1955-07-27

Right Hon. L. S. Si. Laurent (Prime Minister):: Mr. Speaker, I would like to table a document entitled "Traffic and Transportation Plan for Ottawa, Canada", prepared by Wilbur Smith and associates for the city of Ottawa. This is not a government document, but it is one of interest to the federal district commission, whose estimates will be considered today. I thought it might be of interest to some members of the house, and it would be convenient to have it as a document that could be referred to. For that reason I would ask leave to table it at this time.



QUESTIONS


Mr. Hodgson:: 1.	How many contracts have the Welch construction company with the Canadian National Railways at the present time?
2.	How many miles of track do these contracts include?
3.	How many men have they employed on Canadian National Railways work?
4.	How many are Canadian citizens or have taken out citizenship papers?


Mr. Langlois (Gaspe):: The Canadian
National Railways advise as follows:
1.	The contracts that were in existence between the Canadian National Railways and R. F. Welch on March 29, 1955, when the president made a statement on this matter to the sessional committee on railways and shipping, have been cancelled. At that time the president also stated that general tenders would be called if it proved in the interests of the railway to do so. Since then

(a)	two contracts for work covering ballasting, surfacing and rail-laying have been awarded after tenders were called for;
(b)	three contracts have been entered into involving specialized kinds of off-track work, such as rock scaling, quarry operations, installation of rock tunnels, etc. These three contracts are of a different character because they cover risks requiring specialized skills or new line construction and this work has
not been claimed to be part of the normal maintenance of way work or competitive therewith.
2. Under 1 (a): Ballasting and surfacing- 743 miles; rail-laying-294 miles;
Under 1 (b): 64 miles new line construction.
3 and 4. These are matters that concern the contractor himself and the management has no information.


CENTRAL MORTGAGE AND HOUSING, REGINA
Mr. Ellis:: 1.	What was the total amount spent by Central Mortgage and Housing Corporation in respect of the 300 houses in project 7/48, built for veterans in Regina in 1948-49?
2.	What was the total construction cost of each type of house in this project, and how many houses of each type were constructed?
3.	What was the total amount paid to the city of Regina in payments in lieu of taxes with respect to the houses built in this project?
4.	What is the total amount of moneys received to date in rentals from the 300 houses in this project?


Mr. Winters:: 1.	(a) Capital	cost-$2,010,782.21;	(h
Administrative costs to date including payments in lieu of taxes-$539,107.55.
2.	The total cost of each type of house including municipal participation for lane and services, is, 90, 4 room houses at $6,900.81 each; 210, 5 room houses at $7,403.37 each.
3. To June 30, 1955	 $124,077.4!
4. To June 30, 1955	 $743,753.2:


CANSO CAUSEWAY
Mr. Buchanan:: 1.	Have the contracts for the Canso causewa: been completed?
2.	If so, what was the total cost of construction
3.	How much was paid by (a) the provincia government of Nova Scotia; (b) the federal govern ment?


Mr. Langlois (Gaspe):: 1.	No.
2.	The estimated cost, excluding provisioi for compensation to the owner of the site fron which the rock-fill used in the causeway wa taken, is $19,490,000, of which the estimate! share of the federal government will b $14,780,000, and that of the province of Nov Scotia $4,710,000.
3.	The definitive division of cost betwee: the province of Nova Scotia and the feders government will be established only whe construction is completed.

Questions
TRANS-CANADA HIGHWAY, CAPE BRETON	TRANS-CANADA AIR LINES


Mr. Buchanan:: 1.	Has the Department of Public Works approved any trans-Canada highway projects in Cape Breton?
2.	If so, in what locations and in what amounts?


Mr. Winters:: 1.	Yes.
2.	Baddeck west toward Whycocomagh, 5 miles-$208,740. Whycocomagh to Inverness, Victoria county line, 7-1 miles-$318,770.


QUESTION PASSED AS ORDER FOR RETURN
Mr. White (Middlesex East):: 1.	How many contracts have been awarded to the Sterling Construction Company Ltd., of Windsor, Ontario, from 1950 to the present date, inclusive?
2.	What are these projects with their contract values?
3.	Where are they located and what is the individual value of each contract?	t


MOTION FOR PAPERS
Mr. Knowles:: For a copy of all correspondence, exchanged between the superintendent of insurance, or the office thereof, and the president or any other officer or director of the Canada Health and Accident Assurance Corporation of Waterloo, Ontario, since the date of the incorporation of the said company.


Mr. Nicholson:: Mr. Speaker, on behalf of the hon. member for Winnipeg North Centre, may I ask whether this motion can be narrowed to cover correspondence exchanged between the superintendent of insurance and the company regarding the purchase of property and the purchase of an automobile?


Mr. Harris:: I heard "purchase of property" but I did not hear the last part of the statement.


Alexander Malcolm Nicholson: And the purchase of the automobile for the use of the president.


Walter Edward Harris: Yes. I would like one qualification. Is it one property or all the properties that the company owns?


Alexander Malcolm Nicholson: The property which was later leased by the company from the president for the head office of the company.


Mr. Speaker:: Motion agreed to as amended by the observations made by the hon. member for Mackenzie and the Minister of Finance.


REPORTED FAILURE TO PICK UP INSECTICIDE AT BUFFALO
[Stage Direction]
On the orders of the day:
Hon. George A. Drew (Leader of the Opposition):: Mr. Speaker, I wish to direct a question to the minister who may be acting as Minister of Trade and Commerce. I refer to an article in yesterday's Toronto Telegram by Miss Judith Robinson. It refers to news coming from Manitoba that a very important insecticide, which was wanted in Manitoba and was available in Buffalo, was delayed in delivery by the failure of T.C.A. to pick it up there. I would ask whether the department has investigated this failure to make an important contribution to an urgent situation in Manitoba. If so, what explanation can be given of what would appear to have been an extraordinary delay in an important service that T.C.A. could have performed?


Hon. Robert H. Winters (Acting Minister of Trade and Commerce):: May I take the question as notice?


Mr. Fleming:: Answer tomorrow.
ILater: ]


George Alexander Drew: Mr. Speaker, I should like to direct a supplementary question to the Acting Minister of Trade and Commerce. I wonder if he would inquire into this situation which has been set out in more detail in Miss Robinson's article. I would remind the minister that in view of the refusal to grant competitive air freight rights to a competing line there is only one line which can give this service. If the circumstances are as set out in the article, all hon. members should be concerned. For that reason may I ask the minister if he could give this information later today?


Robert Henry Winters: I have already communicated with the parliamentary assistant, who will be in touch with the president of Trans-Canada Air Lines at once, and I shall endeavour to have the information later today.


INQUIRY AS TO FAILURE TO ANSWER QUESTION ON ORDER PAPER
[Stage Direction]
On the orders of the day:
Mr. M. J. Coldwell (Roseiown-Biggar):: May I, on behalf of the hon. member for Vancouver-Kingsway (Mr. Maclnnis), ask why the question in his name, filed on June 23, has not been answered. It reads:
1. Who were the Department of Justice lawyers in the prosecution of the coarse paper companies at Vancouver recently?

2. What amount was paid to such lawyers for
(a) fees; (b) expenses?


Hon. Stuarl S. Garson (Minister of Justice):: Mr. Speaker, the reason this
question has not been answered is that the accounts for legal services rendered by counsel instructed by the Department of Justice were rendered in due course but they have not yet been taxed, and we do not know the amounts until they are taxed.


AGRICULTURE
[Stage Direction]
On the orders of the day:
Major James William Coldwell: have a question I should like to direct to the Minister of Agriculture. In his absence, perhaps the Prime Minister could answer it. In view of the serious recent drought in eastern Canada-and I may say that coming on the train I noticed the crops were almost destroyed by drought-is the government formulating any plans under which this serious situation could be alleviated?


Louis Stephen St-Laurent: It would be difficult for the government to formulate plans that would take care of all the consequences of weather, which sometimes brings about serious floods or droughts. The matter will receive consideration. I have heard similar reports about parts of the province of Quebec through which I have travelled but I found it difficult to believe them from the looks of things. I find that everything is looking pretty fresh. Some strawberries were lost, but otherwise I feel quite happy about the appearance of that part of the province between Quebec and Riviere du Loup. I hope there are other portions where the recovery is as substantial as it has been in general from the too much water that we had in the spring.


Major James William Coldwell: Is the Prime Minister aware that much of the grain is unquestionably dead? What I had in mind was that there is a great deal of low-grade wheat in western Canada which could be used to help the eastern farmers if arrangements were made so that it did not have to pass through several middlemen.


Louis Stephen St-Laurent: I do know that the wheat board is planning for a larger movement of feed grain from the west to the east.



COMBINES INVESTIGATION ACT


[Stage Direction]
On the orders of the day:
Mr. H. W. Herridge (Kootenay West):: should like to direct three questions to the 50433-435
Inquiries of the Ministry Minister of Justice. First, is any action to be taken on the report of the restrictive trade practices commission concerning the manufacture and distribution of wire fencing, made as long ago as November, 1954? Second, if not, what is the reason for the delay? Third, is the minister aware that the restrictive trade practices commission urged that at the very least a judicial restraining order should be applied for, to bar activities which might lead to a resumption of the restrictive arrangements previously in effect?


Stuart Sinclair Garson: On March 7, 1955, as reported on page 1761 of Hansard, in response to a question by the hon. member for Kamloops (Mr. Fulton) I said:
The other report concerned wire fencing and this has been submitted to Mr. T. N. Phelan. Q.C., who has considered it and has given the opinion that the evidence in the case warrants prosecution.
In line with that advice Mr. Phelan was instructed to proceed with this prosecution and he and his assistant counsel have since been engaged in preparing the crown's case. I am sure my hon. friend from Kootenay West realizes that cases of that sort are very complicated and require a great deal of preparation. For that reason, I do not think a case will actually be commenced, at the earliest, until after the end of the long vacation.
My hon. friend's second question was:
If not, what is the reason for the delay?
I would submit that there has been no delay. Mr. Phelan and his assistant have been busy preparing the case.
3.	Is the minister aware that the restrictive trade practices commission urged that at the very least a judicial restraining order should be applied for, to bar activities that might lead to a resumption of the restrictive arrangements previously in effect?
Yes, Mr. Speaker, the minister is perfectly well aware of that, but it will not be in order to apply for such judicial restraining order unless and until the crown has first proved its case that the corporations are guilty of the offences charged.



MIKADO, SASKATCHEWAN    REPORTED INABILITY TO DELIVER TO ELEVATOR

[Stage Direction]
On the orders of the day:
Mr. G. H. Castleden (Yorkton):: Mr. Speaker, I should like to direct a question to the Minister of Trade and Commerce. Will the minister look into the grain delivery situation at the delivery point of Mikado, Saskatchewan, where the producers are

Inquiries of the Ministry unable to deliver their grain to their own elevator because of inequitable distribution of box cars?


Mr. J. H. Dickey (Parliamentary Assistant to the Minister of Defence Production):: Yes, we shall be glad to look into that.



ARTS, LETTERS AND SCIENCES INQUIRY AS TO SETTING UP OF CANADA COUNCIL

[Stage Direction]
On the orders of the day:
Mr. George H. Hees (Broadview):: I should like to direct a question to the Prime Minister. Could the Prime Minister advise the house what progress is being made in setting up the Canada Council?


Louis Stephen St-Laurent: No, Mr. Speaker, I have no further information to communicate to the house at this time.



MINES AND TECHNICAL SURVEYS


[Stage Direction]
On the orders of the day:
Hon. George Prudham (Minister of Mines and Technical Surveys):: When the estimates of the Department of Mines and Technical Surveys were before the committee, the hon. member for Comox-Alberni (Mr. Barnett) asked what part the vessels of the hydrographic service play in search and rescue. At that time I did not have complete information. It is perhaps important to him in his area, and I should like to give the full answer now.
Search and rescue operations are controlled by the R.C.A.F., which has an interdepartmental advisory committee. The marine superintendent of our hydrographic service is a member of this committee.
A number of rescue control centres have been established throughout Canada, the ones in the coastal areas being of particular interest to the hydrographic service. All our ships report their positions to the rescue control centres daily if they are moving from place to place, and less frequently when they remain in one area. They are available, when called on by the search and rescue organization from their control centres, to carry out any necessary operations.


Walter Edward Harris: that the house go into committee of supply.
[Mr. Castleden.l



NATIONAL FUEL AND POWER POLICY

Mr. Clarence Gillis (Cape Breton South):: am going to make myself unpopular for a few minutes. However, one must do one's duty, popular or unpopular. During the course of the past few days we had a long and very fruitful discussion on the whole fuel industry of Canada. During the course of that discussion many recommendations were made with respect to many things that should be done in order to find some solution, but this time, as briefly as I can, I am going to try to finalize that discussion by making a recommendation to the government that we give the government power to do some of the things that we said in this house should be done.
Many of the things that were recommended are now outside the jurisdiction of the federal government. I am sure the Leader of the Opposition and the Minister of Mines and Technical Surveys would think I was remiss in my duty if I did not make the kind of recommendation that I am going to make at this time. During the course of the debate on the estimates of the Minister of Mines and Technical Surveys, the Leader of the Opposition made a very valuable contribution. During the course of his contribution he made five specific recommendations as to things the government should do. But in looking over those recommendations I find that practically all of them, with perhaps one exception, were outside the jurisdiction of the federal government. If he seriously suggests that the government should do these things, I am sure he will support me in the motion which I am going to make and which will recommend certain powers to the government in order to carry out the recommendations he has made.
In the second place, for the benefit of the Minister of Mines and Technical Surveys (Mr. Prudham) or in order to direct his thoughts to the matter I [DOT]should like to point out that in the last report of the dominion coal board to his department the seriousness of the coal situation was set out particularly, and that the board finished up their report with the opinion that, in their judgment, there was no permanent solution to the problem of the coal industry except an over-all national energy policy under a proper regulatory body in order that the coal industry might be planned.


Mr. Speaker:: Order. I do not want to make myself unpopular with the hon. member but may I say this. It strikes me that the hon. member in a sense, within the meaning of our rules, is reviving a debate that has already been concluded. He is dealing with a matter that was dealt with in committee of

supply when items 234 and 235 were before the committee. If discussion was had under those items in committee of supply and if, as a result of the information so obtained, the hon. member is not satisfied with the passing of the resolution in supply but wants to raise the matter now as a grievance on a future motion which is made to go into supply, then we shall have the recurrence of a debate which took place in committee of supply.
The hon. member knows that, according to citation 467 of Beauchesne's third edition, it is not in order to discuss on a motion to go into supply anything for which there is an item in the estimates. That citation applies either after or before. The hon. member cannot get around the rules by trying to discuss the matter on a motion to go into supply after there has been an opportunity for full debate in the committee of supply. I think he will realize that under the two items I have just mentioned he had that opportunity.


Clarence Gillis: Mr. Speaker, I am not going to quarrel with your ruling, and I am not attempting to revive a debate. I am merely laying the groundwork for a motion which I intend to make and which asks the government to give consideration to formulating a policy that might give effect to recommendations that we made in that debate. If I just read my motion, Mr. Speaker, it perhaps might plant in the minds of many hon. members the idea that there is perhaps not too much necessity for a long debate on the matter. I move, seconded by the hon. member for Kootenay West (Mr. Herridge):
That all of the words after "That" be struck out, and the following be added:
"the government give consideration to the formulation of a national fuel and power policy, so that all fuels may be used to the greatest advantage in their proper economic areas and, further, that the country may get the maximum power development so that industry may be placed to the best advantage in all sections of the country, to make for a more balanced economy and give greater protection in the event of war."
I have not any intention of elaborating on that motion, Mr. Speaker. All of the necessary arguments were put forward during discussion of the minister's estimates. As far as I am concerned, I now give this motion to the house to do with as it will.


Mr. Speaker:: Order. The hon. member for Cape Breton South has been very good in accepting the views I expressed a moment ago. My difficulty at the moment is increased by the very fact that I cannot very well ask the hon. member to allow the matter to remain in abeyance until I can make a further check of the authorities. I must either 50433-435J
National Fuel and Power Policy accept the amendment or reject it at this moment. I should like to ask the hon. member to reflect on this point. How can he do after the estimates have been approved what he could not do before they were approved? Citation 467 of Beauchesne, third edition, reads as follows:
Whenever an order of the day has been read for the house to resolve itself into committee of , supply ... it shall be permissible to discuss any public matter within the powers of the federal parliament or to ask for the redress of any grievance, and it is not necessary to move an amendment for that purpose; provided that the discussion and the amendment, if one is moved, shall not relate to any decision of the house during the current session, nor to any item of the estimates, nor to any resolution to be proposed to the committee of ways and means . . .
As the situation stands now, there were items of the estimates relating to the dominion coal board. The policies that are to be followed in order to meet the situation the hon. member has described in his amendment were discussed in the committee of supply when those items were called. The resolutions were passed, read the first time and concurred in. The debate with respect to decisions relating to the operation and policies of the coal board, because there is a general policy debate on these items, has been terminated and the items have been passed.
We now have a motion to go into committee of supply because under our rules, today being Wednesday, we must have a motion. See standing order 28. The hon. member, having had the benefit of the debate and discussion already concluded and decided upon, now moves an amendment. It is inevitable that if the amendment is accepted by the chair there will be a revival of all the arguments put forward in committee of supply, as the hon. member himself has indicated, when items 234 and 235 of the estimates were debated.
I would much prefer not to have to rule on the amendment. It may be that the hon. member, who is always very co-operative, will not want me to establish a precedent either one way or the other and, having read his amendment and made his intention clear, may decide to withdraw the amendment.


Clarence Gillis: Mr. Speaker, I am not going to argue the rules with you but I would point out that during the discussion of the estimates of the Minister of Mines and Technical Surveys we dealt only with coal. The particular amendment now before you deals not only with coal but with all sources of energy-electricity, gas, oil and coal. It recommends that all fuels be brought together under a national fuel policy so that both fuel and power can be developed in a planned way in order to make the most economic and

National Fuel and Power Policy advantageous contribution to the economy of the country. Therefore I suggest that your reasoning with respect to coal alone is not sufficient to make the amendment out of order.


Mr. Speaker:: If I am going to err I would rather err on the side of generosity. The hon. member for Kootenay West.


Herbert Wilfred Herridge: Mr.'
Speaker, we appreciate your generosity in this respect and will be quite brief. We in this group support the amendment because we consider it involves a matter of great importance and some urgency. We think that in Canada three basic policies are required if we are going to lay sound foundations for our over-all economic development. The first is a nation-wide policy of conservation. The second is a nation-wide fuel and power policy as outlined in the amendment moved by the hon. member for Cape Breton South (Mr. Gillis), and those two should be related to a national public investment policy. We believe that at this stage in our economic development there must be a policy that coordinates and correlates all these sources of energy within the country. If we are going to produce satisfactorily for the present, and conserve our natural resources for the future, we believe this type of policy is necessary to avoid duplication, to avoid waste, to promote efficiency and to make for a higher standard of living.
We believe in the conservation of energy; and in that connection I want to quote briefly from a document from the United States. This is the United States scientific conference on the conservation and utilization of resources. It is dated in the year 1940, and at page 273 of volume 3 I find this:
There should be a national fuel policy that will in the long-run make for a higher standard of living than would result in an unplanned exploitative economy. Firstly, a resource like water power which is constantly renewing itself should be used to the full. In Canada, for instance, only 25 per cent of water power resources have been developed although much of the undeveloped area is remote from population.
Secondly, short-reserve fuels like petroleum and natural gas should not be used where with reasonable economy long-reserve fuels like coal can be used. It is estimated, for instance, that coal reserves are from ten to twenty times as large as the reserves of all other fuels combined. According to U.S. Federal Power Commission data based on 1947 experience, coal is the most efficient fuel in terms of energy required for producing a kilowatt-hour. If petroleum or natural gas is used for a use like power generation, it will only mean that some time later it will be necessary to convert coal into liquid fuels at the cost of a loss of approximately 50 per cent of the energy in the fuel.
It goes on to deal with the necessity for a thorough study of the resources of power


-coal and water power, oil and gas, and their correlation in a national policy.
We believe now is the time for the government to consider a policy as proposed by this amendment. We talk about the tremendous power development on the Columbia, and other rivers in Canada. We talk about the new means of utilizing all our great coal resources, and we know that the government is considering seriously the distribution of gas and oil on a national scale.
In this connection I do wish to point out that, so far as over-all planning is concerned -and I am referring to over-all planning of the development of natural resources- Canada actually lags behind India at the present time, although we refer to India frequently as one of the underdeveloped countries of the world. India, although starting late in the game, has developed a very sound policy for the over-all development of its natural resources.
Before concluding I should like to read a paragraph from a booklet entitled "First Five-Year Plan", and it deals with India. In this book is found a recital of their five-year plan for the development of natural resources for the whole of India, as the result of a national policy in which the activities of the national government and the state governments are combined. These are the objectives of the policy, and I present them to the house as being closely related to the objectives of a policy which would be well worthy of consideration by this government. It says under the heading "Objectives":
The central objective of planning in India is to raise the standard of living of the people and to open to them opportunities for a richer and more varied life. Planning must, therefore, aim both at utilising more effectively the resources, human and material, available to the community so as to obtain from them a larger output of goods and services, and also at reducing inequalities of income, wealth and opportunity. A program aiming only at raising output might result in most of the increased wealth flowing into the hands of a few, leaving the mass of the people in their present state of poverty. It would thus fail to achieve wider social objectives. On the other hand, a mere redistribution of existing wealth would impair the well-being of certain sections of society without sensibly improving the lot of the rest. Our program must, therefore, be two-fold, leading at once to increased productivity and reduction of inequalities. These two sides of the program act and react on one another and it is a matter of delicate judgment to decide to what extent an immediate advance in one direction is compatible with advance in the other. While in the initial stages the accent of endeavour must be on increased production-because without this no advance is possible at all-our planning even in the initial stages should not be confined to stimulating economic activity within the existing social and economic framework. That framework itself has to be remoulded so as to secure progressively for all members of the community full employment, education, security against sickness and other disabilities and adequate income.

I submit that those are splendid objectives for a nation such as India; and the objectives, as outlined in this booklet, could well be considered by the government of Canada when it considers the amendment now before the house.
That is all I am going to say at this time. We were anxious to bring this matter to the attention of the house without delaying procedure for any considerable length of time. But we do urge the government to consider that the present time is appropriate to undertake the necessary planning of resources development in Canada-and the possibility of a national fuel and power policy for Canada.


George Alexander Drew: Mr. Speaker, I do not intend to go into any extended discussion of the purport of the amendment. But since it would appear that Your Honour is going to permit a vote on it, then I do wish to explain our position with respect to it.
In a case of this kind it is our duty to examine the resolution itself, and the words in which the request is framed. It is not for hon. members to guess what is in the minds of those who present the amendment, even though there might be a suggestion that the policies of the party to which the hon. member belongs may, in themselves, necessarily give an added meaning to the amendment.
As the amendment stands it calls for the formulation-and I should imagine that it was "formulation" rather than "formation" that was intended-of a national fuel and power policy for the general advantage of the people of Canada. That, in a few words, is what this means.
The fact that there has been a hint by the hon. member who has just spoken that it goes further than that is not adequate reason for our taking the position that this says more than it actually means. I cannot refrain, however, from pointing out that the situation in India and in Canada illustrates perhaps more clearly than anything else could illustrate the immense difference between the types of policy which are required to be employed in the two countries. India is a country much smaller in land area than Canada, but with a population of 400 million people. Here in Canada, in the third largest country in the world, we have 15 million people. There has not been a time since this country acquired the status of a nation in 1867 when there has been such general development of our resources, not only as a result of the initiative and energy of the people, but also because of new
27, 1955
National Fuel and Power Policy scientific developments which have opened up possibilities scarcely dreamed of a few years ago.
May I say that if there were any hint that this resolution, in itself, proposed the application of a socialist policy to the development of our resources, then I would urge that every hon. member who does not believe in socialism should vote against it.


Major James William Coldwell: It is not there.


George Alexander Drew: Before the hon. member came in that was exactly what I said. I am pointing out that it is not there. I do this because of the not unnatural tendency of many people outside to say: We must examine the policies of the party which has put forward a certain resolution. I am looking at this simply as the wording appears. I want to make it clear, however, to anyone who might suggest that there is implicit in this resolution an acceptance of socialist doctrine, I believe that in this vibrant and vital country of ours there never was a time when there were more reasons for Canada resisting the crippling shackles of socialism. Nevertheless, this resolution does put into words the general proposals upon which we were in agreement the other day. I only wish to comment on the statement made by the hon. member for Cape Breton South (Mr. Gillis) that in certain proposals which he was kind enough to describe as excellent proposals I had been dealing with subjects that were under provincial jurisdiction. I cannot agree with him in that.
Surely, at a time when we are allocating to the Department of Defence Production, and those departments for which it constructs so many things, nearly half of the total budget, directly or indirectly, there are ways that the federal government can well allocate greater industrial production to Nova Scotia, New Brunswick, Newfoundland, Prince Edward Island, or the western provinces, which are directly and immediately interested in the increased production of coal.
Then again, there was the point I made that our immigration policy could provide the long-term answer to this by encouraging the settling of industrial communities near to the sources of fuel supply. The third point was the encouragement of our export business. Surely, that is entirely, or almost entirely, within federal jurisdiction.
Then, there was the question of the development of electricity from coal. I recognize -and I think, to an extent that sometimes has become tiresome in this house, I have emphasized over and over again-the jurisdiction of the provincial governments over the development of resources. Nevertheless,

National Fuel and Power Policy I have at the same time urged that in these cases where it requires the co-operation of the federal and the provincial authorities to bring them into operating form, the dominion government should not only be agreeable to doing this but should actually suggest a way in which it could be done.
Only within the past few months a development was opened in New Brunswick which called for co-operation between the federal and provincial governments in the development of electric power resources by the harnessing of the Saint John river. I have repeated my suggestion on different occasions that we should explore more vigorously than we ever have the possibility of using some of the Nova Scotia seams of coal and other of our bituminous coal for the production of electricity. I do not mean simply to encourage the use of coal in the furnaces of electric plants; I mean the actual burning of the coal below ground to produce the power sources, as I have actually seen done in Germany and in Russia. It has been done for years in a very efficient manner. It produces electric power at a price higher, it is true, than hydroelectric power but on a very satisfactory economic level. I am sure that is something which with the research facilities and the financial resources of the federal government could be carried out by mutual agreement and in co-operation with the provincial governments.
The fifth specific proposal I put forward was for the encouragement of the chemical uses of coal. There again it is a case of research by the national research council into the possibilities of the wider use of these very friable coals with a high chemical content. I have said it before, and I can only repeat it again, that I have seen in Europe a fantastic variety of things used in daily life made from the chemical by-products of coal. I believe there are opportunities in that field and that more could be done by the specific allocation of research tasks to the national research council for the encouragement of the coal industry in the areas where the quality of the coal itself sometimes makes it difficult to ship it over long distances. When I speak of quality I am not talking about the fuel content, but simply the fact that it is a very friable coal and in some cases does not lend itself to shipment over long distances as satisfactorily as anthracite coal.
I shall say no more, but I do not wish to leave the suggestion that the proposals I have made were outside the field of consideration of this government. I indicate that I shall support this motion. I do so with emphasis on the fact that we read into


it nothing that is not in the words. We accept no socialist doctrine that might perhaps be interpreted by others as an appropriate method of carrying this into effect. We simply accept the words as they are, and we do support the request that there be a national fuel and power policy which will be for the general advantage of the people of Canada, and particularly for the immediate solution of the very serious situation in Nova Scotia and in other areas where the coal industry is now so depressed.


Mr. Solon E. Low (Peace River):: Mr. Speaker, I should like to take just a minute to explain the position which my group is to take on this amendment. Like the Leader of the Opposition, I should like to emphasize that we take our stand on the basis of the amendment as it is worded, and certainly not with respect to any implications that there might be in the wording of it. We would not support it if it envisioned the establishment in Canada of a centrally planned economy that carried with it all the implications of a socialist economy.
I was just a little afraid that the hon. member for Kootenay West (Mr. Herridge) was going to spoil it by bringing in too much of a five-year plan. I have no objection to five-year plans or ten-year plans excepting so far as they do set up a central planning board that tends to do the kind of thing that a good many private individuals and private interests are perfectly capable of doing, I think, much more capably. However, I do realize the necessity for having a more definite national fuel and power policy.
As a matter of fact, for a good many years spokesmen of our group in this house advocated that very thing. When the hon. member for Kootenay West says, "The time is now for the formulation of such a policy", I say the time is long past. There was a time when it would have been possible to save the coal industry, but at the moment it is a very difficult thing simply because we did nothing in years gone by to help to save it. We did not set up a national fuel policy that would bring about the optimum of cooperation between the provincial and federal governments and the full co-ordination of effort which would be demanded if a successful policy was to be established. I think the time is long past and I am afraid irreparable damage has been done.
We find in the province of Alberta today a terrific conflict between the producers of natural gas on the one hand and the producers of coal on the other. We could include with the producers of natural gas the producers of oil, which has become a very successful competitor of coal. How they are going to solve that in Alberta, where the conflict has taken

place on a large scale and to a certain degree, I do not know. It could have been solved years ago but it was not.
I think the government of Canada has been shortsighted in not understanding the situation in the provinces. They never really tried to understand the situation in Nova Scotia and they certainly have never tried to get down to a full understanding of the situation in Alberta. I recall hearing, when younger, a debate in the legislature of Alberta where a member representing a coal area advocated the export of coal. Another member representing a farming area threw up his hands in holy horror and said that if they did that it would not be very long before there would be no fuel left in the province and they would have to import it. The fact is that that sort of shortsighted attitude has been in existence for many years. As recently as three years ago the leader of the Liberal party in Alberta was taking exactly the same stand with respect to the export of gas. He brought himself into serious conflict with the interests of the federal Liberal party who were anxious to have the export of gas.
Our fuels have been bandied around for political purposes too long and it seems to me it is about time that an honest effort was made to get the co-operation of the provincial governments who are charged with the major responsibility for the development of resources. Having got that co-operation, I am satisfied it will be possible to set up a policy in specific terms to co-ordinate the efforts of all governments concerned so that our resources may be developed in the interests of the country.
The various factors involved have been dealt with by the Leader of the Opposition and it is not necessary for me to repeat them as I do not want to hold up the debate that long. The setting up of a national fuel and power policy should be one that would be fair and just to the various interests and sections of the country. In so far as it deals with related matters that fall within the jurisdiction of the federal government I propose to support the resolution and I am sure that members of this group will do likewise.


Major James William Coldwell: Mr. Speaker, I want to say to hon. members of the house that we are under no illusion. We know that we are living in a capitalist society and that a resolution of this sort would have to be put into effect in the kind of economic environment in which we live. It is true that we do not live in a democratically planned economy and when I hear it suggested that the planning of some phases of a planned economy introduces the shackles of socialism I wonder where the Leader of the Opposition (Mr. Drew) gets that idea.
27, 1955
National Fuel and Power Policy
I happened to be in Great Britain last year and I went down to Cardiff and the region where some of the most depressed areas of Britain were located. But for the planning that took place when the Labour party was in power, the great steel industry adjacent to Cardiff would not be providing employment in those formerly depressed areas. The same is true of Cumberland and many other parts of Great Britain. When I hear reference to the shackles of socialism I call to mind Norway, Sweden and Denmark where they have had socialist governments for many years and where the people are more unshackled than the people anywhere else in the world. I look back at the years 1930 to 1935 when there was no planning of any description and many of our people were shackled under a load of depression, misery and want. Our young people were wandering up and down the countryside. However, I am not going into that.
All I rose to say was that we are under no illusion. We know perfectly well that if this resolution passes it will have to be implemented in the economic environment in which we are living. We would support anything in the way of a fuel policy under the capitalist system under which we live or under a democratically planned economy under which we may live in years to come because we believe that such a policy is a sound one under any circumstances. I want to assure the Leader of the Opposition and the leader of the Social Credit group that when this resolution was formulated by the hon. member for Cape Breton South (Mr. Gillis) he had no ulterior motive. It is in line with other resolutions which he has moved in the past. I wanted to say this in view of the manner in which the resolution has been received by the Leader of the Opposition and others.
Right Hon. L. S. St. Laurent (Prime
Minister):	Mr. Speaker, the Leader of the
Opposition (Mr. Drew) and the hon. member for Peace River (Mr. Low) say that they are going to support this resolution because the language appears to be quite innocuous and would not mean very much in the light of what is already being done. In moving his resolution the hon. member said that as four of the five points which had been discussed by the Leader of the Opposition on the estimates were within provincial jurisdiction he was moving the resolution so the federal government might have power to do the things that were recommended as being desirable in respect even to matters within provincial jurisdiction.
That is not stated in the resolution. The language of the resolution is ambiguous and

National Fuel and Power Policy the Leader of the Opposition and the hon. member for Peace River say that they will support it because of the innocuous interpretation they put upon it. If the resolution does not mean any more than is suggested by them and is not contrary to one's construction of these vague terms, then I suggest that it is unnecessary because these things that can be done by the national research council, the payment of subsidies to promote the development of a coal turbine, the payment of subsidies to promote the movement of coal from one area to another, are being done. There may be some suggestion that they are not being done as well as they could be done or in the best possible manner. If that is to be considered, that is something that is to be considered by the Gordon commission which has just been set up and which will hold its first public hearings in Halifax. If that is all that the resolution should properly be construed as meaning and intending, then it is quite unnecessary and useless.
If it means what the hon. member for Cape Breton South suggested before he read its terms, that is that the federal government should take over jurisdiction to deal with those aspects that are within the jurisdiction of the provinces, then that is something the government is not prepared to do at this time. It might be desirable in a unitary form of government but it is not the situation which results from the B.N.A. Act. If it means that the government should proceed to take steps to acquire the jurisdiction that is now the jurisdiction of the provinces, then this party will resist it, because that is not its policy. Because of the ambiguity of the terms and the various implications that can be put upon those terms, I feel, as far as I am concerned, that I have to vote against it. I cannot take the risk of voting for it by putting upon it the innocuous construction put upon it by the Leader of the Opposition and the hon. member for Peace River.
We all agree that these good things are good things, and we all agree that we should work together to make them beneficial to the Canadian people. But I cannot accept the suggestion of the hon. member for Peace River that we have not been farsighted because we did not try in advance to arrange something that would settle the conflict between the producers of coal and the producers of oil and the producers of gas in Alberta. Those are provincial resources, and they are resources that are competitive in their nature, but the way in which they are dealt with in the province is a provincial problem to be dealt with under the constitution by the provincial authorities.

That makes it impossible for us to accept any blame for having been shortsighted because we did not attempt to prescribe by legislation a solution for that problem that would have prevented the farmer member in the legislature of Alberta from making the speech he made and to which the hon. member for Peace River has referred. The question of whether or not in the exercise of our jurisdiction we are following the right path and moving along it fast enough for the best interest for the economic future of this country is precisely the reference made to this royal commission that is just about to enter upon its undertaking.
When that royal commission has reported, if it finds that there should be some deviation from the path we have followed, that will be considered. If it finds something more should be done so that there will be greater dispatch in achieving the objective, that also will be considered. However, for the time being I am sorry to have to say to the hon. member for Cape Breton South that we are not going to ask for a constitutional amendment to give us the powers he feels it would be desirable that we have to handle this situation in a more expeditious and, as he envisages it, a more effective way than is being done by the provinces.


George Alexander Drew: On a question of privilege, I think I should make the record clear, as there will be references to Hansard on other occasions in the future. I wish to make it abundantly clear, in saying that we support this motion, that neither directly nor indirectly do we imply that we ask for any change in the constitutional division of responsibilities. I thought I had made it clear that I was very strongly opposed to that. I have at all times opposed any breach of the constitution. What I explained was that to the extent that the motion is a request for a policy we are prepared to support the request without suggesting that this carries with it the suggestion of either constitutional changes or the acceptance of policies ordinarily supported on other occasions by the party to which the member who has moved this resolution does belong.


Mr. J. H. Blackmore (Lethbridge):: I should just like to say a word in respect of the remarks of the Prime Minister on the remarks of the hon. member for Peace River. As regards the development of the resources of the provinces, I think it is fitting to point out that, whilst the federal government lacks the constitutional competence to help develop the resources, it apparently has all the competence necessary to get in the way of the

provinces when the provinces try to exploit those resources and export the products.


Clarence Gillis: Mr. Speaker, might I just say a few words in closing this? For the benefit of the Leader of the Opposition, the resolution means what it says. There is no national policy either on power or on fuel in this country. It is certainly getting into a bad hotchpotch in the hands of the provincial governments.
Fuel and power are basic to the whole future development of the country. I do not envisage any necessity for constitutional changes. The machinery to implement the recommendation of this motion is already set up by the government in the dominion coal board. All I envisage is an expansion of that board, a broadening of the legislation setting up its work, and placing people on that board from the other fields in the country such as atomic energy, electricity and so forth so that that board could take a look at the whole field of energy in this country and the picture in the future and with respect to any application of socialistic principles. It' is in the hands of a Liberal government which may be there for a long time from the look of the political complexion of the country.
I am merely trying to get some sanity into the fuel and energy picture of the future. Any time that the federal government thinks it is doing something that is necessary without a constitutional change, it can declare anything in Canada in the general interest of Canada and enact legislation in order to solve the problem. So I say that I could see my way clear to instilling the confidence in the government itself that I appear to have in it. I am quite agreeable to hand that solution, the expansion of that board, to the present government. They are afraid to take it. They are afraid of themselves.


Mr. Speaker:: I hope that this debate will not be regarded as a model for future reference. So that the hon. member for Cape Breton South does not tell me on a future occasion that I should allow him to proceed, I shall tell him immediately that he did speak a second time on his amendment by unanimous consent. He had no right of reply. Let us make this quite clear. Is the house ready for the question?


Some hon. Members:: Question.


Louis Stephen St-Laurent: Mr. Chairman, apart from what concerns the federal district commission which will come later, and about which I propose to make a separate statement, the estimates of the privy council office are almost entirely routine in nature and show little change from year to year. There is a small increase in the number on the staff.

Supply-Privy Council bringing it back to what it was in 1952. In a small office of this kind, minor changes of this nature reflect changes in the work load and in the normal turnover of personnel, a few of whom are usually on loan from other departments.
The principal item of interest is the $80,000 for the publication of a new consolidation of statutory orders and regulations. The last such consolidation, and the first one ever made, was published in 1950. It is now out of date both in substance and in form; in substance because of many amendments to and revisions of regulations that have been made since that time, in form because the statutes themselves were revised in 1952. The government has consequently decided that a new consolidation would now be worth the fairly substantial cost that it necessarily involves.
The new consolidation will conform in its arrangement to the new revised statutes. It will contain all regulations in effect at January 1, 1955, with the exception of those exempt from publication under the Regulations Act and some voluminous regulations, such as those made by the board of transport commissioners, which are published by those who make or administer them. I should add by way of explanation that among the regulations exempt from general publication are a great many that apply only to members of the public service and the armed services, and these are of course circulated directly to those affected by them and are available of course to members of the house and to the press should they wish to see them.
The new consolidation has been used as the occasion for making a fairly comprehensive revision of outstanding regulations, not only to incorporate previous amendments but to improve them both in form and in substance.
We have taken a number of measures to reduce the size and expense of the new consolidation. Many lengthy forms and technical appendices, which can be readily obtained by those who need them, are merely described and not reprinted in the consolidation. The number of cross-references in the text has been reduced, but a full index retained. The individual volumes will be larger, about 1,200 pages as compared with 900 in the 1950 volumes, but there will be only three instead of five, that is to say, about 3,600 pages instead of the 4,500 that were in the former consolidation. Fewer copies will be printed, and there will be less free distribution. By this means we hope to reduce the cost of printing in the two languages from the $103,000 that it was in 1950 to 
about $80,000 which we feel should be sufficient to cover the cost in spite of increases in the cost of printing.
Despite these economies, I am still concerned with the high cost of producing periodical consolidations of this kind. I have asked that a detailed study be made of alternative arrangements that would provide a convenient and authoritative source of reference at less cost. But, of course, in this day and age parliament must necessarily delegate to the government and to ministers the making of detailed regulations to carry into effect the statutes that are passed. That being so, I think we owe it as a duty to those who are affected by these statutes and regulations, as well as to those who elect us, to make these laws and regulations readily accessible to those they concern. We cannot shirk this duty because of the cost that it involves but we must ensure that it is discharged as economically as possible. Hon. members of the committee will of course have an opportunity of examining our new consolidation in whatever detail each may desire, and I wish to assure all members of the house that we will welcome any suggestions any member may wish to make designed to make the consolidation more convenient for ready reference and make it easier to have the regulations known and properly carried out.
I would hope it would appeal to members of the committee to confirm this appropriation and thereby indicate that they feel this is really a necessary document to have available to those who have to administer the regulations and to those who are affected by the regulations.


Mr. Winch:: Mr. Chairman, under this department we have the salary of the Prime Minister, and there is a matter I should like to draw to his attention. It has often been said that the Prime Minister opens the house and the opposition closes it. I am not going to discuss the matter of the opposition closing the House of Commons, but I am certain that the Prime Minister actually opens the house. I should like to suggest to the Prime Minister that consideration be given as to future policy with respect to sittings of the House of Commons. May I say that I am speaking personally and not on behalf of the group to which I have the honour to belong.
During the present session, with the exception of the short recess at Easter, the House of Commons will have been in session approximately seven months. I am convinced that as Canada grows, and Canada is going to grow, the work and responsibility of government and the work and responsibility of the House of Commons and the

6SS9
Senate are also going to increase. Although a number of alterations have been made in the rules of procedure of the house which are to come into effect at the next session,
I prophesy that over the years the length of sessions each year is going to be extended and not reduced. That being so, I should like to ask the Prime Minister to give very serious consideration to the times of meeting of the House of Commons. I do not think it is in the best interests of doing the business of the people in the most beneficial and expeditious manner to hold continuous sessions. It is, I think, quite acceptable to members from Quebec and from Ontario and, to a certain extent, the members who represent their constituencies in adjacent provinces. But, sir, Canada is a land thousands of miles across, and I believe consideration must also be given to the position of members of the House of Commons who come from provinces far removed from Ottawa. I refer of course in particular to the maritime provinces on the Pacific and Atlantic coasts, and I would also include Alberta and Saskatchewan.
It is important that a member in the House of Commons be able to be in contact personally at times with his constituents and, I may say, to be in contact with his own family. I do believe greater consideration must be given to the fact that Canada is one nation, and that British Columbia, New Brunswick, Nova Scotia and Newfoundland have some rights that must be considered.
I understand that what I have suggested might not be possible of fulfilment at the next session; but I do suggest some thought be given to refraining from holding continuous sessions of parliament lasting for seven months-and I believe the sessions will be even longer as Canada develops. Recognition must be given to members coming long distances. I suggest the house might meet the last week of October or the first in November. It might sit until the middle or the third week of December and then be adjourned until the second week of January, to meet continuously from then forward until the completion of its business. In view of the size of this country and the responsibilities of all hon. members, I suggest this is a logical and reasonable request.
I am not placing my remarks on a personal basis; but I know that in order to be here on time I had to leave my home on January 1. With the exception of a few short days at Easter, I have not been home since that time to visit either my family or my constituents. I realize my family is my own responsibility, but my constituents are my House of Commons responsibility. Surely members from outside Ontario and Quebec, 50433-436*
Supply-Privy Council and other adjoining provinces, should be in a position to represent their constituents properly, so that they may know their reactions through meeting them, as do the members coming from Ontario and Quebec.
I am certain the Prime Minister will give thought to this matter. He must recognize that as Canada develops sittings of both houses of parliament are going to be extended, rather than reduced. If this does not meet with the acquiescence of the Prime Minister, who has the responsibility of calling parliament together, then I make the suggestion that members who come from far-away provinces-and I am not going to define those provinces by any limitation such as 500 miles or perhaps a thousand miles-and who cannot get home during week ends, or even once a month, in the interests of our parliamentary democracy and of equal rights for members coming from long distances and having the same responsibility as, for instance, representatives from Ottawa, should be given, on a definite and responsible basis, opportunities for air transportation. In this way they could meet their constituents and visit their respective provinces once in a while.


The Chairman:: Order. I have hesitated to interrupt the hon. member, although I thought perhaps in what he was saying he was getting far afield from the item under consideration. I am now confirmed in my view that in what he is saying he is not in order. The subject he is now discussing might more properly be discussed under the estimates for the House of Commons. Therefore I would ask the hon. member to confine his remarks to the item before the committee.


Harold Edward Winch: I have said all I wish to say.


George Hugh Castleden: There is one matter of some importance I wish to draw to the attention of the Prime Minister. On July 20, just a week ago today, in reply to a question the Prime Minister said this, with regard to the flood situation in Saskatchewan and Manitoba:
The premier and two of his colleagues were here yesterday and the situation was gone into in the course of an interview with them. There is one aspect that can be dealt with at once, and I understand that arrangements are being made for a representative of the federal government-


William Alfred Robinson: Order. Again I cannot see how what is being said relates itself to the estimates of the Prime Minister, or to item No. 338. Surely this is a matter which comes under another department.


George Hugh Castleden: The Prime Minister undertook to answer the question. It was his statement to the house with regard to the position, I presume, of the privy council or the cabinet.

Supply-Privy Council This was just a brief matter, and I wanted to know from the Prime Minister if he could answer, because I was informed by an official from the Saskatchewan government this morning that they have received no communication with regard to these arrangements. Would the Prime Minister bring us up to date on the actual situation, in view of the fact that this is the last day of the session.


Louis Stephen St-Laurent: Mr. Chairman, on that question, just as soon as we have the opportunity to have a full meeting of council there will be instructions decided upon and communicated at once to the government of Saskatchewan and the government of Manitoba. It is on the agenda to be prepared for the meeting we wish to have as soon as prorogation takes place.
Then, with respect to the matter raised by the hon. member for Vancouver East, the hon. member knows of course that, I believe it was last year, we did begin the session in November. This year the session opened on January 7. Then, this year, there has been unanimous consent given to a revision of the rules. I think it would be wise to see just what this revision of the rules, agreed to by all hon. members, will mean. I would think that even those rules that have not been changed have been reaffirmed unanimously by the house, and we will see just what the result will be when they are applied.
This year it would be difficult to have an early autumn session, because the dominion-provincial conference is to meet in October. I can assure the hon. member that we realize it is very important to have sessions of parliament as convenient for all members from the coasts as they are for those from the central provinces. We do try to arrange that, and will continue to bend our efforts to have a system which will enable the work to be carried on properly, without placing any avoidable inconvenience in the way of hon. members whose homes happen to be at greater distances from the capital city.
There has already been something done with respect to air transportation for the travels that are covered by the legislation governing that matter in respect of the House of Commons; and those matters are never settled definitely in a permanent and immutable fashion. They are always subject to reconsideration to see whether they can better be made to achieve the objectives intended.


[Stage Direction]
Item agreed to.

Federal district commission-
340. To authorize the federal district commission to expend for construction, improvements and operation of works under its control, revenues accrued or accruing to the commission from the rental of properties under its control and from other sources. $1.
Major James William Coldwell: I want to say just a word on the federal district commission.


Louis Stephen St-Laurent: I have a statement to make. Perhaps the hon. gentleman would prefer to deal with it now. I had a rather comprehensive statement to make about the federal district commission's operations, and perhaps it might be interesting to the hon. gentleman with respect to what he himself would wish to say about it.


Major James William Coldwell: It may preclude any possibility of my saying what I intended to say, so I am very happy to give way.


Louis Stephen St-Laurent: Mr. Chairman, as there have been some interesting developments in the activities which the federal district commission is undertaking, I thought it would be worth while to take a few minutes, even at this time, to make a short statement about these and to acquaint hon. members with some of the questions and problems confronting us in the development of our national capital. This information may be of some use to members and others in preparing for the joint committee of both houses which we propose to set up next year to study the various questions relating to the development of the national capital and the arrangements with Ottawa and the other municipalities in the area.
Parliament has already recognized the importance of creating a national capital which will be a source of legitimate pride and inspiration to all Canadians, a sort of focus and symbol of those ties which now unite us as a young but already quite vigorous nation. The recognition of this importance of the capital has been tangibly demonstrated by the action parliament has taken in establishing the federal district commission and placing at its disposal the resources necessary to develop, in co-operation with others, the physical aspects of our capital in keeping with the role that most Canadians wish it to play in our national life.
Until recent years, these activities of the commission were on a relatively small scale. In the past ten years we have developed a major long-term plan for this work, and have carried forward the implementation of that plan on a scale that greatly exceeds what was done in earlier periods. In this respect, as in so many others, we have seen a quickening in the pace of our national development. Under the vigorous leadership and

direction of the enlarged commission authorized by parliament in 1946, the excellent plans developed by Mr. Greber, Mr. Fiset and the late Mr. Kitchen, and their staffs and collaborators, have been carried some distance into execution. In the development of this plan, the commission has had the valuable assistance of the national planning committee. To this development, our other public works in Ottawa have also contributed, for the buildings undertaken by the Minister of Public Works and his department, and in some cases by other government agencies and departments, have been sited and designed to accord with and implement the plan for the national capital.
It has not been easy to distinguish those features of the plan and its execution which are peculiar to the national capital as such, and those which are simply appropriate to a modern North American city of the size and prosperity of Ottawa. Any city of this size and wealth should have a plan, and it should be developed in a manner that is sensible and yet as beautiful as circumstances and the length of its purse will permit. The commission itself, charged with the special responsibility for developing the national capital as such, and zealous to discharge those responsibilities in a manner and degree worthy of the trust parliament has shown it, has naturally taken the initiative, not only in the planning, but also in promoting the works necessary to implement the plan. It has been necessary for the government to examine carefully the projects of the commission to ensure that they fall within the proper sphere of responsibilities of the federal government, rather than the normal responsibilities of the city and of the province, and that they fit into the pattern of policy in accordance with which parliament established the commission and voted funds to carry out its program.
In recent years, the importance of a careful distinction between the functions of the city and of the federal authorities has been increased by the introduction of the Municipal Grants Act, and now by its revision at this session of parliament. Under the revised act, we shall be paying to the city of Ottawa the equivalent of full taxes on all our property in Ottawa which is in excess of the 2 per cent which is taken as a minimum measure of what federal property is normally to be found in any major municipalities. Given these grants, there is no reason for regarding the activities of the federal district commission in the planning and creation of a national capital as being in any way a substitute for the payment of full taxes to the city.
Supply-Privy Council
I would suggest, therefore, that one of the subjects to which our parliamentary committee should give attention next year is the proper definition of the type of project which should be carried out by the commission, and what should be expected of the municipality and perhaps of the provincial authorities. I say the "provincial authorities" because the capital area comprises both sides of the Ottawa river. Should it be necessary, in order to have a proper capital, that the federal authorities undertake work that should be undertaken by the municipality itself, the committee may wish to consider an extension of the practice that we have followed in the past under which adjustments would be made in the grant paid to the city under the Municipal Grants Act to take into account such work done by the commission as would normally be done at the expense of the municipality, just as adjustments have been made in the past in respect of such things as parks and the police services rendered by the R.C.M.P. in connection with the parks and parkways.
There is another general problem to which I would hope the members of this house and those who are on the joint parliamentary committee next session will give some study. This is one which is inherent in the planning and control of land use to achieve any longterm community program. We keep running into situations in the national capital area where not only the planning of land use is required, but also some measure of control if the best results are to be achieved over a long term, and if the most is to be made of the opportunities created by public actions and expenditures. In these circumstances, we find ourselves frequently met with the suggestion that the federal district commission or the government should acquire land in order to control its use. Some examples include property adjoining the driveways that have been created; properties adjoining those to be acquired from the railways in exchange for new properties south of Ottawa for the establishment of the freight yards; properties adjoining streets to the improvement of which the commission has contributed; and finally, properties in the areas which have been proposed as a green belt around the cities comprising the national capital. A serious potential problem has arisen by the need to construct new permanent headquarters for the Department of National Defence on the periphery of Ottawa and its environs. For several reasons this large headquarters can hardly be accommodated properly either in the downtown areas or elsewhere within the presently built-up areas of the city. If it
6S02

Supply-Privy Council is not to create new problems in the neighbourhood of its new location, some proper planning and control of the land use around it seems necessary.
These situations which I have described and illustrated all require some zoning and control. It seems to us to be inappropriate that the federal government should undertake this function, even in the capital area. It belongs more appropriately to the provinces and the municipalities to whom our constitution and traditions give jurisdiction in these matters. But this government hopes that these local responsibilities will be effectively discharged. With the approval of parliament and on behalf of the people of Canada we have assumed some responsibility for the proper development of the capital area. Canada is much the largest owner of land in the area. It is the principal employer. It now provides a large share of the revenue of the municipalities. Yet it has no vote or voice in municipal affairs. We must depend upon the sense of responsibility and good judgment of the provincial and municipal authorities in dealing with this problem. We wish to work in harmony with the local authorities and not at cross-purposes with them, nor do we wish to replace them in their proper role.
I think our committee should also have in mind that the municipal authorities here, in receiving the quite substantial grant now made under the Municipal Grants Act, have an obligation to this parliament as well as to others to undertake the zoning and control of land use in an effective way to promote the long-term interests of this community.
We are proposing to take one step now within our own powers and responsibilities. Hon. members will recall that the plan for the national capital included a green belt around the built-up areas of the national capital, in which it was proposed that the land would be used in a manner that would preserve some open space and rural appearance. This green belt is an important part of the plan which was drawn up by Mr. Greber and his associates, approved by the federal district commission, tabled in this house in April, 1949 and used as the basis of our plans in developing the capital. The basic idea was also set out in a report dated December, 1947 by the Ottawa planning area board set up under the legislation of the province of Ontario. This report was approved in principle by the municipalities affected and was acknowledged by the minister of planning and development of Ontario.
Neither this nor other proposals for the green belt have ever been fully adopted and given proper legal status, however. Recently, a decision by the Ontario municipal board

made clear that until the plan relating to the green belt had full legal status it would not be possible to prevent urban development within it. If such development is now facilitated in any way it will defeat the purpose of this aspect of our capital planning. I hope that the provincial and local authorities will co-operate in preserving a green belt about the capital and promote good planning and urban development in this respect. Nevertheless, we must await further action by the municipalities and the provinces concerned and cannot achieve our objective by federal action alone.
In the meantime, however, I believe that this house would not wish any action to be taken by agencies of the federal government that would be other than in harmony with the plan for a worthy capital which we are endeavouring to implement. One federal agency that has some responsibilities in this field is the Central Mortgage and Housing Corporation which, of course, co-operates in financing and facilitating housing and land assembly and development for housing purposes.
The Central Mortgage and Housing Corporation are being directed immediately to restrict the facilities they provide under the housing act within the area of the green belt of the national capital. For the time being that belt will be defined for this purpose as the one in the plan of the Ottawa planning area board, dated December 1947, and acknowledged by the minister of planning and development of Ontario early in 1948. Its exact boundaries in so far as the housing act is concerned may from time to time be amended by consultation between the provincial and federal authorities concerned, in the light of further study.
The limitation to be imposed is that until further notice no assistance with respect to housing or land development in the designated area will be entertained by Central Mortgage and Housing Corporation unless the proposed development is in accordance with a plan that has been approved under the Ontario planning act. I am sure that there will be general agreement that this is the best way to avoid a sporadic development which the government should not in any case underwrite and which should not be facilitated in contravention of the plan developed for our national capital.
I should make clear, however, that this negative action in respect of housing is by no means enough. Some positive action for the control of land use in the green belt will be required if it is to be properly maintained in the manner that has been proposed.
I would point out for the consideration of our parliamentary committee, however, that

this maintenance of a green belt will pose a major financial problem that cannot be overlooked. It will require a restriction on the use of land that will prevent its sale or use for purposes that might be more valuable financially than those to which it is restricted. This restriction is in the public interest, but it is not in the interest of the individual owner. A problem of compensation arises.
The principles involved in this question are, however, very complicated and controversial. I am informed that there is relatively little agreement on them by authorities in this field, let alone any simple means of implementing such principles in respect of the federal capital of a country like this. The value of such land for development purposes arises from the growth of the community and from various actions taken by public authorities, rather than to any large extent from action on the part of owners themselves. But the owners of other land outside the restricted areas are normally subject to much less stringent zoning restrictions and are consequently free to make profits from the development of their land. Moreover, it is not certain that any one parcel in any area within or without the green belt would in fact be used for development at any particular time. Most of it would not be used until much later at any rate. It would be unfair to the taxpayers at large, of whatever authority is involved, to make compensation to all owners of land for this element of what is called "floating value" considering the fact that some parcels might be saleable for development purposes.
In regard to this particular case of a green belt around the municipalities comprising the national capital, I think the committee should consider whether the federal government ought to share with the provincial authorities and the municipalities concerned in the cost of whatever compensation it might be fair to make.


Major James William Coldwell: May I interrupt the Prime Minister, as it is one o'clock. I was wondering if he had very much more. I am not thinking of the members of the committee but of the members of the staff who were working until after four o'clock this morning. If there is very much more I would suggest that the Prime Minister resume at half past two.


Louis Stephen St-Laurent: There is much more that I had set down in my notes, but I would not want to burden the committee.


Major James William Coldwell: May I assure the Prime Minister that he was not burdening me, as
Supply-Privy Council I find all this intensely interesting. I was just thinking of the Hansard staff, and so on.
At one o'clock the committee took recess.
The committee resumed at 2.30 p.m.


Walter Edward Harris: Mr. Chairman, I wonder if I might have unanimous consent that the committee should rise and ask leave to sit again later this day, so that the Speaker might read to us a message from the secretary to the Governor General.


William Alfred Robinson: Is that agreed?


Some hon. Members:: Agreed.
Item stands.
Progress reported.



PROROGATION OF PARLIAMENT

Mr. Deputy Speaker:: I have the honour to inform the house that I have received the following communication:
Sir:
I have the honour to inform you that the Honourable Patrick Kerwin, Administrator of the Government of Canada, will proceed to the Senate chamber at five o'clock p.m. on the 27th of July, 1955, for the purpose of proroguing the second session of the twenty-second parliament.
I have the honour to be, sir,
Your obedient servant,
J. F. Delaute,
Secretary to the Governor General (Administrative)

The house in committee of supply, Mr. Robinson (Simcoe East) in the chair.



PRIVY COUNCIL

William Alfred Robinson: On item 340.


Louis Stephen St-Laurent: Mr. Chairman, when we broke off for lunch I was mentioning the problem of whether or not it would be fair that there be some compensation to owners of land within the green belt because of the restrictions that might be put on the use of that land. I was suggesting that the committee of the houses of parliament to be set up next year consider that problem. If they came to the conclusion that there should be some compensation, they should consider whether the federal government should participate in any way with the province and municipalities in making fair provision for such owners whose rights to use their land might be restricted in the general interests of the community.
It would be desirable, I think, to relate any action in that regard to a general policy



$904 HOUSE OF COMMONS

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Supply-Privy Council to be followed by the provincial authorities in regard to the planning, control and betterment of land use in general. I hope that the creation of a proper green belt around the capital will not be prevented or unduly delayed by lack of action on the part of those concerned in addition to the federal authorities. I think this government and parliament would be ready to join with others in seeking an effective and fair means of implementing this important element of the over-all plan.
Now I should like to turn briefly to some other aspects of federal district commission activities and plans. I should say first that the legislation establishing the federal district commission itself appears to need some moderate revision, and we plan to bring in an amending bill as soon as convenient following consideration of the subject by the joint committee. This would relate to such things as the organization, powers and procedures of the commission itself, the legal delineation of the national capital area, the revision of the statutory grant made to the commission, which for some years has had to be supplemented by an appropriation, and other matters that may arise out of the consideration of the whole subject by the joint committee.
It may well be that the committee will feel that, instead of having a statutory grant, the whole appropriation required for upkeep purposes should be subject to annual consideration by parliament. Those are matters about which it will be, I think, in the public interest to have a considered opinion expressed by this joint committee.
I should say, secondly, in regard to the operations of the commission, that it has now become part of our regular, continuing machinery of government. It has devolved a long way from the old Ottawa improvement commission, which undertook the creation of parks and parkways. It has, nevertheless, the same basic purpose and spirit, and it is largely the scale and continuity of its operations that have changed.
The commission now has an annual maintenance budget of approximately $1J million and a capital budget of several million dollars a year. It has 350 full-time employees and it hires between 100 and 200 men for seasonal work during the spring and summer months. I think lion, members would be as interested as I was to visit the headquarters of the commission at 291 Carling avenue. That is where the work of the commission is carried out. I was very much interested to see that they have the plans and sketches kept continuously up to date with the projections for the future, and I felt well rewarded for the time I took. I had

to take it before nine in the morning because these days from nine in the morning till eleven at night there is not much opportunity to do anything else than attend to one's parliamentary duties. But I felt well rewarded for the time I spent there seeing what the set-up was, how the plans were being kept up to date, and what work was being done by the staff. They are organized under the management of the general manager who is responsible to the commission itself.
The members of the commission, as hon. members know, serve without remuneration, and they meet normally from six to eight times a year. In recent years it has become necessary for the chairman to devote much more of his time to the work of the commission. I think it desirable that the chairman's position should not be a full-time job, but I think in future we will have to recognize that it demands more than can be expected from an active busy man without any compensation, as the statute now provides.
The present chairman of the commission, as hon. members know, is Mr. Howard Kennedy. It so happens that he is under retainer from the Department of Northern Affairs and National Resources as a consultant on forestry matters, because he is recognized as one of the most competent forest authorities in this country. He is also the federal member of the eastern slopes of the rockies federal-provincial commission. The retainer he has from the department of northern affairs is not just a formality. He is very frequently consulted by the officers of that department, and the reason for the retainer did have also in its motivation the fact that, if he were not receiving that retainer here, he would be doing much more work outside of Ottawa and would not be available for the work he is doing for the federal district commission. The retaining fee I understand that he has from the department is $6,000 and his remuneration as the federal member of the eastern slopes of the rockies commission is $3,500.
In speaking of maintenance operations of the commission I should explain the rather complicated arrangement of its finances. It derives its funds for maintenance from three sources and its money for capital expenditures and for payments to municipalities for assistance in construction projects from the national capital fund.
The three sources of revenues for maintenance are first the statutory grant of $300,000 a year provided under the Federal District Commission Act. This is now much less than the cost of maintaining even the parks and

parkways which are the statutory responsibility of the commission. This maintenance cost now amounts to about $750,000 a year and is gradually increasing as the size of these properties increases.
The second source of funds is the revenue of the federal district commission itself. It is a corporate entity and receives revenues of several types. Some substantial portion of it comes from service rendered to government departments for which payment is made by those departments. Some of it comes from the sale of certain nursery products that it provides to others. Some of it comes from the rental of properties owned by the commission as an agent of the crown. Hon. members will notice that in the estimates there is a nominal vote, No. 340, to make clear the authority of the commission to expend those funds that come in as revenue. There was some doubt in the Auditor General's mind as to whether those revenues that are derived from the property under its control could be expended, so it was thought desirable to have a nominal vote in the estimates to make it clear that although they have to account for these funds, they can form part of what they spend for the maintenance of the properties entrusted to them.
The third source of revenue is the annual appropriation for maintenance work. This is vote 341 of the privy council estimates. The bulk of this vote is to enable the commission to defray the cost of maintenance of grounds adjoining government buildings in Ottawa. It was felt that it would not be good economy to have two authorities dealing with the maintenance and the landscaping of lands that either belong to the government directly or are under the control of the federal district commission, and that it would be better to have one authority doing the whole of the same kind of work that is required. This vote also provides-as it has provided for several years-additional funds to supplement the statutory grant to make possible the maintenance of the parks and parkways in the care of the commission. For the current fiscal year the statutory grant is $300,000. The amount of revenue expected to be used for maintenance expenditures is $413,827. Perhaps this is a rather precise figure, but that is the calculation made by the officers of the federal district commission. The amount to be voted under item No. 341 is $622,105 which, it will be noted, is held at the same figure as was in the estimates last year. Thus the total expenditures on administration, construction, operation and maintenance will be, we expect, $1,335,932. That is the figure for which we are requesting an appropriation.
Supply-Privy Council
This total will be divided into four main categories of expenditures. In view of the corporate nature of the federal district commission, those are not shown in detail in the estimates book but I thought they would be of interest to the house. About $109,000 of the total is for the administration of the commission itself and its central office, including the travelling expenses of the commissioners, the majority of whom, I may say, reside outside of Ottawa. About $750,000 of the total is, as I have said, for the maintenance of parks and parkways, the property which is held by the commission on behalf of the crown. There is about $365,000 for the maintenance of properties adjoining government buildings in Ottawa. We use the federal district commission to do this outdoor work on these grounds as well as on its own for reasons I mentioned a moment ago. This work ranges from the planting of, I would say, the magnificent flower beds here in front of the parliament buildings to the mowing of the lawns or the grass around even the lowliest of our laboratories. Finally, we have the direct cost of the planning of the national capital, about $113,000, which includes the expenses of the national capital planning committee and its information office. This information office provides and keeps up to date the model of the national capital and the other material illustrating the national capital plan and the various stages of its implementation.
I turn now to what is perhaps the more interesting aspect of the commission's work, namely its capital projects. I have mentioned that they are financed from the national capital fund which was set up in 1948. There have been seven instalments of $2| million each put into that fund and we are asking parliament to appropriate the eighth instalment, making in all $20 million.
Expenditures from the fund to the end of the last fiscal year were $13,019,824, leaving a balance in the fund of $4,480,176 as at March 31, 1955. If the eighth instalment is paid, this amount will be increased by another $2J million. This balance includes both the moneys advanced and still held by the commission and the remainder which is held in trust by the treasury pending its advance to the commission. Expenditures from the fund last year were $5,508,955 or more than twice the expenditures of the preceding year. This high level of expenditure was due mainly to the purchases of property in and around Ottawa and Hull and, second, to construction projects, notably the railway cut-off south of Ottawa, the building of Sussex drive in Ottawa to which the commission contributed,
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Supply-Privy Council and the building of parkways on the Quebec side of the capital area. Details of these expenditures will, of course, appear in due course in the commission's report which was tabled early in January in this house. The details are also in volume II of the public accounts. Expenditures for the preceding year and the total up to that time will be found at pages 41 and 42 of volume II of last year's public accounts.
For the current fiscal year the expenditures planned for the fund, if parliament approves this further contribution, are budgeted at $8,134,000. Of this total, $2,550,000 is for the purchase of land, and nearly all the balance, namely $3,279,000, is for construction, either directly or by grants toward the cost of municipal construction projects. Sometimes the commission makes, with the approval of the governor in council, a grant to forestall the time when the municipality would be doing the work if it were not for the implementation of the federal district plan. I will not endeavour to go into the details of the capital budget. They are shown in the budget which was tabled here on the 23rd of June.
I would, however, like to mention the status of some of these major projects. The largest project, of course, and, indeed, the key feature of the whole plan is the relocation of the railways. The federal district commission has purchased land in the southeastern part of Ottawa to provide eventually for railway lines and yards there in place of those which are within the city itself. On this property it has now constructed a cut-off for freight trains, which has already made it possible to abandon the old cross-town tracks of the C.N.R. to the west of where they cross Carling avenue. They will be abandoned farther east as the property is needed for the expressway. The plan is that only some two tracks and certain sidings will be retained for some years pending the time when the whole railway network may be moved to the south of the city.
The new freight yards south of the Walkley road and the various associated facilities will be finished during the next few months and will make possible the transfer this summer, we think, of most of the freight movement from the present Bank street yard of the C.N.R. in the centre of the city.
The next step in our railway program is the working out of arrangements for a jointly operated railway terminal area for Ottawa that will include both freight and passenger operations. This is being actively pursued now by the federal district commission with the two railways, and with the help of the services of a firm of specialized consulting
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engineers in planning the new railway facilities. Once agreement on these arrangements has been reached, we plan over the next few years to remove the C.N.R. freight terminal from its present position near the station to the Hurdmans Bridge area, and to eliminate the C.P.R. Sussex street branch south of St. Patrick street. We also plan to improve the union station arrangements and in five or six years' time perhaps to eliminate the railway line across the interprovincial bridge to Hull, using instead the bridge at Nepean bay.
It is hoped that within the next five or six years the whole complex of lines across the Rideau river at Hurdmans Bridge, and crossing the canal at Pretoria and turning down to the station can be elevated sufficiently to facilitate crossing all the important roads and streets in this area without level crossings while preserving the appearance of the capital. As time goes on, it is hoped to move more and more of the freight yards to the south and east of the city.
From this movement of the railways we can expect important positive benefits. The government has offered the cross-town right-of-way formerly used by the C.N.R. to the city and the province as a right-of-way for a modern limited access expressway across the city from east to west. When I say "limited access" I mean limited access from within the city. The federal district commission has been acquiring and is continuing to acquire property to complete the right-of-way to the necessary width for the expressway, although it is not proposed that we should undertake to provide all the property that is needed for ramps and connections with intersecting streets. We think that part should be left to the responsibility of the civic authorities inasmuch as it is more particularly of immediate limited local concern.
We feel that this is much the best use for the land in terms of the national capital plan. It provides a wonderful opportunity for the city to secure a modern traffic artery where and when it will be needed. It is not to be a parkway. It will be a main commercial traffic artery in and out of the capital city and across it. If the province wishes, the federal government is prepared to have this designated as part of the transcontinental highway, though it will be within the city limits, and thus eligible for a grant from the federal crown on the basis of its being part of the transcontinental highway. Otherwise, however, the federal government will not contribute to the construction costs. We believe that the contribution of the property of the land, the right-of-way, which is estimated to be worth at least $5 million or

somewhat more, is a fair share for the federal authorities in a project which, after all, is in large part one that might perhaps be considered a normal part of the programs of both the city and the province.
I will not endeavour to go into any construction details about this major project. Hon. members who are interested will find considerable information about it in the Smith report on the traffic plan for Ottawa, which I got leave to lay on the table this morning so that it might be available for these who might wish to consult it.
I should also mention the completion of Sussex drive and the bridges on it across the Rideau river. To this project the federal district commission has contributed about two-thirds of the cost and the city and the province the remainder. This will, I think, be a valuable supplement to the driveway and parkway network of the federal district commission itself, and it provides a suitable location for many federal buildings, some of which are already built alongside it. The design of the driveway itself and the boulevard in the centre of it have given rise to some questions, and in this connection the federal district commission cannot avoid some responsibility. It was consulted and it approved of the plans as they were carried out. I am informed that the width of the boulevard strip and' the nature of the entrances are in accord with good modern practice in such matters. But I drive through there more than once a day, and now that there is no longer any question of lawsuits over the very unfortunate accident that cost the life of a constable on the very day that the driveway was opened, I hope that some consideration will be given to easing a bit the angles as you come off the bridge into the rest of the driveway.
There was another matter that was giving me some concern. There was a turn from the driveway to go down into Lady Grey parkway. I thought that was pretty inconvenient and I inquired to find out who was responsible for relocating the entrance to Lady Grey drive across a bit of park land opposite the premises occupied by the Franciscan Fathers. I found that little bit of land belonged to the federal district commission and it was the body which was providing the alternative entrance into Lady Grey drive. Perhaps it should have been done in the first place but I am glad to see it is being done now. It will be possible to have one-way entrances and exits from Lady Grey drive and thus avoid the possibility of accidents that the planners originally
Supply-Privy Council wished to avoid by making it necessary to go so slowly that accidents would not be apt to happen.
One of the major projects for the coming year is the reconstruction of the approaches to the old Chaudiere bridge across the Ottawa river, particularly on the Hull side. This project will enable this old federal structure and its approaches to accommodate safely the modern traffic load that is using it. As part of the project, the old streetcar route over the bridge has been replaced with buses. This replacement permits the tracks to be removed from Wellington street west of Bank street, on which, as hon. members know, many of our finest government buildings are situated. With the completion of this project and Sussex drive we shall have completed most of the driveway projects planned for the present decade on the Ottawa side of the capital area. Finances permitting, we plan to proceed with the acquisition of property on which to build parkways in the 1960's or later, as economic conditions permit. Of course capital planning is a field where we must take a long-term view.
Most of the actual construction of driveways over the next several years will be on the Quebec side of the river. The most immediate will be further work on the Lac des Fees parkway in Hull proper, on which the commission plans to complete the grading and gravel base this year. It is also proceeding this year with construction of a part of the Gatineau parkways which is intended to open up to visitors to the capital some of the beautiful park land that has been acquired in the Gatineau hills to provide a natural background-perhaps a quite unusual background-for the capital itself. For several years construction of this parkway has been delayed because of difficulties in acquiring the land at reasonable cost. The present year's program is confined to a portion of road that can usefully be built on property already owned by the crown.
In the Gatineau hills we have now a beautiful natural park. It is being enjoyed, I am told, by many tens of thousands of visitors each year, as well as very frequently by large numbers of the people of Ottawa and Hull. It is planned in due course to round it out by acquiring more land in the area designated for the park in the national capital plan. There seems to be no particular hurry in this matter, however, and we do not see any necessity for using expropriation processes to secure property which is being used in a manner that does not detract from the park we have already formed. And we do not think we need to pay high prices or
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Supply-Privy Council prices higher than are considered to be proper market prices, for the acquisition of land by negotiated agreements.
I shall not endeavour to go further into detail about what the commission has accomplished and is doing. Much is available in the annual reports of the commission, and the financial details of its current plans are in the budget already presented to parliament.
I hope that early during the next session hon. members will have a chance to study what is being done and what is being planned, and I hope they will use this opportunity to help further the development of a capital of which probably a much more populous nation of the future will be proud.
George Alexander Drew: Mr. Chairman, I do not intend to make any extended remarks in regard to the survey that has been presented to us by the Prime Minister in connection with the capital plan. I do think it is unfortunate that a joint committee of both houses did not proceed with a consideration of this subject during the session that is now coming to a close. The Prime Minister has said that this will be done at the next session, and I trust it will be proceeded with immediately after the new session opens.
I hope however that it will not be within the confines of the wording appearing in the speech from the throne this year, because the reference made on that occasion, on January 7, said that-
A joint committee of both houses will be proposed to examine, in the light of the Municipal Grants Act and possible amendments thereto, the financial and other relationships of the government and the federal district commission with the city of Ottawa and neighbouring municipalities.
I do not think that such a committee should have any such limitations, nor do I think it wise that it should even have these terms of reference. They suggest that there is some implied condition arising between municipal grants and the attitude of the federal government toward the course of action followed by municipalities. Certainly I do not think there should be any suggestion that municipal grants in lieu of taxes carry with them any obligation to submit the activities of any municipality to the supervision of the federal government.
The situation so far as the capital plan is concerned is, of course, something entirely different, and I think for that reason that the reference to municipal grants is unnecessary, because it could mislead the members of the committee, as well as members generally in the House of Commons, as to the real purpose of the committee itself.
I think the time is long overdue for an examination by members of the House of

Commons, or by a joint committee, as has been suggested, of the over-all plan relating to the development of the capital of the nation. I believe there are a number of features about which there is not too great satisfaction at the moment, no matter what our regard may be for the individuals who serve as members of the federal district commission.
The truth is that while there is a Greber plan and while there has been a good deal of discussion of this subject, all with the best of intentions, like Topsy the capital has just "growed up". Land is bought here and land is bought there, without hon. members having any clear idea of the pattern being followed. A very worthy project, such as the construction of a new highway to the park area in the Gatineau, suddenly emerges without anyone being sure about what plan it relates to. There are other places where road facilities are not only not too good, but leave much to be desired.
I think it is desirable at this stage in the growth of Canada, particularly at a time when we have such evidence of rapidly increasing growth ahead, that hon. members who must assume the ultimate responsibility should consider this whole subject, and agree upon some over-all planning that would guide the federal district commission, guide the members of the government, and guide the House of Commons in future' parliaments.
One of the problems of course is the fact that there are municipalities with the ordinary municipal functions. I think it is quite clear that any measure of compulsion would not be acceptable either in the case of the city of Ottawa or in the case of the city of Hull. Success in carrying out these plans involves negotiation and co-operation between the federal district commission and the municipal councils concerned.
Undoubtedly that co-operation, and the planning of the federal district commission as well as that of the two municipalities, will be vastly facilitated by some clear understanding as to whether the Greber plan as such, or the Greber plan with modifications, or some completely new plan is to be accepted.
I do wish to refer to what may be regarded as only an incident, something to which the Prime Minister has already referred. He spoke about the entrance into Lady Grey drive from the new driveway on Sussex street. He mentioned that the turn that had been introduced there out of the new driveway into the Lady Grey drive was somewhat inconvenient. Mr. Chairman, it was more than that; it was extremely dangerous. Hon. members should not overlook something which may be symptomatic of a situation that should

be carefully checked. I strongly suspect that somebody laid out those plans on a paper with the cold concept of a route in front of him, without any thought of the speed of movement of traffic and what would happen when cars were suddenly forced to stop before making a sharp right-angle turn into that new driveway. If that alone had happened it would be different. What did happen, however, was that the angular entrance into the Lady Grey drive was closed. Now they have gone to all the expense of knocking away some of the new curb to put in a new roadway. I do not know how much has been wasted, but I know a great deal of money has been wasted on something that anybody with a reasonably good knowledge of planning of routes in these modern days would have anticipated.
It is not a case of wisdom after the event, because I know the Prime Minister realized the awkwardness of it the first time he went through there, and certainly the first time I went through there I found it difficult to understand how anybody could have created such a traffic hazard at this stage of the scientific development of highway construction.
In large measure the same situation exists at the other point the Prime Minister mentioned. A plan was drawn which on the ground provides ample width for cars as long as they are not moving. If they are moving, you suddenly find yourself in what is in effect a single passageway for one car after having had the full width of the passageway alone. I do not mention these to emphasize these two instances, each of which is going to cost a good deal of money to rectify. I mention them to suggest that it would be well in making future plans if steps were taken to ensure that routes of this sort will be designed on the assumption that automobiles do move and that even at 30 miles an hour, which is the declared speed limit, there is a momentum with tremendous effect on the general construction of routes of that kind.
I shall not add anything further to these remarks other than to say that all of us as members of this House of Commons, representative of the whole of Canada, do feel that the federal district commission has an important function to perform. We are all indebted to those ladies and gentlemen who at the present time and over the years past have devoted a great deal of time to this important public service. It is a part of the very natural instinct of a large and vigorous nation to make sure that the capital city is in all ways a city of which it can be proud, not only from the point of view of things that are done in the city or in the two cities
Supply-Privy Council that are joined in this plan, but also in the appearance that the cities will present to visitors from Canada and from ouside of Canada.


Major James William Coldwell: When I rose to ask the
Prime Minister a question or two I did so because I wondered whether certain questions might not be pertinent at this time. But the Prime Minister answered most of the questions I had in mind, and the point I had particularly in mind was about the appointment of a joint committee of this house and of the Senate to review the operations of the federal district commission.
I agree that the ladies and gentlemen who have been serving voluntarily on this commission deserve the best thanks of the House of Commons and indeed of the nation.
The Leader of the Opposition said, and the Prime Minister agreed, that there are many problems. There are a good many eyesores in this capital city which I hope one day will be removed. But what I was going to say is this: a few years ago I had the privilege of meeting some prominent people who had travelled all over the world. After dinner in the evening a discussion arose as to beautiful sites for capital cities. They placed three cities among several others as having the best sites, and they placed them in various order. One put Budapest first; another put Rio de Janeiro first; and another put Ottawa first. But always Ottawa appeared among the first three as one of the most beautiful sites for cities in the world.
A good deal of imagination has already been exercised by the federal district commission in laying out the attractive parklands around this city. The driveway is a lovely drive, enjoyed by all those who come to visit Ottawa. Beyond the city limits we have wonderful possibilities for a national park and for recreation, with numerous lakes and beautiful woodlands, rolling hills, and so on. I sincerely hope that when a parliamentary committee is established next session, it may not only review the operations of the federal district commission, but may give it encouragement to go ahead and give the city of Ottawa and the city of Hull encouragement also to remove some of the eyesores that now exist, to make their cities as beautiful as their surroundings. I know, as has already been said, whatever is done by the federal district commission with regard to beautification within the cities themselves will have to be done in co-operation with the municipal authorities.
It is a pity that when this city was established as the capital of Canada it was not made a federal district so that it could have

Supply-Privy Council been laid out appropriately under the direction and with the financial support of this parliament of Canada. However, that was not done. If I read the symptoms in Ottawa and Hull aright, the municipal authorities are going to hang on tenaciously to the rights that they have assumed or that have been granted to them under the provincial legislation that set them up. Therefore, we have to try to co-operate in every respect with them.
This parliament should not begrudge the money that will be required to make this capital city conform to the beauty of the surrounding countryside, the Gatineau hills and river, the beautiful countryside beyond its borders. I was glad to hear the Prime Minister say that the National Housing Act officials will safeguard the projected green belts around the cities of Ottawa and Hull.
I am looking forward to the parliamentary committee. I hoped to be on it if it were set up this year, and I certainly hope to be on it when it is set up next year.


Mr. Richard (Ottawa East):: I want to say only a few words, Mr. Chairman. I thank the Prime Minister for the excellent, lengthy survey he made of the federal district commission and its plans for the future. I also welcome, as others have, the announcement that surely next session we shall have a joint committee of the House of Commons and the Senate to study the operations of the national capital plan and the federal district commission in Ottawa and the adjoining areas. I have been asking for such a committee for some years, not that I thought the operations were not satisfactory, but I believed that hon. members should be better acquainted with the operations and also have a voice in the making of this national capital in the future.
There is one good thing about the survey report made by the Prime Minister. I think it is clear that the committee will not be bogged down with questions as to whether the federal government is taking over any of the rights of the municipality or the electors of this municipality. I believe that the electors of Ottawa have never had any great suspicion that the federal authorities wanted to take away their rights, but in any event the statement made by the Prime Minister this morning makes it clear that the primary concern of this committee, for the present at least, will not be to make of this area a federal district under the authority of the federal government.
One of the great difficulties that we have experienced with the plan is the fact that while there has been a master plan it has never received the approval of the municipal and provincial authorities, which authorities

are the essential ones in putting this project into effect. While it is true that this has had embarrassing effects on the federal district commission and the government, I want hon. members to realize that the fact that this plan has never been approved has made it difficult for the citizens at large who had lands or buildings within the areas mapped out on this plan.
It has not always been easy for the citizen of Ottawa to know what to do with his land. He does not know whether some day it may be expropriated or whether the Greber plan will be brought into effect. It is true that there were some bolder citizens who were willing to speculate and who went ahead knowing that it was legal in the sense that the municipal and provincial authorities would not stop them building. They went ahead while others with a greater sense of national responsibility did not do anything and then found their properties expropriated before they could take advantage of the improvements being made.
There is another feature which I have brought to the attention of the house before and which I have taken up privately with the Minister of Justice. I refer to the operation of the Expropriation Act. As the Prime Minister has said, the Expropriation Act is not used in the province of Quebec in connection with the acquisition of land, but it is used to a great extent in Ottawa and the province of Ontario. It is a very forceful weapon in the hands of those who must acquire land.
I must say that as a rule the citizens of Ottawa have not been satisfied with the results of land expropriations. I am speaking now of home owners. Those who have large buildings and possess the necessary resources can take care of themselves in the exchequer court, but the man who has only a small house finds himself in difficulties and must accept a price which in the opinion of many is too low.
I urge the government to consider doing something about the method of acquiring land for the federal district commission. The use of the Expropriation Act in its present form is really not called for. I have always contended that the Expropriation Act was not meant to be used to acquire land of this type or under the circumstances in which the federal district commission is acquiring land at the present time. I realize it is a long time since I went to law school but I have always looked upon the Expropriation Act as being a violation of civil rights. I submit that it should be used sparingly by the crown only in cases of great public interest, such as the acquisition of land for post

offices, wharves, national defence buildings and so on. It should not be used too readily. If it is to be used as in the present case all advantages should devolve upon the party whose property is being expropriated. On behalf of those hundreds of people whose properties have been expropriated in the district here and who are voicing discontent over this procedure, may I say that I hope the government will see that this parliamentary committee to be set up next session will make a complete study of the use of the Expropriation Act in acquiring land.
The time that elapses in the settlement of these cases is far too long. It may surprise some hon. members to know the time that elapses. These transactions are carried on by the federal district commission through the Department of Justice, and before the three parties involved can conclude an ordinary sale of land many months may elapse. I know of one case recently involving only $12,000 where the sale was not completed until after one year.
I welcome the fact that we are to have a committee to discuss the workings of the federal district commission and also, I hope, the operations of the Expropriation Act in connection with the national capital plan. I hope that hon. members will appreciate how much has been done in this area with the moneys which have been voted from year to year and that they will be kindly disposed in the future to approve expenditures so that this capital plan can be completed at a much faster rate than has been the case in the past.


Mr. Macdonnell:: Mr. Chairman, I do not rise to make a speech because I am sure we are all hoping against hope that we may finish earlier today than we did yesterday. Before I ask the question I have in mind may I pause to remark that it is interesting to contemplate the development of Ottawa as it has been described by the Prime Minister. I recall that it was only a few decades ago that an Englishman living in Toronto referred to Ottawa as an Arctic village. The Prime Minister referred to the green belt and I am not clear whether that is merely a picture on a map or whether it is still partially green. I was not clear from what the Prime Minister said whether steps are being taken to prevent further building on it.


Louis Stephen St-Laurent: Mr. Chairman, most of what appears on the map as a green belt is still green. The only thing that the federal government can do at the present time to
Supply-Privy Council prevent the subdividing of that green belt for building purposes is to refuse to make any contributions under the National Housing Act toward the financing of such undertakings. Negotiations are going on in an effort to have the provinces and the municipalities give legal effect to this green belt.
But, as I mentioned, there is a problem. It is felt that there is the possibility of there being some unfairness to owners of land in the green belt if restrictions are placed upon those lands which do not apply outside of what is shown on the plan as the green belt. That is a matter about which municipal authorities and economists are not agreed.
Under the Quebec law the city simply homologates a line which constitutes a restriction upon owners of property enclosed within that homologated line and the owner gets no consideration because of restrictions being placed on his property. Some think that that is not fair. I think that this is something that should be looked at by this committee. Then the committee may come to the conclusion that some consideration should be given to providing compensation, and should then consider whether the compensation should come solely from the province and the municipality or whether the federal government should make some contribution to the compensation.


James MacKerras Macdonnell: The Prime Minister used one phrase I should like to mention because it seemed to indicate the need for urgency. He spoke of the proper definition of the type of projects being carried out by the commission. I was struck with that phrase because it seemed to me that every month that was lost might create new difficulties.


Louis Stephen St-Laurent: There is not always full agreement between the municipal authorities, the provincial authorities and the federal district commission as to what are the things the municipal authorities should do without any contribution and what are the things that are undertaken because this happens to be the capital and not merely a city of the present size. That has to be dealt with by negotiation. I think there has been very much progress made in the last four or five years in implementing the general outline of the plan. I think there is a genuine desire on the part of the municipal and provincial authorities and the federal district commission not to get as much from each other as they can, but to settle these problems on a basis that will appeal to most people as fair.


[Stage Direction]
Item agreed to.
[Stage Direction]
Supply-Fisheries

[Stage Direction]
Special-
795. To provide, subject to terms and conditions approved by the governor in council, for payment of assistance to producers of salted cod, haddock, pollock, hake and cusk, in the amount of 50 per cent of the laid down cost of salt used in their 1955 production; including authority to charge administrative costs to vote 153 of the main estimates, 1955-56, $500,000.
Robert Henry Winters: With regard to item 795, I should like to recommend to the committee that there be a change in the wording at this stage to permit greater flexibility. The reason for this is that no regulations have been established as yet. While the study is continuing, some flexibility is required. The change is a minor one. The suggested wording would be as follows:
To provide, subject to terms and conditions approved by the governor in council, for payment of assistance to producers of salted fish on products designated by the governor in council in the amount of 50 per cent of the laid down cost of salt used in their 1955 production; including authority to charge administrative costs to vote 153 of the main estimates, 1955-56, $500,000.
The difference is that, instead of limiting it to salted cod, haddock, pollock, hake and cusk, this wording would permit salt assistance to be applied on salted fish products. If my colleague, the Minister of Finance, would so move, I would recommend that the wording be changed accordingly.


Walter Edward Harris: I so move.
Item as amended agreed to.



DEPARTMENT OF FINANCE

[Stage Direction]
General administration-
112. Departmental administration (including the former administration of employees' instalment purchase plan and employees' group insurance plans), $1,965,633.
James MacKerras Macdonnell: Is the minister going to say anything?


Walter Edward Harris: Mr. Chairman, I think there is no need of my making a statement. The estimates were considered in the estimates committee some two weeks ago and we had, if not a very extended, at least a fairly thorough consideration of the items that were placed before the committee. I should be glad to answer any questions that might be asked or make any observations that hon. members desire on particular points.


James MacKerras Macdonnell: Mr. Chairman, as the minister has said, these estimates were before the committee on estimates. The hope was expressed there-and I hope I shall do nothing to belie it-that the time spent in this committee could thereby be lessened. I think we shall show that that is possible.
I wish, however, to make comments on one thing that came up before the committee,
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namely the operation of the treasury board. I should also like to make reference to a matter that came up at the time of the minister's speech in connection with his reduction of taxes. We had some talk at that time, and I could never quite disabuse my mind of the idea that the minister was teasing us a little. Members of the committee will remember that the only reason he was prepared to give for reducing the taxes was that he thought they were too high. That is a very good reason indeed, but we also thought he had probably done it to a certain extent to stimulate the economy. We could not interest the minister in that idea at all. He shied away from that.
It is with reference to that point that I wish to ask one or two questions. I think we are entitled to assume that the minister has given the matter a good deal of thought in the three months which have elapsed, and my questions will be based quite briefly on a C.P. report from London which appeared in the Globe and Mail of July 18. The report says this in part. This is a news story from Ottawa reported back from London:
The government now is veering round to the view that Canada's growth of population requires and justifies free spending on public projects even at the cost of increasing debts.
Later there is a further statement:
The policy "is obviously based on the view that any signs of repeated slackness next winter can be largely offset by public investment planned for its long-range usefulness in national development without too much regard to the budgetary situation of the moment."
I send this across to the minister so that he can have it for his convenience in answering. I would remind the minister, if he will allow me, that when we were discussing this in April I pointed out to him that deficit financing was like drink. It is apt to get hold of you and apt to become very attractive. It is for this reason that I am putting this report before the minister and hoping that he may say something about it.
Of course, if the minister's answer is that his views are along this line and that we are going to follow what was regarded as the Keynesian view that we can spend our way through, then the next thing I am going to discuss might seem to be irrelevant because it is the old topic of economy. I do not believe the minister is one who has economy out of his mind, and certainly I have not.
So for a few moments I propose to talk about the treasury board, which is really our front-line trench, one might say, in resisting the onslaught of extravagance. I want to confine myself to non-defence expenditure because, of course, in the first place, defence expenditures are almost untouchable

and, secondly, one gets into mysteries that those of us who are not familiar with up-to-date war are not very well versed in.
I should like to begin these remarks by referring to a speech made by the minister's predecessor in 1950 and reported on page 1214 of Hansard. I have always remembered what Mr. Abbott said at that time. Whilst no one wants to hold him to the predictions he mentioned, because no one could foresee the glad years we have had since, nevertheless this is what he said. I would suggest to the committee that what has happened since shows that economy is not too much with us and that a good deal of effort is still necessary in that direction. This is what Mr. Abbott said:
Our efforts to hold expenditures ... I have described .	.	. we must cope somehow with a
continuing level oi expenditure of $2,400 million, ... I doubt if the public or this House of Commons will really wish government services or activities to be reduced in years of prosperity to the degree necessary to get our expenditures much below this level of $2,400 million.
That is five years ago. I am sure the minister will share with me the irony of that statement because our non-defence expenditures for the present year are going to be about $2,920 million against $1,957 million non-defence expenditures in 1950. In other words, they will have gone up in those five years about $965 million. I should be quick to point out that a large part of that amount is for old age security, something like $367 million. That would bring it down to somewhere near a $600 million increase in the five years. Again one must immediately draw attention to some other amounts. For instance, at that time the province of Ontario was not receiving money under the dominion-provincial agreement. There are other substantial amounts too. But I wish to draw attention to just three or four of the ordinary amounts in departments which have not experienced any revolutionary change in that time. Public works is up $61 million; transport is up $35 million; national revenue only $8 million; external affairs, $33 million. That is becoming more expensive. Citizenship and immigration is up $91 million. I am not going to take the time of the committee to delve further into that matter. I submit that I have made a prima facie case that we need to watch the bawbees, that we need to economize as much as we can.
It is for that reason that I was interested, when we were before the estimates committee, to get a close-up of the treasury board. Treasury board has always been a rather mythical organization to me up until this time. I have heard about the terrors that face people that go before the treasury board.
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I was therefore interested to come to be a little bit more familiar with this organization. I was a little bit disappointed. I did not feel that it was quite as terrifying an organization as I would have liked it to be. It consisted of a group of ministers, mostly

if I may say this with respect-rather junior ministers. To my surprise I found that the comptroller of the treasury does not sit on the board. But it was explained to me that he is only concerned with seeing that the money is properly spent.


Walter Edward Harris: No. It was explained to you that the treasury board was a committee of the cabinet.


James MacKerras Macdonnell: Yes. I think I understood that. Then in addition to the ministers mentioned there are present, when each department is reviewed, several senior officials of the Department of Finance, and of course senior officials of the department concerned. The method of operation is naturally one that one would expect. The preparation of the estimates is done by the department concerned. Then the treasury board examines these estimates and each department is discussed by the treasury board. When examining anything, one is always anxious to have evidence from outside and from people who may seem to be impartial. I therefore read to the committee a statement emanating from the Winnipeg Free Press and which indeed I had brought to the attention of this house once before. I read it again:
Careful study of the federal civil service indicated that the cause of the hitherto uncontrollable growth was simple. Whenever there was a need for expansion, the departments expanded. They did not search within themselves for surplus personnel and meet the need for expansion by making better use of their existing staff. They invariably added to it.
Let me digress for a moment to say that that procedure seems to me to be extremely undesirable on two grounds. First of all, it is undesirable in automatically adding to the civil service and, second, in not making sure that the good jobs that are going are available primarily to people who are already in the civil service. I continue the quotation:
To illustrate: If a bridge is built across the St. Lawrence, there would have to be a customs house at the Canadian end of it, staffed by customs and immigration officers. The opening of the bridge would greatly reduce the number of people entering the country by ferries but instead of transferring them from the ferry ports to the bridge, the tendency would be to add to the payroll by appointing additional staff at the bridge.
What I am quoting comes from a staff writer of the Winnipeg Free Press. I therefore think I can assume that it is not prejudiced against the government. This item and other things put us on inquiry and we

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were interested to find in the committee where the responsibility lay. We asked the Minister of Finance about this matter. This was the question asked of the minister: when we find this happening according to the Winnipeg Free Press, we must not blame the customs department but we must blame the treasury board. To this the minister replied, "No; blame the Minister of Finance". That does not really help because, however generous the minister may be, it does not solve the problem.
We went on to ask the minister whether -as I most certainly had understood-the fact was that the finance department exercised supervision over other departments. I want to point out that representatives of the senior officials of the finance department do go and confer with the representatives of the department in question. But when the minister was asked whether there was supervision over other departments the answer was this:
We are only discussing my own department. X do not tnink there is need for it-
That is for outside supervision.
-in that department.
Then further he was questioned as to the other departments or any other departments and what might be the need for investigation, and his answer was this:
You would not expect me to say that any other department ought to be investigated.
That came to me in a way as a surprise because I thought that somebody must be responsible and I assumed that it was the Department of Finance. But apparently the real answer is that in each department- subject to the scrutiny of certain officials of the finance department-the minister and his staff allow his conscience to be their guide. When the minister had it pointed out to him that certain departments-notably post office and the film board, I think-had outside investigation and he was asked under what circumstances was it found that there was investigation in this case, the answer by the minister was this:
You would have to ask the departments concerned.
My query about that matter is this. I entirely failed to find what seemed to me to be the real responsibility. I think the minister would say that I am overlooking the senior officials-and very good officials they are-who go to department A, department B and department C and discuss the situation. But I cannot imagine a senior official, however good he is, being able, with a deputy minister,-and deputy ministers are rather formidable people-to go into a department and not merely do a little bit
[Mr. Macdonnell.l
of chiselling here and a little bit of chiselling there but discuss the whole question of reorganization as an outside visitor might do. I am going to discuss that outside inspection for a moment or two. The minister's final comment on that matter was this:
Perhaps we could agree on the general proposition that these business firms (efficiency firms) are useful in their own field.
I was disappointed by that answer because it seemed to me to imply that there was one standard of efficiency in the business world and an entirely different standard in the government, which would be a kind of mystery to anyone coming from the outside. I am just using the words uttered by the minister and from them drawing what inferences I can.


Walter Edward Harris: If you want me to use the word "misleading", I can use it right here.


James MacKerras Macdonnell: I am using the minister's words and he can correct my inferences if they are wrong. The implications seemed to me to be those which I have suggested. I will read the words again:
Perhaps we could agree on the general proposition that these business firms (efficiency firms) are useful in their own field.
I want to spend a moment or two on the question of these efficiency firms. We asked why they were brought into the post office and the minister's answer was that we would have to ask the department concerned. I want to read a part of the report of the efficiency firm, Woods, Gordon and company. With regard to the operations branch of the Post Office Department the report has this to say:
The work of the operations branch has over the years increased to the point where the staff at all levels are overloaded with a multitude of routine problems and correspondence. No one has had the time to develop policies which can be applied on an over-all basis.
Later the report says:
The branch is operating under a severe handicap as there are no standards established to measure the relative efficiency of a given method of operation. The lack of such standards is particularly felt when requests are received for additions to staff or accommodation.
I can well believe that. I repeat what I said a moment ago, that as between some outside independent persons coming in, as was done in the case of the post office, outside people with no strings on them, as between an independent and presumably efficient inspection of that kind and that which would be conducted by even the very best civil servants, there is, I submit, a world of difference. In the one case you have a person who is absolutely at arm's length, and in the other case I submit you have not to the same extent.

I remember being told that when Winston Churchill as a young man became first lord of the admiralty he summoned all the senior members of the staff and asked them what they were doing. When they got to the end of the story he then asked them a question they had never been asked before. He said, "Why?" In other words, what he was doing was to query the organization right from the foundation up. Nothing was sacred, nothing was untouchable, everything had to be submitted to scrutiny and justify itself or it would be changed.
Personally I have never been a civil servant, but I find it impossible to believe that a civil servant could go into the department of the Minister of Trade and Commerce, let us say, and tell him that there was some basic reorganization that was needed in his department. Such a man ought to have the V.C. I just cannot see it happening, and that is why I come back again-


John Horace Dickey: It does not need reorganization.


James MacKerras Macdonnell: There you are. That is the real spirit. It does not need it. But what I would say to the senior member for Halifax is that in the business world, where there are, I think, able people, people who have been trained to their jobs, it is recognized that it is a good thing to get a fresh outside mind to come in and see what they are doing. I want to stress again the Minister of Finance's own words-"You would not expect me to say that any other department ought to be investigated". I admit it would be a difficult thing to do, but at the present time the only person who can say that a department should be investigated is the minister concerned himself, and I submit that is utterly and absolutely unsound.
If there is a skeleton in the cupboard, if the minister is conscious that there are things that are not right, unless the minister is a very unusual person both in character and ability he is not going to bring in strangers and give them full scope to see what is going on. He is going to hide it and, as I say, unless he is a very unusual man he will not regard the hiding as anything improper. He will be quite sure that he is going to clear it up himself next month or at the most in two months. He will not be conscious he is doing anything wrong. He will not feel in the least that he is doing anything wrong. Again I say it would only be a man of unusual character and ability who would do that.
I submit that on the basis of what I have said, and it all comes out of this memorandum, there is nothing to indicate that there is a really searching inquiry going on now. There is nothing I could see in what we
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heard, and I repeat, why should that be true only in government business? After all, government operation in a way is a piece of cake because the government can fix its own income. They are not subject to the hard law of the market where a company only nas the income which it earns. If the government has not got enough income they can take more out of our pockets. Therefore there is a great danger that money does not mean quite the same to them as it does to somebody who is handling a business which, if it does not succeed, goes broke with the result that the person in charge probably loses his job and comes to a sad end.
The answer may very well be made that you are only talking about ministers and ministers may not be trained in administration. As a matter of fact, a good many of them are not. Their talents often lie in other and very useful directions, directions which bring them to this house, directions which enable the government to stay in office but which may not necessarily have any very close connection with administration. Take the civil servants. My answer is that if the civil servants are to be regarded as the second line of defence-in some ways they are really the first line of defence-then I would like someone to show me a good civil servant, a top-ranking civil servant, and I will venture to say I can persuade him it would be a very good thing for him to have some able outside person come in and discuss with him his operations.
Take, for example, the Department of National Defence, and I have mentioned this in the house before. When the minister's predecessor was here I never could get rid of the idea that he felt by working like a demon, working ten times as hard as anyone else, he was going to be able to get the thing going all right.


Walter Edward Harris: So he did.


James MacKerras Macdonnell: In my opinion that was always the greatest mistake. If the minister is assuming, without more knowledge than I think he can possibly have of the Department of National Defence, that everything is all right, he will have to allow me to say that I regard other opinions of his as of more value than that one. At any rate, there you have a department with tens of thousands of civilian employees. When the question was raised as to what had been done to scrutinize the organization the minister just said, as far as I can remember, that they had a job and they were doing it, and certainly if hard work and application were the key he had it.

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I have never been able to understand why there was an adamant unwillingness on the part of the government to avail themselves of outside assistance. When this matter was brought up by our party and discussed earlier in the year the government took no part in the debate whatever. They did not think it was even necessary to answer what was said. I suggest that prima facie the course I am suggesting is reasonable for three reasons.


Walter Edward Harris: I suppose you realize you are out of order. We had a vote on this subject once.


James MacKerras Macdonnell: Perhaps the chairman will tell me if I am. I am nearly through. These are the three reasons: 1. With a business of nearly $5 billion, it stands to reason that even a little additional efficiency will pay off in a big way. 2. In the United States this plan has been adopted with beneficial results.
3.	In two of our own departments it has been done and it was found that it was worth-while.
As a result of the experience I had in the committee, if the government is not ready to bring in outside assistance which, incidentally,
1	would hope would offer comments on the present organization and comments as to the relationship of the treasury board with the departments, then I suggest to the government that they should have a very good look at the treasury board itself because so far as I was able to discern as a result of the evidence given to us there is at the present time no real responsibility. You cannot find where the real responsibility is, and I cannot imagine a worse criticism that could be made of any organization than that.


Mr. Jones:: Mr. Chairman, I wish to discuss a matter that has been brought to my personal attention by several municipalities in British Columbia. I understand municipalities in Ontario and western Canada generally are anxious to have this matter brought before the minister. I refer to the reopening of the Municipal Improvements Assistance Act. This act is still on the statute books but has been inoperative for 14 or 15 years.
Its history is a very good one. When it did operate some of the municipalities were in a pretty shaky condition, but under that measure they were able to borrow money at
2	per cent for self-liquidating projects. Without a single exception all the principal and all the interest was paid back on every loan. Therefore it is hard to understand why the department is reluctant to continue this excellent service to municipalities.
As hon. members know, British Columbia has almost doubled its population in the last

ten years. The municipalities are facing a difficult situation, inasmuch as the area originally incorporated as a city has not increased, and there is a heavy burden placed on the handful of land owners who have to bear the higher costs of education and operation of the city in general. All the increase in population is not necessarily in the established towns. I visited recently outside of Vancouver where a totally new area is being developed. Obviously they have no credit, because they are not an established community. The residents are mostly returned men. They need public improvements such as sewers and roads, and all the facilities required by a new town. However, with no' credit and with no established history as a city they find it difficult to borrow money.
I feel this fund should be reopened to-serve communities of that kind, so that they could borrow money at 2 per cent when,, otherwise, they have to go on the market and, in view of their inability to offer adequate security, they have to pay 5 or 6 per cent.
The sum available under the act today is $30 million, and that amount is frozen. I suggest that immediately it be increased to $100 million, and the fund reopened. About half the cities in British Columbia would be delighted to borrow some of this money. I know some of them need new waterworks. They are carrying on with obsolete piping systems and obsolete dams, but they just do not have the money to make these improvements. One town I have in mind would like to borrow $150,000, but they are afraid to go on the open market because they are already up to their necks in debt because of the building of hospitals and the like.
Therefore I would ask the minister to study the provisions of the act so that he may learn the good accomplished under it while it operated. He would find out about the public works it had helped to build, and the excellent history of payments made by those who borrowed. Many municipalities in British Columbia have requested that the benefits of this act be made available to them. I do not think the minister has had time to find out exactly how it operated, or why the fund has been frozen. However, I appeal to him on behalf of all these towns to give consideration to increasing the sum available from $30 million to $100 million at once, and again allowing municipalities to borrow at the rate of 2 per cent for self-liquidating works.


John Horne Blackmore: Mr. Chairman, I should like to approach this whole matter of the Department of Finance in this way: I feel the only time we have during the year to discuss effectively the minister's budget speech is on the occasion of the appearance before the

committee of supply of the estimates for the Department of Finance. I am not sure that I am putting the correct interpretation on the situation but I believe I am.
We know that in the United States they listen to a speech every year known as the "state of the nation" speech. In Canada I believe the budget speech is the one delivered by the government to indicate the state of the nation. Consequently when we consider the budget speech and the estimates of the Department of Finance we are considering the state of the nation.
My first observations will be of a negative character, but they will set out exactly the kind of problems which will be confronting the dominion-provincial conference in October. And those problems will have to be solved.
May I approach the minister's estimates with this general point of view: I would like to congratulate the minister upon the work he has done already in his department, and I would say for the record, so that people out in the country who read may learn, that this is the minister's first year, and that he is not responsible for the unhappy conditions which have developed in Canada but which he, and men like him who will succeed him, must solve, or see the Canadian nation probably fall apart. As I said, I should like to congratulate him upon the way he has taken hold of the general situation. What I shall say is not in any sense by way of criticism of the minister, but simply a matter of reviewing the problems and of seeing whether or not we can find some ideas that might solve those problems, ideas which up to the present time we have not put into operation or implemented.
I was impressed, as I am sure were other hon. members, by the speech delivered by the hon. member for Winnipeg South Centre on May 10. It was a thoughtful speech, and was the first of its kind I had heard given in the house. It greatly impressed me. He said, in effect, that the parliament of Canada is losing its prestige because, whereas parliament should lead the nation and should lay down policy for the provinces to follow, what is actually happening is that the provinces, after seeing the dominion government in operation for the number of years it has been in office, have given up all hope of solving their problems through the federal government, and are now seeking more and more to hold provincial conferences of the kind they held when the federal government was first established.
I thought the hon. member's speech was well developed, and that there was good sound reasoning in it. If there is truth, if there
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is validity in the general position taken by the hon. member, I am sure the minister will agree with me that the situation constitutes a real challenge to Canada. It is a challenge to the finance department. Just to indicate how serious the situation could be the provincial representatives who will meet in these conferences will have much less opportunity of devising new ways and means than there would be in the minister's department, in the cabinet or in a caucus of the Liberal party. Now, certain reasons will apply. In the first place, when the provincial representatives meet they will not all be alike politically in their thinking, or economically in their thinking. You can imagine the difficulty of seeing eye to eye that will develop between British Columbia and Ontario or Alberta and Nova Scotia or New Brunswick just because we have Social Credit thinking in one province and we have strictly Conservative thinking in another, whatever that means. I have never been able quite to figure out what Conservatives do stand for, but that is a sufficient indication of the difficulty.


Mr. Lennard:: We know what we stand for.


John Horne Blackmore: The way is open for you to tell. I do not hesitate to tell what we stand for, but I have never heard Conservatives say what they stand for. I am merely illustrating Ihe point that there will be a tendency for a clash between those who meet in provincial conferences.
Again, the average provincial expert is not a federal expert. A man who has spent his life working on provincial problems has not had the opportunity to think federally. Consequently, for a group of provincial men to grapple with the problems of high finance which have to be grappled with by the minister and his department is just a very difficult thing, perhaps a high improbability.
There will also be a clash of sectional interests among members of the provincial conference. For example, the interests of Ontario or Quebec are certainly not the interests of Prince Edward Island, and they are not the interests of Saskatchewan. There will be a clash of sectional interests, and then there will be a shortage of time and there will be a lack of finance to employ the best experts. Consequently, I see, or I think I see-I do not want to be too gloomy; I want to face facts as they are-a real danger implicit in the development of more and more provincial conferences with the object of solving the problems of Canada taking precedence over the dominion government. Therefore, I do not see very much hope ultimately from the provincial conferences.
I am sure the minister saw the report of Premier Smallwood's statement to the effect

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that he would be leading a secession move. I know the Prime Minister more or less endeavoured to gloss this over in the house, to laugh it off; but I do not think the report which we find in the Ottawa Journal justifies one in treating lightly what this man said. In the Ottawa Journal of June 21, 1955, we find this statement:
Newfoundland may quit Canada, premier's threat.
St. Andrews-by-the-Sea, N.B., June 21-(BUP) -
Premier Joseph Smallwood threatened last night to lead Newfoundland out of confederation with Canada unless the federal government stopped discriminating against the four Atlantic provinces, including his own.
Smallwood issued his blunt notice at the annual meeting of the Atlantic association of broadcasters.
His threat of quitting Canada was given added weight by the presence of premier Henry Hicks, of Nova Scotia, a Liberal, and premier Hugh John Flemming, of New Brunswick, a Conservative. Flemming introduced Smallwood in glowing terms and Hicks praised him for "talking the way we should in the Atlantic provinces".
This is what is reported further:
Economy Lopsided
"This may not be good Liberalism, nor good politics", the aggressive premier of Canada's youngest province Said. "But Canada is not just four provinces, Quebec, Ontario, British Columbia and Alberta. It is 10 provinces."
"The Canadian economy is becoming lopsided. The federal government will spend billions of dollars in war contracts in Ontario and Quebec. There is nothing wrong in those provinces becoming industrial giants", Smallwood said. "But if they are to show statesmanship they should make every province economically strong."
"It is not good for Canada to leave these Atlantic provinces to their own resources," he said.
His thinly-veiled threat:
"Before we become second-class citizens of Canada, we will show the other maritime provinces how to get out of confederation." There was a storm of applause from the audience.
I am not just sure that I have the completion of the statement, but I believe this is the completion of the press report. In any case, it is sufficient and I think I shall leave it at that. There is enough warning in it, I would say, to make anyone in Canada very serious.
It must be quite obvious to anyone who stops and thinks a little that when any province came into the Dominion of Canada there was implicit in the contract the ideal that that province would be able to share on equal terms all the good things that all the provinces can produce. If that is the case, and I see no way of explaining the proposition away, then undoubtedly there is a very heavy responsibility resting upon the minister and his department to see to it that every province in this dominion is able to share adequately in the good things that Canada can produce. Up to the present time that happy condition has never been brought about by any government that has held
[Mr. Blackmore.l
power in Ottawa. I maintain there is no reason why it should not be brought about. Evidently Premier Smallwood feels about the same way. In other words, the dominion government has utterly failed in the major responsibility of seeing that every province in this dominion shares equally in the good things this dominion can produce.
The question is, what are we going to do about it? My general position, Mr. Chairman, is this. We can keep on carrying on in this parliament for a hundred years, using the same ideas which we have employed up to the present time in managing this country, and never change the situation at all. Now, what can be done about it?
The other day in another connection I said this: If we could create money, as was done under the Finance Act of 1914, if we could create money in Ottawa and issue that money to Nova Scotia, to Prince Edward Island or to any other of the maritime provinces, if we could do that, we would enable those provinces to buy any goods available for sale in the Dominion of Canada.
I will ask anyone in the committee and anyone in the country whether that is not true? If we undertake to tax money from the more fortunate provinces of Quebec, Ontario, Alberta and British Columbia and give that money to the maritimes, obviously we are being unfair to those provinces from which we tax the money. But if we can create the money as was done, remember, under the Finance Act of 1914-to anyone who wants to talk about funny money I say, just fix your eyes on the Finance Act of 1914 and hold your peace until you see your way through. If we can create money as they did under that Finance Act and put that money into the hands of the people, what will happen? They will be able to enjoy the good things that the other provinces produce and will provide markets for the other provinces, which is exactly what we all want, and at the same time the process will cost no one a dollar.
I do not feel that it would be becoming for me to go on with this problem too far before I gave a hint of what might form the solution. Let it be borne in mind that we are in an age of superabundance. Surely everybody knows that. Not only do we have the production which we have been able to bring into being in each of the various provinces of Canada, not only do we have that and all that we can bring into being in the future by similar means, but we are now entering into whole new fields of productive capacity, as is witnessed by a report in the Ottawa Journal of June 11 stating that the atom is opening the way to synthetic foods.

Every hon. member has heard about the culture of algae and of the simply astounding things that are possible with respect to producing through algae culture every kind of food for human beings. If we brought into Canada the use of the atom to produce synthetic foods and the use of algae to produce new foods, can anyone conceivably see any reason why the people of Nova Scotia, New Brunswick, Newfoundland or of any other province should be in the slightest degree in need? If they continue in need, then it is somebody's fault and the only one whose fault it could possibly be is the Minister of Finance, except in so far as he might be bound by a lack of comprehension on the part of those who are about him. I suggest that the solution which I have offered thus far constitutes a way around the difficulty I have mentioned and that without that solution there is no way around. Let anyone who wishes to answer what I have to say tell where there is a way around.
There are some eleven serious problems facing Canada. The first is the centralization of industry and population and consequent control in Canada. In the last redistribution Saskatchewan lost members; other provinces lost members. Where did those members go but into Ontario and Quebec? What does that mean? That means that the political control of the destinies of Canada to the extent that members went from the western and eastern provinces into Ontario and Quebec was further centralized in Ontario and Quebec. Under those circumstances how can we pretend that we have in Canada a growing democracy?
What is the solution? Obviously it is the decentralization of industry. How can industry be decentralized? I am thinking at the present moment of a woollen mill which was established in Magrath in my constituency. We thought we had everything necessary to set up and run a good woollen mill, but we could not manufacture any goods to speak of that could not be manufactured in Ontario and Quebec and sent out there to undersell our goods and put our mill right out of business. Under circumstances like that, tell me how we can ever decentralize the business of textile manufacturing and establish any considerable amount of it in Alberta, Saskatchewan, Nova Scotia or Newfoundland.
It is one thing to talk about decentralizing industry; it is another thing to do it. Saskatchewan under its government has made noble efforts to establish industry, but they have come into collision with the same forces. The great sums of money which they have expended in establishing these industries,
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absolutely soundly expended, have been lost. It has been shown once more that it is going to be impossible in this country-unless something is done-to decentralize industry in any real sense of the term.
How are we going to get around the difficulty? I maintain that if it is possible to use money in such a way as to subsidize the price of woollen goods or textiles manufactured in southern Alberta so that they may compete successfully with those produced in Ontario and Quebec, then by that means we can enable industries to develop in Alberta or Saskatchewan. By that means we can enable industry to develop in the four maritime provinces thereby providing in them employment and increasing population and the use of their resources.
If there is any other way in which it can be done, let anyone who thinks he knows that way rise in this committee and tell us. If there is any reason why it cannot be done by that means, let anyone rise and tell us why. That is the first problem. That is the problem that Mr. Smallwood pointed his finger at. Unless we can get industry developed in the other provinces we can never be anything but hewers of wood and drawers of water in the eight provinces of Canada; hewers of wood and drawers of water for Ontario and Quebec, although those two provinces may not want it to be that way at all.
Another problem is the inadequate use of resources, which ties right in to what I have just said about the development of industry. If we cannot have woollen mills in southern Alberta we cannot use our sheep and our pastures to the advantage to which we could use them if we could manufacture our own textiles in southern Alberta. Therefore all those resources are lying idle, and so with the great resources of the other less favoured provinces. Their resources are lying idle while the resources of the two central provinces are being used in large measure. Obviously that is not a sound state of affairs in a country like Canada and in a world which requires so much production. What are we going to do about it? I maintain that there is a chance of solving it by using a monetary technique and I maintain that there is no chance of solving it by any other means.
The third important problem is the inadequacy of provincial control over credit. When the Social Credit government went in in Alberta-I am using this as an illustration- we found the bankers presiding at their desks like lords over domains. If a man came in to seek a loan he almost had to get to his knees or lower down and plead for it. If

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Alberta had no means whereby she could bring pressure to bear on the banks to lend money to men who wished to produce, how could Alberta possibly have any real control over the prosperity of her people? When loans were granted Alberta borrowers had to pay 8 per cent. The ordinary farmer who needed to borrow money to produce a crop had to pay 8 per cent, and even at that he had his note discounted. The hon. member for Peace River was one of the members of the Social Credit government who faced the problem in Alberta. It is quite obvious that when Alberta began we had no effective control at all over our credit in that province. Would anyone pretend that a state of affairs like that was sound, or that a province had any chance whatever of giving good government while conditions like that prevailed?
I am going to tell you something about the maritimes. When the maritimes were independent, Nova Scotia and New Brunswick had their own banks. People could go into those banks and borrow money to set up any kind of industry which the banks might consider a sound proposition. After they entered confederation, it was not long before large banks such as the Royal Bank of Canada, the Bank of Montreal and other banks in Ontario and Quebec acquired a controlling interest in the banks in the maritimes and were able thereby to bring to Toronto and Montreal the control of lending in the maritimes. There were even cases where industries whose products were competing with corresponding industries in Ontario and Quebec were cut off from credit and closed up. As long as a condition like that continues, Nova Scotia, Newfoundland, or any other province similarly situated can only pretend to be able to control its own household.
What did we do in Alberta? First of all we set up a treasury branch. I am using this to illustrate what I mean by provincial control of credit. Fortunately, according to our constitution the Alberta government had a right to loan money from the provincial treasury. I think there were only two provinces that had that right. The hon. member for Peace River, faced with the problem, conceived the idea of setting up a branch of the treasury in a given place to allow people to come in and borrow money.
He saw that the day would come when such treasury branches would be established all over the province, and those treasury branches would lend money to men who were worthy of credit at 5 per cent interest. Imagine the difference to the economy of Alberta when every dollar borrowed by Albertans could be borrowed at 5 per cent, as contrasted with 8 per cent from the banks.
[Mr. Blackmore.l
Those who talk about Alberta's prosperity depending on her discovery of oil completely overlook that little matter, which is a very big matter.
As soon as the treasury branches got into operation, the banks realized that they were losing money, and I know of bankers who buttonholed in the street men whom they had previously refused, telling them they could borrow money now and at lower rates. The result was that the treasury branches enabled Alberta to bring down the bank rate and bring down the requirements for borrowing money. So it was not really necessary to establish treasury branches all over the province in order for Alberta to exercise control over her credit. If we could let Nova Scotia or any other province that has had difficulties of the same kind have treasury branches, they could do something similar to what Alberta did, with tremendous advantage to the economy.
We went further than that, and this is just another illustration. When our Social Credit government assumed office in Alberta, all the money our municipalities were borrowing in order to put in waterworks and other facilities had to be borrowed, almost all of it, in the open market and that generally meant New York. They paid a high rate of interest, 6 or 7 per cent. You know what Alberta is doing now? As a result of the blessings we have had through wisely managing our oil, we have been able to save a considerable amount of money, some hundreds of millions. We have used that money to lend to the municipalities, to electrification organizations and to other organizations at 2 and 3 per cent, thereby saving a tremendous amount of money to all those municipalities. We have been lending the money on much longer terms and on such terms that all the interest on the money that used to go to New York stays home in the province of Alberta.
The hon. member for Peace River reminds me that that sort of thing prevents competition in the open market. With our provincial debt, when Social Credit went in our over-all rate was 4 9 per cent. Now it is 2 78 per cent.
I have said enough to indicate what I mean by a province controlling its credit. If any province cannot control credit within its boundaries, it can hardly control anything with respect to its economy. Nothing has been done throughout the years by any minister of finance of Canada to remedy that situation. Are we going to let that state of affairs continue, or are we going to do something about it?
Here is another important problem. There is inadequacy of provincial control over markets. I referred to that in connection with

a local textile mill in Alberta. If a province establishing an industry within its boundaries is to be denied access to the markets of that province, certainly it is denied everything that can make the industry succeed.
That is one of the serious mishaps that-occurred to the provinces when they entered confederation. Before Nova Scotia and New Brunswick entered confederation they were able to have their markets themselves. Now their markets belong to Ontario and Quebec. That state of affairs simply cannot continue.
I hope the minister sees that. If we are ever going to have a sound, economically healthy and happy Canada with the population all over the country using our resources and benefiting by them, some sort of device must be worked out whereby any given province can at least have some kind of control over its own markets.
People will ask, "How are you going to accomplish that?" You do not need to set up tariff barriers. All you have to do is subsidize the goods produced in the province sufficiently so that similar goods coming in from Ontario and Quebec will not be able to undersell them. You do not have to set up tariffs. Will anybody tell me that device would not work, if you had the money? Will anyone tell me that device could not be applied with almost infinite benefit to the maritime provinces, Saskatchewan and Manitoba, if we had the money?
Another problem we face is this. It has been emphasized-and I know the minister is worried about this-by what has happened in Canada since 1946. The minister knows that in 1946 the dominion government permitted the steel companies of Canada to raise the price of steel by $5. Immediately the steel workers struck, and they continued on strike for 82 days until finally they were granted a share of the money that was involved in that increase. That increase of $5 a ton raised the price of goods all over Canada, directly and indirectly, to the terribly high prices they are at now, and cut the value of the Canadian dollar from $1 to about 53 cents. Because labouring men all over struck for higher wages, the cost of production of everything again went up, and so we are where we are now.
The provinces suffered by that rise in prices. The loss which Alberta and other, provinces- in fact every province-sustained by reason of that rise in price because of that move in connection with steel only-not because too much money was put into circulation-is almost beyond the power to compute. And the provinces could do nothing at all about it.
As to the power in Canada that might have done something about it, what did they do?
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What did the finance minister of those days do? He did just completely nothing. The provinces were left all unprotected against that terrible rise in prices. Now what do we find? We find another rise in steel prices, if you please, down in the United States which will result before very long in another rise in steel prices in Canada, comparable no doubt with the $5 increase in 1946. And what do you suppose that price rise will do to the value of the dollar? If it does not cut the value of the Canadian dollar in two again I shall be greatly surprised.
What is the minister thinking of doing about the matter? Are we to turn the provinces over to the spoilers again so that billions and billions of dollars can be literally stolen again from the people of the various provinces by the men who are in a position to produce and sell goods? That is what I mean by inadequacy of dominion control over prices in Canada.
Some people may say, "Do you propose slapping on iron-clad controls?" My reply is, "No, I do not propose anything nonsensical like that." Social Credit does not favour iron-clad controls. Social Credit favours persuasive means through a monetary technique similar in principle to the one I have indicated, giving a province control over its own credit. In 1935 a law might have been passed forbidding interest rates above 5 per cent. That law would be a control, but it would not have been anything like as effective. That procedure would not have got us very far. What did Alberta do? By competition she brought the interest rates down in a way that laws and controls never could have done. There are devices of that sort that can be used. All we have to do is to explore them if we can get the money. Now can we get the money?
The important thing to bear in mind is that money is only a ticket for goods. You cannot have any money on a desert. The more goods you have in a country the more money you can have, for the real backing of money is goods. We can produce goods to further abundance in Canada. The minister expects $26J- billion this year in Canada, does he not, and probably much more than that. I am positive we can easily double that amount if we set about doing it. If there were enough markets and sufficient demand in Canada, we could probably double that $26 billion. If we can produce the goods, why can we not have the money? That is a point which needs careful consideration.


The Deputy Chairman:: I am sorry to be compelled to interrupt the hon. member, but it is my duty to inform him that his 40 minutes' time has expired.

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John Horne Blackmore: Thank you, Mr. Chairman. I shall continue this discussion after a while, when I have an opportunity.


Mr. Maiheson:: Mr. Chairman, my reason for entering this debate at this time is the fact that a few days ago I had a communication from an important part of our potato industry expressing concern over the forecast surplus production of potatoes in the United States to the extent of an estimated 50 million bushels.
Most of my remarks will concern the potato industry in my own province, but I should like to point out that the problem of which I speak is of concern to the industry right across Canada. Representatives of that industry across Canada met and expressed their concern to the tariff board at a hearing requested by the minister. I do not think 1 can introduce my subject in any better way than by reading a few excerpts from the letter or order which the minister gave to the tariff board at that time. I quote:
I have received numerous representations to the effect that there has been a significant increase in imports of potatoes in recent years, and that this has caused serious concern among Canadian potato producers.
In these representations it has been urged that the customs duty on potatoes be increased and that tne period to which the seasonal duty applies be extended.
That ends the quotation for the time being. I might note that the letter then gives the tariff scale, which indicates that except for the period between the middle of June and the end of July there is no tariff at all on United States potatoes coming into Canada. I should explain that United States potatoes were not indicated as such, but United States potatoes are what we are concerned with. They are what is referred to in the letter as getting favoured nation tariff treatment.
The minister asked the board for the most complete information that can be obtained regarding production, consumption, marketing, imports and exports of potatoes, and the effects on Canadian producers and consumers of the operation of the Canadian tariff relative to potatoes in their natural state. I might say that the tariff scale was arranged, I believe, about 16 years ago. At that time I think perhaps it did make good sense. W. J. Callaghan, a former tariff commissioner, a native islander who grew up not far from my own home, said this in part in presenting the brief of Prince Edward Island to that board:
In former years we exported substantial quantities of table stock to the United States and imported supplies from that country only when fresh supplies were not readily available in our own country, or in the occasional year when our domestic crop was below normal.
[The Deputy Chairman.]
But I might say that the trend has changed. In recent years United States imports have reached alarming proportions. After the cessation of United States guaranteed prices-I think it was in 1951-the United States growers apparently found there was a ready market available close to home, so they poured their spuds into our country. Now they ship in more than we ship to them. In the last three years, for example, we have shipped 7 million bushels to the United States and they have shipped 9 million bushels into Canada.
As I have indicated previously, when the present tariff structure was arranged apparently it made sense. The potato movement between this country and the United States was a one-way movement for the most part, certainly so far as the late crop was concerned. But that is true no longer. By the way, this tariff which is now in effect for six weeks in the summer is designed to protect the very early growers in Canada, and I believe it applies to those in southern Ontario and southern British Columbia. With that I have no quarrel at all. I am just pointing out that fact. I should emphasize again that those people ship their potatoes into Canada without any duty at all except for the period I mentioned. I might explain that we pay 37 i cents on our quota, which is 21 million bushels of seed potatoes and 1 million bushels of table stock, and 75 cents per hundredweight on anything over that amount.
It is interesting to note that the United States quota of one million bushels of table stock is just a little bit more than one-quarter of 1 per cent of their average production. But in the last few years they have been shipping more than 3 million bushels into our country, and this compares with an average annual production here of some 58 million bushels.
My study of the situation indicated that people generally from Prince Edward Island to British Columbia were concerned about this problem. They showed that in the concerted request they made to the tariff board. I should explain that Newfoundland was not represented, . and I can find no trace of Saskatchewan being represented.
In the hearing before the board there was talk of bigger acreage and that more machinery might be employed. It was suggested that large commercial growers using
mass production methods could meet United States competition without tariff changes. It was explained in the brief of the horticultural council representing Canada as a whole that less than 4 per cent of the registered United States growers harvest 77 per cent of the acreage and produce 91 per cent of the total crop. It was stated that generally

speaking the Canadian production is a part of the average farm program, although there are exceptions.
The statement was made to the board that in my own province the average grower has about 5 acres of potatoes. I think that is true, although there are exceptions of people who grow much more than that. I think there was fairly general agreement on the idea that we have to decide in this country the pattern of farm life we want not only to adopt but to keep. I think it was pretty generally agreed, too, that we should follow the family farm idea as much as possible. That was emphasized by people from my own province. I liked very much the reaction of Commissioner Leduc. Commenting on this phase of the discussion, he said:
It seems to me that you are fighting for a pattern of life-a pattern of agriculture. It is a pattern of life you are talking about, and I see the force of your argument because if you start to speculate the other way you do not know where you are going to stop. The only stopping place is Russia where you would have one producer . . . It is a way of life you are trying to protect and develop.
It was indicated to the tariff board that the average consumption of potatoes has fallen. Several reasons were given. I was interested in one particularly. It was said that the modern slimming trend comes into the picture. It was suggested that milady, with an eye on her figure, the hope that someone else would have an eye on it, has stopped eating potatoes. I find that Canadian consumption is 170 pounds per capita, while that of the United States is 100 pounds. It was stated at the hearing that there had been a sharp drop from 30 years ago. I looked into the problem and tried to find some statistics, but I could not find anything to indicate just what the consumption was 30 years ago.
I know the minister has taken this matter seriously. The fact that he ordered an investigation by the tariff board indicates that. I might say again that the people at home are very concerned about it, and they are asking for the most favourable and speedy treatment that is possible. Perhaps the minister may be able to make some statement at this time. I do not imagine the matter lends itself to speedy treatment, but I believe it would be helpful if we could have some indication of what is in the minister's mind with respect to this matter.


Mr. Hamilton (York West):: Mr. Chairman, I was thinking before I rose that it almost takes as much courage to speak on the last day as it does for a new member to make his first speech in the house.


Walter Edward Harris: Hear, hear.
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John Borden Hamilton: I did not commence my first speech with generous congratulations to anyone, as apparently is the custom, so before I go on perhaps I might say that as one of the newest members here I have appreciated very much the way all hon. members have treated my remarks and the friendly spirit in which all parties have made me feel at home in the House of Commons.
I only intend to direct my remarks to one problem at this time. We in our group are very disappointed that again this year no plan has been provided to alleviate the rather unhappy position in which self-employed people find themselves in connection with providing some security for their old age. I think our record is quite clear with respect to this particular problem, because in reading Hansard of 1953 and 1954 I find that we set out very clearly that some relief should be given to this class of people. I am not going to repeat the arguments put forward in those two debates at great length, but I would refer hon. members to Hansard of April 10, 1953. pages 3702 to 3708 and Hansard of May 18, 1954, pages 4858 to 4863.
Here is a class of people who more than any other group in the country can, I suppose, be classified as a free enterprise group. It includes storekeepers, fishermen, farmers and professional groups of all kinds. We have seen a steady progression in legislation benefiting people so far as making some plans for their old age is concerned, but at no stage of development has there been any provision for income tax exemption in the case of those who are self-employed covering their contributions toward a retirement scheme as is allowed to ordinary employees. I think the arguments against some type of consideration for this group were very ably summed up from the standpoint of the defence by Mr. Abbott, the predecessor of the present Minister of Finance.


Walter Edward Harris: On a point of order, I think I am quite within both my rights and the privileges of the committee in pointing out that this subject was raised during the budget debate and surely should not be the subject of a second debate. I know that on the administration item of my department one could presumably criticize my own conduct but, I should think, in connection with administration and not in connection with taxation matters that have been settled by resolutions and bills of the house.


John Borden Hamilton: Mr. Chairman, I certainly think the matter could be considered to be in order, since in the first item which we are now considering we find a reference to an amount set aside to cover the
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administration of employees' instalment purchase plan and employees' group insurance plans.


Walter Edward Harris: There is nothing in the item for self-employed people.


John Borden Hamilton: That may be quite true, but surely if we are in a position at this time to debate the efficacy of a type of plan provided for people who are employed by the government of Canada, we should also be in a position to debate whether the government should make some provision for those who cannot qualify under such a plan as set out in this item.


Edward Turney Applewhaite: On the point of order raised by the Minister of Finance, I would express the opinion that if the hon. member for York West is criticizing the administration by the Department of Finance of an existing act he is in order. But if he is recommending a change in the substantive law of the country; if he is recommending that something be there which has not yet been put there, and therefore which cannot have been mishandled by the Department of Finance, then there is not any administration which he can discuss under this question.
I think it is only fair to say that the hon. member did me the honour of asking me on what item this matter should be brought up. I had noticed that there was a reference in the administration item to the administration of employees' instalment purchase plans and employees' group insurance plans. But I pointed out that if this referred solely to plans dealing with employees of the government, then the discussion would have to be restricted to them.
I think the Minister of Finance is correct in stating that a discussion would be out of order at the present time, when the hon. member seeks to raise a point which could be adjusted only by budgetary action and not by departmental administration. If that is so, then with some regret I must suggest to the hon. member that his discussion comes too late in this session.


John Borden Hamilton: Do I gather that the tenor of my remarks would be admissible if I were criticizing in some respect the action of the minister in his capacity as Minister of Finance in not recommending some type of change in the Income Tax Act which would provide for this type of person? Is that in effect what the chairman is saying? Or am I prevented from criticizing in any way the administration of the minister's department in connection with this particular subject?


Edward Turney Applewhaite: Perhaps I might make a suggestion, one which I trust will not be accepted as a precedent. It is that if the hon. member were to state briefly the point he wishes to raise, by that time he would have raised it. And even though I might find it necessary to rule it out of order, I suggest that at this late stage of the session it might be done. But I would not want to be held to it as a precedent.


Walter Edward Harris: On the point of order; since you were consulted, Mr. Chairman, I would not wish to intervene at all. Had I known that, I would not have spoken. On the other hand I think it is fair to the hon. member to say that he is quite aware of the situation, and that our general debates throughout the session-debates on the speech from the throne and the budget-give full scope for proposing to the government those schemes which are not presently adopted; and those are the occasions when such proposals can be made. Indeed, as I have pointed out, they were made in the debate on the budget, because I recall discussing the matter with the hon. member for St. Paul's.
I think it is quite correct to say that on these items I can be criticized only with respect to the administration of those statutes which I am charged with the responsibility of administering, and not those which the hon. member would like to have on the statute books. Nevertheless, as I have said, I hope the hon. member will be brief in what he says, particularly since he consulted with Your Honour.


John Borden Hamilton: Perhaps when I opened my remarks I should not have been so generous in what I said. If I had added that I intended to take only ten minutes this particular issue might not have been raised.
To continue, I would refer hon. members to page 3703 of Hansard for 1952-53. I am not going to read what appears there, but I am going to say that the case for the defence was summed up by the minister's predecessor in office along three lines, and they were these. First of all, that there is a tendency to exaggerate the differences which may arise because of the concessions made to the employee under plans of this kind, which are not available to the employer. Secondly, there was the point that the employer who does set up a plan for himself, on which he is paying income tax, has the funds available to use for various purposes in cases of emergency. The last point made by the minister at that time was that of course this application for assistance came

from people who were represented by organizations, and what are we going to do if all persons wish to become involved in this type of plan?
First of all the minister did point out that in connection with the employer type plan, the self-employed type plan, deduction was allowed from income for any of the interest accrued in the plan, whereas in the employee type plan the employee had to pay interest on his investment in this type of protection.
Let me say this, that it would take many years before there would be any equality in connection with the saving by one method to the employer of the penalty imposed on the employee in the way of taxes on the interest on his money. As a matter of fact I think if we took a case where a deduction of $900 was allowed to the employee and we calculated interest on that deduction, it would probably take 15 years before the two parties would be placed in the same situation.
The second point which was argued against our stand was that the employer type annuity or plan placed an asset at the disposal of the employer, which was not the case with the employee. Funds in connection with the latter's plan were frozen, and he had not access to them. Surely that is a defective answer to this situation; because obviously if there are types of emergencies in the case of an employer, the funds which are required, in I would think by far the vast majority of cases, are required to continue or enhance or prolong his business which, in turn, provides employment for the various people working for him. If we are going to take that attitude, then of course we will dry up the source of employers, and there will not be many people to work for, unless it is the state.
In connection with the third argument against the position we have taken, that it would necessitate people being in an organization like a law society, a dental association or a medical association, I do not think that argument holds water either. I am sure that if this type of proposition were put before the free-enterprise insurance companies their group departments would certainly be in a position to provide coverage for any employer who desired to take part in such a plan.
Now it is a proposition, so far as we are concerned, of putting up a case for a group of people who do require assistance to provide for their old age. It is one of the cardinal principles on which we operate that if at all possible old age is something for which the individual himself should make
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every effort to take care. We are attempting by various government measures to supply supplementary benefits to take up the slack for those who cannot provide during their lifetime for all they need. If that is so, then this or any other government should be taking very positive steps to ensure that all classes of people are put in a position to provide security for that time. And without repeating the arguments that have been made previously in connection with this matter, as the minister has said, what I have said today does echo some of the remarks of the hon. member for St. Paul's. It also repeats some of the arguments of the hon. members for Eglinton and Greenwood.
I would respectfully suggest to the minister that as he begins his second term in office, some consideration should be given to that group of people without whom this country could not have achieved the stature it has today.


Harold Edward Winch: I am sure we all listened with a great deal of interest to the 40-minute exposition of the hon. member for Lethbridge on monetary theories. Ninety-five per cent of his 40-minutes were spent in discussing monetary and fiscal policies and monetary and credit theories. I am certain all members, and especially when we sit as backbenchers in the opposition, appreciate the courtesy and forbearance of the Minister of Finance, in that he has not interrupted in any way whatsoever. That being so, sir, I hope the Minister of Finance will also give me the courtesy of a few minutes for a practical discussion of fiscal policy that can only come under his direction, and on the practical issue of fiscal policies that were impossible to discuss until the present time.
As Minister of Finance I am certain he would like to make known to this House of Commons and to the people of Canada what he has in mind to recommend to the government in view of the situation which has developed in Great Britain only this week. Canada is an exporting nation. Export is trade; but as Canada does not trade on a reciprocal trade basis but on a financial trade basis, the situation which has developed in the past two days is of the utmost importance. The man who can give us the greatest direction in Canada is the Minister of Finance. As long as the present situation exists in Great Britain, the man who is more responsible than any other man for the economy of Canada is the Minister of Finance.
As the minister undoubtedly knows, on Monday the London stock market had what was described as "black Monday". I think we all know of the orders issued by the chancellor of the exchequer, R. A. Butler, in

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London that day. It can only be interpreted as meaning that in Great Britain inflationary profits are to be regulated. If we can go by press reports from London, because of the prosperity in Great Britain, they have to go on a financial basis which indicates that they must have even less in the way of imports related to exports. In other words Great Britain has to export more and consume less in order to live if the position of the pound sterling is to remain strong. This actually means, sir, that in Great Britain the declaration of Mr. Butler is that they have to lower their standard of living. Since Canada is dependent to a great extent on her exports to Great Britain I should like to ask the minister a direct question, because I think it is basically a matter of financial policy as far as this country is concerned and therefore comes under the Minister of Finance. Will the government of Canada at least in part come to the rescue of Great Britain and ship our Canadian goods and commodities, of which we have a surplus at the present time, in exchange for sterling credits while Great Britain has to go through this temporary- and, sir, I have every confidence in Great Britain; I think it is temporary-deflationary period? If not, does the financial policy of the government and of the minister mean that we in Canada are going to sit on our surpluses unless we can get payment in dollars?
I was very much disturbed by what I read in our Canadian press as to why this action had to be taken by Mr. Butler, the chancellor of the exchequer in Great Britain. I wish to quote very briefly a part of the report in the Globe and Mail of Tuesday, July 26. Mr. Butler is quoted as saying:
He set the background to his new emergency measures by explaining that Britain's very prosperity and increased production are at the root of the trouble.
There is an economic contradiction if I ever heard one. That is capitalism, but I am not going into that at the moment. He also said:
Too much was being bought at home. This meant increased imports which in turn had to be paid for by increased exports. But sufficient exports to close the gap were not forthcoming.
I am going to be completely honest; I am going to read the next paragraph, because this is what disturbed me.
Harold Wilson, a former Labour trade minister, accused Butler of worsening the balance of payments "by the frivolous way he has increased purchases of dollar commodities, such as grain, which could have been imported from sterling sources.
Sir, both the new regulations the chancellor of the exchequer has put into effect in Great Britain and the criticism of a former Labour minister that part of the difficulty
fMr. Winch.]
was caused by the frivolous purchase of goods from dollar countries, should bring home to us right now a very serious situation and one on which, even before this House of Commons closes, we should have an understanding from the minister who is in charge of our financial obligations and relationships.
As to the position of Canada, we can only live by exports. If countries to whom we export goods, because of their monetary situation, have to bring in regulations so they cannot take our exports, then the situation in those countries is detrimental to the standard of living of the people of our own Dominion of Canada. I do believe, sir, that means that we should have now a clear understanding as to whether the situation from the point of view of international monetary matters is being studied by the government and the minister, and whether he has anything to recommend.
At the last session we heard a great deal about the convertibility of sterling. We have heard a little at this present session. I admit that I am not a financial economist, but the entire matter has interested me. In view of this situation I was most interested to receive a copy of a communication signed by Sir Edward C. G. Boyle, who is the economic secretary to the treasury in the House of Commons in Great Britain, dealing with what an individual or a corporation in a Canadian dollar area can do if he is selling into a sterling area such as Great Britain. I want to quote briefly from it. I am not going to take 40 minutes as my hon. friend did. In brief, as far as Canada is concerned, this is the situation:
(a) Sterling earned by a resident of the dollar area, i.e. the American account area and Canada may be used:
(i)	to make payments in the sterling area;
(ii)	to make payments to any country outside the sterling area;
(iii)	to Pay for sterling area goods shipped to any country in the world;
(iv)	to acquire dollars on demand from a United Kingdom bank at a current market rate, or from any bank in the dollar area who is a buyer of sterling;
(v)	to purchase gold in the London market from authorized dealers.
I understand that because of its economic position Great Britain has been buying great quantities of gold from the U.S.S.R. and paying for it in sterling. They are prepared to pay in sterling or in gold; at least that is the interpretation I place on this letter from the economic secretary to the treasury in Great Britain.
Canada could have increased her trade with Great Britain in the past, or may be able to increase her trade at the present time, if we operated on a triangular trade basis. Perhaps I could explain that to hon. members who

may not know what I am driving at. We have been buying quantities of butter and cheese from New Zealand, which is in the sterling area. As I understand this information, we could ship to Great Britain, purchase from New Zealand or any other sterling area country and utilize our sterling credits from our exports to Great Britain to pay for our purchases in sterling rather than in dollars.
I am not going into the details, as I am sure the minister is conversant with the seriousness of this situation. I am convinced that Canada has a responsibility in what is now a time of trial and tribulation for Great Britain which once again has to go on something like an austerity program. We have the surpluses which Great Britain needs but which she cannot take. Mr. Butler said last Monday that she cannot take them because they have no Canadian dollars. Surely Canada as a part of the commonwealth could work out deals on some basis. Surely Canada with her love for the mother country will make our surpluses available during this time of need, and not demand dollars. We should be able to work within the five points set out by the treasury in Great Britain and utilize credits on sterling payments.
I should like to talk at length on this matter, but I am not going to take advantage of this opportunity to do so. I appreciate the minister giving me an opportunity to speak, and I hope he will be able to give us some indication that a study will be made of this problem which is facing our greatest market; and it is hoped he can work out some method whereby Canada can export and assist our mother country.


Mr. Pearkes:: Mr. Chairman, I want to take only a minute or two to endorse the remarks made by the hon. member for Queens regarding the tariff on potatoes coming into this country. I was particularly pleased to notice that the minister gave signs of approval, at least of the speech if not the subject of the speech, by applauding on his desk.
We on the Pacific coast are faced with the same problem confronting the maritime provinces. Early potatoes come into Vancouver and Victoria from California just as our own early potatoes are reaching the local markets. If the date on which the tariff is applied could be advanced say to May 1 it would be of great assistance to the potato growers on Vancouver island. I imagine the same thing would apply to the potato growers in the Ashcroft district in the interior of British Columbia, although I am not as familiar with that district as I am with Vancouver island. Within the last few weeks I have had complaints from potato growers who say that once again their market is being destroyed by early potatoes coming in
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from California. Perhaps the solution may be to advance the date upon which the tariff is made applicable.


Mr. Small:: Mr. Chairman, I do not think I shall take very long, but I have a matter to discuss that pertains to two different things. I suppose you could call it a matter of internal economy. It constitutes what might, be called a physical block or a fixation which is seeking release. Very few people seem to want to have anything to do with this matter, which concerns employees who work for the government.
These employees are grouped in certain categories. There are those who are seasonal and sessional, there are those who are permanent and there are those who are called permanent temporaries. I suppose you could classify seasonal and sessional employees who are fortunate enough to have year-round employment as permanent temporaries, while those who are seasonal and sessional could be classified as part-time employees.


Walter Edward Harris: May I point out that that is the responsibility of the civil service commission.


Robert Hardy Small: It has to do with superannuation. That is what I am working up to.


Walter Edward Harris: If the hon. member will confine himself to superannuation I shall be glad to discuss it.


Robert Hardy Small: This comes under page 202 of the details.


Walter Edward Harris: Which is superannuation.


Robert Hardy Small: Statutory payments under the superannuation and retirement acts; that is what I am getting up to. I realize that I am probably on difficult ground, but if you will bear with me I shall not take too long. Whether or not it comes up under this item it will come up eventually, and I think it will be in the interests of all concerned to take it into consideration now.
I refer to the possibility of giving some consideration to employees who are retired because of age. Some of these employees do not get the consideration that they are entitled to. Many of them have worked for the government for 20 or 25 years. If they are not in the category of permanent employees, or seasonal or sessional or what you call permanent temporaries, they do not receive the same consideration. Permanent temporary employees get the full benefit of retirement leave as well as sick leave, but while the seasonal and sessional employees get sick leave, if they do not use it up during the year it is not accumulated. The

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permanent and permanent temporary employees have the benefit of enjoying cumulative sick leave on the same basis as the full-time employee.
I think the minister realizes that we cannot say much about it now, but if a committee were appointed representative of all parties of the house it could take up this matter in respect to these individuals. It is something they cannot take up themselves. It is one of those unfortunate situations which very few members want to take up because it is not a pleasant task.
There is a grievance. There is an inequality which I do not think the members of this house want to see exist. A committee of all parties of this house should take up the matter with the' different departments, as it applies to almost every department; but particularly the Speaker's department. Under the circumstances the Minister of Finance should try to rectify this by adjusting the whole matter to the satisfaction of the staff who are unfairly if not unjustly dealt with.


Herbert Wilfred Herridge: I should like very briefly to support the hon. member who has just spoken with respect to superannuation arrangements for sessional employees.


Walter Edward Harris: Of this house?


Herbert Wilfred Herridge: That is the subject the previous member was speaking about.


Walter Edward Harris: I am not responsible for the House of Commons.


Herbert Wilfred Herridge: But I should like to point out that the Minister of Finance's department can do something to correct this, because some of the employees have been in touch with the officials in his department. At the present time there is a certain injustice and a certain confusion. I should like to draw the minister's attention to the fact that first of all the employees received a letter from Mr. R. B. Bryce, clerk of the privy council, informing them of arrangements for contributions to the superannuation account. That letter is countersigned by Mr. Leonard Hill and is dated 5th of May. Then they received a letter dated July 1 from Mr. Leonard Hill with further instructions. Then they received another letter from Patrice F. Cyr with further instructions.
After receiving all this confusing correspondence, one or several of them decided to telephone some of the officials of the minister's department. They advised them that a few of these letters were not correct, so they were more confused than ever. In addition to that, you see the forms that had to be filled out. Here is one of them. They
(Mr. Small.]
are asked to complete these forms. On making inquiries of personnel about some points which were not quite clear, they were informed it was not necessary to complete this form at all because of a certified minute from the treasury board.
In addition there are certain things in connection with the form that seem rather stupid. They are asked to give the day they joined the service. That is rather difficult for some women who have been here 25 or 30 years and, I think, quite unnecessary. But my point in rising was to urge that fairness be shown to these sessional employees who have worked here many years and who under the present regulations cannot take advantage of superannuation. I would suggest that the minister have an official of the superannuation branch meet these employees to discuss with them all the facts concerning the superannuation plan, because they are completely confused and they can only have the situation made clear by one of his officials undertaking to deal directly with them.


Mr. Regier:: Mr. Chairman, I shall be only a minute. I noticed the minister attempting to rise after the hon. member for Okanagan Boundary had spoken. I hope when he gives his reply in the house he will not neglect to answer the petition put forward.
It is a very serious situation. I have five municipal organizations in my riding. All of them are desperately in need of the operation of this fund. I should like to endorse the raising of the amount from $30 million to $100 million. The problem is becoming worse each year. If we look at what is being done by the Social Credit government of Alberta to aid its municipalities, the Liberal federal government would not want to have it said that it was able to give less aid to municipal financing than the Social Credit government of Alberta.


Solon Earl Low: Mr. Chairman, I assure the Minister of Finance that I do not intend to engage, or to attempt to engage, in a full-dress debate at this time. I rise largely because I feel it is my responsibility, even though the hour is late and the minister wishes to get through, to put certain facts before him for his consideration.
The minister is a new Minister of Finance. I consider him to be one of the bright minds of our country. I am not attempting to flatter him. I have known and admired the minister for some time. I have associated with him in various ways, and I have great confidence in his ability to look facts in the face. I would dearly love at this time to be able to

get the minister into a full-scale debate on his financial policy. However, the hour is late and it would be unwise perhaps for me to do so, but let me say that no one is to blame but the minister himself for not having had his estimates before the house earlier than this so we could engage in a full-scale debate on financial policy.


Mr. Martin:: He has been unselfish.


Solon Earl Low: He has been self-effacing and unselfish in helping the other cabinet members get their estimates through, and he is the kind of person who would wait until the last minute to get his own through. At the same time we like occasionally to have an opportunity for a full-dress debate on financial policy. We asked his predecessor on several occasions to allow us such an opportunity. His predecessor, who was a most affable man, did say, "Next session we shall try to make an opportunity''. That opportunity never came. I am hoping the present Minister of Finance will see fit-in fact, will feel it is his responsibility-to provide an opportunity for such a full-dress debate on his financial policy at the earliest possible time. As I say, I hope he will, but just in case he does not-


James MacKerras Macdonnell: Would the hon. member permit a question?


Solon Earl Low: Yes.


James MacKerras Macdonnell: Does he still hope that the finance estimates will come in any year on anything but the last hour of the last day?


Solon Earl Low: I suppose that is naive of me, and perhaps it is the triumph of hope over experience, but I still have hope, and I am pleading with my hon. friend the minister to be wise enough at another session to give us that opportunity. .
I might tell him that I am actuated by two inducements at this moment to say a few words about his policy. The first inducement is this. The Ottawa Journal of May 31 of this year carried an editorial calling upon members of parliament to stay on the job until the unemployment problem was solved. We have not solved it by any means. It looks as if we are close to prorogation, and we shall not be on the job to solve it. But I believe the major factor in the solution of the unemployment problem in this country is financial and monetary. Because I believe that, I certainly am not doing my full duty toward the Canadian people and discharging my responsibility to them if I do not at this time bring before the minister and his colleague, the Minister of Justice, certain things I would like them to study and consider during the period between now and the next session.
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For the information of the hon. member for Greenwood, if the minister does not bring his estimates down early next year, it will be my determination to bring in either a bill or a resolution which will make it necessary for him to debate his financial policy on something other than his own estimates, and I believe we shall be doing the country a service by having that sort of thing.
I couple the Minister of Justice with my friend the Minister of Finance because I see him in the house today, and I would want him to hear what I have to say. I hope he will do me the honour of listening for just a minute or two. I know that he is an extremely busy man, but I am sure he can spare just a few minutes to listen to what I have to say.
I want to say this to my hon. friend, and it is completely in connection with the financial policy of the country. His colleague the Minister of Justice recently paid us a visit in the province of Alberta. We were glad to have him. It was a good thing, and we welcomed him as best we could. He was there, of course, attempting to justify the policy of the Minister of Finance by telling the people, "What is the use of attempting to send back from this particular constituency a Social Credit member? Why do you not send a Liberal?" That was all right. It was his privilege to do that.


An hon. Member:: Was he speaking to the Canadian Club?


Solon Earl Low: No, he was speaking to an extremely interested audience in a constituency called Battle River-Camrose. He was trying to tell the people why it would be wise to send a Liberal and not a Social Crediter down here. In the course of his remarks he made a statement which I think should bear some examination. If he is reported correctly in the press he said, "No top-ranking economist has ever endorsed the Social Credit proposals."


Stuart Sinclair Garson: That is correct.


Solon Earl Low: The minister nods his head and says that is correct. Hansard does not record a nod either this way or that way. For that reason I felt that we should describe the nod. He made a statement which I think should be made in a forum where he can be answered. I could not be on the same platform with him because I was not invited to the Liberal meeting, but I can be with him in the House of Commons.
I am now going to say this to the Minister of Justice, and I am trying to be as calm and reasonable with him as possible. I am going to say to him now that he has a wonderful opportunity right now, during the discussion of these estimates, to stand up on the floor of this house

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and debate that question. I am going to give him a little bit of homework to do. I maintain that the minister was completely wrong and uninformed, and that because he was wrong and uninformed he misdirected the jury which was composed of the voters of Battle River-Camrose. They realized, of course, that they were being misdirected and did not take his advice. But my comment is that he overlooked-


Stuart Sinclair Garson: I admit that they were misdirected, because they elected a Social Credit candidate by a very narrow margin.


Solon Earl Low: I said they were misdirected by the Minister of Justice, Mr. Chairman, and that is the contention I make today. That is the subject I want to discuss just briefly. To my hon. friend who perhaps has not had time to go into these things, let me point out what Social Credit proposals are, first in the financial field.


Mr. Harrison:: Write us a letter.


Solon Earl Low: Of course if my hon. friend wishes me to take a great deal of time I can do it. But if he is going to leave on this afternoon's train I can write him a letter, as he suggests. But I want to talk to my friend the Minister of Justice for a moment and to my friend the Minister of Finance. I am taking their proposition, not mine.
As I said, what is the Social Credit financial proposal? It can be divided into three simple parts. The first one is this. We claim there is ample evidence to show that the production of goods and services today does not distribute amongst the consumers of Canada sufficient purchasing power to enable the people to buy back what they produce and that, as a consequence, there will be generated a shortage of purchasing power.
The second part of it is this. If our productive processes generate a deficiency of purchasing power, then there must be some means of making up the deficiency and we propose that, as a mechanism for making up that deficiency, some agency of government shall create and distribute amongst the consumers of Canada new purchasing power equal to the deficiency that has been generated so there will be a balance between consumption and production.
The third important feature of it, Mr. Chairman, is this. The mechanism by which that shall be done shall be the Bank of Canada coupled with the treasury of Canada -that is the Department of Finance-and we propose that they unite in their efforts to see that the new purchasing power is distributed in sufficient quantity to balance consumption with production. That in a nutshell is the financial proposal we make.

I cited that proposal, Mr. Chairman, because I wanted first to make it known to the committee exactly what it is we hold as a fundamental principle, and so I can then cite top-ranking economists who not only advocate the same thing but who, through their long study of economies throughout the world, have discovered exactly the same thing that Major Douglas discovered away back about 1922 or 1923.
First, for my friend the Minister of Justice, and in order to refute completely what he said, I am going to cite one of the top-ranking economists of the United States, who for 18 years was head of the department of economics at Texas University. I am speaking of Professor C. E. Ayres. After a long study of the economy of the United States, which operates on exactly the same principles of finance as those upon which we operate, Professor Ayres came to certain conclusions which he embodied in a book published in 1946 and entitled "The Divine Right of Capital". At pages 32 and 33, where he is discussing the habit of pendulum thinking that people have got into, or the habit of thinking in terms of booms and busts, he says this:
There are some in whom this habit-
That is the habit of pendulum thinking. -still persists today and who are therefore already talking of the depression which will "inevitably" follow post-war inflation, which with admirable consistency they also think of as inevitable.
But pendulum thinking is not as common as it was. We have learned a lot since 1929. Obviously that is because we have seen a lot. So long as disturbances are kept within decent bounds, economists prefer to view them with Olympian detachment, taking a "long-run" view of upward and downward movements and not worrying too much about incidental "friction". But when the friction generates heat so intense that it threatens to blow the whole outfit galleywest, most of us are strongly moved to stop, look and listen.
What we have learned as a result-
I suppose, if I may interpolate, from stopping, looking and listening.
-now seems obvious indeed. The economic heretics-
I suppose they would be the Social Crediters.
-have been trying all along to make us see it. No economy could swing back and forth so wildly from one extreme to the other without there being something very wrong about it. There is indeed something very wrong with ours. It fails to distribute mass-consumer purchasing power in sufficient quantity to permit the entire product of industry to be purchased. This failure exists at all times under capitalism and is noxious at all times.
That is a statement in succinct terms of the first part of the financial principle which I put forward as the Social Credit principle a few moments ago. Here is a top-ranking

economist making the same statement, an economist who is accepted very widely. But let me ask the Minister of Justice this question. Can you, sir, picture a man sitting for 18 years in the top economic seat in one of the great universities of the United States unless he had something on the ball, unless he was pretty widely accepted? I cannot, and I do not think the Minister of Justice can.


Stuart Sinclair Garson: I think my hon. friend could solve this matter very quickly if he would give the members of the committee the name of some top-ranking economist anywhere in the world who has specifically endorsed the doctrines of Social Credit as such.


Solon Earl Low: I am doing that right now.


Stuart Sinclair Garson: Your merely saying that your ideas are like his does not constitute an endorsement by him of Social Credit.


Solon Earl Low: It is not a case of saying that our ideas are like his. What I am saying is that here is a man who in his investigations has discovered exactly the proposition which Major Douglas, the founder of Social Credit, put forward; and the fact that he did not by accident mention Social Credit in his thesis is no justification for my hon. friend saying that no top-ranking economist has ever endorsed it. If he endorses the principle, then he endorses Social Credit because that is a Social Credit principle.


Stuart Sinclair Garson: You are just saying that he does.


Solon Earl Low: I am quoting to you from his own work, and I shall go further. I remind my hon. friend that the second part of my Social Credit proposition was this, that wherever it is discovered that there is a deficiency of purchasing power generated within the economy, then the remedy for it is a flow of new purchasing power sufficient to make it possible for consumers to buy what is being produced. Does he endorse that principle? Let us see if he does. I turn to page 95 in this same book by the same author, Professor C. E. Ayres, head of the economics department of Texas University. This is what he says in chapter 17:
What we require, and all we require, to make the industrial economy work is a flow of mass-consumer purchasing power sufficient to absorb the entire product of industry at whatever level of production we may be able to achieve. This would not bring Utopia. It would not solve all problems. On the contrary, it would solve only one problem, the crisis into which we have been thrust by the institutions and dogmas of absolute capitalism. But this problem is the most important one we face today in this sense. If we solve this problem, we shall then have an opportunity to tackle others.
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If We do not, all our present problems will merge in the general collapse of the present structure of western society.
There is an endorsement without qualification of the second part of our thesis. I shall turn to another very quickly, and tell the minister that here is another first-ranking economist who has endorsed exactly the same principle. Here is the president of the University of New Mexico in a book entitled, "Financing Full Employment". It was published in 1945 and the author is Dr. J. Philip Wernette. A man holding such a prominent position and writing on economic policies and matters would have to be a topranking economist to be able to hold his position as president of that university in the face of the criticism that his books and publications would evoke. I shall refer to what he said in his book entitled, "Financing Full Employment", and I want the members of the committee, particularly the Minister of Finance and the Minister of Justice, who has been engaging in a sort of Dutch battle and not coming to grips with us, to listen to what this man has to say. I challenge the minister to take up the debate; to not merely ridicule what is said but bring something before us to show that he has the facts. Dr. Wernette had this to say:
Control of the total amount of money must be assumed by the government and exercised through a federal stabilization board. This board shall have power to create new money to be used in financing deficits in the federal budget and in paying off the federal debt. The board, guided by reliable statistics on employment, unemployment and other economic factors, shall issue such new money in whatever amounts may be necessary any time that depression threatens, so as directly and indirectly to stimulate and maintain employment at a practical maximum.
That, Mr. Chairman, is a 100 per cent endorsement of the technique which we have been putting forward in this country for the last 30 years and which the Minister of Justice evidently has not yet looked into very carefully. I might point out for the benefit of my Conservative friends that back in 1930 Winston Churchill had been giving this matter some thought, and he made this statement:
There is a strange discord between consuming and producing power, a mysterious crack between supply and demand upon which the keenest minds in the world should be concentrated.
That was Winston Churchill's view.


Stuart Sinclair Garson: Mr. Chairman, could I ask my hon. friend if he regards Sir Winston Churchill as one of the supporters of Social Credit?


Solon Earl Low: No, and I have not said so. I have
merely quoted him. The thing that induced me to use that statement of Sir Winston Churchill was that it recognized the thing

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which the Minister of Justice refuses to recognize and which he should be recognizing if he is to give this country the service which it requires at his hands. If the Minister of Finance is to serve this country as I know he wants to serve it, then he will induce his colleague the Minister of Justice to study these matters so they will know-and I think they will recognize that it is their responsibility to see to it-that production and purchasing power are geared together in this country.
I am sure the Minister of Finance must recognize that today the issuing of new money is a haphazard business, and the more he looks into it the more he will discover that is so; that there is no control whatsoever from day to day, from month to month or year to year of the amount of money that is issued into circulation to buy goods and services that Canadians produce. I am certain that if they will give the matter some study they will find that it is necessary to concentrate the very best minds in our country upon the problem of balancing consumption with production.
I suggest to the Minister of Finance that since the Gordon commission has been set up to investigate the economy of Canada, one of the responsibilities which should devolve upon it is to investigate this very matter. If he will do that I think he will come back here at the next session and get up before the house and say he has discovered that what these boys have been saying all these years is right, and they are going to change the situation.


Frank Exton Lennard: Six o'clock.


Walter Edward Harris: If I may be permitted a word for a moment, I take it that the general debate has ended.


Major James William Coldwell: No.


Walter Edward Harris: No one rose.


Frank Exton Lennard: I said it was six o'clock.


Walter Edward Harris: I am going to deal with that in a moment.


Frank Exton Lennard: I have dealt with it now.


Walter Edward Harris: Then would the committee consider resuming at seven o'clock rather than eight?


Some hon. Members:: No.


Frank Exton Lennard: Mr. Chairman, the Minister of Finance had his fling last night and early this morning. It is six o'clock.


Major James William Coldwell: I am not thinking of that, but I am thinking of the staff again. I am thinking particularly of the Hansard staff and the stenographers, who have been working continuously. I think while we might be

quite fresh and willing to sit at seven o'clock, we should not impose that upon the people who have been working under such pressure for the last day or so. I believe we should meet as usual at eight o'clock.
At six o'clock the committee took recess.


[Stage Direction]
AFTER RECESS

The committee resumed at eight o'clock.
William Alfred Robinson: Order. Resolution 112; shall this resolution carry?


[Stage Direction]
Item agreed to.
General administration-
113. Comptroller of the treasury-central office and branch offices administration, $15,616,300.
George Randolph Pearkes: Is the minister going to reply?


Walter Edward Harris: Yes, on item 113. A number of statements have been made, and if I miss any of them I hope I shall be reminded of it. Let me take them in turn. The hon. member for Broadview-


An hon. Member:: For Greenwood.


Walter Edward Harris: The hon. member for Greenwood-the hon. member for Broadview has assured me he has made his last speech in the house and I would not suggest that he is going to make another one-covered three points. First was the question of the treasury board, which we went into in some detail in the committee, and its influence or authority with respect to the spending of other departments, and with particular reference to an investigation by outside persons into the efficiency of the administration of other departments. I would not want the hon. member to hold the view that he tries to tell the committee he holds, that the treasury board would not have some influence in these matters.
It is the duty of the treasury board to supervise in many ways not only the preparation of the estimates but various factors that enter into the hiring of persons, the providing of the establishment, the salary range and all these things that are directly under the control of the civil service commission, that are nevertheless the responsibility of the Minister of Finance in so far as expenditures are concerned. Therefore treasury board does in fact, through the Minister of Finance, exercise an influence, if you like, or express an opinion with respect to many of the financial aspects of government in the other departments. When I said "treasury board" I referred, of course, in fact to the staff and not to the treasury board as a cabinet committee.
To say that the staff might impose upon another department an investigation of its

affairs, of its establishment, of its pay list and all these things, is going somewhat beyond what one would expect. However, the treasury board officials, in consultation with the officials of the other departments, of course, try to improve the efficiency of government on all occasions; and if perchance it is felt an investigation of some particular matter is called for, the treasury board officials themselves may participate in such a study with the officials of the other department and perhaps in fact on many occasions clear the matter up immediately without further ado.
As I said in the estimates committee, this is a daily grist. This goes on the year round. That is what treasury board officials are for; that is how they earn their pay that the government gives them. If, however, my hon. friend supposes that even the Minister of Finance could arbitrarily decide that there should be and would be an investigation such as he has in mind, of course he would understand that would be impossible. That is a matter of government policy, a matter of government decision, a matter of consideration and examination and decision not only by the treasury board itself, the Minister of Finance and the appropriate minister, but even perhaps the cabinet itself. All these steps have been taken in the past and no doubt will be taken in the future should the occasion arise when those persons concerned feel it necessary.
The hon. member gave a short rehearsal of the economic factors involved in the budget, and asked me whether I was under the influence of some of the persons who have studied at the feet of a man by the name of Keynes. I do not think I ought to go into that. I have never inquired of any of my officials or of my colleagues as to their views on that point. In fact if I asked them what their views were they would probably give me qualifications that would only confuse the issue. What we want is a decision at budget time about what is necessary and desirable at that particular time, without trying to adhere to a theory of any preceding period. I mention that only to say that of course it is out of order in this debate.
The hon. members for Queens and Esqui-malt-Saanich were kind enough to make some reference to the proceedings before the tariff board with respect to potatoes. Since we have originated the reference I think I need only say here that we did originate it because of representations which had been made to us especially by the maritime potato growers, and having in mind the changed market conditions which were referred to by the hon. member for Queens.
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We feel that if there is a substantial change in market conditions, and if representations are made which have validity, a reference of the particular matter to the tariff board is the best way in which we can have a study made by experts who will place before us the facts of the situation. I can assure the hon. member for Queens that the maritime potato growers, when they came here in the spring, made a case for reference to the tariff board and we acted upon it. The results in so far as the study is concerned will have to do with the potato growers on Vancouver island as well.
The hon. member for Okanagan Boundary, followed by the hon. member for Yale and I think the hon. member for Fraser Valley, sought to intervene to speak on the subject of the Municipal Improvements Assistance Act, which was passed in 1938. It was an unemployment assistance provision, designed to stimulate the building of municipal services at a time when employment was needed. The terms, of course, were generous; but it should be remembered that the provincial governments had to guarantee the loan which was made by the federal government to the municipality. The last loans we made under this act were in 1940, because it may be recalled that during the war years the municipalities and the provincial governments co-operated with the federal government in postponing as much as they could any municipal services or any other buildings of a strictly nonessential nature. When the war years were over the situation was not that credit was needed from this source, but that the municipalities could and did in fact finance nearly as they chose. We think that condition has obtained until recently.
However, I have been informed that in recent weeks representations have been made that some municipalities find it difficult to get money. Without arguing the question as to whether their condition was such that it might be impossible for them to get money or whether the particular project was one for which they normally could not borrow money, may I say that these representations have been made and I have been studying the Municipal Improvements Assistance Act since last fall, somewhat as an academic study but nevertheless in connection with the discussions which we will be having in October with the provincial governments under the heading of public investment.


Harold Edward Winch: Is the act still in force, and is the $30 million still available?


Walter Edward Harris: We have not the $30 million. The provision was that we could lend up to $30 million. Should we do anything at the

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moment by way of using the powers under the act it would be necessary to vote the money required for the project.


Harold Edward Winch: But the act is still in force?


Walter Edward Harris: The act is on the statute books, yes. Because of what I have said, namely that this might come under the heading of public investment in October, I choose not to say anything more than to assure hon. members that we are aware of the act, we are aware of the low interest rate which was offered to municipal corporations at that time, and no doubt this and other similar subjects will be discussed in October.


Harold Edward Winch: The minister says the money is not available and would have to be voted, but I understand that in the original vote there was an allocation of $30 million.


Walter Edward Harris: What I said was that if we chose to lend money under the act to municipal corporation X we would have to vote the amount of the loan, just as we would vote money to lend it to the Central Mortgage and Housing Corporation or for any of these other loans we make.
The hon. member for Peace River was kind enough to say that he would not engage in a debate on monetary fiscal policy this evening but would postpone his remarks until the next session. Of course he then went on to tease us a little by giving us a preview of what those remarks might be. Let me say in his absence that I am sure we can look forward to a discussion of monetary policies by him in the coming session. Perhaps by that time I shall have an opportunity to study the book to which he referred and the authority referred to, and any other authorities which may be referred to by him in the meantime.
I think the same would apply to the remarks of the hon. member for Lethbridge, who repeated the argument he has made before in the house with regard to subsidies for local industries and activities. I was a little surprised that he should think the Minister of Finance would be enamoured with the idea of subsidies; nevertheless he made the proposal in the light of a general over-all approach to the welfare of Canada.
I might just add that I am not prepared to agree with him that the government of Canada should find money for subsidies for this purpose, but at the same time I would point out that we do provide subsidies for the coal industry, for the gold mining industry and in a somewhat different manner than he had in mind we provide subsidies for feed grain moving to the east. He had in mind a subsidy for local industries to allow them to compete with the products of the central

provinces. We are doing precisely the same thing, only in reverse, with respect to feed grains. He may argue from this that, the principle having been accepted, we ought to do many other things. All I can say is that I shall look forward to his discussion of monetary policies next year; but let me say that as Minister of Finance it will be difficult to convince me that we ought to pay more subsidies.
I think that concludes the references to what has been said today, except what was said by the hon. member for Vancouver East. In that connection may I refer to the trade figures with the United Kingdom. Without going into detail, may I give our exports to the United Kingdom in the first five months of this year as compared with the same period last year. Our exports from January 1 to May 31, 1954, were some $234 million, while for the like period this year they were $321 million, roughly $80 million more this year than last. That does not indicate the state of affairs which my hon. friend had in mind when he was concerned about the export of Canadian goods to the United Kingdom.


Harold Edward Winch: I was referring to the announcement by the chancellor of the exchequer, who said they did not have Canadian or United States dollars. I was not referring to the past, but to what is going to happen from now on.


Walter Edward Harris: In that connection I would point out to the committee that the chancellor of the exchequer gave no indication of any quotas or restrictions other than those now in existence. In his announcement, and in the speech made in the House of Commons, he did not forecast any restrictions on imports from Canada. If I might run over what he did say just to clarify my hon. friend's mind, he referred to restrictions on consumer credit and instalment buying. He referred to certain restrictions on bank loans in the United Kingdom. He referred to a reduction in government expenditures on capital goods. He stated specifically that there was no crisis of any kind but that there had been a slight reduction in the gold reserves of the United Kingdom. The only action he had in mind was as I have mentioned already.
There is nothing there which indicates in any way action which would reduce the purchasing power of the United Kingdom with respect to Canadian goods. My hon. friend may say that may be so. The fact is that we have been through this before, but at the moment we can expect no action to be taken by the chancellor of the exchequer, certainly not as a result of his speech the

other day with respect to the sale of Canadian goods in the United Kingdom.


Alexander Malcolm Nicholson: One hot day last week the minister was kind enough to offer to make a calculation over the week end to find out how many hours had been lost by civil servants during the hot weather this summer, and also how large a down payment that amount would have made on some air conditioning equipment.


Walter Edward Harris: I did tell my hon. friend I would try to find out, but I have been told it would be somewhat difficult. As I reminded him the other day, the decision is in the hands of the deputy minister of the department concerned. I have been told by my own deputy that during this summer the amount of time lost by the Department of Finance staff in the Confederation building, he thinks, is about three-quarters of an hour on four or five occasions. However, I would have to go over each of the departments concerned, find out what buildings they were in and whether or not there was air conditioning there, make quite a lengthy study and probably end up with no better answer.


Alexander Malcolm Nicholson: Some of the offices closed as early as one o'clock. It seems to me that if it were suggested that in the winter we stop buying coal to cut down expenses, people would think there was something wrong with the running of our country. When we build new buildings such as the veterans affairs building and the new library, it is very difficult to justify the fact that we cannot find the material and the manpower to instal air conditioning. At some point we should know what the total estimated loss is because of our failure to have this very convenient device. I understand that Loblaws are opening a $500,000 building in Ottawa tomorrow, and the Loblaw firm considers it good business to have the establishment air conditioned. I think we should have some estimate.


Walter Edward Harris: I should be glad to go further into the matter from the standpoint of savings, but I have complete confidence in the decision made by my colleague the Minister of Public Works when it comes to the constructing of buildings, the cost of installation of air conditioning and similar matters.


Alexander Malcolm Nicholson: The Minister of Trade and Commerce has indicated that it is government policy that air conditioning should not be used in government buildings. It would appear to me that would become a cabinet responsibility. As I said before, I do not think any government would argue that it should not have heating in buildings in Canada, or that we should close our buildings for the
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wintertime. I think it is just as senseless to argue that Canada cannot afford to make use of the air conditioning industry, which is a legitimate industry, and start using it in new construction like the new veterans affairs building.
I think the Minister of Finance is the minister to look into the cost factor and find out what the loss is to the Canadian treasury to have 50,000 or 75,000 civil servants go home at one o'clock, two o'clock or three o'clock for the rest of the day, day after day. At some point some department of government should be able to tell us how many thousand hours have been lost this summer. It may take until next year to get that information. I thought that as the minister had a week's notice, he might be able to give us some information.


Walter Edward Harris: We have made efforts, as I said, and we shall continue to do so in the hope of having some concrete figures for this summer.


Harold Edward Winch: I am very much interested in the subject of air conditioning in our buildings in Ottawa, and I appreciate the endeavours of my hon. friend; but under this item I am more interested in the trade carried out with sterling countries. Would the minister enlarge on what he said a few moments ago? As I understood the remarks of the Minister of Finance, in spite of the devaluation in Great Britain he does not expect any impact on the export business of Canada. That is what I understood from the minister, but I cannot believe he meant what he said. The economic and financial impact of what the chancellor of the exchequer has had to do in Great Britain cannot help being detrimental to the export trade of Canada. How can the minister say it is not going to have such an effect?


Walter Edward Harris: My hon. friend begins with a misunderstanding of what the chancellor said. He did not announce a devaluation of the pound.


Harold Edward Winch: I agree with that, but it is a devaluation in Great Britain because of the orders that have been put in-


Walter Edward Harris: The orders to which I referred a moment ago were orders with respect to restrictions on instalment buying. That is as my hon. friend knows, down payments on goods have been increased. That may or may not restrict purchasing power. It probably will; at least the chancellor hopes it will. However, it will prevent more credit being granted for the time being. That does not necessarily mean they will not buy Canadian grain, because one does not buy Canadian grain on credit; one buys it for cash. The bank loans in the United Kingdom which

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are to be restricted, or perhaps not granted quite as easily, would be loans made to local firms. They may not be buying Canadian goods for resale in the United Kingdom. These things, of course, may possibly prevent someone from buying something from Canada, but in itself there is nothing here to restrict purchases of Canadian goods as the ordinary practices are now. If, however, the chancellor were to announce additional quotas on Canadian goods, then my hon. friend's position would be correct.


Harold Edward Winch: Could I ask only one more question, and then I shall sit down. From all the press reports I have read, not only in Canadian newspapers but also in those of Great Eritain, it is my interpretation that this is being done mainly because they are short of United States and particularly of Canadian dollars. Would the minister state whether or not it is a shortage of Canadian dollars that is having an effect in Great Britain? Everything I have read in the Canadian press-and I take in all the press of Canada-indicates that it is because they are short of Canadian dollars. If they are short of Canadian dollars they cannot take our goods. Am I right or am I wrong in my interpretation?


Walter Edward Harris: You are wrong, if I may say so with respect.


Harold Edward Winch: Then will you make it clear, which the chancellor has not done? Every article I have read indicates that they have to do this because they are short of Canadian dollars. That is why I asked this afternoon if we could not help from Canada in the matter of sterling payments.


Mr. Barnett:: On the point raised by the hon. member for Vancouver East, I think the Minister of Finance will appreciate that this matter is of great interest and importance to the people of British Columbia, particularly those connected with our basic industries of forest products and fishing. Would the minister not agree that it was on that premise of the shortage of Canadian dollars that the trade mission from the British Columbia fishing industry went to Britain, in order to canvass the possibilities of increasing our purchases of British products so they might more freely dispose of their fisheries products in Britain?


Walter Edward Harris: Mr. Chairman, I agree that they went over to see if they could sell more goods. But in general we have had no difficulty in the past year with quotas or restrictions. Perhaps my hon. friend would be interested to know that one can sell

Canadian wheat, Canadian lumber and Canadian base metals in the United Kingdom and the purchasers there can use Canadian dollars without restrictions; there are no quotas whatever. There are quotas with respect to manufactured goods, that is, quotas on Canadian money with which to buy them; but Canadian raw products such as I have indicated may be imported into the United Kingdom under general licence without restriction. For that reason, as I tried to tell my friend the hon. member for Vancouver East, we are considering a situation that does not exist. Those who are thinking in terms of difficulty are thinking of a condition that existed up to 12, 14 or 18 months ago.


Harold Edward Winch: I am sorry to persist, but I am interested. If that is the case, why is it reported that the chancellor of the exchequer says they have to impose restrictions in Great Britain because they have not dollars?
I am interested. I am just seeking information.


Walter Edward Harris: I cannot explain what writers might say. I am trying to explain to the committee as best I can the announcement of the chancellor of the exchequer as I understood it to be. It may well turn out that I am wrong, but I assure my hon. friend that I find nothing in the statement which indicated an intention on his part to reimpose those restrictions which he had on imports from Canada until some time ago.


William Alfred Robinson: Shall resolution 113 carry?


Major James William Coldwell: Then why is it we are told that Britain cannot buy Canadian salmon and Canadian apples because she needs the dollars for the purchase of more essential commodities? That is what we are told.


Walter Edward Harris: Perhaps I did not make myself quite clear when my hon. friend was not in the chamber.


Major James William Coldwell: I was here, but I was behind the curtain.


Walter Edward Harris: When I read the items I read wheat, lumber, base metals.


Major James William Coldwell: But you did not say salmon.


Walter Edward Harris: It may be that they have always had restrictions on apples and salmon and may still have them. What I was trying to say to my friend the hon. member for Vancouver East was that there is nothing in this recent announcement which would indicate an extension of the quotas or restrictions that are at present in existence.


Major James William Coldwell: The quotas on apples and salmon are still there because they need the dollars to buy wheat, lumber and base metals.


Walter Edward Harris: Quite so.


Major James William Coldwell: So there are restrictions owing to a shortage of dollars.


Walter Edward Harris: Quite so.


Harold Edward Winch: I am not going to pursue this matter any further. I am grateful to the minister for the information he has given. When the estimates of the Secretary of State were before the house-and they included the civil service commission-I wanted to ask a question and the minister told me that I should ask it under the estimates of the Minister of Finance. I want to ask a question on this civil service insurance. Will the minister tell me whether or not I can ask the question now? If not, will he advise me under what item I may ask it? I held it over on the advice of the Secretary of State. Shall I ask it now?


Walter Edward Harris: If the hon. member asks his question now I may have the answer by the time we reach the appropriate item.


Harold Edward Winch: Thank you. What I had in mind, Mr. Chairman, when I spoke to the Secretary of State was a matter in connection with the civil service insurance. I desire to ask the minister who is in charge whether any changes have been made since the Auditor General's report of 1953, in volume I at page 33. Under the heading of civil service insurance the Auditor General set the matter out as follows:
There was a year-end balance of $28,382,000 at the credit of the civil service insurance account. Section 15 of the Civil Service Insurance Act requires premiums to be founded on tables "based on the H.M. mortality table of the institute of actuaries of Great Britain, and on a rate of interest of 6 per centum per annum". The statute was enacted 60 years ago and the mortality table employed was published in 1869. The average life expectancy having since considerably lengthened, outlays in the form of payments to beneficiaries have not had the expected impact, a consequence being that the burden on the account is less than the Civil Service Insurance Act anticipated. For this reason, the statutory requirement to use a certain mortality table and the stipulating of a 6 per cent interest rate merit reconsideration.
I should like to ask this question of the Minister of Finance, under whom I understand this matter comes. This report made by the Auditor General on the civil service insurance fund indicates that something should be done, because what he said then was to the effect that by law the mortality table has to be one that was published in 1869. I would ask the minister if that matter has been taken care of?


Walter Edward Harris: May I save my hon. friend time? The scheme was reconsidered. It was discontinued, and has been replaced by the death benefit scheme which we put through this house in the last session.
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Harold Edward Winch: There was no mortality rate table dealt with last session.


Walter Edward Harris: No.


William Alfred Robinson: Shall item 113 carry?


Harold Edward Winch: No, Mr. Chairman. On what is the mortality rate based now?


Walter Edward Harris: We have not a scheme like that now. We discontinued it.


Harold Edward Winch: What is it based on?


Walter Edward Harris: There is not one.


Harold Edward Winch: You mean you have an insurance program-


Walter Edward Harris: No. We have not an insurance program.


Harold Edward Winch: -and there is no basis of mortality rate?


Walter Edward Harris: No. We have not an insurance program.


Harold Edward Winch: You have not an insurance program?


Walter Edward Harris: No. We have superannuation but we have not an insurance program.


Harold Edward Winch: How does it tie in?


Walter Edward Harris: The very point my hon. friend makes is the one I am making, namely that consequent upon this report and other information this scheme was considered and it was discontinued. It does not exist any more for the reasons referred to, among others.


Harold Edward Winch: I have been asked this question about this matter. It is included in what? I do not know the answer. What is the answer?


Walter Edward Harris: I do not know how I can make the matter any clearer. There is not any such scheme left. We are not operating the insurance scheme to which my hon. friend refers, for the reasons referred to in that report of the Auditor General.


Harold Edward Winch: I may be stupid, but I am going to find out whether I am stupid.


Walter Edward Harris: Let me put it this way. We repealed the act to which my hon. friend is referring.


Harold Edward Winch: How are you now covered?


Walter Edward Harris: We are not covered at all. It does not exist.


Harold Edward Winch: It is now under superannuation?


Walter Edward Harris: No. We are not writing any more insurance policies since we repealed this act last session, when we put in the death benefits.


[Stage Direction]
Item agreed to.
[Stage Direction]
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Administration of various acts and costs of special functions-
114.	Superannuation and retirement acts, administration, $574,240.
James MacKerras Macdonnell: I have a point I wish to raise, and I think it should be raised under item 114. It is in connection with the public service superannuation regulations. I am reading from page 2242, part II of the Canada Gazette of December 22, 1954, and I read as follows:
Notwithstanding anything in this section, a deputy head may, at any time, for reason only of age, terminate the employment of a contributor who has attained 60 years of age, if the deputy head gives to the contributor at least six months notice of termination of employment.
I am puzzled by that regulation. On its face it seems to be an extremely arbitrary power to give. I am particularly puzzled by the part of the phraseology reading "a deputy head may, at any time, for reason only of age". Would the minister please comment on that?


Harold Edward Winch: While you are figuring that out, may I ask the minister if he would mind having his staff send me an explanation of this business of the civil service insurance, and in particular what happened to the $28,382,000?


Walter Edward Harris: I shall have a full explanation sent to my hon. friend by the staff.


Harold Edward Winch: And what happened to that $28 million?


Walter Edward Harris: Yes.


Harold Edward Winch: I am not going to hold up proceedings, but I want to get that.


Walter Edward Harris: As to the questions asked by the hon. member for Greenwood, this is a repetition of a section in the former act which means that at or after the age of 60 a civil servant may be invited to take his superannuation by the deputy minister concerned.


James MacKerras Macdonnell: Yes, but for reason only of age. I mean is there to be no incapacity to do his work, no disability of any kind? Can the head of a department just say to a man, "You are 62; you are out". Surely that cannot be so.


Walter Edward Harris: Yes, that is true, although of course it is not the sort of action that is undertaken unless there are good reasons to do so in the interests of the public service.


James MacKerras Macdonnell: Then does the minister not agree that if those are the reasons that are being used-


Alexander Malcolm Nicholson: Would the member for Greenwood speak up a bit? I should like to follow this.


James MacKerras Macdonnell: Did my hon. friend hear the clause I read?


Alexander Malcolm Nicholson: No, I did not.


James MacKerras Macdonnell: Then I shall read it again.
Notwithstanding anything in this section, a deputy head may, at any time, for reason only of age, terminate the employment of a contributor-
That is a contributor to the superannuation fund.
-who has attained 60 years of age, if the deputy head gives to the contributor at least six months notice of termination of employment.
The minister says, and I find it easy to believe, that this is not acted upon in an arbitrary manner; but does the minister not agree that it is a very odd situation to leave this clause as it stands if the words "for reason only of age" mean, as I think they do, that all the deputy head needs to say to a man is, "You have passed your sixtieth birthday and out you go"? Why is it worded in that way? Is it the natural wording? Did the minister say it was taken from the old act? If it has the practice of many years behind it, that in itself is perhaps some sanction.


Walter Edward Harris: I am informed the wording is slightly different from the old act but the principle is the same, that at that age there is a discretion in the deputy head. I can only repeat what I have said, and my hon. friend agrees with me, that these actions are not taken without full consideration of the best action in the interests of the public service. My hon. friend might disagree with the regulation and might feel it should be altered. If so I would be glad if he would say so and I will have a look at it, but I think he would agree that at some age, be it 60 or otherwise, there ought to be consideration given to the factors I have mentioned.


James MacKerras Macdonnell: Yes and no.


Walter Edward Harris: Absolutely, yes and no; no in some cases and yes in others.


James MacKerras Macdonnell: I want to submit this to the minister. Am I right in thinking that prima facie a man has the right to go on until he is 65? Is that correct?


Walter Edward Harris: There is no absolute right to go to 65. Admittedly 65 is the generally accepted age, but there is no right.


James MacKerras Macdonnell: That does not seem to me to leave it in a very happy position. I think the minister has said in effect that these actions are not taken purely on the basis of this wording. In other words, I understood him to tell me that it would not

be done by reason only of age between 60 and 65 but that there would have to be some real incapacity to do the job.


Walter Edward Harris: First you must bear in mind that any civil servant may retire at 60, and there is a counterbalance there that he may be retired after 60. But if in the interests of the efficiency of the department the deputy head comes to the conclusion that somebody past 60 might be invited to accept his superannuation, I see no reason why that should not be done in the interests of the service.


James MacKerras Macdonnell: Neither do I, but I wish it said that in the section in words very nearly the same as those the minister has just used, instead of saying "for reason only of age".


Walter Edward Harris: But the difficulty arises that you always have the borderline case where you cannot say to a man that he is not doing his job, but you can say to him if you choose that he is only doing 75 per cent of his job. You do not say that. You say, "Because of age I am asking you to accept your superannuation."


James MacKerras Macdonnell: I am not going to take the time of the committee further, but I find it most distasteful. It seems to me it ought not to be worded like that. May I ask the minister if he will have a look at it in the light of this conversation.


Walter Edward Harris: I will.


Alexander Malcolm Nicholson: I am very glad the hon. member for Greenwood has raised this point. Going home on the bus one night I happened to meet a civil servant who was 62. This provision had just been drawn to his attention, and this man had very important family responsibilities. I think it is unfortunate that the government of Canada as an employer should have a regulation providing that for reason of age only, regardless of the efficiency of the individual, at age 60 an employee is liable to be forced to leave the service. How many have been asked to leave the service under this clause, and will the minister not reconsider the matter in the light of the comments of the hon. member for Greenwood? I think it is a mistake for the government of Canada to assume that there is only a limited amount of work in Canada for all the people to do. Surely people 60, 70 and 75 want to work.


Walter Edward Harris: Of course they do, but you do not entrust to some people certain jobs that must be done. There has to be some discretionary right in the deputy head of the department, who is responsible for the efficiency of the department. I am told, though I cannot recall when, that a return was tabled during 50433-4381
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this session giving the numbers who have been retired under this provision. I have also been told that there have been two in the Department of Finance, so it will be seen how small the numbers are. Nevertheless there may be occasions on which this discretionary right ought to be exercised in the public interest, and that is all.
It is not a matter of great moment. We are not turning many people out who are over 60. In fact I believe the contrary is true. I think the government, certainly from the time the present minister became Minister of Labour, has been encouraging people to continue to work and encouraging employers to ask them to work past 60 and past 65. It has been the policy of the government to employ people and keep them employed. Nevertheless you cannot make an absolute rule about it.


Alexander Malcolm Nicholson: If we are going to have a rule by which people can be thrown out of employment at 60, I submit the minister should bring in legislation to change the Old Age Security Act so that payments will be available at 60. If we are going to make it difficult for people beyond 60 to retain employment in the government service, then such legislation should be introduced.


George Randolph Pearkes: During the last session of parliament the government introduced legislation setting up a form of life insurance for civil servants and members of the armed forces. In the original bill the government made the insurance compulsory, but I think when the bill reached the other place at the end of the session the compulsory clause was removed and a voluntary condition was introduced but with certain limiting factors. Is provision made under this item for the carrying or financing of that particular insurance scheme? If not, where would the money be found; under what item?


Walter Edward Harris: We can deal with that now if the hon. member wishes to ask a specific question.


George Randolph Pearkes: I would like to ask a question.


Walter Edward Harris: It is a statutory item.


George Randolph Pearkes: How does that legislation stand, and what is the policy? My recollection is that a canvass was to be made of civil servants and of the armed forces, and if a certain percentage volunteered to accept the conditions, then it was to be made compulsory. If not, the voluntary element would remain; and there was some suggestion- although this was not official at the end of the last session-that action was to be taken between sessions. My recollection was that

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the scheme would be dropped. I was wondering whether it had been dropped or whether there are funds available here for it.


Walter Edward Harris: There is a statutory item making provision for the money. The scheme was not dropped. I made a public announcement when it went into effect. Those covered by the act had until November 1 to opt out. After that date, and after studying the figures of those who had requested not to be covered by the act, we proclaimed it and it has been in operation ever since. I cannot give the exact figure, but I think about 18,000 nonmilitary civil servants elected not to be covered by the act. However, it does apply now to all persons who joined the civil service since that time.


George Randolph Pearkes: And I understand that the armed services are also included in the act. Can the minister give the committee any information as to how they stand?


Walter Edward Harris: There was a smaller percentage in the armed services who elected not to be covered, but I am not sure of the number. However, I do know that it was a smaller percentage than among civilians.


George Randolph Pearkes: And those joining the armed forces now have to accept this condition?


Walter Edward Harris: Yes.


George Randolph Pearkes: Is there any money available to establish that insurance fund?


Walter Edward Harris: A statutory item appears at the bottom of page 23, which deals with the government contribution to the public service death benefit account under part II.


Mr. Charlton:: I understood the minister to say to the hon. member for Vancouver East that the government was carrying no insurance plan at all. I recall the situation mentioned by the hon. member who has just spoken, and I thought that was insurance.


Walter Edward Harris: This is a group policy scheme. The hon. member is referring to individual insurance.


John Alpheus Charlton: But it is still insurance.


Walter Edward Harris: Yes.


John Alpheus Charlton: You said there was no insurance carried.


Walter Edward Harris: No; I said the scheme referred to by the hon. member had been discontinued, and we are no longer writing individual insurance.


Erhart Regier: Mr. Chairman, in a discussion of the estimate having to do with the administration of the superannuation and retirement acts, could the minister inform the

house whether in the course of his administration any efforts are being devoted to research in connection with a problem raised often by the hon. member for Winnipeg South as well as the hon. member for Winnipeg North Centre.
When a man pays into a superannuation fund plan for a long number of years he is assured of a certain income upon reaching a certain age. This man is making the sacrifice as he goes along, and his sacrifice is tuned to a certain standard of living which will be assured to him when he reaches the age of retirement. I know there are many people in Canada who make great sacrifices over a long number of years to ensure themselves $60, $70 or perhaps $80 a month upon reaching the age of, let us say, 65. However, upon reaching that age they find that in actual standard of living value the thing for which they had been sacrificing so much over all the years has depreciated in value. They find that the purchasing power of their money has been greatly reduced because of the deliberate policy of ministers of finance in the government of Canada, and they have a feeling that somehow or another they have been let down. In a growing nation and an expanding economy I can fully understand why it is in the interests of the nation gradually, over a period of years, to devaluate its currency. Thereby our public debt and carrying charges become much less, and any minister of finance who has heavy public indebtedness on which he has to meet interest rates likes to see a slight inflationary spiral. This inflation helps to ease the load. It lightens the load on anyone who owes money.
Recently the people of Canada went through a period of inflation, and those who owed money did not mind that condition very much. However, it does hit at those who have been making sacrifices for many years to look after themselves in their old age, through superannuation and other plans. I wonder whether the minister's department has been paying any attention to the representations that have been made, particularly those of the hon. member for Winnipeg South, and if so, can we have a report? Is there any way at all in which a superannuation plan operated by the government might be evolved so it would automatically look after inflation and deflation?


Walter Edward Harris: Mr. Chairman, if I were able to do that I think I would be the most renowned minister of finance in the world.


Erhart Regier: Oh, Mr. Chairman, the minister
has not told me whether any attention has been paid to this matter. We have a sum of money set aside here for administration. I would point out to the minister that he and

his predecessors have been responsible for inflation and deflation within our nation. They have a moral obligation to those people who put their savings aside for their old age. If by their actions as ministers of finance they have taken away half the value of that money, then I feel they have an obligation; and the minister has not answered the question satisfactorily.


Walter Edward Harris: To be specific, we are not making a study of what it would cost the taxpayers of Canada to guarantee and pay superannuation in times of inflation at a rate greater than that of the bond; nor are we considering the taking away of benefits of superannuation and pensions in a period of deflation from the person who has a bond.


Erhart Regier: Mr. Chairman, the minister has made a statement that to the average reader of Hansard may sound reasonable. However, I think I ought to ask whether the minister will not agree that a period of deflation in Canada is just beyond comprehension for many long years to come.


Walter Edward Harris: I would be happy to think that the present government could continue for all time the high level of prosperity which it has brought to the Canadian people.


[Stage Direction]
Item agreed to.
115.	The Bank Act-salaries and expenses of the inspector general of banks' office, $31,780.
James MacKerras Macdonnell: I want to ask a question about the industrial development bank. I am not quite sure where it comes. Will the minister answer it under this item?


Walter Edward Harris: It does not come under any item at all, Mr. Chairman. The industrial development bank is owned by the Bank of Canada and its operations are dealt with in its annual report.


James MacKerras Macdonnell: But, Mr. Chairman, may I ask the minister if I am not correct in believing that the Bank of Canada, in some sense anyway, is under the aegis of the Department of Finance? My understanding is that some department is the sponsor or the responsible department for all the crown corporations. Therefore one may ask questions of this type. If that is true of the Bank of Canada, is it not true of the industrial development bank?


Walter Edward Harris: The bank of course reports to parliament and I have the honour of tabling the report. If my hon. friend would like to ask a question about the industrial development bank I suggest he do it on the final item of my estimates, but there is no particular item having to do with the bank. I shall be glad to answer any question.


[Stage Direction]
Item agreed to.
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116.	Administration of the Farm Improvement Loans Act and the Veterans' Business and Professional Loans Act, $74,178.
John Alpheus Charlton: Mr. Chairman, I have the report of the Canadian farm loan board before me. I should like to ask the minister a few questions regarding the work of that board.


Walter Edward Harris: This is the Farm Improvement Loans Act. We shall come to the Canadian farm loan board later.


John Alpheus Charlton: There is no item in the estimates for the Canadian farm loan board.


Walter Edward Harris: Ask the question on the final
item.


John Alpheus Charlton: This item has to do with administration of the office and the cost of special functions. I would presume it is under the Minister of Finance.


Walter Edward Harris: I do not object to answering questions, but as I say there is no item for' the farm loan board, just as there is none for the industrial development bank, but I shall answer the questions on the final item of the estimates as I have promised in the other case.


John Alpheus Charlton: The Farm Improvement
Loans Act is under this item.


Walter Edward Harris: That is right.


John Alpheus Charlton: I have before me the annual report in connection with the Farm Improvement Loans Act. The government professes -and I use that word advisedly-to be of help to farmers across this country.


Mr. Lafoniaine:: That is right.


John Alpheus Charlton: I suggest to you, sir, that if you think 5 per cent interest is of much help to farmers then you had better think again, because that is the interest charged under this act and the loan is guaranteed to the bank. I believe the government could do a little better than that. They are guaranteeing the loan to the bank, yet the bank is charging the farmer 5 per cent on that loan. I believe one could go out and get first mortgage loans at 5 per cent almost any place, provided it is on a good mortgage; yet the government says this is a great act for the farmers of Canada.	.


Robert Henry Winters: So it is.


John Alpheus Charlton: I do not think it is a great act. One has to go to the bank and get money and have the government guarantee the loan to the bank. The bank is not taking any chances. A good farmer can go to the bank and get a loan at 5 per cent without this act at all. He does not need this. It is only on the loans that are questionable; it is only

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on the risks that are questionable that the bank asks the farmer to come in under the Farm Improvement Loans Act. The banks know they cannot lose the money. I would strongly urge that if the government professes to be helping the farmers, as they say they are, they should lower that interest to at least 4 per cent on these loans. The maximum is $4,000. It is a short-term loan and is used only for building, repairs, implements, and that sort of thing. Surely if it is to be the assistance to the farmers that it is professed to be then the interest should be no more than 4 per cent, if not less than that.
I have some other questions I should like to ask the minister, but I should like to get his reaction to the questions I have just asked.


Walter Edward Harris: I think my hon. friend proved the case for the Farm Improvement Loans Act by saying that these are marginal loans that the banks would not ordinarily handle. That was the purpose back of the legislation, to assure those persons who were marginal that they would in fact get the loans to assist them in their operations. That is all I can say.
With respect to the interest rate, I shall be glad to look at it to see if it is out of line with normal lending practices at the moment. But bearing in mind that, as my hon. friend said, persons who can get loans anyway would not be borrowing under this act and those who might not will still be borrowing, it is a real advantage to the farmer who gets the loan under these circumstances. It is not insignificant that the total loans under this act have amounted to $513 million. It has been a help to the farmers of Canada despite what my hon. friend may say.


John Alpheus Charlton: That is true. In effect you are putting a means test on this Farm Improvement Loans Act.


Walter Edward Harris: All I know is that my hon. friend was in favour of the act when it was passed.


John Alpheus Charlton: That is very true. What else could we do? We were handed an act and we had to take it or leave it. What I am saying is that by the minister's own admission he is putting a means test on this act, because the farmer who has credit can go to the bank and get money at 5 per cent. The farmer who has not good credit can still go to the bank and get money at 5 per cent and the government guarantees the poor risk. In fact you are putting a means test on this act.
On the back page of the report appear the claims paid by the bank from 1945 to 1954. Altogether there have been 282 claims made and paid by the government to the

banks, amounting to the total of $149,814. Can the minister give me a breakdown of these figures by provinces?


Walter Edward Harris: No. All I can give is the breakdown by the various fiscal years. It would take some time to get the information for my hon. friend.


John Alpheus Charlton: The breakdown by years is here.


Walter Edward Harris: That is right. If my hon. friend wants to know what provinces they are in I shall be glad to inquire, but it will take some time.


John Alpheus Charlton: The breakdown of provinces gives almost everything else. We have the provincial breakdown on the amount of the loan and the reason for the loan.


Walter Edward Harris: Is the hon. member not content with my promise? I shall get it for you.


George Randolph Pearkes: This item also covers the Veterans' Business and Professional Loans Act. Is the administration divided between these two acts, or do the same personnel carry out the duties? Is it possible to say how much of this $74,000 odd is allocated to the Veterans' Business and Professional Loans Act and how much to the Farm Improvement Loans Act?


Walter Edward Harris: The staff of the Department of Finance handle this act and do all the work.


George Randolph Pearkes: Can you tell me, please, whether requests are still being made for loans under this act?


Walter Edward Harris: Yes; 185 loans were made in the fiscal year 1954-55.


George Randolph Pearkes: I want to get the picture as to whether or not the numbers are decreasing. Is that a rapid decrease or not? There is a general decrease of $12,000 in the cost of administration. That may be explained by the number of applications under the Veterans' Business and Professional Loans Act, and the fact that they are decreasing.


Walter Edward Harris: They were decreasing up to within the last two years, when there was a slight increase by reason of the fact that the veterans of the Korean war are taking advantage of these loans. With that exception, a decrease in the number of applications was beginning to become evident.


George Randolph Pearkes: These loans are available only to veterans of Korea; the man who is joining the service now would not be eligible?


Walter Edward Harris: No.


George Randolph Pearkes: So we can expect a decrease?


Walter Edward Harris: Yes.


Erhart Regier: I want to endorse what the hon. member for Brant-Haldimand has said. It is a well recognized fact that the average A-l creditworthy man can borrow money at a bank at 5 per cent, and I think it is ridiculous that the government of Canada should insure the banks against loss when they are lending money at that rate. The other day a minister informed me that the government of Ontario was obtaining money at 3 per cent, so I am sure the government of Canada could get money at a rate lower than 3 per cent. I think the banks could handle these loans at 4 per cent, or even at 3 per cent.
I am not saying this on the spur of the moment, as it is something that has given me some concern of late that the government of Canada should enter the insurance business in connection with loans on National Housing Act homes where the interest rate is 5 per cent and has been even more than that. Not so long ago the banks voluntarily reduced their interest rate by one-half of 1 per cent. That was a most significant move, almost unprecedented. If I had had any money I would have gone out and purchased all the bank shares I possibly could. The banks were making more money than they had anticipated, and the result has been that within the past month bank shares have risen by more than 16 per cent. I think the farmers of Canada would be well served if loans were made under the Farm Improvement Loans Act at 4 or even 3J per cent.


Thomas Speakman Barnett: Can the minister indicate when the Fisheries Improvement Loans Act will be proclaimed?


Walter Edward Harris: I hope that will be the second thing I will decide after prorogation.


Mr. Bryson:: I should like to take exception to a remark made by the Minister of Finance, as well as by a member of the opposition. I do not like to hear it said that unless there is a great deal of risk involved these people have to accept these loans under the Farm Improvement Loans Act. Even in the best years in Saskatchewan I never heard of a man who did not have to go through this procedure regardless of his status in the community.


Walter Edward Harris: I said the hon. member for Brant-Haldimand had stated that anyone could get a loan without this legislation if he had good credit, and that if he did not have good credit he could get a loan under this act. I said if he was correct in saying that he had justified the existence of the act.
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Hugh Alexander Bryson: That is exactly what I mean. In view of the conditions which existed last year in western Canada I am surprised that this appropriation has been cut. Has the minister any comment to make in that regard?


Walter Edward Harris: The comment I made in the committee was that presumably not as many people were applying. I do not think that necessarily means that more applications are being refused. I did promise the person who mentioned it to me in the estimates committee that I would look to see whether because of the conditions that arose in western Canada last year there had been an inclination to refuse loans. I have not been able to find any evidence of that, but I did promise, and I repeat that promise, that I will look to see if that is the case.


Hugh Alexander Bryson: I know of numerous occasions where one man who obtained a loan was asked to make his payment in the year he got the loan, while another man was not asked to make his payment until the following year. Are specific instructions given to the banks as to how payments are to be made?


Walter Edward Harris: I think my hon. friend will appreciate that it depends largely on when the loan is made. If you borrow money in the spring you will probably be asked to make a payment in the fall, on the assumption that you will have money from your crops. If you borrow money in the fall you probably will not be asked to make a payment until the following crop year. The timing may be fixed at the best time for the borrower to pay.


Mr. Ellis:: The minister said he agreed with the hon. member for Humboldt-Melfort that generally speaking loans were financed through the Farm Improvement Loans Act. Would he not therefore surmise that the banks are using these facilities when there is no need to do so? In other words, many good risks who normally would be able to go to the bank and get money at 5 per cent are using the facilities of this act, and the banks are simply using the act in the main as added security when they loan money.
The reason I mention this is that in the annual report for the year ending December 31, 1954, there are quite a number of figures as to the extent of the operations of this act. Under the circumstances I think the figures will be misleading. In the main they are not going to reveal the number of marginal loans which will have to be made under this particular act. The figures are misleading in that they include not only those farmers who would have to make use of the facilities

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provided by this act, but also all farmers, whether or not they were good risks in the eyes of the banks, who are using the facilities provided under the act.


[Stage Direction]
Item agreed to.
Expenses of the Royal Canadian Mint and the assay office, Vancouver, B.C.-
118.	Administration, operation and maintenance, $1,050,181.
George Randolph Pearkes: I should like to know whether this is the Royal Canadian Mint here in Ottawa and an assay office in Vancouver, or whether it is a branch of the Royal Canadian Mint in Vancouver.


Walter Edward Harris: It is both. The mint is in Ottawa. The assay office was in Vancouver until I closed it in the interests of economy, on the 31st of March.


George Randolph Pearkes: There is no assay office in Vancouver now?


Walter Edward Harris: No.


George Randolph Pearkes: Where have they moved to?


Walter Edward Harris: Ottawa.


George Randolph Pearkes: Is that the only assay office in Canada now?


Walter Edward Harris: Yes.


George Randolph Pearkes: In view of the importance of the mining industry in British Columbia and the proximity of the smelter at Trail and for various other reasons, I have had numerous complaints sent to me about the closing of this assay office. I do not know whether it is too late for the minister to reconsider this decision he has made, but I can assure him it is causing inconvenience on the west coast.


Walter Edward Harris: We gave careful consideration to this. We considered the amount of work that had been done there and the amount that was likely to be done. Since we closed the office I have not had a protest. If my hon. friend will send his protest to me I shall be glad to look at it.


[Stage Direction]
Item agreed to.
119.	Construction or acquisition of new equipment, $268,970.
James MacKerras Macdonnell: At the top of page 21 there is a reduction of $6 million in the item of annual amortization of bond discount, premiums and commissions. Could the minister explain how that large amount has arisen?


Walter Edward Harris: This is not under item 119. This is a statutory item, as I understand it, having to do with the annual amortization of bond discount, premiums and commissions. We do not vote that; it is statutory.
r.Mr. Ellis.]


James MacKerras Macdonnell: I was merely asking for the explanation of the reduction of $6 million.


Walter Edward Harris: The cost of amortization has dropped by that amount.


[Stage Direction]
Item agreed to.
Grants to universities-
126. To provide grants to institutions of higher learning recognized in each province by the government of Canada and the government of the province as being universities or institutions of equivalent standing equal to an amount, for each province, not exceeding 50 cents per head of its population as certified by the dominion bureau of statistics divided among the recognized institutions, of the province proportionately to their enrolment of full time intramural students in personal attendance at the recognized institution or at an institution in the same province affiliated with it who are registered in courses of university level recognized as leading to and counting year for year toward a university degree awarded by a university in Canada and the Minister of Finance may for this purpose more particularly define the terms "university level" and "university degree", $7,800,000.
Mr. Knight:: The university grants have given an impetus and encouragement to the universities the like of which they have certainly never had before in my time. One should congratulate the government for giving and maintaining those, grants. I shall not go into the situation or even discuss the fact that some of those grants are not apparently welcome in certain quarters, because there is a whole constitutional issue in which I do not want to get mixed up at this late date. But it is sure that the increased fees that would be necessarily charged by the universities if these grants were not in existence would preclude the education of many people who are now enjoying such an education owing to the existence of these grants.
The grants make it easier for those with less funds, and I am interested in this angle of the question. They make it easier for those families with less money to spend to send some of their members to university. In that regard it is an excellent piece of social legislation, because it should not be anyone's aim that a university education should be the prerogative of any one class, and when I say "class" I am speaking in terms of money available to the family.
Attendance at university even now, of course, entails sacrifice on the part of members of the family concerned. It is a common fallacy that high school education, for instance, is free to those who are concerned. It is not just a matter of the fact that there are no fees for those people who are attending our high schools, because there are things like food, clothing and transportation which must be taken into consideration. Statistics prove that the amount of money which comes

into the family has a good deal to do with the attendance of high school students and the number of students from a family who can attend the high school.
There is the matter, for instance, of books, and there is the necessity for certain members of the family to work in order to maintain the family income while the other members go to high school. I had the statistics some years ago. It is quite a proven fact that the greater percentage of the children are in the professional classes, followed, I think, by the business classes, followed by skilled labour and unskilled labour in that order.
I am well aware that there are other reasons for that sliding scale, but one of the chief reasons is the amount of income enjoyed or not enjoyed by the families concerned.
While I am speaking on these grants-and I am all in favour of them-I would suggest to the government that they carry their work further by the granting of more scholarships to needy students. We have here an opportunity to mention this in connection with grants to universities. I shall not spend long on this, but I think we need more scholarships. I think the system of grants to university students in Britain has been very successful in this regard. We have had some system of scholarships here, but there has been a tendency to give them for scientific subjects. I suppose one can understand that tendency in times of war or in times of national emergency such as we have had. However, I notice that this government has been much more interested in that type of scholarship than in scholarships for the humanities, which I think are equally necessary, certainly in times of peace. In many families there are clever students who need this type of assistance. The fact that there is a grant to the university as such does not meet their problem.
Of course in my plea for scholarships for the humanities I do not want the scientific subjects to be neglected. It has been noticeable that in Canada most of the scholarships have been in the scientific field, under the influence of defence needs. There is certainly a need for trained personnel particularly in this atomic age. I know there has been difficulty in finding persons to fill certain important posts. I believe it was the Secretary of State who said the other day that there was a shortage of patent engineers and a shortage of engineers in general. I think a system of scholarships, together with the present system of university grants, would improve conditions in that regard.
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As to the university grants themselves, may I say that I never felt particularly comfortable about the method of their distribution or about the basis upon which they were distributed. It is true that 50 cents per head, if I may put it that way, is a nice easy way of solving the problem. It is easy of administration, but I am not sure that it is completely just. I think need should be taken into consideration; I refer to need in the particular province. I believe that the educational efforts which the province is prepared to make should also be considered. One can easily realize that a province with an extremely large population would not necessarily be as much interested in the education of its young people as would certain other provinces. I think this could be adjusted somehow in order to cover those two matters.
In any case I shall conclude by saying what I rose to say, namely that we are glad of these grants. We are thankful for them. As I say, they have been not only an impetus to the universities and to university education but they have been the very salvation of some of the universities which at present exist but which could not have existed if those grants had not been given. I welcome them as a sign that we are not concerned wholly with material things, though now one might urge, even in the material sense, that a country with such great potentialities and such great natural resources as we have will certainly need skilled minds, if I may put it that way, to administer them and to bring this Canada of ours which has such great potentialities up to the educational level of some of the older but perhaps less fortunate countries of the world in the matter of wealth and natural resources.


Alfred Claude Ellis: There are one or two questions I should like to ask the minister on this item. I assume that the government is guided in its policy decisions by the recommendations made by the Massey commission. On page 355 of its report the commission recommended as follows:
That these contributions-
That is referring to the moneys dealt with in this particular item.
-be sufficient to ensure that the work of the universities of Canada may be carried on in accordance with the needs of the nation.
Since the government set up the commission to make a thorough investigation of the needs of the nation in this respect, I feel that the government is prepared to accept its recommendations as the basis for its policy. I note that the sum of money appropriated under this item is some $7,800,000. I should like to know whether the minister feels that this amount is sufficient to meet the requirement

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laid down in the recommendation, namely that the appropriation be sufficient to ensure that the work of the universities of Canada may be carried on in accordance with the needs of the nation.
I believe it is generally understood that there are 100,000 university students in Canada. In view of the recommendations made to the commission with regard to what various organizations felt would be a proper form of financial contribution to the universities by the federal government, it seems to me that the amount of this appropriation is clearly insufficient to meet the needs of the nation.


Walter Edward Harris: This is the amount recommended by the report from which my hon. friend is reading.


Alfred Claude Ellis: I am not too much concerned with a specific figure. What I am suggesting is this-


Walter Edward Harris: You asked me a question and I answered it by saying that the Massey commission recommended this amount, that being the amount they thought carried out the substance in the report to which he referred.


Alfred Claude Ellis: My question to the minister was whether the government felt it was sufficient. I am dealing with the specific recommendation of the report, namely that appropriations be sufficient to fulfil a certain purpose. I was asking the minister whether it is the view of the government that the sum provided for in this appropriation is sufficient to meet the requirement set out in that recommendation.


Walter Edward Harris: My hon. friend bases his appeal to me on the report of the Massey commission. He referred to the government having appointed a commission and having taken some action to adopt as a policy the recommendations made by it. From that I take it or assume that he approves of the report himself and thinks we ought to be carrying it out. In answer to his question, let me say that I take it that this appropriation does carry out what the commission reports.


Alfred Claude Ellis: Might I ask the minister to what year the figure applied which he gave the house a moment ago as being recommended? In what year was that recommendation made? May I ask whether it was the intention of the commission that this should be the amount that should be appropriated each year, or whether it was the start of a program?


Walter Edward Harris: It is in the report itself. It reads as follows:
For example, if the grant were at the rate of fifty cents per head of population-
And so on. I am reading from the report.


Alfred Claude Ellis: That illustrates the very point; "for example." My suggestion is that when the commission made their report they envisaged a long-term approach to this whole problem, and that the figure suggested at that time applied not at this particular moment but at the time the recommendation was made, and was suggested in view of the situation at that time. My contention at this time is that the amount is insufficient. That is the point I want to make to the minister.


Walter Edward Harris: I understand that point now. I did not understand that point until this moment.


Alfred Claude Ellis: Irrespective of what recommendation was made by the commission, what I should like to get from the minister is whether in his view the appropriation is sufficient to meet the general requirement laid down in the commission report, namely that the amount of money be sufficient to ensure that the work be carried on in accordance with the needs of the nation.


Walter Edward Harris: Well, for the third time the answer is yes, but perhaps my hon. friend does not like a forthright yes or no so I shall give him a qualified answer. The recommendation was made by the Massey commission. The government accepted the principle involved in granting moneys to the universities. We conferred with the provincial governments and the universities concerned, or rather with the universities -conference. Certain formulae were worked out. This is the result. After four or five years it is possible my hon. friend may argue that conditions have so changed that the formula no longer applies.


Alfred Claude Ellis: That is my very point.


Walter Edward Harris: All right, I accept my hon. friend's point. It took him a long time to come to it, but we understand each other now. He says we should increase the grant.
I regret that at the moment I only find it possible to recommend this amount to parliament, and that is what I am doing.


Herbert Wilfred Herridge: I intended to make a few remarks on this item involving grants to universities, but in view of the remarks made by the hon. member for Saskatoon there is little necessity for me to do so. He is widely known, because of his interest in this subject, as more or less the unofficial representative of the universities in this house. With his don-like appearance and logic of Socrates we can leave that subject to him.
However, I do have two questions to ask the minister. What standard is used on which to base the qualifications of a university to

receive these grants, and who compiles the list of universities that are to receive them?


Walter Edward Harris: The list has to be approved both by the federal government and the provincial government concerned.


Herbert Wilfred Herridge: Does each provincial government send a list to the federal government for approval? Is that it?


Walter Edward Harris: That is correct.


Robert Ross (Roy) Knight: On that point, is there not a committee that makes the decision?


Walter Edward Harris: There is a committee that does the work, and it comes through the provincial government concerned.


Robert Ross (Roy) Knight: It is not actually the government that makes the decision.


Walter Edward Harris: Yes, it is.


Robert Ross (Roy) Knight: A committee appointed by the government.


Walter Edward Harris: That may be, but both governments approve the list.


Erhart Regier: Mr. Chairman, I noted the efforts of the hon. member for Regina City to get the minister to make a statement on whether or not he considered the amount of these payments to be adequate, and the minister expressed his regret that all he was able to recommend was the sum of $7,800,000. I feel that in coming to that decision the minister has possibly ignored some of the other grants he has authorized. I notice that the subsidy to the gold mines, for example, is some $11 million. Surely the minister will agree with me when I propose the idea to him that federal aid to university education is in the long run of far greater significance to the welfare of Canada than is federal aid to the continued operations of gold mines.
I am not opposing subsidies to the gold mines at this time. However, when you look at the amounts we are willing to spend on other things by way of subsidies, the amount of $7,800,000 for the universities is very insignificant indeed. I think we would be making at least a token recognition of the growing importance of university education for our young people if we paid a minimum of $1 rather than 50 cents per head. I doubt very much whether the minister would find much opposition in Canada to that kind of allotment.
For the benefit of members from those parts of Canada which have not yet seen fit to take advantage of these grants, may I say that I come in fairly close contact with the universities in the province of British Columbia, and I have never yet noticed any effort on the part of the minister to exercise 50433-439J
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any influence on the universities in that province as to the manner in which the educational grant is to be used. In my opinion the resistance to federal grants to universities is based on a false assumption, that assumption being that the federal government will exert an influence on how the grant is to be used by the universities concerned. As far as the University of British Columbia is concerned, I think I can safely say that the grant is being used very directly for the purpose of keeping at a low level the annual fees that have to be paid by the students attending that university.
There is one other reason I should like to advance in my effort to have the minister consider a radical upward revision of these grants at least with respect to the estimates on which he will be working a few months from now. On numerous occasions I have read statements of the Minister of National Health and Welfare addressed to the people of Canada, and have also heard him say that one reason we are unable to have national health insurance is that the technical help is not available in Canada to institute such a program. The other day the Minister of Mines and Technical Surveys admitted that he was very short of the trained help he needed in his department. I think almost every minister in the government will agree that he is handicapped in his efforts to obtain necessary civil service personnel by the lack of sufficient adequately trained professional people in the nation. Yet I find that the government is making next to no effort to remedy the situation.
I think the minister will agree with me that for the government to contribute the sum of $7,800,000 in aid of university education in a nation such as Canada is to admit at the same time that the federal government is making next to no effort to aid education at the university level. It may be that seven or eight years ago this amounted to a considerable effort. However, in the light of the cost of education today it is very little indeed.


Alfred Claude Ellis: I hesitate to leave on the record without any challenge the interpretation placed on the recommendation of the Massey commission by the minister. The Massey commission recommendation in this respect is to be found in italics on page 355 of the report. It is true that in section 11 prior to the recommendation the Massey commission does make certain suggestions which the minister has interpreted as being the recommendation. I am going to read the paragraph which the minister has interpreted as the recommendation. It is as follows:
There are a number of ways in which federal aid might be given to universities. We shall

Supply-Finance
recommend that this aid be given but we venture only to suggest how it might be given.
In other words the commission made no attempt to name the amount of money. The report continues:
If a grant were made on the basis of population in each province, it could be distributed among institutions in the province in accordance with the number of students. For example, if the grant were at the rate of fifty cents per head of population, then on the basis of 1949 estimates Manitoba would receive $389,000 which would be divided among the university institutions of Manitoba in accordance with their certified registration.
That is not a recommendation. It is quite clear that the commission was leading up to the recommendation, but they did not recommend 50 cents a head. That' was merely used as an example. Yet the minister has seen fit to lift this example out of context and create the impression that the Massey commission had recommended 50 cents per head as a basis for providing federal aid to universities. What the commission did recommend were four points, and I shall set them out:
(a)	That in addition to the help already being given for research and other purposes the federal government make annual contributions to support the work of the universities on the basis of the population of each of the provinces of Canada.
There again there is no reference at all to any set amount of money. Then they continue:
(b)	That these contributions be made after consultation with the government and the universities of each province, to be distributed to each university proportionately to the student enrolment.
(c)	That these contributions be sufficient to ensure that the work of the universities of Canada may be carried on in accordance with the needs of the nation.
(d)	That all members of the national conference of Canadian universities be eligible for the federal grants mentioned above.
Those are the recommendations of the commission. At no time did the commission recommend a set amount of money. The minister is seeking to justify an inadequate amount provided in this appropriation by referring to the fact that somewhere in the report there was mention of an example-


Walter Edward Harris: May I interrupt the hon. member. He has made his point that he thinks this is inadequate. Now let me make my point, that the presentation made by the conference of universities to the Massey commission worked out to a figure of about $6 million. In working out the recommendation the commission used this figure as an example. That was accepted by the government qs the only stated figure, and was used as its recommendation. If my hon. friend wishes to

say, as he has said, that they did not recommend 50 cents, I agree with him. But this figure was accepted at that time by the government as being a suitable figure, resulting in a grant of over $7,800,000. My hon. friend says this is inadequate; but can we agree that I am prepared to recommend only this amount in the meantime?


Alfred Claude Ellis: My point was to clear up what I believe was a misrepresentation.


Walter Edward Harris: Then you have done that. I will not accept the word "misrepresentation", but you have cleared it up.


Erhart Regier: No. This is far too important a subject to be brushed aside arbitrarily. The minister may say that $7 million is all the government of Canada can afford-


Walter Edward Harris: I did not say that. Nothing I said could be used to come to that conclusion. I do not want to argue with my hon. friend, because he is making the same point as was made by the hon. member for Regina City, that this grant ought to be increased. I appreciate his argument. I have heard it before, and I am sure on this occasion he has added a certain amount of grace and conviction to it. But at the same time let me point out that I never said I thought the universities of Canada should not have more than $7,800,000.


Erhart Regier: I still think it is my responsibility as a member to emphasize, with all the force I possibly can, that this aid to universities in Canada by the federal government is utterly inadequate. Today we have hundreds of thousands of boys and girls going to schools manned by inadequately trained teachers. The federal government ought to meet this urgent need of the nation. I have mentioned the field of public health and welfare. While I admit I am not too familiar with that field,
I am familiar with the field of education. And if I had to send my four youngsters either to a public school or a high school and have them supervised by a girl who had only grade 10 education and who was operating under a permit, I know what I would do. Yet that is the situation facing thousands of Canadians at the present time.
The progress of Canada is not forever going to be blocked by the opinion of a few who would like to see this government and all of Canada completely decentralized and become nothing. There is a tendency that has developed within very recent years in the cabinet of Canada. I feel the minister now concerned was not initially responsible; I feel

the Prime Minister shares the major responsibility. If years ago we started paying 50 cents per head for university education, then surely we should have increased that amount by now. We are not making any progress as a national entity. By deliberate design we are moving backward, turning the clock back. For a nation such as Canada to be short of school teachers when it is within the financial power of this government to remedy the situation is a disgrace, and the government must share the blame. For the minister to say we can afford $11 million for the gold mines of Canada and not more than $7 million for education is a disgrace not only to the government but also to the minister who puts forward that idea.


An hon. Member:: Ten o'clock.


William Alfred Robinson: It being ten o'clock, shall I rise, report progress and ask leave to sit again?


Walter Edward Harris: Mr. Chairman, I must say I heard someone call ten o'clock. May I say now that the Minister of Finance has asked the house leader to appeal to the committee to continue its consideration of the estimates of the Minister of Finance.


Erhart Regier: I have asked that it be called ten o'clock. May I say I am getting $10,000 a year and I am quite prepared to stay here until the snow flies. I didn't get any sleep last night, and I insist upon getting some tonight.
Item stands.
Resolutions adopted in committee of supply this day reported, read the second time and concurred in.


[Stage Direction]
At ten o'clock the house adjourned, without question put, pursuant to standing order.
[The following items were passed in committee of supply!:
PRIVY COUNCIL Privy council office-
338.	General administration, $474,595.
Prime Minister's residence-
339.	Maintenance and operation, $25,000.
Governor General and Lieutenant Governors-
156. Office of the secretary to the Governor General, $183,090.
Federal district commission-
340.	To authorize the federal district commission to expend for construction, improvements and operation of works under its control, revenues accrued or accruing to the commission from the rental of properties under its control and from other sources, $1.
Supply
341.	To provide for maintenance and improvement of grounds adjoining government buildings at Ottawa, and to authorize an amount not exceeding $111,820 for construction, improvements and operation of the parks, parkway system and other works under the control of the federal district commission which is additional to the sum of $300,000 granted by chapter 112, revised statutes, and for expenses of the national capital planning committee, $622,105.
342.	To authorize payment of the eighth instalment to a special account in the consolidated revenue fund, known as the national capital fund, established under vote 809, Appropriation Act. No. 4, 1947-48, $2,500,000.
157. To authorize and provide for the reimbursement to the lieutenant-governors of the provinces of Canada of the costs of travelling and hospitality incurred in the exercise of their duties up to a maximum per annum for each as follows:	(a)
where the population of the province at the last decennial census did not exceed 500,000, $5,000; (b) where the population of the province at the last decennial census exceeded 500,000, $5,000 plus $1,000 per each 100,000 or fraction of 100,000 of population over 500,000, but not exceeding $12,000 in any case, $86,000.

[Stage Direction]
Special-
795. To provide, subject to terms and conditions approved by the governor in council, for payment of assistance to producers of salted fish on products designated by the governor in council in the amount of 50 per cent of the laid down cost of salt used in their 1955 production; including authority to charge administrative costs to vote 153 of the main estimates, 1955-56, $500,000.

[Stage Direction]
General administration-
112.	Departmental administration (including the former administration of employees' instalment purchase plan and employees' group insurance plans), $1,965,633.
113.	Comptroller of the treasury-central office and branch offices administration, $15,616,300.
Administration of various acts and costs of special functions-
114.	Superannuation and retirement acts, administration, $574,240.
115.	The Bank Act-salaries and expenses of the inspector general of banks' office, $31,780.
116.	Administration of the Farm Improvement Loans Act and the Veterans' Business and Professional Loans Act, $74,178.
117.	Tariff board-administration, $63,993.
Expenses of the Royal Canadian Mint and the assay office, Vancouver, B.C.-
118.	Administration, operation and maintenance, $1,050,181.
119.	Construction or acquisition of new equipment, $268,970.
Payments to municipalities-
120.	Grants to municipalities in lieu of taxes on federal property-to provide for payments to municipalities in accordance with the Municipal Grants Act, and the rural municipal grants regulations established by order in council of August 6, 1952, P.C. 3729; and to provide for payments to municipalities under order in council of July 19, 1950, P.C. 3456, in respect of the cost of medical
[Stage Direction]
Supply
and hospital services and supplies furnished to federal employees and other persons specified therein, $3,279,050.
Contingencies and miscellaneous-
121.	To provide, subject to the approval of the treasury board, for miscellaneous minor and unforeseen expenses including authority to re-use any sums repaid to this appropriation from other appropriations, and special compensation or other rewards for inventions or practical suggestions for improvements, $1,000,000.
122.	Cost of telephone service at Ottawa for all departments, $1,060,000.
123.	Amount required to cover losses incurred on foreign exchange tendered in payment of accounts receivable, $1,000.
General items of payroll costs including superannuation payments-
124.	To provide, subject to the approval of the treasury board, for supplementing other votes for the payment of salaries, wages and other paylist charges, $750,000.
125.	To provide for the government's contribution, as an employer, to the unemployment insurance fund in respect of government employees paid through the central pay office, $1,080,000.
[Stage Direction]
Thursday, July 28, 1955