everybody is doing the same thing. But the total effect is to produce a moral disease which manifests itself in many ways, including unemployment.
I do not believe that unemployment can ever be eliminated unless we do something about those human forces. A moral disease demands a moral remedy, and the cure is, I believe, to copy a page out of the scientists' books and live up to the highest standards we know and to keep on ever striving towards standards that are still better. In this way we can become part of the cure instead of being part of the disease. That is the kind of leadership that I want for business, labour, management and industry in Canada. It is the only kind of leadership that will develop responsible enterprise and keep freedom of enterprise from degenerating into the freedom of the jungle. That is the kind of leadership I want Canada to have and to give to the world.
There is plenty of scope for each of us to exercise this kind of leadership. The employer can take another look at his books to make sure that his wage scales are the very best that his business can afford. The labourer can check his performance to see whether he is really doing his best to give an honest day's work for an honest day's pay. Retail trades can take another look to see if ways and means can be found of passing on all or part of a tax reduction to the consumer. Business organizations can check their advertising and expense accounts to make certain that the spending is absolutely necessary and not indulged in as an alternative to income tax payments. Individuals in the groups can check their demands to see if they are reasonable and responsible and not designed to get something for nothing or at the expense of someone else who is often less fortunate than themselves. These are things that we can all do without any pressure at all from government. The essence of democracy is that people and government co-operate together to solve our

problems. We have little ground to criticize government if we ourselves are failing to do our part.
Finally, we need to strive for higher standards in our relations with one another as fellow Canadians and with our brothers in the outside world. Are we going to insist on creating an ever higher standard of living for ourselves, even if it means a lowering of standards in other countries?
What kind of Canada are we trying to build? Are we trying to build a Canada in which every province will use its great wealth for its own benefit or for the benefit of the nation as a whole? It is not enough to make Canada a good place for some Canadians. It must be a good place for all Canadians.
Some hon. members have pointed out that we always have full employment during wartime. It is well to remember that we have full employment in time of war only because other countries, many of whom are our competitors, have had their productive capacity destroyed and their manpower diverted to military service.
Full employment in Canada is nearly always accompanied by unemployment, misery and starvation and reduced standards of living in other countries. Bad as unemployment is, I do not think any Canadian wants to get rid of it at the expense of someone else. It is not enough to make Canada a good place in which to live. We must work to make the whole world a good place in which to live and not for Canadians only but for all peoples and all nations.
Our measure of success in this direction will depend to a great extent on the direction of our human forces and that in turn depends largely on our moral and spiritual growth. If our human forces are governed by comparative standards there will be little moral growth and little chance of success. On the other hand, if they are directed in accordance with the highest and best that is in us I am confident that not only will unemployment be eradicated but that even the miracles of science will be surpassed.


Donald Methuen Fleming: Unemployment
unnumbered for participation by the Prime Minister (Mr. St. Laurent) and other ministers, opportunities without number for statements of government policies, statements of government panaceas, now on the sixth day S,f this debate we are yet waiting to hear the very first proposal from the government to meet the problem of unemployment in Canada? It is a sad, a tragic fact. It is evidence complete of irresponsibility on the part of those who occupy the treasury benches.
The Minister of Labour (Mr. Gregg) in speaking in this debate on the first day contented himself with drawing comfort from the figures on employment. He did not at all gome to grips with the problem of unemployment. He turned his back upon the incontrovertible facts that Canada must always have increasing numbers of unemployed because our population is rising and the Canadian labour force is increasing at the present time att the rate of about 6,000 per month.
We then heard from the Minister of Trade ^nd Commerce (Mr. Howe) and we saw him Content himself with a mere review of ^Sonomic conditions, the sort of thing he puts gut as a matter of routine at the end of each year.
~ Not one proposal has yet been made by the government in relation to this problem. We still await even some elementary evidence of recognition by the government of the existence of this problem. There has been no realism exhibited by this government in the-course of this debate.
' The seventh fact, sir, is that the govern-rhent has hitherto made no preparation for a situation of this kind. Has no lesson been learned from the experience of the depression which had its beginning in 1929? Is it to tie expected that the government is to be permitted to wait until an emergent situation of this kind is upon us before it begins even to think about it? Has no lesson been learned from the past?
' Those who recall those days of depression would be the first to hope that there would toe enough sense of responsibility, enough realism, enough ingenuity in government, regardless of its party stripe, to have given thought in advance to a situation of this kind so that when it arose measures would be ready to be put in operation to grapple with these conditions. But no preparation has been made by this government; it is a tragic fact. The situation is upon us. The situation has occurred in other sessions, though in none since the war to as alarming an extent as today. There have been ample warnings to taring about a sense of urgency to any government that had a sense of realism and sense of responsibility. It is quite apparent and

deplorably manifest now that the government has made no preparation in advance to meet the type of situation which confronts Canada today.
Having examined those unchallengeable facts, facts emerging in the course of the discussion in this house, I shall ask and attempt to answer this question, which must lie at the root of the thinking of responsible men and women in this house in regard to this problem.
What is the extent and nature of the responsibility of government in relation to a situation of this kind where we have widespread unemployment and positive suffering on the part of tens of thousands of Canadians who deserve and desire only opportunities and work?
I am of those who believe that it is a proper function of government, as far as government can, to create an economic climate within which the enterprise of individuals may flourish. That is a sound rule under all circumstances, but it does not preclude a recognition of a proper measure of governmental responsibility in an abnormal situation such as I conceive this to be. Indeed, if this were to be regarded as a normal situation I suppose the government would then be entitled to say this is a matter simply calling for a normal attitude. We of Her Majesty's official opposition do not regard a situation in which 600,000 Canadians are looking for employment as a condition which self-respecting Canadians can contemplate as normal. This to us is an abnormal situation; let us see to it that in our thinking and in our consequent policies and actions we do regard it as abnormal.
Governments in Canada have, I affirm, a measure of responsibility in an abnormal situation of this kind which they cannot shirk. I said "governments" because I recognize that there are three levels of government in Canada and I propose, sir, to face up, to the question which any member who regards himself as possessing courage must face. What is the degree of responsibility of each level of government? Where does the responsibility lie in a situation of this kind, abnormal in its nature and extent, as I have affirmed?
Let us turn first of all to the municipal governments. Here I think I can claim to speak out of some lengthy experience. It is to the municipal governments that the unemployed naturally turn first. The municipal governments are always at hand and accessible. It is only natural that the unemployed turn first of all to the local government. It is an easy matter for the unemployed anywhere to go first of all to the city hall or the town hall.

When it comes to the question of what are the remedial works which governments can engage in, believe me, sir, none of them are of a type more likely to provide employment in abnormal times than those works which municipal governments do carry out. And when work is provided of a constructive nature in a municipality it has the advantage of providing employment where the unemployed live. It is not necessary in these cases to uproot people and send them elsewhere to find employment. It is a fact that the unemployment existing in Canada today has its most acute form in the large urban municipalities. I mentioned my own city of Toronto where the unemployed today exceed 50,000.
But, sir, municipalities are, of all levels of government, least able to cope with the problem. They are closest to the problem, but they are least able to deal with it-they have such a limited tax base. Many of the unemployed who are flocking into the cities today and there swelling the numbers of unemployed are people who are not normally residents of the particular municipality. It is a fact, and it is not a new fact, that when unemployment arises in Canada on any substantial scale the unemployed in large numbers trek to the larger urban centres.
Now, sir, there is virtually nothing within the broad scope of policy of municipal government that can affect the rise or fall in the numbers of unemployed. Municipalities, if they have the financial resources, can provide work in certain cases; but those great realms of governmental policy which do affect the conditions out of which unemployment or prosperity may arise are far beyond the competence of the municipalities under our division of governmental jurisdiction in Canada. Therefore in a situation of this kind we who devote ourselves to public responsibility at the federal level might just as well accept the fact that if this problem is going to be grappled with at the governmental level the senior governments must find a way of either assisting municipalities or relieving them.
The Canadian Federation of Mayors and Municipalities in its submission of a few months ago made these important statements:
. . . national or regional figures indicating the percentage of the working population without employment do not necessarily reflect the situation in a particular municipality.
Then later:
. . . there is a compelling necessity to develop a program of unemployment relief assistance that can be brought into operation when unemployment reaches abnormal proportions on a local or regional basis even though it is apparently normal from an over-all nationwide point of view. It is clear that an adequate unemployment assistance program cannot be financed through the limited and relatively inflexible resources of a municipality.
Unemployment
The responsibility must therefore devolve upon the federal government which has a variety of revenue resources at its command and which, increasingly, is commanding an even larger proportion of all government revenues.
What of the responsibility of the provincial and federal governments? In my submission to the house this is a problem where the responsibility primarily rests upon the dominion government; and it rests there, apart from other considerations, for three reasons. First, the federal government has the required tax resources, the ultimate tax resources in Canada. Second, the realms of policy out of which unemployment conditions arise on a national scale-for this is a national unemployment problem-are federal and national. Third, the federal government, if it will scan the record, has already admitted responsibility.
We recall that but a few months ago the federal government was proclaiming loudly, proclaiming from the housetops, its assertion of priority in the fields of direct taxation. The house will not have forgotten the assertions on this subject by Mr. Abbott a year ago, when minister of finance. The country will not have forgotten the wordy contest that began on the part of the Prime Minister (Mr. St. Laurent) last September, and died away significantly soon thereafter, at the outset of which the Prime Minister was supporting the contention of Mr. Abbott of a year ago that the federal government has priority in these fields of taxation.
Therefore the hon. member for Spadina (Mr. Croll) was perfectly right and completely logical when he said that, having that priority over sources of revenue, the dominion government must recognize at the same time a priority in responsibility with reference to the unemployed. In his speech on March 2 the hon. member for Spadina provided the most complete and telling answer to that partisan outburst in the house last Wednesday, March 16, on the part of the hon. member for Rosedale (Mr. Henry). I ask the hon. member for Rosedale to read the speech of his more experienced and more logical colleague, the hon. member for Spadina. There he will find a complete answer to himself and others who are like-minded.
It was significant that the hon. member for Rosedale carefully eschewed any questions that any members in the house sought to ask him. Look at page 2097 of Hansard and you will see the efforts that were made to persuade the hon. member for Rosedale to submit to questions on the subject, and how carefully he insisted that he would not [DOT] answer questions. The reason is quite obvious. A poor case would not admit of

Unemployment
being tested by questions, and so the hon. member pursued his thorny way. Sir, what part of that speech remained after being submitted to the test of fact was a tiny fragment indeed. It did violence to history; it did violence to fact.
I do not need to remind hon. members again of the green book proposals of 1945, wherein this federal government offered in the plainest terms to accept responsibility for unemployed employables in Canada. That is the crux and the heart of the problem today. It is not unemployment among unemployables; it is unemployment among employables. There is a ten-year-old admission on the part of the federal government as to where the responsibility rests. It is no answer for hon. members to say, as the member for Rosedale attempted to say in his speech last Wednesday, that these proposals were not accepted at the time. Constructive proposals were put before that conference, among the best of them being those put forward by my leader, then representing the government of Ontario.
The government today has agreements with pine out of ten provinces. This is a national problem. Where can they find cover; where can they find refuge today from the responsibility they acknowledged in plain terms in 1945? It was not only an acknowledgment of responsibility for the unemployed employables or employable unemployed; it was also a recognition of a responsibility on the part of the federal government to think and prepare in advance for just such situations as this. Programs of what were called public investment played an important part in the proposals then put forward. Where is the program of public investment on the part of the federal government today? We have been waiting patiently for some indication of it in this debate, but none has yet emerged.
But, sir, if 1945 is too recent for this government let them go back to 1935 and recall what was said at that time by leading press organs that were loud in their support of the Liberal party, and loud in their condemnation of the then Conservative government. The Toronto Daily Star, in an editorial of February 26, 1955, says, after a survey of the present unemployment situation:
Primary responsibility for providing assistance to unemployed employables undoubtedly rests with the province and the municipality.
Well, it is unfortunate that the author of that particular editorial in the Toronto Daily Star did not take the trouble to look back over the earlier files of that same newspaper,
[Mr. Fleming.!
because if he had examined its editorial of August 6, 1935, 20 years earlier, he might have read this:
He-
Referring to Premier Hepburn.
-cannot throw it-
That is the burden of meeting the problem of unemployment.
-upon the federal authority, where it wholly belongs.
When we say that on the federal authority it wholly belongs we mean just that. The only government which undertakes to play providence to man is the federal government. It is the only government we have which professes to know more about all of us than we can know about ourselves. It is the only government which intervenes between buyer and seller and imposes fines for selling and buying. It is the only government we have which forbids a man to act in his own interest. It studies all his concerns and taxes and fines him in every movement he makes. If he buys a new shirt he is taxed. We only mention the shirt because it is so intimate a garment of a man. We could mention everything else a man uses, wears or wants. The federal government, like an eternal spider, has its web out and catches every human being in its tariff or inland revenue tax in every enterprise in which the energy of man can engage.
It is the federal government that should pay the whole cost of relief.
So spake the Toronto Daily Star, the organ of Liberal propaganda in 1935. The record has changed, sir. Twenty years have made such a difference.
Let it not be forgotten, either, that this government yonder is the same government that, whenever times were good, claimed full credit. In their thinking there was not even a place for credit to Providence. When times were good, when conditions were favourable, sole credit was demanded by the federal government. Well, if the credit had any reason for flowing to them under those conditions, certainly responsibility inescapably attaches to this government today.
It is a reproach to this government that today, with this problem having built up to its present urgent, critical proportions, we have not in Canada any agreement or understanding between the federal and provincial levels of government as to what measures they are to take in concert to meet it. There must be an understanding reached between dominion and provincial levels of government. There should have been a conference long ago. Time is required, after agreements are reached at a conference, for measures to be developed and brought into operation. It is for that reason there should have been a shelf of public investment projects available, as was proposed in 1945. We see now how hollow, how horribly hollow, these proposals were as put forward by this government ten years ago.

Much precious time has been lost by the way in which this government has dillydallied, has denied and sought to avoid its responsibility even for calling a conference.
In relation to this problem there has been no leadership from this government. How many members does a Liberal government have to have in the House of Commons, how many supporters do they have to have in the other place, before they feel prepared to give the nation some leadership in the face of a national problem? A dominion-provincial conference can only be called by the dominion government. The initiative must come from the federal level. It has not come. There is to be a preliminary conference next month which will arrange for a conference to be held later in the year. Why was that conference not held long ago? For years, session after session, we have been urging the government to call the conference, but they would not call it; theirs is the responsibility. The welfare council of Canada offered recently to call a conference. What a reproach! This government, on whose shoulders rests the responsibility, as the only government that can call a dominion-provincial conference in Canada, was so bankrupt of leadership that it remained for an outside organization, however worthy, to propose to sponsor such a conference.
We well know now the attitude of the provinces. We know their response. We know the provinces have welcomed with enthusiasm even this belated and tardy proposal that there should be a dominion-provincial conference. Far from having justified the kind of attack that was made upon him by the hon. member for Rosedale last Wednesday, Mr. Frost, the premier of Ontario, has been the first amongst the provincial premiers to call for a dominion-provincial conference with a view to reaching agreement on this matter. On March 2, as reported in the press, he stated to a delegation from the Ontario federation of labour:
Ontario is ready and willing to accept the 1945 proposals of the federal government for dealing with unemployment . . .
The province has told Ottawa this, the premier said, and the Ontario government also has repeatedly expressed the view that any solution to the unemployment problem must be a co-operative one. All levels of government must share the responsibility, he declared.
There is a frank statement from the premier of Ontario. Then let us bring these governments together and work out agreements and understandings. I quote further from this press dispatch:
Premier Frost said that he would like to feel that Canadians now are prepared to put into practice the lessons of the thirties.
Unemployment
It is now time for a concentrated effort by labour, industry and government to take care of the problems which will arise in a return to a peacetime economy, the premier added.
Declaring that no level of government can take care of the unemployment problem alone, Premier Frost said the Ontario government is most anxious to sit in with representatives of all Canadian governments to discuss the problem.
Ottawa had offered as an excuse in 1945 for not proceeding with its own proposals that Ontario had not entered into a fiscal arrangement with the federal government, the premier said.
"We have had an arrangement since 1952, so that reason no longer is valid," Premier Frost declared.
For my part, I say that reason never was valid. Again on March 4 the premier is quoted in a press dispatch as having said the day before:
Unemployment, Premier Frost said, was a problem that was giving him great concern. "But it is not a matter that can be dealt with by any one government alone. If the government of Canada will sit down with the other governments and the representatives of labour and industry I am sure we can find a solution."
Then, sir, in the last quotation I should like to read, the premier of Ontario in a press dispatch of March 11 is quoted as having made this statement:
Of immediate concern, employment and sale of farm products merited early study. These should occupy as early consideration as any other matters.
He is speaking of providing an agenda for consideration at the forthcoming dominion-provincial conference. Then this follows in quotation marks:
"Conferences between the federal and provincial governments should never be a matter of extraordinary arrangement," said Mr. Frost. "They should be ordinary affairs, on a continuing basis. That is in the spirit of confederation. It was this spirit that established the confederation, and it was this spirit that was intended to have been continued.
"If we had a good basic committee, working at all times on the many matters of mutual concern of all the governments, we would need no extraordinary meetings. They would be a regularly planned and expected program at which the matters studied by that committee would be considered, the solutions suggested by that committee would be reviewed, and early and agreeable solution could be reached on those matters.
"We, in Ontario, sincerely hope that this will be the opinion of the other governments meeting in April," added the premier. "In such a spirit, we can move to our mutual benefit. We could establish a permanent basis for our relations. In addition, of course, we must, I think, seek stabilization of employment and reduction of unemployment. And we must solve any constitutional problems that retard the marketing of farm products."
Sir, there is an eloquent plea for a continuing economic committee, a joint dominion-provincial committee, representative of all governments in Canada. That was something for which my leader, when representing the province of Ontario at the dominion-provincial conferences of 1945 and

Unemployment
1946, made an eloquent plea. It is a pity- it is a thousand pities, sir-that the proposal he then made was not readily accepted and acted upon for the general benefit of Canada in all these succeeding years.
Sir, I have quoted certain extracts from a statement recently made by the premier of Ontario. One might parallel such statements with statements made by the other provincial premiers. They, in turn, have welcomed the government's belated proposal for a dominion-provincial conference. The alternative to some agreement involving initiative, responsibility and action on the part of the federal government is continuing chaos and continuing unemployment. The proposal we make is a realistic proposal that calls for realistic effort.


Mr. Deputy Speaker:: Order. I am sorry to interrupt the hon. member, but I must tell him his time has expired.


Donald Methuen Fleming: I had finished, Mr. Speaker.


Mr. H. A. Bryson (Humboldi-Melforl):: Mr. Speaker, ordinarily it is difficult to inject any new ideas or new arguments into a debate as prolonged as this one. But I feel that this is no ordinary debate, because unemployment is the most important issue facing the people of Canada today. I am sure that when this session of parliament is over we who are members of the house will look back and say this has been the most important debate in the whole session. And if statements are made and if there is repetition in debate, no one need apologize for that fact.
However, I do believe the scope of the debate is such that unlimited arguments can be put forward to show why we should not have serious unemployment in Canada today. It is not my intention this afternoon to cover the ground as to the fundamental and basic reasons why this serious unemployment situation exists. That aspect of the matter has been covered most ably by other hon. members. I would say only this in passing, that if we are not prepared to recognize those basic and fundamental causes of unemployment, then I fear we shall not find any lasting solution to the problem.
It is obvious to me that the government has no intention of recognizing these fundamental causes. Indeed, it is scarcely prepared to believe that unemployment exists. In short, they do not want to hear about it. The accusation has already been made in the debate and, as it continues, no doubt it will be repeated by hon. members supporting the government, that hon. members on this side of the house are deliberately prolonging the debate, thereby obstructing the passage of proposed legislation to give increased benefits under the Unemployment Insurance Act.

No doubt we shall be accused of that, and I cannot help hoping we are because that kind of tactic is not going to fool the unemployed in Canada. By resorting to that procedure the government will be serving notice on the unemployed that it is using the increased benefits under the new legislation as a kind of smokescreen behind which it can hide from its responsibility to provide a permanent solution to the problem. By using tactics of that kind the government will be serving notice on the unemployed that it is prepared to go on placing another prop under a structure which is now in such a state of collapse as to be a threat to the economic life of the country.
The proposed legislation is not an answer to the problem of unemployment, and adds little to the permanent welfare of the workers in Canada. Certainly it adds nothing to the prestige of those who say it will give that permanent help.
May I call it five o'clock, Mr. Speaker?


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



PRIVATE BILL


[Stage Direction]
Bill No. 243, to incorporate Caledonian-Canadian Insurance Company.-Mr. Hunter.


[Stage Direction]
The house resumed, from Friday, March 4, consideration of the motion of Mr. Knowles for the second reading of Bill No. 163, to amend the Income Tax Act.
James MacKerras Macdonnell: Mr. Speaker, it is always interesting, when one is discussing a subject, to know its origin. In this case the proposer of the bill has been very frank in telling us just what induced him to propose it. I read from his words at page 1736 of Hansard:
...it has been an open secret that the incident which has prompted my interest and perhaps the interest of others in this proposal is the case covered by the income tax appeal board judgment No. 227, which concerned a certain firm which sought income tax deductibility with respect to some $27,789.02 which was spent for repairs and improvements to a certain property which it claimed it was using to entertain public officials in order to obtain contracts for government work. As hon. members know, the Department of National Revenue denied that claim in the first instance. The corporation in question thereupon appealed to the income tax appeal board, and in the end that board took the side of the Department of National Revenue and the deductibility was not allowed.

On the same page the hon. member for Winnipeg North Centre went on to say:
The judgment of the income tax appeal board, signed by W. S. Fisher, a member of the board, had this to say:
"I express no opinion as to why it should be necessary to entertain public officials in order to obtain contracts for work to be done for the benefit of public bodies, but apparently the appellant-and, no doubt, its competitors-have found that such entertainment has been not only necessary but also beneficial from a business point of view."
Then the hon. member for Winnipeg North Centre went on to say:
I suggest that this is a scathing indictment concerning the way in which some private businesses carry on. I suggest it opens up a very broad question as to whether there are any firms that are getting income tax deductibility for expenditures of that kind or for other expenditures which might have a political connection of one kind or another. It does seem to me, Mr. Speaker, that the time has come to lift the veil of secrecy behind which matters of this kind are considered.
There is a saying which comes back to me, Mr. Speaker, from law lectures I once attended, to the effect that "hard cases make bad law". While I do not suggest that saying applies technically to this situation, nevertheless I suggest that the same general idea holds good, and that it is a great pity to rush off making laws because one has become angry or indignant about some incident which has occurred.
Actually, if the deductibility claim heard had been allowed I would have sympathized more with the hon. member for Winnipeg North Centre, because it seems to me that then he would have been able to say not only that requests-improper in his opinion and in mine-were being made, but that they were being granted. I suggest that one of the reassuring things about this incident which has aroused him is that in fact the judgment which he and I approve of was given.
I would also like to draw attention to the fact that thousands of appeals are going forward. I hold in my hand figures given in answer to a question by the hon. member for Kamloops (Mr. Fulton) on January 14, 1953. The question had to do with the number of appeals and objections received by
the board.	I shall read	the answer: Number of assess-
	Number of	ments reduced in
	appeals and	respect of such
Calendar	objections	appeals andyear	received	objections1950	7,346	3,9091951	4,643	2,9611952	4,288	2,218Totals 	... 16,277	9,088
In other words, in those three years there were over 16,000 appeals, and presumably in 50433-144J
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the subsequent years about the same number; yet we have the satisfaction of knowing that these cases, so far as we know, have been properly dealt with. I do suggest that it would be in the highest degree unreasonable to rush off and change the law merely because there was one case which excites our indignation. I would point out incidentally, and we should remind ourselves of this, that while these cases are not made public, nevertheless the government has the information and we have to look to the government to carry on business with some degree of responsibility.
I shall read again from what the hon. member for Winnipeg North Centre said, because it seems to me he is in some difficulty in distinguishing between the right to appeal in camera, which he concedes to the individual, and the right on the part of the corporation, which he wishes to deny. Therefore I wish to read from page 1737 of Hansard:
I have been privately asked by some who are interested if there are not instances where individuals should not have the right to private hearings either. I have no doubt there are individual cases which might be borderline cases where secrecy should not be allowed. However, one has to lay down general rules, and I would say that there may be some individual cases which should not be denied the right to be heard in camera. Most individual cases should be accorded that right. Therefore the only way to deal with the matter is to leave it that all individual cases are covered by the provision that they can be heard in camera, on request.
That seems to me a very reasonable approach. The hon. member suggests that there will be individuals who are naughty, also; nevertheless he says you must not legislate against the general body because there will be transgressors. But when it comes to corporations, where perhaps in some ways the matter is more important, he takes an entirely different view. He says:
On the other hand, so far as corporations are concerned, they are public bodies. What they do is a matter of public concern. I do not think they should ever have the right to take these appeals to the board and have them heard in camera. I hope those who have been concerned about the rather staggering or shocking revelations that came out of the appeal board consideration of case No. 227 will share my view that this is something not just to ask questions about, not just to make big speeches about on the floor of the House of Commons, but something to legislate about so it shall not happen again.
Well, that is where the hon. member for Winnipeg North Centre and I part company. I suggest that we should not rush off into legislation because we have had this case before us-incidentally, a case where he and I approve the judgment, and where I have no reason to think the law is not being fairly and justly administered. The case he makes there is very unconvincing to me, indeed.

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I wish to state the positive side for a moment before taking my seat. I think corporations have a real case, in some ways a better case than individuals, for the right to appeal in camera; because I think any fair-minded man will agree, if you consider the point on its merits, that it is an injury to a corporation in competition with others to have its affairs spread out and made public. If you consider that, then it makes a prima facie case for the right to appeal in camera, and you must have a much more substantial foundation than I suggest the hon. member now has to deny that right. As a matter of fact, I think you really put a kind of handicap on the corporation if you insist that its appeal has to be heard in public. I should think a corporation might very well consider whether a full disclosure to its competitors of the details of its business might not be such an injury that it would rather not take an appeal.
I repeat what I said a few moments ago. What have we? On what substance are we proposing this legislation, which I suggest can be injurious, and which I suggest further there is no adequate case to support? The hon. member for Winnipeg North Centre himself speaks about the individual cases, and the final point I wish to make is that if we deny the right to appeal in camera to corporations, that is just opening the door. The next thing that will happen is that it will be denied for individuals. It will be quite possible.
Indeed, the hon. member for Winnipeg North Centre, being so ingenious in argument, I can quite believe that if we passed this bill, if we give him his way with regard to corporations, he might come back with a very, shall I say, ingenious argument that now having denied the right to corporations this house should deny it to individuals. Indeed, I would say he might very well argue that corporations, with their auditors and various safeguards by which shareholders protect themselves against their managers, were much less likely to be bringing in inaccurate or improper returns than individuals, either because the individual is not sufficiently familiar with the matter or because he has nobody to check him up as have the individuals who present corporation returns.
I do not think a case has been made out for this measure; therefore I propose to vote against it.


James Joseph McCann: Mr. Speaker, if I remember correctly this is the fifth time in ten years the hon. member for Winnipeg North Centre has
[Mr. Macdonnell.1
introduced a bill designed to limit what I shall refer to as the secrecy provisions of the Income Tax Act. I feel that I shall have to oppose this bill, because I do not think these amendments are in the public interest.
Unlike its predecessors this bill seeks to limit the provisions of subsection 2 of section 91 and of section 133 of the Income Tax Act only in respect to corporations, leaving the present provisions of the sections apply as at present to individuals. I am of the view that this definitely would be class legislation.
All corporations are persons under the law. Certainly they are subject to the same requirements under the law, and are entitled to the same protection of their rights. Every reason for maintaining the secrecy provisions for the protection of the individual applies with equal force to corporations. In fact the vast majority of corporations are owned through share holdings by one person or by a very small group of persons who have assisted the one person financially in the establishment or in the extension of his business.
Most of these corporations are in substance proprietorships under a legal corporate form. I do not intend that what I have to say shall be limited to small corporations, because I feel my remarks apply to all corporations, whether large or small, just as they do to individuals.
As everyone knows by common knowledge, from time immemorial the Englishman's home has been his castle, and all affairs pertaining to him and to his family are protected by law from trespass or exposure. You may not enter his home without his permission; you may not ascertain his private affairs without a voluntary disclosure. This right of privacy that every Englishman possesses is as strong in the countries of the commonwealth as it has been from time immemorial in England, whence we draw so many of our laws and so much of our tradition.
These comments are not comments in law; they are comments on things vital to the nation and the welfare of the people, and are instinctively understood, appreciated and jealously guarded by common consent of every citizen in every nation.
The provisions of the Income Tax Act respecting the right of the taxpayer to have his appeal heard in camera, and the provisions respecting secrecy which this bill proposes to amend, have been in the income tax legislation since it was first introduced in 1917. I think it may be taken that these provisions are a recognition of the inherent right of the citizen to have his business affairs

kept as private as possible. This right of privacy is necessarily invaded for the purpose of collecting the revenue, but when that purpose has been attained these two provisions of the act preserve to him that right to privacy in all his affairs. I understand that the tax laws of all countries of the commonwealth provide that disclosures of their affairs made to the tax authorities by taxpayers are to be held confidential and secret.
The taxpayer is by statute compelled to produce and file with the government and its officials for the purposes of revenue certain portions of his private affairs, namely his income, contracts out of which his income is earned, his investments, his relations with other businesses, all of which from time to time play a part in determining what the taxpayer's income may be and have to be produced.
On many occasions in litigation between subject and subject litigants in order to advance their case have subpoenaed officers of the crown for the purpose of compelling them in the witness box to disclose information which came into their possession as officers of the crown under the compulsion of the revenue laws. Where the matter was a civil matter between subject and subject the courts have sustained the basic British right of privilege or privacy and secrecy pertaining to a man's affairs, and the inroad into those private affairs is not to be made through the medium of subpoenas.
I am informed that the courts have said that while the right of production as an abstract right is not to be denied the courts, it is equally clear that that abstract right is not to be invoked by order of the court to serve the end of litigants in our courts which are places of public entry. Having secured the abstract right to the courts, they nevertheless realize the paramount need of the nation as a whole and do not issue orders demanding the production of documents which were obtained under compulsion of law in the course of carrying out revenue measures.
In cases of litigation of civil matters between subject and subject our Canadian courts have followed the practice of the British courts of maintaining the right of the court to compel the production of any evidence; but where the Minister of National Revenue or his officials state that it would be injurious to public interest to produce the documents or to give information they have consistently held that production should not be made or evidence given. I submit that is
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very important. I should like to quote from a judgment given in 1893 in the British courts, as follows:
They (meaning those who are in the public service and the minister in charge of the department) must know the exigencies of the public service far better than the court and therefore the courts, although not departing from the power to have the question thoroughly investigated, nevertheless recognize, in all except extreme cases, that the word of the officer who is head of the department ought to prevail on the question whether the production of the document would be injurious to the public service.


John George Diefenbaker: What is that case?


James Joseph McCann: I do not know the number. It was a British case and this decision was given in 1893. I do not know who the litigants were.
The courts have dealt with this subject on the broad basis of public policy. I think I would go further and say not only would it be injurious to public policy, but since there must be such full, complete and comprehensive disclosure of private affairs by force of a public statute for a public purpose, there is the implied, indeed the distinct understanding that the information will be received by the crown for the purpose of revenue only, and will not be used directly or indirectly in any other direction or for any other purpose.
They should not be permitted to become a source of information for others whom the statute never intended should have them, namely third parties; and those parties should not have access to them either through the courts or through any other channel that would make the documents so received public property. It is essential that the public should know that their affairs must be disclosed completely and fully for revenue purposes so far as those laws may require, and they must be assured and have complete confidence that their disclosures will have that same secrecy that they themselves maintain in relation to their own affairs.
The right of the taxpayer to have his appeal heard by the board in camera is but a continuation of his right to have his affairs kept private and confidential. Court procedures may well expose the trade secrets and every financial operation of a corporation to the full view of its competitors, a process which would completely eliminate the fruits of good business principles and administration and do irreparable harm to the business. His right to appeal to the courts for a judicial interpretation of the law should not depend upon his willingness to forgo his right to privacy. Without that right many taxpayers would not appeal, and thus indirectly would be denied a review of an administrative decision by Ihe court.

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The Income Tax Act gives the minister the widest power to demand information from any person of his own or another taxpayer's affairs for the sole purpose of assessing taxes. Obviously the minister would not of his own volition bring to the house information obtained under the authority of the act. Accordingly, these amendments necessarily mean that someone in this house or the Senate must seek information from the minister, and the purpose for which he seeks it may be good or evil. Indeed, it may be presented in such a manner that it appears to be for a good purpose, but who can tell what other purposes may be inherent in the disclosure, either to the member or to other persons known or unknown to the taxpayer, who might desire to use the information against the taxpayer? Thus parliament could be made the instrument of securing private information compelled initially to be given by statute solely for the purpose of revenue, and the house could not possibly know beyond all question why the information in a particular case or group of cases was desired.
It would be my view that parliament is supreme in all matters. It created the public statute; it can modify it. The abstract right of parliament to have any information is undoubted. It is axiomatic that the House of Commons, the people's court, can always inquire, if it so desires, into any affairs both private and public. That is not the question that is being put to the test. The question is, should this amendment be the means through which persons in this house can cause the minister to secure information and bring it to the house in response to any inquiry or motion?
I suggest it is more desirable to deal with these matters directly. If any corporation is to be interrogated, or its private affairs examined, then parliament can do that if it so desires by the appropriate procedure, of which every member of this house is aware. That is, it can do directly what this bill seeks to do indirectly, after the taxpayer has complied with the law in the belief that its affairs would continue to be private, except for the purpose intended, and innocent of any thought that a full disclosure of its affairs would one day be brought before this house, through the hand of the Minister of National Revenue.
In addition to the powers of parliament to which I have just referred, I might remind the house that the Auditor General, who is an officer of this house and not responsible to any minister, has free access to all files, documents and other records of every department. In this regard I may quote section 66
fMr. McCann.]
of the Financial Administration Act, being chapter 116 of the Revised Statutes of Canada, 1952:
"66. (1) Notwithstanding any act, the Auditor General is entitled to free access at all convenient times to all files, documents and other records relating to the accounts of every department, and he is also entitled to require and receive from members of the public service such information, reports and explanations as he may deem necessary for the proper performance of his duties.
(2) The Auditor General may station in any department any person employed in his office to enable him more effectively to carry out his duties, and the department shall provide the necessary office accommodation for any such officer so stationed."
That condition exists in the Department of National Revenue all over the country.
" (3) The Auditor General shall require every person employed in his office who is to examine the accounts of a department pursuant to this act to comply with any security requirements applicable to, and to take any oath of secrecy required to be taken by persons employed in that department.
(4) The Auditor General may suspend from the performance of his duty any person employed in his office."
I may add that the Auditor General does attend at various taxation offices throughout the country for the purpose of carrying out his duties.
It is a matter of pride that the department administering this law has loyally and meticulously complied with these secrecy provisions, though of necessity the collection of taxes requires the production in detail of the private business affairs of all taxpayers.
Those associated with the administration of the tax law in the earlier days will recall the subtle but tangible resistance to the disclosure of information by the public generally, a natural reaction of a free people. There can be no hesitation in saying that these two provisions of the taxing statute so meticulously adhered to by the administration have produced the almost universal co-operation of the public in the collection of taxes by the ready and complete disclosure of all information required or demanded, in the sure belief that it will not be disclosed to their detriment or embarrassment.


John George Diefenbaker: Would the minister allow a question?


James Joseph McCann: I shall be finished in a moment.
Should these amendments pass, any resulting disclosure of private information to this house, which would be disclosure to the public at large, including competitors, would undoubtedly be resented; and notwithstanding the legality with which these amendments would clothe that disclosure, such resentment would reflect on the administration

which had secured the information for the sole purpose of levying taxes.
I am of the opinion that the passing of these proposed amendments would be a backward step that would seriously retard and handicap the administration of this act. Accordingly, I oppose this bill.


John George Diefenbaker: Would the minister now allow a question asked for the purpose of information, because I am so fully in agreement with what he says? Was there not recently a judgment in the Supreme Court of Canada to the effect that income tax returns are available for use in the courts? If I am right in that, has any consideration been given by the minister to ensuring that income tax returns are secret and are not compellable for production in court?


James Joseph McCann: My understanding of the case, and perhaps it is not the one which the hon. gentleman refers to, is that it was so held in the British Columbia court where, although we resisted being subpoenaed to give evidence in a criminal case, the court decided that we had to give evidence and this was done. The evidence related to a gangster or something like that; but it was still maintained, I think, that in relation to civil cases, if that is what you call them, you can resist appearing in court on the grounds that it is not in the public interest, and that it would violate the secrecy provisions of the act.


John George Diefenbaker: Has the minister given consideration to making clear provision in the act to that effect?


James Joseph McCann: I understand that is being given consideration at the present time by the law officers of the department, in conjunction with the Department of Justice.


Mr. J. W. Monteiih (Perth):: Mr. Speaker, I should like to take a moment to illustrate how in my opinion this bill is actually quite unfair. I gather that the hon. member for Winnipeg North Centre is after what he might call big corporations. However, the bill does not stipulate that. It includes all corporations.
Many corporations, as we know, are extremely small. There are cases of partnerships or individual proprietorships that run along for years and years, and suddenly the proprietor or one or all the partners realize that they are getting older and they decide to incorporate. They do so for no other purpose than that in case of an estate, stock certificate shares are much more readily handled than bricks and mortar, as anybody will realize. They do not make any more money, but they are no longer a partnership
Income Tax Act
or a proprietorship. They are a small corporation. One person can incorporate and have his wife and daughter as directors.
Is it not quite unfair that just because there is an incorporation this information should be revealed? According to the bill it would be subject to disclosure. I do not think it is equitable that information relating to a proprietorship should not be subject to disclosure, while information relating to the corporation that takes its place, exactly the same entity, should be subject to disclosure. These matters may be of interest to the public, as the hon. member for Winnipeg North Centre says, but in my estimation disclosure would not be in the public interest.


Stanley Howard Knowles: Mr. Speaker-


Mr. Deputy Speaker:: May I remind hon. members that if the hon. member for Winnipeg North Centre speaks now he will conclude the debate.


Stanley Howard Knowles: Mr. Speaker, first of all I want to thank the hon. member for Greenwood for putting on the record again a good portion of the speech I made in opening the debate on second reading of this bill. I have no quarrel with the selections he made from my speech. In fact he has made it unnecessary for me to repeat some of the arguments I made on that occasion. I must say that even though I had reason to anticipate the position that might be taken by members of the Progressive Conservative party and of the Liberal party in connection with a bill of this kind, I have been astounded at some of the things that have been said by those who have spoken.
For example, although I did not take down his words I think I am reporting him faithfully when I say that the hon. member for Greenwood said we must have confidence in the responsibility of the government in administering these matters. I must confess that it seems strange indeed to hear the hon. member for Greenwood talking of confidence in the government, in the light of the many times he stands up in the house and expresses the very opposite, his complete non-confidence in the so and so's who have been across the way far too long.


James MacKerras Macdonnell: Will the hon. member permit a question? Does he not distinguish in his own mind, as I do in mine, between matters of policy and questions of administration by skilled civil servants of legislation passed in the house by ourselves? That is all I expressed confidence in.


Stanley Howard Knowles: Certainly there is such a distinction; but the final responsibility for what

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the civil servants do, particularly the decisions they make, rests upon the government. Time and again the hon. member lor Greenwood and other members of the Progressive Conservative party have pointed out and have in fact tried to get behind what ministers were saying to the decisions made under their direction by their officials in various departments. I submit that if members of the Progressive Conservative party are going to assert one day their lack of confidence in the government, as they did on another motion yesterday, it is strange that they turn around today and ask us to affirm confidence in that same government.
Similarly, I was surprised that the hon. member for Greenwood took the stand that secrecy should prevail with respect to matters of this kind. He and his colleagues, and some of us in this party, time and again try to get through the veil of secrecy we are up against in this house. We try to get the curtain lifted. We try to get information as to what is going on in government departments and crown corporations. Lo and behold, when it comes to private corporations the hon. member for Greenwood wants to roll down the curtain of secrecy that he tries to roll up when public bodies are under consideration.
I may say that I was also somewhat astounded at the question directed by the hon. member for Prince Albert to the Minister of National Revenue at the end of the speech made by the minister. In my bill I am asking for some relaxation of the secrecy provisions, but I discover that the hon. member for Prince Albert wants to go in the opposite direction and make the secrecy provisions even stricter. He wants to have the law amended so that even the courts of the land cannot get at some of this information. When I think of the many speeches the hon. member for Prince Albert makes in the house glorifying the courts of our land, when I think of the times he rejoices in the fact that no matter what the government may do we have the courts to fall back on, I must say I am astounded that he now wants the legislation to be tightened up so that even the courts cannot get at information of this kind, no matter what issue might be at stake.
The hon. member for Greenwood suggested to me that I should not be pressing this bill since I said that it arises in part out of case No. 227 because, as he put it, in that case the claim for deductibility was denied. He and I are both satisfied with what the department and the income tax appeal board have done in that case; so he said: why not let the matter rest? I took it from his remarks that he read the entire debate the day this matter was up a while ago, and if so he must have read the

remarks of my colleague the hon. member for Dauphin (Mr. Zaplitny), who pointed out that there are four large corporations in the province of Quebec which were given income tax rebates totalling some $2 million under circumstances to which the hon. member for Dauphin appropriately applied the word "fishy".
It seems to me if the hon. member for Greenwood is going to be satisfied on the one count he should tell us what he thinks of this other situation. Here we have a case where, even when the matter was still pending before the courts, the government made a settlement with these corporations amounting to a rebate of some $2 million. When the hon. member for Dauphin brought down a motion seeking the correspondence so we could find out how the deal was made, he was denied that correspondence on the ground of the secrecy provision in the Income Tax Act. I think it is noteworthy that the hon. member for Greenwood and the Minister of National Revenue made no reference to that case which was presented to the house so clearly and so forcefully by the hon. member for Dauphin.
The hon. member for Greenwood, in one of the lighter moments of the speech he made, suggested that we should not accept this bill, applying as it does to corporations, lest I find some way next year to extent its provisions to individuals. I can assure the hon. member that if I had wanted the provisions of the bill to cover individuals as well as corporations I would have included individuals as well as corporations in the bill now before the house. It is precisely because I think the lifting in part at least of the secrecy provision should apply only to corporations that I worded the bill specifically to that effect.
So, Mr. Speaker, I say I am somewhat amazed at the line of argument followed by the hon. member for Greenwood and at the implications of the question put by the hon. member for Prince Albert; because I would have thought I would get support for this measure from my friends to the right who have doubts about the government across the way and who are forever, along with some of the rest of us, trying to get the veil of secrecy lifted.
I turn now, Mr. Speaker,-


John George Diefenbaker: We want the veil of secrecy lifted from the Canadian National, not the government; that is what we are asking.


Stanley Howard Knowles: It all depends upon whether it is the Canadian National or Canadian Pacific at which my friends are looking. If it is the Canadian National, they want the

secrecy lifted; but if it is the Canadian Pacific they want the secrecy maintained.
I turn now to the remarks of the Minister of National Revenue. I cannot but smile at the playing with words in which he indulged. He told us, first of all, that under the law corporations are persons. He nods his head that he said it, of course. Is not that a legal way of putting it? Does it follow from that that corporations are to be treated in all respects as though they were human beings?


Mr. Rowe:: What do you think they are?


Stanley Howard Knowles: Well, I regard the hon. member for Dufferin-Simcoe (Mr. Rowe) as a person, a very fine person. I like him very much, especially when he makes speeches, and I like him even more when his speeches are being interrupted. He is a person; he is a human being; he is alive. According to the law Canada Packers is a person, but to me there is a world of difference between Canada Packers and Earl Rowe. By calling Canada Packers a person for legal purposes, you do not put that or any other corporation in exactly the same category as the deputy leader of the opposition or any other person in this house or anywhere in the country.
I suggest that it is begging the question to try to move on from the legal statement that corporations are persons to the idea that therefore you have to treat Canada Packers, the Canadian Pacific Railway, Consolidated Mining and Smelting Company and a few more as though they were ordinary human beings as we know ordinary live Canadians to be. Of course the Minister of National Revenue went on to argue that we should give to these corporations-he used the phrase "class legislation", so I am entitled to use one also-I do not think we should be asked to go on and give to these soulless corporations the same right that we ask should be given to real, live human beings.
Despite what was said by the hon. member who spoke just before I rose, I do think the point I made in speaking previously was well taken, that the affairs of corporations, the affairs of profit-making private industry, are matters of public concern. They make money out of the public. They live by virtue of the public being there to provide those who must work for the corporations, and being there to provide a market for their products. If the public did not exist, these corporations would not get anywhere.


Jay Waldo Monteith: I wonder if my friend would allow a question? Would he consider that an individual proprietorship worth roughly half a million dollars should not be subject to these investigations or these disclosures, 30433-145
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while a corporation worth $40,000 that is owned by one man and his wife and daughter should be?


Stanley Howard Knowles: I think a corporation that is making money out of the public and is-


Jay Waldo Monteith: You have a proprietorship just the same.


Stanley Howard Knowles: My hon. friend is indulging in the same use of words as did the Minister of National Revenue. I suggest that a corporation that is making its money out of the public is a matter of public concern, whether it be a $40,000 corporation, a $40 million corporation or a $400 million corporation. In my view, because these are matters of public concern, the public has a right to know what is going on.
In my speech in introducing this bill I made it clear that we should not clutter up the books of the country, that we should not hire twice as many printers as we now have at the printing bureau, in order to print all the information that is gathered by the Department of National Revenue. But I do suggest that parliament should be in a position to get this information if members of the Senate or the House of Commons, on their responsibility as members, feel it should be made public.
The Minister of National Revenue suggested parliament could do this any time it wanted. He knows how many times he himself has denied members information which they have sought because of the secrecy provisions in the act. Members of this house know, as do the members of the Conservative party, how often requests for information, even through motions, from the income tax department have been denied.
The only possibility of such information being obtained would be if an amendment like this, or a similar one drawn in other words by the government, were made to the Income Tax Act. So, Mr. Speaker, I contend that in principle these matters are of public concern, and should not be cloaked in inviolable secrecy. Profit-making private corporations are matters of public concern, and we should have a right to know what is going on so far as their profit-making activities are concerned.
I think it is interesting that we have not had any discussion by the Minister of National Revenue in this debate about some of the matters to which I referred the other day, including United Distillers Limited. We have had no reply to the case that was made by the hon. member for Dauphin and the disclosures he put on the record. Rather we have had this indulging, as I call it, in the use of words.

Income Tax Act
It does seem to me, Mr. Speaker, that we should lift this veil of secrecy; we should be able to find out what is going on. We all know that so far as corporations are concerned there are many adjustments that can be made in the amount of income tax to be paid, depending upon depreciation allowances, depletion allowances, deductions for expenses of all kinds, and other allowances across the board. As I said earlier, corporations engage lawyers and accountants for the purpose of getting the best possible deal they can, even if the public treasury is the loser. One corporation does not know what sort of a deal another corporation is getting?


Jay Waldo Monteith: Why should they?


Stanley Howard Knowles: I sometimes wonder why some hon. members come to parliament, when they do not seem to be concerned about the interests of the public. They are concerned mostly over private interests.


William Earl Rowe: Who are they?


Stanley Howard Knowles: The public has no knowledge of what loss the treasury may be suffering because of the various arrangements that have to be made between the Department of National Revenue and the various corporations that are required to pay income tax. For these reasons, Mr. Speaker, I believe the veil of secrecy should be lifted and I call upon the house to support second reading of this bill.


Mr. Speaker:: At eight o'clock the house will resume consideration of the business which was 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 Mr. Harris for committee of supply, and the amendment thereto of Mrs. Fairclough, and the amendment to the amendment of Mr. Regier.

Hugh Alexander Bryson: Mr. Speaker, at five o'clock I was pointing out the reluctance of the government to admit that there is a serious unemployment situation in this country. As a matter of fact, speakers on the government side of the house who have taken part in this debate have spent literally hours in an abortive sort of way trying to explain away the seriousness of the unemployment situation that exists in this country at the present time. They have marshalled endless sets of figures in an attempt to justify their argument that unemployment in Canada is no worse this year than it was last year.
Regardless of how many sets of figures, no matter how many surveys are made, regardless of how many employment categories the government uses, no matter how many months of this year they compare with months of last year, they keep coming up with a disastrously high figure as far as unemployment is concerned. I am sure the government are reluctant even to believe their own figures.
We have today in Canada the greatest number of unemployed since the end of the war. I am sure also the government will be trying to devise other formulae and other sets of figures in an effort to come up with something they want to come up with, because the figures and formulae they are using now keep coming up with the wrong answers.
I do not think the question of whether there are 300,000 or 600,000 unemployed in this country is of such great importance. That kind of argument is just about as logical as trying to convince a fan dancer 50433-1454
Unemployment
that 60 below zero is twice as cold as 30 below zero. She is not going to be greatly impressed with that kind of logic or that kind of argument, because both temperatures are equally disastrous as far as she is concerned.
The minister spoke of a sample survey which is being carried on by the Department of Labour, and mentioned that this survey was of great importance. Through these surveys the department is able to ascertain how many people are not working in Canada. Then they claim the survey is useful in other ways as well, because they are able to find out why these people are not working. I wish the minister would tell us who these people are who are out in the field making these weekly surveys. I would like to know how much these people are paid for doing this work. It must be on a per capita basis. I say that for this reason. Last year I had the opportunity of watching one of these surveys being taken weekly throughout the summer. The person who was carrying out this important job of finding out why people were not working kept going into this one establishment every week. When I investigated I found that it was a home for old men.
It seems to me that making jobs of that kind is simply another excuse for appointing a lot of political hatchetmen who are strategically located throughout the length and breadth of this country. If the government spent as much time and effort trying to find work for people as they spend in finding out why they are not working, possibly we would be a lot better off.
Apparently the government have nothing to offer in the way of an over-all comprehensive scheme or program that will come up with a permanent solution for this serious unemployment problem. They are quite prepared to go on pinning their hopes on unemployment insurance doing the job. I will admit that the minister has intimated that he is concerned about unemployment and possibly he has some ideals in respect to this problem; but I would submit to him that ideals will materialize only when there is some application of practical ideas. I suggest that one of the most practical ideas would be to provide jobs for the unemployed in this country.
I was thoroughly amused and then completely amazed at the antics of the Conservative party, and the concern they are showing for the unemployed in this country. I do not think many of us have forgotten the attempt made by that party to solve a similar unemployment situation which existed in this country not many decades ago. There is one other

Unemploy merit
thing I am sure of. I do not think anything would please the Liberal party more at the present time than to unload this miserable mess on the Tory party, as they did once before.
The only thing the unemployed in this country can be really thankful for is that the Tory party is not in a position to gain power in this country at this time. When I mention jobs I have in mind the jobs which the Tory party provided for the unemployed back in the early thirties. At that time we saw railroads being built with picks and shovels and wheelbarrows, and in cities like Saskatoon we saw men working at the city dump flattening out and baling tin cans. We do not want jobs of that kind provided.


Mr. Knight:: At $5 per month.


Hugh Alexander Bryson: The kind of jobs that must be found are those which will build up assets in this country, assets which in themselves will be wealth-creating and because of that fact job-creating. The hon. member for Winnipeg North Centre (Mr. Knowles) and hon. members of this group have enumerated a long list of projects that would come under the category I have just mentioned. It is not my intention to go over the ground they covered so ably and so well, but I would suggest that one project which would fall within the category I have mentioned would be a publicly-built oil and gas line, one that would become a public utility. I am not suggesting that the actual construction, whether under private enterprise or under government enterprise, would employ any more men, but I do submit that the economic results that would accrue to this country in the future would be considerable.
I think the South Saskatchewan dam would be such a project. I was surprised the other day when I heard the hon. member for Prince Albert (Mr. Diefenbaker) ask what the province of Saskatchewan had done toward relieving unemployment.
It is not my intention, Mr. Speaker, to trespass on the ruling you gave the other day in this connection, but I would like to say that the hon. member for Prince Albert knows as well as I do what is being done in the province of Saskatchewan to combat unemployment. He knows as well as I do that we have undertaken the greatest public investment program in the history of the province. So far as the South Saskatchewan river dam is concerned, we have advanced from the point where this government promised to build this dam in its entirety. We have come from that position and now we have agreed to pay $33 million for the complete power installation, and in addition
IMr. Bryson.]
we have agreed to pay some $20 million for the construction of the dam itself.
It is all very well to talk about a public investment program when the dominion and the provinces co-operate to that end, but let us make no irresponsible statements about any province in western Canada being able to undertake on its own a program of public investment. For example, of the $65 million the province of Saskatchewan has agreed to spend on the South Saskatchewan river dam, 75 per cent would be spent for steel, cement, pipes and other necessary material. Therefore some $48 or $49 million of the total $65 million would go out of the province of Saskatchewan to the eastern provinces where those materials are manufactured, and only 25 per cent would remain in the province. Let no one say that by the expenditure of large sums of money any province, especially those in western Canada, can combat unemployment itself.
I am not suggesting that the fact this money accrues to eastern Canada is undesirable. I say it is good, provided that the federal government and the provinces cooperate in a public investment program. We in the province of Saskatchewan are quite prepared to do our share in that regard.
There is a tremendous need for development in our north country. The Minister of Northern Affairs and National Resources (Mr. Lesage) is loud in his praise of the development that can and must take place in relation to railways and highways. He speaks of the tremendous development that is possible in that absolutely fabulous land. Its possibilities in providing work cannot even be estimated, to say nothing of the economic advantages to the welfare of the Canadian people that will accrue as a result of that development.
I suggest one other project which should be undertaken to assist tremendously in the battle against unemployment. I refer to a national housing program. I believe no agency other than this government can hope to cope with the important need for a national housing program.
I think a housing program of this type has many aspects. One aspect we have failed to recognize, for which this government must accept some moral responsibility, is that we have in our cities a serious juvenile delinquency problem. Certainly authorities are in agreement that slum conditions are the greatest contributing factor to this serious problem of juvenile delinquency. They are quick to point out that many thousands of children who are exposed to slum conditions, and the abject poverty which is associated with slums is the greatest contributing factor to that delinquency. Our habits only

reflect our environment. As one authority puts it, we talk about the influence of the home, yet we fail to acknowledge the fact that many thousands of children in this country have in effect no homes at all but only broken and unfit homes. When they mature they tend to establish similar homes because they know of no others, and to produce in turn more neglected and abandoned children. Read backwards the story of delinquent youth, and observe how frequently it becomes the record of a delinquent society.
I believe this government has some responsibility regarding this question on two counts. First of all, I think it has a responsibility to the taxpayers of this country, because we must remember a good deal of money is spent as a result of the misdemeanours of juvenile delinquents. I think the most important question is the moral aspect of this problem. I believe this government has some moral responsibility which it must and should accept. Surely it would be better to salvage these children now by building proper housing in these slum areas, rather than pay for their crimes and delinquencies at a later date.
In his remarks the other day the minister said the manufacturing industry has maintained its output at fairly constant levels. At the same time he said that employment in manufacturing has dropped 5 per cent. He also said this represents an increase in productivity, which is all to the good and has a double-barrelled effect. Mr. Speaker, as far as the agricultural producers who have been buying farm machinery are concerned, it certainly has had a doublebarrelled effect and they have felt the effect of both barrels.
The minister pointed out that this increase in productivity had placed the manufacturing industry in this country in a preferred position. He said it had put them in a very competitive position in our export and domestic markets. I suppose on the face of it that appears to be a pretty logical argument, that if you have a manufacturer who is able to maintain his output with less labour it means he is going to be in a competitive position so he will make more sales and will have to manufacture more goods. When he does that it will mean he will have to hire more men to produce those goods. Therefore the minister says this puts the manufacturing industry in this country in a strong position to increase employment in that industry.
However, the strange part of it is that the minister concluded his remarks by stating that this year the increase in productivity has meant a displacement of labour and has
Unemployment
added to our unemployment difficulties. In other words, he implies that last year was the first year the manufacturing industry has been able to increase its productivity at the expense of labour. Now, I just wonder whom the minister is trying to kid. I would like the minister to just try to sell that bill of goods to the agricultural producers in this country.
I suggest that last year was not the first year the farm machinery industry in the country was able to show a productivity gain. For example, in 1945 wages and salaries in that industry charged against the selling prices of machinery generally throughout the industry amounted to 42 per cent. Yet in 1950, only five years later, salaries and wages charged against selling prices of the same machinery amounted to only 27 per cent. In those five years the productivity of the industry generally rose over two and a half times, 2-6 to be exact. Profits in those five years, because of the productivity about which the minister spoke, increased generally throughout the industry by 223 per cent, and in the case of the Massey-Harris Company by over 300 per cent.
As a good example of what I am talking about, in 1946 a Massey-Harris 12-foot combine cost $3,635. In 1951 the same type of machine cost the agricultural producer $5,757, an increase of over $2,000. Certainly there is very little excuse for the increases in the prices of farm machinery. It is not because of the quality of the machines. I can say without fear of contradiction that the quality of such machinery is the worst it has been in 10 years. Certainly it is not because of carrying charges involved because farmers are buying on credit. In that regard I remind hon. members that 97 per cent of all loans made under the Farm Improvement Loans Act were used for the purchase of farm machinery. The farmers of this country paid cash for most of their machinery. They paid the banks 5 per cent, and the government guaranteed the banks up to 15 per cent of the aggregate losses they sustained in any one year.
Therefore I fail to appreciate the minister's suggestion that labour or the consumer has gained anything from that kind of a deal. The future prosperity of our country depends on the prosperity of two groups, on the one hand the industrial workers, the white collar workers, casual workers and small businessmen, and on the other hand our agricultural producers. If these two segments of our society are prosperous the whole economy of Canada will be healthy and prosperous. The fact is becoming very clear to farmers and workers that in business and industry their

Unemployment
interests are mutual and interdependent. Our agricultural producers realize that only by federal action can their major economic problems be solved.
One of the best methods by which we can meet the unemployment problem in this country is by the stabilization of our agricultural industry. That stabilization will only come about when agricultural producers are guaranteed a fair return for what they produce, so they in turn will be able to buy the products of the effort and ingenuity of labour. Surely it is absurd to believe that the government can continue to ignore this fact. Surely the government realizes that to let farm income decline, with its accompanying unemployment, is to court economic disaster.	[DOT]
The proposal to stabilize agriculture, coupled with the many other proposals made by this group, can lead to a solution to the serious and ever-growing unemployment problem. What is needed is a completely new approach. Based on past experience, the present program of the government to cope with the problem, as spelled out by the minister, is doomed to failure.


Mr. John Hunter (Parkdale):: Mr. Speaker, I am entering this debate because I think it concerns a matter of importance. There appears to be a divergence of opinion as to the seriousness of unemployment In the country, but whether one speaker regards it as serious and another as not serious, I am of the school who think there is a serious problem.
I have listened to the debate with great interest, and have read the speeches I missed hearing. In my opinion one speech that made a great contribution to the debate was that of the hon. member for Spadina (Mr. Croll). I listened to another member from the city of Toronto today, the hon. member, for Eglinton. I found his speech very long on rancour and very short on ideas.
The question has been raised by a number of people whether the present unemployment is seasonal, regional or a combination of a number of things. I think the truth is obvious, that it is a combination of a number of things. There is definitely some seasonal unemployment, and there will always be seasonal unemployment in a country in our latitude and with our climate. But I think to say at this stage that unemployment today is only seasonal or regional is simply not paying attention to the facts. There is definitely unemployment in the country today which is not seasonal or regional, and anybody who refuses to face that fact is just not being realistic.

We all know that the textile business is flat, that the farm implement business is at least semi-flat, and that the automobile business is in a precarious state. The demand for automobiles is not as great and the supply is greater, with the result that for dealers to sell automobiles at the terrific rate at which they are being produced today they are having to give special discounts, and it may well be that before long the automobile business will have to lay off some employees. I sincerely hope not, but it could happen. To simply stand here and say that this is a seasonal or regional problem is not treating the problem fairly.
In my own constituency there is substantial unemployment. I am not for one moment prepared to accept the figures put forward by some members of the opposition, which I think are very unfair-and I think they know they are unfair-but at the same time it is in my opinion extremely dangerous to minimize the problem. I think it just as dangerous and pretty unscrupulous to magnify it. People talk about whose responsibility the problem is. I do not think there is any question of whose responsibility it is in the eyes of the people of Canada. When the federal government went to Westminster and got an amendment to the British North America Act in order to pass the Unemployment Insurance Act, the people of Canada immediately assumed that the federal government was accepting unemployment as its responsibility, and to take any other attitude is simply disagreeing with the people of Canada. The people of Canada believe it is a federal problem.


An hon. Member:: And it is.


John William Gordon Hunter: I do not say it is constitutionally. Constitutionally the provincial governments have complete and exclusive legislative jurisdiction over property and civil rights and many other things. But let us not talk about it as if it were a constitutional problem. Let us face the fact that the people of Canada regard it as a federal problem.
Having accepted that premise, which many may not but which I believe to be the view of the people of Canada, then it becomes a question of the provincial and federal governments getting together. Obviously if the federal government, by reason of the wishes of the people of Canada, is to accept responsibility for employment and unemployment in the country, it must also be given the tools to do the job. If the provinces have certain tools which are required to do the

job, then those tools must be transferred to the federal government if it is to assume the task.
However, even if in the eyes of the people of Canada the federal government is responsible, and even if we accept that responsibility, I do not for one moment suggest that we should do the actual work. Clearly it has to be done through the junior governments, both provincial and municipal. Obviously the government has neither the personnel nor the intimate knowledge to deal with the problem at the local level. It would simply have to be done through the junior government.
What I am getting at is that if this government wishes to accept this responsibility, then the provincial governments must be willing to give them the jurisdiction, give them the finances and give them the opportunity to work out this tax aspect. I think that can be done. We are having a dominion-provincial conference, and I think at that conference long steps forward will be taken.
It may be that this will be a fairly longterm thing. I do not believe these constitutional problems can be worked out overnight or in a matter of months, as the hon. member for Eglinton suggested. I feel the hon. member would be the first to admit, if he were being fair, that you do not work out these problems overnight, nor do you even understand them overnight. It takes a long period of time, not only to work them out but to understand the implications of what you are trying to work out. These things will come. I believe this government, and all governments following, will be in the position that they will have to accept jurisdiction for this problem. We have, of course, accepted jurisdiction for some aspects of the problem in that we have unemployment insurance. This has been a great boon, and it has been extended from time to time. Doubtless it will be extended further.
I have heard a great deal of talk here about public works, how the federal government should have a shelf of public works available. The federal government did have a shelf of public works, but employment was at a high level for such a long time that these public works had to be implemented. We could not wait forever for a depression which, I might say, several parties in this house were forecasting from year to year. These programs had to be implemented.
But even if we had waited with a large shelf of public works, they are only a partial answer to this problem. It has been suggested that the St. Lawrence seaway, which is one of the big public works projects in
Unemployment
this country, will only employ 15,000 people as a maximum. Fifteen thousand people employed on a large construction program in this country would be a great help, but that is not the answer to the problem. Even if we had a shelf of public works right across this country, that would be of assistance but it would not be the absolute answer. It cannot be the absolute answer. You cannot employ that many people on a public works program when you have serious unemployment.
In addition we have had the defence production program. We recognize that defence production employs a lot of people. I believe it is recognized that defence production will continue for many years, in the light of this cold war in which we are now. From now on, however, there is likely to be a levelling off of our defence production program. I do not think we can assume that is the answer anyway. Obviously, anything connected with armaments is not the answer to employment. It is a help, but it is a temporary thing. Surely if our economy depends forever on armaments to keep employment at a high level we have not faced or answered the problem. At least, in the meantime it is of assistance.
There is another point about public works that many people know but do not seem to appreciate, and that is the question of the mobility of labour. A country such as this has many untapped resources, many large areas in which there is very little civilization, and it might well be that you would desire to carry on some construction program in one of those areas. This means you have to have a certain mobility of labour. The mobility of labour is decidedly limited, and I think it is getting more limited all the time.
There are a number of reasons for that. First of all no man, unless he is single, wishes to suddenly pull up stakes and move 2,000 miles to put up in a bunkhouse somewhere and live under rather primitive conditions. Second-and I am not criticizing the unions for this-the unions have insisted on certain privileges for the men. They have given the men seniority rights and pension plans.
I appreciate everything the unions have done for the Canadian people. I think one of the best things they have done is to give everybody a stake in the country, and thus form a great bulwark; against communism generally. Once a person has a vested interest in a pension plan or has a fair degree of seniority in a company, he is going to think a long time before he gives up those privileges or rights which he has won, to go to

Unemployment
some construction scheme in the wilds of Canada. I think it must be recognized that the privileges which unionism has won for labour make for less and less mobility in our labour force. I am not criticizing that; I am, just saying it is a fact.
No matter how many of these public works programs you start there will definitely be a large number of employables in Canada who will be in a position where they may consider it unwise to accept such employment somewhere else while there is any hope of getting back into the employment they formerly had. These are problems which I think many people fail to take into consideration when considering the mobility of labour. It is true that immigration has a tendency to supply a fairly mobile labour force. However they, in turn, as soon as they gain the same privileges and rights, fit into the picture I have just described.
Similarly in a free enterprise-and I sincerely hope this will always be a free enterprise, as free as it can be without hurting people-there can be no compulsion. I do not think a Canadian government-possibly my friends in the C.C.F. party will disagree with me-would ever compel people to take jobs somewhere else when they do not want to go there. This is the Russian system, and I have no doubt there may be some people of that mind in this house, but personally I sincerely pray there are not many.


Stanley Howard Knowles: Many of our people are under economic compulsion now.


John William Gordon Hunter: My friend here says there are lots of them. In looking at some of those people down there I must say that perhaps he is right.
Another thing these people have, and it is something that has grown up imperceptibly, is the prosperity of the workingman, generally speaking. Today there is a widespread tendency toward home ownership under the National Housing Act and various other schemes. When a workman, or anybody for that matter, has purchased a home, has an equity in it and has grown to love it, you have one more thing that prevents him from being part of a mobile labour force. He does not wish to leave his home. He does not wish to leave his neighbours. As our economy becomes more prosperous-and we have a very prosperous economy, though there will be some defects in any economy-then more people will want to own their own homes. They will love their homes and will definitely not want to move around the country. They may be forced by economic circumstances to move, but it is not something they are going to do easily.

I have heard it suggested, mainly by the socialist group in this house, that we should make homes more readily available, that the down payments should be made very low. Possibly they have not appreciated what has been happening under the veterans' housing administration in the United States. There under certain circumstances a veteran can walk into a home without paying a cent, not even the legal fees. The administration is greatly worried about it, because the veterans are treating these homes as a rental proposition. They have no stake in them. They walk in and out as though they were rooming houses, and they do not care how they treat them. I do not think any sensible people in the C.C.F. party-and I hope there are more than I think-would believe we should allow people to walk into a house without making a substantial down payment. Some of them talk as though every man were entitled to a home. He is entitled to exactly what he is willing to work for.
Another thing I think our government could do-I am not suggesting our government is perfect or that any other government is perfect-would be to push international trade a little harder. I know that is agreeing with something the Conservative party has been saying for a long time, but I do not agree with the way they have put it. They are thinking only in terms of the United Kingdom, and I am thinking in terms of the world. I am convinced that if we put more trade officials around the world, in every conceivable place, in the long run they would more than earn their salaries. That is just what England used to do. They put people all over the world. They picked up a hundred thousand here or a million there. In the individual case it might not have been much, but in the aggregate it was very great.
Recently I had the privilege of visiting the Republic of Haiti, and it seems we had $2,600,000 worth of trade down there, without lifting a finger. I am told we buy $15,000 worth of goods from them. Probably we buy a little more indirectly, in the shape of goods that come to the United States for processing and then come up here. Also I was told by a government official down there that if we had a trade attache in Haiti we could easily increase our trade by at least a third in two years. Perhaps that is not much, a third of $2,600,000; but if you took every country and every community in the world and increased trade to that extent, then I am convinced that before long Canada would be the greatest trading nation in the world. And I am convinced people's salaries down there would be just a fleabite compared to what the country would gain. I am not suggesting

for one moment that I know more than the right hon. Minister of Trade and Commerce (Mr. Howe), but I am suggesting we should push this thing, and push it hard.
There is another thing would happen if we did that. I think we would gain parity on our dollar more quickly; and the sooner we gain that parity the sooner our international trade will appreciate. We have had this favourable dollar value, and while it is something I am very proud of-it is easy to be proud of the fact that our dollar value is high-I do not believe it is something that is making us a lot of money. I do not think it is making us money; I think it is losing us money.
There is another thing I have heard talked about until, quite frankly, it has made me somewhat ill, although this may be because I come from an urban riding. I am referring to the question of farm price supports. I can understand farmers being given and taking price supports as a palliative, as an emergency measure. But surely I am not reading the minds of members of the C.C.F. party correctly when I am led to the conclusion that they want a broad program of price supports, and to continue it indefinitely. Surely it is not sound economy to have price supports for those in agriculture who continue endlessly to produce something for which there is no market. That is not sound business.
I recognize, and I think any sensible person must recognize, that if you are to have a prosperous country then the farmer must be prosperous. But surely we are not going to make the mistake the United States made for so many years, when they put in supports for things that the country could not possibly consume, and ended up with a surplus they just do not know what to do with and which they have a tendency to dump on world markets to the detriment of our international trade in agricultural products.
Surely that is not what they mean. Because, if it is, they are not thinking clearly. I agree with this procedure as an emergency procedure, but not as a long-term measure. That could not be the intention or the considered plan of any sensible government. Surely that is not what they are after. If they are, then they only confirm my opinion of their party.


Edward George McCullough: Would the hon. member permit a question?


John William Gordon Hunter: I do not wish to have any questions at the moment. I would like the same privilege you have, namely that of continuing my speech. I know you have
Unemployment
never liked criticism, because you cannot take it. You never have been able to take it, and you never will be able to take it.
Now, I would like to mention housing, and the fact that we are catching up. I was told by one hon. member today that they are not catching up in Vancouver, and I am not in a position to dispute the fact. But I do know we are catching up in Toronto. Last year we built 12,000 units, and today expensive housing does not sell at all. They are trying to get rid of it. The demand is for cheaper housing, and we have a large number of family units coming into existence every year. There will be a large and continuing market for cheaper housing, and when I say that I mean housing cheaper than it is today. Right now in many cases it is too expensive for the wage returns of the individuals concerned.
However, I do not for one moment suggest that housing is on the decline. I do say, though, that we certainly should be able to produce houses for about $11,000 or $12,000, which means moderate payments for persons earning moderate wages. Because when you get over that price you reach the point where you are not providing housing for the people who need to purchase it, and your market will go down.
It would be even better if we could provide houses for $10,000, and it may be that in certain parts of the country that can be done. At the moment, however, it is not being done in Toronto. In that city the cheaper housing subdivisions are going well, but they are going much more slowly than they did two years ago. The answer is that more of the people who have been able to afford these houses have been able to purchase them, and the market has gone down.
In connection with housing I do not think anybody could deny the importance of that industry, because there are more people employed in it than in probably any other industry in the country. There are more building products being used which, in turn, tend to provide employment in a myriad of different industries. And for us to do anything stupid in connection with housing which would give us a flood of houses which, in the end, would result in ,a decline in sales over five or ten years, would be a singularly stupid policy. But that is the policy my hon. friends of the C.C.F. would implement without the slightest hesitation.
In connection with housing I would make this further statement, that there are very few communities in Canada that have had the wisdom of my own city in starting slum clearance; and when I say that I am not

Unemployment
trying to be egotistical at all. I know the word "slum" has been stricken out, that they are called blighted areas today. However, I still think of them in terms of slums. The fact is that the Regent Park project in Toronto has shown leadership that I think could be well followed by many communities, and which could be followed to an even greater extent in Toronto, as I am sure it will be. Such great ramifications are involved that I could not be expected to go into them now, except to say that many people in Toronto who were somewhat dubious about this are today pretty unanimously in favour of this so-called slum clearance. Personally I have been in a few cities in Canada that have never admitted they had slums, but so far as I could see they could readily have admitted it and started clearing out those blighted areas.
Another thing that is coming up today- and this may be one of the answers to the problem, although it is very unpopular with many people who are somewhat capitalist-minded-is the guaranteed annual wage. You know, as soon as you say something about guaranteed annual wages you think, "Oh, what a horrible thing; how could people dream of anything so terrible". But I can remember things that came up 20 years ago that we said were horrible. We commented on how terrible they were, but they are here today. And I would not be surprised if in another 10 or 15 years the guaranteed annual wage would be taken for granted, just the way it is in Sweden. We know that Sweden, while somewhat socialistic, is not considered communistic. It is not considered subversive. It is certainly a free economy. But they have had a guaranteed annual wage since the thirties.
I am not suggesting that this is the time to have the guaranteed annual wage in Canada, nor am I suggesting that we are going to have it. But I do say this. Never scoff at those things which may contribute to the permanence of the economy of Canada. These things do not arise because they are stupid; they arise because somebody believes in them. It may well be that quite a few people today, many of whom are scoffing at the guaranteed annual wage, in 20 years' time will be explaining to their children, "Why, of course, we have it. Did we not always have it?"
No one knows what will happen. People scoff at these things, but in time they come. They come with a definite measure of inevitability, when the economy can bear them. I am not suggesting that the economy can bear the guaranteed annual wage right now, but I am sure hon. members must admit

that, assuming the economy could afford it, there would be a measure of stability which would be desirable.
Unfortunately, however, a third of the gross national product of this country has to be exported to countries the purchasing power of which we do not control. Just as long as we have to export a third of our gross national product to areas over which we have no control, just so long must we sell at whatever prices they can pay. The guaranteed annual wage is probably in the future, but some day we may well have it. You people in the C.C.F. party may have ideas, but you have no common sense.
Another responsibility which the federal government may have to take over-and it has taken it over in the past during a depression-is the matter of relief. As hon. members know, an employable does not get relief. I am not prepared to say that our unemployment problem is gigantic or that it is ridiculously small. It is a problem that is there. But if we are to continue to have this problem, and if the people of Canada are going to continue to expect the federal government to handle it, then the federal government must have the funds with which to provide relief. Because a man is employable surely does not mean that he is not to have some relief, assuming his unemployment insurance has run out and he is in need of relief. We all know that today employable men are deserting their families because, as soon as they desert them, their families become subject to the relief regulations.
It is obvious that if the federal government is to assume responsibility and this is to be their problem-and I am suggesting that the people of Canada expect it to be their problem-then relief must be one of the subjects brought up for consideration at this federal-provincial conference, and the federal government must be allowed the necessary taxation powers. But it is ridiculous at the present time to expect the federal government to do everything before these problems are ironed out.
Another thing I wish to mention is this. I would suggest that today the Bank of Canada has gone about as far as it can go with its discount rate and the various other ways it can help stimulate the economy. Maybe I am getting a little bit out of step at this point, but I would suggest that the situation has now reached the point where the government has a responsibility in that direction. I would suggest that it is perhaps a time for some rather imaginative action.
I have no idea what the Minister of Finance (Mr. Harris) is going to bring down in his

budget, but I would make this suggestion. There is a rumour going around that he is budgeting for a $60 million deficit. I would suggest that he budget for about a $400 million deficit. I am suggesting that amount should be taken off the income tax, and that purchasing power should be left with the people of Canada. If that purchasing power were left with the people of Canada, I suggest that the gross national product will increase to such an extent that the minister would probably end up with approximately the same deficit as that for which it is rumoured he is budgeting.
(Translation) :


Mr. Raoul Poulin (Beauce):: Mr. Speaker, in the few minutes which I intend to take up in this debate, I shall be content with suggesting or pointing out a few solutions which I believe to be such as to remedy, partially at least, this unemployment situation which, viewed dispassionately, may be said to be serious, if not grave.
The county of Beauce, which I represent in this house, is partly open countryside and partly villages. There are no large cities but a number of large villages with mediumsized or small industries, many of which at the present time are far from operating at capacity. It may therefore be said that there is industrial unemployment in that constituency.
Moreover, especially in the southern part, there may be found several hundred day labourers and lumbermen who have not managed to find work during the winter months and who, most probably, will also be unable to find any during the next few months.
I fail to see any solution to the problem facing this particular group other than a public works program. I would ask the government to look into this possibility. Should it decide to resort to this solution, I would be in a position to suggest useful works, such as an efficient system of protection against the damage caused every year to farms and properties along the Chaudiere river when it overflows its banks.
As a second measure of relief, I would gladly support a suggestion made in this house last week by some hon. members and, incidentally, by the hon. member for Moose Jaw-Lake Centre (Mr. Thatcher). It would consist in reducing, to an extent to be determined, the rates of the sales tax and the excise tax. This would have the effect of increasing the purchasing power of the mass of consumers, thereby causing a greater demand for manufactured products followed by a resumption of production and employment.
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Along the same lines, I also suggest raising the basic exemption as far as personal income tax is concerned. In fact, this limit should be raised respectively to $2,000 and $3,000 for single and married people.
In previous debates I insisted upon this point. I have no hesitation in returning to it since I believe that this would increase the purchasing power in the hands of the people.
Another solution would be a considerable reduction in corporation income tax. If I may make so bold as to say so, I believe that that would encourage reinvestment of additional capital in industry, with a consequent increase in employment.
I have confidence in private enterprise, but the government must ensure that its normal development is not hamstrung by ill-advised financial policies. In this connection, I would suggest that, if anyone has any constructive, intelligent and, I hope, effective criticism to offer to the government, now is the time to make such suggestions, before the government makes any decision past recall on any change which might be introduced in the budget for the 1955-56 fiscal year to be brought down on April 5 next.
Some will say, and rightly so, that all such measures would result in a large budgetary deficit. I agree that the objection is sound, but I do not see anything very serious in such a course. I do not think that the possibility of a deficit would amount to a catastrophe. In my humble opinion, the general business recovery which would follow the carrying out of these different measures would soon bring in additional revenues to offset any immediate deficit.
The Minister of Agriculture (Mr. Gardiner) announced over the week end that the support price on butter would be maintained at 58 cents a pound. I frankly and sincerely believe that it will have a beneficial effect on the unemployment situation.
Even if I have to repeat myself, I come back to the idea that purchasing power is, for the population as a whole, the very basis of industrial and commercial activity and, as a consequence, it controls employment.
In that respect, we must not overlook the fact that more than two million people are concerned with the dairy industry in Canada, and their purchasing power goes down as soon as the industry on which it depends operates on a reduced scale.
Now, if we are going to maintain in that industry a proper level of prosperity, certain government measures of a particular type are needed.

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I would like to say to the hon. Minister of Agriculture (Mr. Gardiner) and to this house that there is another measure, supplementary to the former, which should be taken in this connection; it is the levying of an excise tax on the sale of margarine, with the evident purpose of protecting both the farmers and the working people. I have tried on several occasions in the past to demonstrate this theory. I do not want to labour it today and I shall merely repeat that the protection afforded agricultural producers constitutes, in my humble opinion, the best means of maintaining or restoring the purchasing power of a class of people who are very numerous in this country. In so doing, we shall, on the one hand, keep in the agricultural industry a number of persons who, otherwise, would migrate to cities and towns and increase the number of jobless and, on the other hand, we shall favour employment by increasing the use of consumer products.
(Text):


Mr. W. G. Dinsdale (Brandon-Souris):: Mr. Speaker, I want to take a brief part in this debate because I believe this is one of the most important subjects the House of Commons will have to face during the present sittings. This debate has continued now for some five days, and it seems to me that the attitude of complacency which was taken in regard to this problem of unemployment has been dissipated only slightly. I recall that there was some reference to the problem in the speech from the throne; then we had an early statement in the house by the Prime Minister (Mr. St. Laurent) when he admitted there was unemployment, but that, as had been the case in previous years, with the advancing season this difficulty would tend to wither away. I believe it is necessary that every hon. member possible should take part in the discussion if we are to impress upon the government the importance of dealing in a forthright manner with this trouble spot in our economy.
There are many sides to the problem but I am going to concentrate on just one aspect, the difficulty faced by the unemployed employable. That is the term which is used to describe him these days but there was a time, particularly during the thirties, when he was referred to as a transient or migrant. This is the man who shifts from pillar to post in the country without having roots in any community or province. The only assistance available to such a person is that provided by voluntary welfare organizations. During the thirties this was a tremendous problem. At that time a large percentage of our young Canadians were members of

what was referred to as the forgotten generation. I suppose I can put myself in that category, because when I left high school in the mid-thirties there were no job opportunities available for my classmates or myself.
While the problem today is less severe so far as the number is concerned, it is still an extreme social tragedy for these young men, unmarried as well as married, who find themselves forced into the unemployed employables group. It is not a new problem. Perhaps it disappeared during the war and the immediate post-war years, but it is one problem which has faced Canada from the earliest period of our economic development. To a certain degree it includes seasonal workers, who have to possess great mobility in order to seek work that becomes available in various parts of Canada at various times of the year. As I say, it is not a new problem; therefore it is all the more surprising to me that some action has not been taken by the government during all these years to deal with it in a more direct way.
During the early part of the thirties the problem of the migrant or transient worker became really severe, and there was an attempt on the part of the government of that day to deal with it in a direct way by providing relief camps. Whenever we hear critics of that government make reference to those days we always hear reference made to the relief camps. They were done away with in 1935, and nothing was instituted to take their place.
Just before the war in 1938, and during the first year of the war in 1939, I had the privilege of having some dealings with some of these men who were pounding the highways and riding the freights from one end of the country to the other. They used to tell me that at least the late Mr. Bennett provided relief camps, but all that was being provided by Mr. King were the highways to pound on.
Coming directly to the problem that faces us today with reference to the unemployed employables, I should like to refer to a study made in 1939 designed to deal comprehensively with this difficulty. It became obvious during the latter part of the thirties, particularly in 1937, that something would have to be done at all levels of government to provide necessary welfare measures to meet this recurring problem. Preliminary discussions beginning in 1937 and carrying on through 1938 resulted in the calling of a conference in January, 1939, under the auspices of the Canadian Welfare Council.
Following the deliberations of that special committee on non-residents and migrants certain recommendations were embodied in

a final report which I have before me, and which was submitted to the minister of labour on January 26, 1939, some 16 years ago. Unfortunately nothing has been done to implement any of these recommendations. Admittedly the war intervened, and in its early years the slack on the labour market, which included a good many young Canadians, was quickly taken up. They enlisted in the armed forces in large numbers.
Following the war the problem could again be ignored because Canada was passing through a period of unprecedented prosperity; and while there was some seasonal unemployment it was met by the voluntary welfare organizations, particularly in 1948, when the problem became more noticeable than it had been since the thirties. But since the war our economy has been buoyant enough to absorb the harsher aspects of this continuing difficulty.
We in this group have always maintained that the post-war prosperity was an artificial prosperity. It was the result of the world economic dislocation which placed Canada in a temporarily advantageous position. We have warned down through the years, and even at the peak of prosperity in 1951 when I came into this house, that sooner or later there would be a day of reckoning. Canada had primary resources which the world was seeking, and our limited industrial capacity was taxed to its limit to supply the overwhelming demand for consumer goods that arose from the dislocation of the post-war world.
We on this side of the house have maintained, too, that this essential emphasis on primary resources would in the long run fail to provide a large and expanding market for an increasing labour force, and that prophecy has now been fulfilled. In this country we have lacked the necessary vocational and technical training opportunities to provide our young Canadians with the skills necessary for an industrial society.
Although the question of education does not come directly within our sphere of interest, we have had discussions from time to time in this house which have emphasized the financial crisis in education. That financial crisis has been reflected in the inadequate provision of vocational training opportunities for our young people. It is significant today, Mr. Speaker, that there is no shortage of work for Canadians who have special skills. It is largely in the unskilled labour categories that we have the great mass of unemployment, and if only we could stimulate secondary industry based on our possession of vast primary resources I am certain we
Unemployment
could then easily take care of the slack that has appeared in our economy during the past two or three years.
I referred to complacency on the part of the government with regard to unemployment in the initial stages of this session. I am almost convinced sometimes, though there are exceptions, of course, as I sit and listen to the government spokesmen, that the government has mesmerized itself into feeling that all is for the best in the best of all possible worlds. Notwithstanding the evidence of the growing numbers of unemployed the government appears to subscribe to the philosophy that every day in every way we are getting better and better. It is either a failure to face reality or a case of selfhypnosis on the part of the government; and of course there are none so blind as those who will not see.
In view of the recent statistics which have been released on unemployment I think the time for complacency is past and, as I have already said, I am making a special appeal on behalf of the unemployed employables, those young Canadians who are not provided for in any way during this critical period and who must fall back on the voluntary welfare organizations for any assistance that is available. As indicated by the Canadian Welfare Council in the information the council put before members of the house, welfare organizations are hard-pressed to meet this growing demand.
In referring once again to the report which was submitted to the minister of labour, Mr. Rogers, on January 26, 1939, I shall reemphasize some of the points which were laid down in that report. In order to deal with this problem of unemployment at all three levels of government and particularly at the federal level, it is necessary to have some method of defining "residence". The transient or migrant is largely a rolling stone gathering no moss. The municipality will not accept responsibility for him; the province ignores him, and of course the federal government is too remote to have any direct interest in his special difficulties.
In this report by the special committee of 1939 it was laid down as a fundamental necessity that the levels of government should get together in conference and define residence qualifications. Otherwise the problem would continue to be put off indefinitely. Direct consideration of the problem has been delayed for 25 years. Surely during the present critical time we might try to deal directly and satisfactorily with this difficulty.
It is necessary to define who come within the category of local residence, so the municipalities might be aware of their particular

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responsibility. Those who are subject to mobility in order to find seasonal employment in various areas of the province must have some basis upon which they can lay claim to assistance from provincial authorities. In a country as vast and varied as Canada there are of course those who must have residence on an interprovincial basis. The final category as set out in the report is the migrant or transient who is actually on the margin of the labour force and who requires special consideration.
A suggestion was put forward in 1939 which still holds validity today. Indeed, it might be that the success of the national registration program in the early years of the war arose out of the recommendations of this committee. Certainly that national registration program went forward expeditiously and was of vast assistance in mobilizing Canadian manpower to meet the challenge of the last war. I know that from a social welfare standpoint it assisted tremendously in defining who was eligible and who was ineligible among the transients, the unemployed employables who regularly confronted social welfare workers of that day for assistance.
Until we had national registration the transient would move from one end of Canada to the other. He would stay in a certain area until he had exhausted the hospitality there. The policy of the voluntary welfare organizations is never to turn a man away when he makes his first appearance. He is given a number of meals and sleeping accommodation for a number of nights to tide him over his immediate needs. It became the established pattern for the transient to stay in a particular area until he had exhausted his welcome; then he	would	go on	to the nexturban centre.	So	he would go	right acrossCanada, a process taking some weeks or months, then	he	would	start	back again.Nothing was ever done to deal directly with his problem,	and	there	was	no way of
checking. The voluntary groups had no system of registration and had to depend on the word of the man as to whether it was his first appearance. As soon as the national registration certificates became available there was a check, and we were able to deal much more realistically with the problem.
I think the recommendation of the committee called together in 1939 to deal with the specific problem is just as valid today as it was in that pre-war period. Indeed, if we are facing the emergency that is supposed to be confronting us, judging by reports from the external affairs department and the Department of National Defence, it is almost essential that we have such a record of our manpower so we may be able to organize
[Mr. Dinsdale.l
to meet any emergency that may be thrust upon us overnight. That is what we are told, and why something has not been done to carry out the recommendations of this report is beyond my understanding.
I should like to suggest some basic solutions for the continuing problem of the unemployed employable in Canada. I have already indicated that there must be a fundamental shift in economic emphasis in Canada from primary to secondary industrial activities. I say this because the extractive industries fail to provide an adequate base for a large labour force, and unfortunately it is a problem that grows more severe as time goes on. On the other hand, if we moved, as we should be moving, toward emphasis on secondary industries, then we could be establishing a labour market that woud safely absorb the growing population of Canada at the present time. The United Kingdom has demonstrated what can be done in this regard through a realistic program. The United Kingdom has come back from the depths of depressed conditions to the most buoyant prosperity it has ever enjoyed, while we have been moving in the other direction.
The situation was made to order for us. We had the economic world by the tail, if I may use that phrase, immediately following the war. It came to us as a gift rather than through any effort on our part, and unfortunately we are letting it slip through our fingers. I suggest that the growing indices of unemployment are indicative of that fact. If we are going to have the population, we must have secondary industries and they must be distributed right across the country rather than concentrated in any particular geographic area. With a larger domestic population we will then have a larger domestic market.
I want to refer once again to the need for educational facilities to train Canadian young people to man the machines of a technological civilization. The Department of Labour has been doing something in this regard, but it is only the beginning of the real job that must be done in order to provide vocational training for our young Canadian citizens. From the point of view of immediate and urgent necessity I see no better method of dealing with the problem at the moment than to call together a conference such as was convened in 1939 after three years of preliminary discussion beginning in 1937, and actually after 10 years of experience of depression. Today I see no better solution to the problem than to call this committee together.
That must have been the thinking of the Canadian Welfare Council when, with the

continuing failure of the government to act, it volunteered to call such a group together. I am sure the council must have been harking back to the experience of 1939, when it was responsible for calling together a similar committee. We have the promise of a dominion-provincial conference scheduled to meet at the end of April. Maybe that conference will be able to deal with this problem, but I doubt whether it can deal with the finer aspects of the continuing challenge of the unemployed employable, particularly as it involves the municipalities.
I strongly suggest that something should be done to implement the recommendation of 1939 and that the conference should be reconvened, so that this forgotten group of unemployed, the greatest of our contemporary social tragedies, will not have to continue to live a hand to mouth existence depending on what they can pick up through the good graces of the voluntary welfare organizations.


Robert Ross (Roy) Knight: Mr. Speaker, may I say first of all I am against unemployment, but not just because it may appear to be government policy. I do not think it is too fantastic to use that expression. The government has already admitted that there is unemployment on a vast scale. Through the mouths of some of its speakers at least it has admitted responsibility for that condition, yet up to the present it has shown no intention of doing anything about it. It is like the weather. We talk about it but we do not do anything about it, and the government apparently has adopted the same policy and is prepared to sit out the storm.
I have listened to the apologists for the government's lack of action. I listened tonight to the hon. member for Parkdale (Mr. Hunter) who treated the matter as a constitutional problem. That may be of great interest to some hon. members in the house but is somewhat cold comfort, I imagine, to the people who have lost their jobs and who have no steady income. My hon. friend said we have unemployment insurance. Government supporters always fall back upon that consolation. Let us give credit where it is due for unemployment insurance, but I suggest that unemployment insurance in the mind of any honourable man who wants to work and make his contribution to his own family and to the good of the country is no substitute for steady work.
Some mention has been made tonight of the Bennett regime. I think it was brought up by the hon. member for Brandon-Souris (Mr. Dinsdale) whom I might classify as another apologist but for a different party. The other day the hon. member for Prince Albert (Mr. Diefenbaker) mentioned it when
Unemployment
he was being taunted from across the other side of the house. He said, "Well, at least it did something". Yes, it did something. I have no particular purpose in raising the matter here tonight, because I feel we should let bygones be bygones and I do not think we should hark back continually to the failures of other regimes. We are more interested in the failure of this one.
My hon. friend mentioned relief camps. I am merely going to use that as an example and a warning to this present government, because if there is any reason that today there is only one representative of the Conservative party in this house from Saskatchewan; if there is any reason that today in my province of Saskatchewan there is only one Conservative member of the legislature- and I believe he is the one who we are told has been flirting with the leadership of the Social Credit party-


William Earl Rowe: They were just trying to flirt with him, he was not flirting with them.


Robert Ross (Roy) Knight: I would remind my hon. friend that one of the last members of the Conservative party who was elected to the legislature of Saskatchewan is now the Liberal leader in that province. I am going to say this just as a warning to my hon. friends, not to my right but those across the aisle, that this question of unemployment may be the rock upon which the ship of state of the Liberal party may founder.
If I were an outsider, if I were someone from Asia for instance, I would think it was a strange anomaly that there should be unemployment in Canada. These people look upon our country as wealthy. They look upon our vast acres of timber and wheat growing land; they look at what is a comparatively small population, and they say, "How is it that country can afford not to have its people working?" I do not want to go into our own particular C.C.F. economic philosophy tonight, but I am going to suggest this. I am quite convinced that if tomorrow by some miracle we had twice the population in Canada that we have tonight, we would have exactly the same proportion of unemployed. So long as we operate in the economic phantasmagoria in which we are operating today, we shall have that same proportion of unemployment.
I said it is an anomaly that we should have unemployment at all. We have been told that we have been having a business boom. We have been told our productivity is increasing. We have been told we have limitless natural resources, some of which have been exploited but most of which are as yet undeveloped. How can we have unemployment?

Unemployment
There is also the tremendous artificial stimulus-and I use the word "artificial" advisedly-of the defence program, which has poured money into the economy of this country.
I used the word "artificial" and perhaps I should not have used it, because in my time in this country-and I have been here since 1909-the state of war or the fear of war has not been an artificial state of affairs but rather the regular state of affairs. It has been during those periods that we have had prosperity, and it has been during the periods of peace that things have been depressed. May I say, Mr. Speaker, that in my opinion we are just about reaching that situation at the moment.
Yes, the employment situation is just about as gloomy as the weather is tonight outside this House of Commons. But, as I said, the government is trying to ride out the storm. It hopes the sun will soon shine; it hopes the spring will come, and that this idea of theirs that this unemployment is only seasonal will, in fact, prove to be a fact. We in this group are not so optimistic. I said the outlook was gloomy. Let me read from this news release which we received today, issued jointly by the Department of Labour and the dominion bureau of statistics. It says:
On February 17, 1955, there were 613,400 applications for employment on file, an increase of 43,900 since January 20, 1955.
Yes, it is gloomy. I have perused the press of the last day or two, and I find that according to this news item of Tuesday, March 22, from the Montreal Gazette, at least 7 per cent of the country's labour force is without work, which is double the usual level. The article continues:
The federation of Catholic charities, taking a 25-page look at welfare conditions in Montreal, stated yesterday that the most important immediate social problem facing the city is the "badly deteriorated employment situation".
"The employment situation was not good last year", said the federation, "and this year it has reached such proportions that anxiety is becoming apparent in responsible circles."
I would that one of the responsible circles referred to were the government of Canada. The paragraph in the article concludes by saying that at least 7 per cent of the country's labour force is without work. It is gloomy.
The heading of the next clipping I have here contains the word "gloomy" and it was from that I got my text. The heading is, "Gloomy Annual Report". The reference is to the statement of the Canadian National Railways

and the article, written by Canadian Press, says, "First deficit in three years". Then it goes on:
The report tabled in the Commons showed that gross revenues fell by about $56 million, bringing the company Its first deficit in three years-
-and so on. Well, everything seems to be full of gloom tonight.
I mentioned the stimulation which is given to any economic system by war. I hope I will not be misunderstood or misquoted when I say that, so far as the economic set-up of the country is concerned, we were lucky when Korea came along. I am not prepared to ask for or to welcome that kind of luck. I hope we may be able to work out our problems in time of peace and not depend upon the imminence of war to give us food, clothing and shelter.
The question which immediately arises in my mind is this. What would happen if we had a prospect of complete peace? I hope we are now facing that situation. Although the world is still troubled, things perhaps are not so dark as they have been. If the labour force was diverted from the defence program under a condition of peace to the creation of consumer goods, I ask you, what would we do with the consumer goods? What would we do with the people who, by their labours, produced those consumer goods? That is definitely the problem with which we are faced. If the government now with the existence of a civil defence program refuses to embark on a program of public investment, could it be expected to initiate any such thing in time of peace?
Up to the present we have had nothing but unimaginative solutions for unemployment. Once again we have seen the day of the soup kitchen, reminiscent of the Bennett regime to which my hon. friend has referred. There are cities in this country, my own included, which have had to bear the cost of relief. Relief was about the only thing the hon. member for Parkdale suggested as an immediate palliative. We find it again in the cities of Canada, including my own.
I shall have a word or two to say later about my own city and province. But the authorities there say the reason for this relief having doubled or tripled is the unemployment situation. Once again we have seen the authorities in cities in Canada telling these poor, jobless people to go off elsewhere, just to get rid of them. The hon. member for Parkdale had a great deal to say about Toronto and what it was doing. I have never, sir, had any prejudice against Toronto. However, I have in my hand a newspaper article

the heading of which reads "Jobless Paid to Quit City and go Home", and which says: Toronto welfare commissioner Rupert admitted to the civic welfare committee yesterday that his department had given funds to unemployed to leave the city.
Shades of 1935. We do the same thing with vagrants; we arrest them on a charge of some kind and then say, "Well, boys, if you are not here in the morning it will be all right with us, and the best for everybody." But that is not a solution of the unemployment problem. I remember what the Minister of Trade and Commerce (Mr. Howe) said when somebody asked him, "What are you going to do with these people when industry closes down?" "Well", he said, "they will have to move somewhere else."
I suppose that is what he would term labour mobility. But I suggest to you, sir, that this government has made no provision for any place in which this mobile force of labour can live. We in this group have constantly advocated the building of at least some proportion of cheap rental housing, but up to the present time the government has not seen fit to agree with us. And so they say, "Just move on. Your luck will change, and the sun will shine."
I have already mentioned that we have increased unemployment benefits, and we are thankful for them. But they are not a substitute for steady work. No wonder, as the hon. member for Parkdale has said, there is a growing demand on the part of labour in this country for a guaranteed annual wage which, incidentally, he did not say he either favoured or disfavoured. He did say that perhaps in time it might come.
The speech from the throne characterized unemployment as seasonal and local. I want to say a word or two now about the prairie west, where I live. As hon. members know, the prairie west is not heavily industrialized as is the east. That has been one of our major problems. Let me admit at once that part of the industry in my own province of Saskatchewan is seasonal, with respect to workers who have been laid off after being engaged in construction work. But let me point out, too, that this generally speaking has been one of the best winters we have had in Saskatchewan for a long time, and that actually the number laid off from construction work has not been so very large.
Lack of work in construction does not account for all the unemployment there, nor does it explain its increase. As a matter of fact in my own city we have overcome that problem to some degree. There are two large buildings going up in the city
Unemployment
today, one of which is the Imperial Bank of Canada building and the other a building of the government-owned telephone system, if I may mention such a thing in this august chamber. I have pictures of those buildings here, as they appear in the local paper, and I see they are all walled in with lumber and canvas, and that construction goes on as usual inside that protection.
So the unemployment is not just in the construction industry. And, by the way, I have figures here showing the numbers of construction workers who have been laid off, and those numbers are remarkably small. Here are some of the figures for Saskatchewan. On February 13 the number listed as applying for work was 21,290. Then somewhat older figures, those of last January, show that at that date in the city of Regina 5,025 were on the list in 1955 as compared with 3,297 for the same date in 1954. That is a large increase. The figures for Saskatoon show that on January 1 there were 4,388, and the corresponding figure for 1954 is 3,532. However, it will be noted that on February 13, about six weeks later, the number listed in Saskatoon had risen to 4,830, and only 664 of those unemployed applicants for work were labelled as construction workers, or would come in the construction category.
The situation in my own city was sufficiently serious that the executives of the two great labour unions, the Canadian Congress of Labour and the Trades and Labour Congress of Canada, have been meeting to see if they could not offer some solution.
In addition to the lay-offs in construction work there are of course lay-offs of Canadian National Railways workers. After all, when one reads the story as it appears on the balance sheet of that company, to which I referred a moment ago, one can understand why C.N.R. workers have been laid off.
Then there is another local industry-and our industries are few, of course. In this instance, however, I am referring to the meat packing industry. Intercontinental Packers in their report show lay-offs of about 30 per cent of their total force. The owner of that company is reported as saying that he hoped a complete shut-down of the plant would not be necessary, but he estimated that lay-offs might go as high as 50 per cent unless things improved quickly. As a matter of fact there were only 400 workers on the staff of that company this year, although the usual average is 700. So it must be pointed out that the percentage laid off must be taken in respect of the smaller number, the 400 people, which is not much more than half the usual staff of

Unemployment
that plant. The owner warned the workers that if conditions did not improve within a reasonable time they would have to consider that their jobs at the plant might be eliminated.
Remedies cannot be just of a temporary nature. I would refer the house to a long-range as well as a short-range plan. First of all there must be immediate public works. I think of the opportunity the government lost when it refused to proceed with the South Saskatchewan river dam project. I am sure that would have helped to relieve the unemployment problem there. There is also the long-term project as outlined by the hon. member for Winnipeg North Centre, which I shall not repeat since it has been placed on Hansard.
When I mention the South Saskatchewan river dam, let me add that I heard something in the house tonight that I had not heard before, when reference was made to the leakage in connection with projects of this kind; and when I use that word I am not sure I am using the proper one. I do not refer to dams in particular, but to works in general. The point arises as to the actual benefit which accrues to Saskatchewan when either the provincial or the dominion government begins a project there. Some interesting figures on the subject indicate that only about 30 per cent of the total expenditure would accrue directly to such a province. So great have been our technological advances that the money goes to purchase machines. In our case, since we do not manufacture machines, where does the money go? It comes down here to the centralized and industrialized province of Ontario. The same thing is largely true for other manufactured articles. A project of that sort stimulates not so much the provincial economy but the economy of the whole country.
That points up the fact that a public investment scheme must be national and not provincial. One of the tricks of the government during this debate has been constantly to pass the responsibility to the provinces and the municipalities in order to get it off their own shoulders. It is only the national treasury that can embark upon schemes of sufficient magnitude.
This business of leakage is so interesting to me that I think I shall put on the record the figures I have obtained with regard to it. These figures have been worked out from the dominion bureau of statistics figures. Of

every dollar invested in Saskatchewan, on the average 46 cents is spent on construction, of which 15 cents goes to on-site labour and perhaps another 7 J cents to materials and service in the province; but 54 cents is spent on machinery and equipment, virtually all of which leaves the province of Saskatchewan, and 15 cents of which even leaves Canada. In effect only 25 cents of each dollar is available to create income in Saskatchewan.
For this reason, in the short run provincial income would benefit much more from a dollar of direct assistance than from a dollar of investment, especially when it is remembered that many whose incomes are now depressed would not in any case be the recipients of investment expenditures. The province's manufacturing industry is very small. We have only 6 per cent of the manufacturing labour force of Canada resident in the province, compared with 26 per cent for the country as a whole, and that is largely oriented to agricultural products and consumer goods.
Even Canada, in its national production, has leakage. The leakage for Canada in 1950 was 32 per cent. The Department of Trade and Commerce estimated in 1950 that of total expenditures on the construction of pipe lines -and that is something that is much in our minds in these times

the domestic or Canadian content was 60 per cent. In the field of oil exploration it was sometimes as low as 40 per cent. The above-mentioned situation is due to the high ratio of specialized imported equipment to wages, the high proportion of non-Canadian employment, and the export of a substantial portion of wage and salary payments.
I think that is an interesting sidelight on the difference between a provincial project of this kind and a national project. There is always some transfer of wealth in this country, as there should be, from one province to another. After all, we are parts of one body and we are interdependent on each other in a united Canada.
The other day I noticed that Blair Fraser, in the last issue of Maclean's magazine, said that Canada's lack of prosperity was for the most part due to the fact that we had a short wheat crop last year in Saskatchewan, or I think he said in the west. It makes one wonder how contradictory we can get. I notice that the farmers in western Canada at the moment are thinking of organizing to reduce their wheat acreage. You must not

blame the farmer. A drowning man will clutch at a straw when engulfed in a sea of plenty; although it is a sea of plenty, to him it represents poverty. Nevertheless, half the world is hungry. We are reminded of that old cliche about people going to bed hungry every night. They are hungry and crying for food. I ask you, how contradictory and how foolish can we get?
I must conclude for tonight, Mr. Speaker, but before doing so may I say that we in this party plead for an immediate government program of works and then a long-time plan of public investment such as that suggested by my friend the hon. member for Winnipeg North Centre. I am well aware that it will not solve the problem. The solution of the problem will come in time. In the meantime these are palliatives. The time to act is now,
Unemployment
not tomorrow or next week or when the sun shines. The time to act is now. Catiline is at the gates.
Mr. Speaker, may I move the adjournment of the debate?
On motion of Mr. Knight the debate was adjourned.



BUSINESS OF THE HOUSE

Walter Edward Harris: Mr. Speaker, we shall continue this debate tomorrow. If it is completed we shall take the resolution in the name of the Minister of Transport with respect to setting up a sessional committee on railways and shipping.


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


[Stage Direction]
The Department of External Affairs released today the text of the "Communique on the Review of the General Agreement" which has been prepared by the GATT secretariat and which is being simultaneously released for publication in Geneva. This communique covers the review of the general agreement on tariffs and trade which was completed by the contracting parties to the GATT earlier this month. The text of the communique is attached.


[Stage Direction]
Introductory Paragraph
On 7 March 1955 the contracting parties to the general agreement on tariffs and trade completed a comprehensive review of the agreement in the light of seven years' experience. They have reaffirmed the basic objectives of the agreement, they have adapted the provisions of the agreement to meet the changed conditions and they have elaborated the objectives and the structure of an organization to administer the agreement.
The changes that have been worked out will now be submitted to governments for acceptance; in the meantime, the existing unamended agreement remains in force. The summary of the changes set out below indicates therefore-except where otherwise indicated-the main lines of agreed proposals, which will come into effect when they have been accepted.
Summary of Main Results
The major results of the review of the agreement may be indicated as follows: Reaffirmation of the basic objectives and obligations including the principle of nondiscrimination in trade and the general prohibition (with specified exceptions) to the use of quantitative restrictions on imports, which have guided the contracting parties in their commercial relations since 1948, subject to any requirements of existing mandatory legislation.
The drawing up of a renewed undertaking to prolong the firm validity of the tariffs bound under the agreement.
The provision, in a special article, of suitable procedures for dealing with the problems of countries in early stages of development.
Provision for the establishment of a permanent organization, to be known as the organization for trade co-operation. When it is established the organization will administer the agreement and will supersede the present informal operational structure.
The introduction of new provisions relating to export subsidies.
Tariffs
By providing for the assured life of negotiated rates of duty the general agreement has given stability to tariff levels for a large proportion of world trade. It was agreed to recommend to the governments of contracting parties the continuance of this stability by prolonging from 1 July 1955 to 31 December 1957 the assured life of the tariff schedules, and a declaration to this effect has been drawn up and opened for signature.
A new principle has been introduced into the revision of the agreement which would permit the automatic extension of the assured life of the tariff schedules in the future, by periods of three years, with provisions to enable contracting parties to seek authority to renegotiate during the bound period bound rates of duty if they find they must modify or withdraw some of them.
A new article dealing with tariff negotiations sponsored by the contracting parties has been included in the proposed amendments to the agreement. The article imposes no new obligations on contracting parties. Each party retains the right to decide whether or not to engage in negotiations or to participate in a tariff conference. The purpose of the article is to recognize the value of tariff negotiations directed to "the substantial reduction of the general level of tariffs and other charges on imports and exports and in particular the reduction of such high tariffs as discourage the importation even of minimum quantities". The article states the principle that, in tariff negotiations, the binding against increase of low duties or duty-free treatment shall be recognized as a concession equivalent in value to the reduction of high duties.
The contracting parties have also set up a special working party to study generally the possibilities for and methods of future tariff reduction and to recommend the convening of a tariff conference when it is felt that progress in that field is possible.

Quantitative Restrictions
No change has been proposed in the basic principle of the agreement that contracting parties which maintain quantitative restrictions for balance of payments reasons have to eliminate them as soon as they can no longer be justified for balance of payments reasons. But in order to make this principle more effective in practice and particularly in order to adapt it to a period when the major currencies may become convertible, it is proposed that, soon after entry into force of the amendments, the organization will review all quantitative restrictions still maintained for balance of payments reasons. Thereafter a system of annual consultations with contracting parties still applying restrictions of this type would come into effect and these countries would be required to justify each year the restrictions still being maintained.
In association with the proposed system of tighter control on the use of quantitative restrictions for balance of payments reasons, the contracting parties have taken a decision, with immediate effect, to assist in resolving the problems faced by contracting parties in eliminating the so-called "hard core" of their import restrictions. These are restrictions whose sudden removal, when no longer justified for balance of payments reasons, would result in a serious injury to a domestic industry or branch of agriculture, to which they have afforded protection. The decision grants a temporary waiver from the obligation to eliminate quantitative restrictions in such circumstances subject to the concurrence of the contracting parties in each case. The contracting parties may impose such conditions and limitations as they determine to be reasonable and necessary and the obligation is laid on the applicant to eliminate the quantitative restrictions in question over a comparatively short period of time not exceeding five years. The application of these "hard core" restrictions and the progress made towards eliminating them will be reviewed by the contracting parties annually.
In connection with the review of quantitative restrictions, the contracting parties, by a separate decision, dealt with the conflict which may occasionally arise between action required under U.S. legislation and the provisions of the agreement dealing with quantitative restrictions and additional charges on imports. The contracting parties adopted a decision, effective forthwith, which recognizes the difficulties arising from the terms of section 22 of the United States Agricultural Adjustment Act, permits the United States to apply measures under this legislation, but at the same time preserves the right of a contracting party whose trade is damaged by
GATT-Communique
import restrictions or additional charges imposed under that act to have recourse to the procedures of the agreement for adjusting the balance through negotiation. The contracting parties will review annually action taken by the United States under this legislation, and the U.S. government has given assurances that before taking any new action it will consult with substantially interested countries and will terminate any restriction imposed under the legislation as soon as it is no longer required.
Assistance for Economic Development
The need to encourage and facilitate the development of the economies of countries which can only support low standards of living and are in the early stages of development is consistent with the long-term objectives of the general agreement, and steps have been taken in the revision to reduce to a minimum the conflict which may arise between the requirements of economic development and the short-term commercial interests of the other countries. Under the new provisions it has been recognized that contracting parties in the early stages of development should enjoy additional facilities to enable them (a) to maintain sufficient flexibility in their tariff structure to be able to grant the tariff protection required for the establishment of particular industries and (b) to apply quantitative restrictions on imports, to protect their balance of payments in a manner which takes full account of the continued high level of demand for imports likely to be generated by their programs of economic development.
Procedures have been worked out by which a country in an early stage of development may enter into tariff negotiations with a view to modifying a concession that is bound under the agreement, in order to promote the establishment of an industry. If agreement is not reached between the country concerned and other interested countries the matter may be referred to the contracting parties. The contracting parties may allow the applicant contracting party to modify or withdraw concessions if they find that the compensation offered is inadequate.
In addition, procedures are established under which, in cases where no measure of commercial policy consistent with the general agreement, such as tariffs or subsidies, would be practicable to protect a new industry in a country in the early stages of development during the first years of production, that country would be able to apply non-discriminatory restrictions on imports for such a transitional period.
The most significant change from the existing provisions of the agreement would be that
[Stage Direction]
GATT-Communique
which would enable the country concerned to restrict, without the prior approval of the contracting parties, the importation of a commodity when the rate of duty on that commodity is not bound under the agreement. In such a case, however, any other contracting party which is injured may withdraw substantially equivalent concessions granted under the agreement.
In connection with these proposals for assistance for economic development and in view of the special responsibilities of the United Kingdom towards its colonies, the contracting parties, by a separate decision, extended to the United Kingdom the right, effective immediately, to give special assistance to its colonial territories which depend largely on the UK. market, through actions which would otherwise have been inconsistent with the provisions of the agreement. These rights will apply only in cases where the industry or branch of agriculture of the colonial territory would be benefited, but not industry or agriculture in the United Kingdom or any other country. The United Kingdom will report annually to the contracting parties on any such measures adopted.
In the course of their consideration of problems in the field of economic development the contracting parties also adopted a resolution recognizing that an increased flow of capital into countries in need for investment from abroad and, in particular, into underdeveloped countries would facilitate the objectives of the general agreement by stimulating economic development of these countries whilst at the same time rendering it less necessary for them to resort to import restrictions. They recommended that contracting parties who are in a position to provide capital for international investment and contracting parties who desire to obtain such capital should use their best endeavours to create conditions calculated to stimulate the international flow of capital, having regard in particular to the importance of providing by appropriate methods for security for existing and future investment, the avoidance of double taxation, and facilities for the transfer of earnings upon foreign investments.
Subsidies
Provisions, additional to those already in the agreement, are proposed in order to limit the harmful effect of export subsidies. In the field of primary products contracting parties would be under an obligation not to use subsidies which increase exports so as to obtain for themselves more than a fair share of world trade. In the field of non-primary products no new or increased export subsidies would be permitted. The contracting parties
agreed that there should be a re-examination to determine before the end of January 1957 whether existing export subsidies on nonprimary commodities can be abolished or whether the maintenance of the stand-still should be extended for a further period.
In connection with the consideration of export subsidies the contracting parties formulated additional provisions concerning the use of anti-dumping and countervailing measures by importing countries.
Problems of Commodity Trade
The contracting parties adopted a resolution providing that if a contracting party decides to liquidate any agricultural surpluses it should do so in such a way as to avoid unduly provoking disturbances on the world market that would adversely affect other member countries. They recommend "that when arranging the disposal of surplus agricultural products in world trade, contracting parties should undertake a procedure of consultation with the principal suppliers of those products and other interested contracting parties, which would contribute to the orderly liquidation of such surpluses including, where practicable, disposals designed to expand consumption of the products, and to the avoidance of prejudice to the interests of other contracting parties, and that they give sympathetic consideration to the views expressed by other contracting parties in the course of such consultations".
The contracting parties also recommend that, whenever practicable, any contracting party intending to liquidate a substantial quantity of strategic stocks of primary commodities should give advance notice and should consult fully with any contracting party which considers itself substantially interested and requests such consultations.
The amended agreement would also include a new provision that would enable a contracting party whose economy depends on the export of a small number of primary commodities to consult with the organization on measures taken by another country which seriously affected that contracting party's exports of the commodities in question.
During the course of the review the contracting parties established a working party to consider a proposal for a convention which might govern international action on problems arising in the field of international trade in primary commodities. The working party, acting in the capacity of an expert group, concluded that it could not put its recommendations into final form until the interested governments had studied its preliminary

views. It was decided therefore that the working party will meet again in the summer of 1955 after receiving the views of governments.
The Organization for Trade Co-operation
The contracting parties have drawn up an agreement which, when it comes into force, will establish the organization for trade cooperation. The agreement contains the basic provisions relating to the structure and functions of the organization. There would be an assembly, an executive committee and a secretariat headed by a director general.
The main function of the organization would be to administer the general agreement. In addition, the organization would be able to sponsor international trade negotiations and to serve as an intergovernmental forum for the discussion and solution of other questions relating to international trade.
The agreement will enter into force, among the governments that have accepted it, after it has been accepted by governments whose territories account for 85 per cent of the total
GATT-Communique external trade of the territories of the governments which comprise the contracting parties.
Legal Status
Most of the proposed amendments to the text of the agreement have been embodied in protocols which are now open for acceptance, a distinction being made between amendments which require unanimous approval under the terms of the existing agreement and those which can enter into force with a two-thirds majority.
In addition the following instruments have been opened for signature:
The agreement on the organization for trade co-operation, which requires-as stated above-acceptance by contracting parties accounting for a high percentage of world trade.
A declaration extending the assured life of the tariff schedules from 1 July 1955 to 31 December 1957.
A protocol of organizational amendments which amends the existing general agreement to take account of the functions of the organization, when it comes into existence.