1956-04-24

COMMITTEES OF THE HOUSE


[Stage Direction]
Second report of standing committee on agriculture and colonization.-Mr. Jutras.

[Stage Direction]
Third report of standing committee on banking and commerce.-Mr. Hunter.


[Stage Direction]
On the orders of the day:
Mr. W. B. Nesbitt (Oxford):: Mr. Speaker, I should like to direct a question to the Minister of Fisheries. Can the minister report what progress is being made by the international great lakes fishery commission in exterminating the lamprey eels in the great lakes?


Hon. James Sinclair (Minister of Fisheries):: Mr. Speaker, I thank the hon. member for giving me notice of this question. The first formal meeting of this international commission is now taking place in Ottawa and they are laying out their program, both for the extermination of the lamprey eels and also the scientific management of the great lakes fisheries.
I was very happy to learn from the scientists yesterday morning that they feel there are adequate funds supplied by both governments to undertake the full program during the coming year. Sir, I might add the members of the commission have taken a short recess and are now in the gallery to see how we do our business in this House of Commons.


Mr. Robinson (Bruce):: May I ask a supplementary question? Will the program entail work in lake Huron and Georgian bay?


James Sinclair: I will be able to answer that better when the commission have concluded their hearings this week.



REPORTED WITHDRAWAL FROM GATT AND RENOUNCING OF EMPIRE PREFERENCE

[Stage Direction]
On the orders of the day:
Mr. Donald M. Fleming (Eglinlon):: Mr. Speaker, may I ask the Minister of Trade and Commerce whether his attention has been called to reports from Ceylon that the government of that country is considering withdrawing from GATT and also denouncing the system of empire trade preferences. Has the department formed any opinion as to the effect this may have on Canada's trade interests?
Right Hon. C. D. Howe (Minister of Trade
and Commerce): I must say that such a report has not been called to my attention. I shall be glad to make inquiries and answer tomorrow.



POLIOMYELITIS


[Stage Direction]
On the orders of the day:
Mr. H. A. Bryson (Humboldl-Melfort):: Mr. Speaker, I should like to direct a question to the Minister of National Health and Welfare, or, in his absence, to his parliamentary assistant. Have laboratories other than Connaught been authorized to manufacture Salk vaccine in order that safe and adequate supplies will be forthcoming to overcome the present shortage?


Mr. F. G. Robertson (Parliamentary Assistant to the Minister of National Health and Welfare):: Mr. Speaker, it is my understanding that the institute of microbiology at the University of Montreal will go into production some time later this year.
[Later:] [DOT]
On the orders of the day:


Hugh Alexander Bryson: I should like to direct a supplementary question to the parliamentary assistant to the Minister of National Health and Welfare arising out of the answer to the question I asked a moment ago. Is it true that further supplies of Salk vaccine to Saskatchewan have been postponed indefinitely?


Frederick Greystock Robertson: I have no information that would substantiate that declaration. I shall have to iake the question as notice.

Inquiries of the Ministry FLOODS



MANITOBA-INQUIRY AS TO FEDERAL ASSISTANCE

[Stage Direction]
On the orders oi the day:
Mr. Stanley Knowles (Winnipeg North Centre):: Mr. Speaker, may I direct a question to the Acting Prime Minister? Has the federal government made any offer to the government and people of the province of Manitoba to assist in combating the serious floods in our province? In particular, will consideration be given to financial assistance?


Right Hon. C. D. Howe (Acting Prime Minister):: Mr. Speaker, it is not usual for arrangements for combating a flood to be made in advance. The province of Manitoba has the situation in hand. If and when the province finds it necessary to call on the federal government, the federal government will, of course, consider the situation as it then appears.



ROYAL CANADIAN AIR FORCE


[Stage Direction]
On the orders of the day:
Mr. John B. Hamilton (York West):: Mr. Speaker, I would like to direct a question to the Minister of National Defence. Would the minister comment on the article in this morning's Gazette indicating that there is a shortage of transport type aircraft in the Royal Canadian Air Force?


Hon. R. O. Campney (Minister of National Defence):: Mr. Speaker, I can deny, of course, that there is a shortage of transport type aircraft in the Royal Canadian Air Force; but due to the activities in the Canadian north, the mid-Canada line and so on, I can assure the hon. member that all the transport aircraft of the Royal Canadian Air Force are very busy.

On the orders of the day:


John Borden Hamilton: Mr. Speaker, I should like to direct a supplementary question to the Minister of National Defence following his previous answer to me. Has the R.C.A.F. sufficient transport type aircraft to carry out its present commitments?


Ralph Osborne Campney: According to my information, that is so.



AIR TRANSPORT


[Stage Direction]
On the orders of the day:
Hon. George C. Marler (Minister of Transport):: Mr. Speaker, the hon. member for Yorkton (Mr. Castleden) inquired yesterday

about inspection and certification of commercial planes being used on the D.E.W. line operating out of Mont Joli.
The answer to this question is that the operators of all commercial aircraft employed in connection with the airlift for the D.E.W. line are required to be in possession of a certificate of airworthiness in accordance with the regulations of my department.
These certificates of airworthiness are contingent upon approved procedures for maintenance and inspection being established and maintained by the operators. These procedures include both inspection and overhaul requirements which are set down according to the type of aircraft and hours it has flown. There is, as well, periodic departmental inspection.



PATENT ACT


[Stage Direction]
On the orders of the day:
Hon. Roch Pinard (Secretary of State):: Mr. Speaker, on Friday last the hon. member for Eglinton (Mr. Fleming) asked me when the house may expect to receive the report of the royal commission appointed to inquire into the operation of the Patent Act, the Copyright Act and the Trade Mark and Design Act. The answer to that question is as follows.
The hon. member may recall that it was considered initially that at least a two-year period would be required for any commission to review and make recommendations concerning this complex legislation. After consulting with Chief Justice Ilsley and also the other members of the commission, I am informed that the commission has now in mind to present its report in separate parts. If so, the report on copyrights, which is expected also to include recommendations covering industrial design legislation, will likely be in the hands of the printers within three to six months. The report on patents will largely be completed by the end of the summer and there is every expectation that it will be presented early next spring.
No announcement can as yet be made with respect to the report on trade marks, as the commission considers that a certain length of time should elapse before the implications of the Trade Marks Act, which was amended in 1953, can be studied more effectively.

Inquiries of the Ministry COMBINES INVESTIGATION ACT



TRANSPORT


[Stage Direction]
On the orders of the day:
Mr. H. A. MacKenzie (Lambion-Kenl):: Mr. Speaker, I would like to direct a question to the Minister of Transport notice of which I have not given him.
Within the past few days two freighters collided on the St. Clair river and one of them sank right in the centre of the current. This is greatly disrupting traffic. Has any attempt been made to raise this vessel? What jurisdiction does Canada have in the matter?


George Carlyle Marler: Mr. Speaker, I made a statement to the house on this subject yesterday in which I said that salvage operations were being carried out under the direction of the United States coastguard and that efforts were being made to raise the vessel which had sunk.



PIPE LINES


[Stage Direction]
On the orders of the day:
Mr. J. G. Diefenbaker (Prince Albert):: Mr. Speaker, I should like to direct a question to the Minister of Trade and Commerce. Will the minister give the house the name of the United States citizen to whom he referred in his speech yesterday, who was connected with or a promoter of Trans-Canada Pipe Lines and who offered to turn over his holdings to the government of Canada or to a nominee of the government of Canada?


Clarence Decatur Howe: Mr. Speaker, I could give the name, but as the remarks were made outside the House of Commons perhaps they would be in the same category as some of the correspondence my hon. friend is having with those in the south who are interested in pipe lines.


John George Diefenbaker: Mr. Speaker, I produced the correspondence, and I now ask if the person the minister referred to yesterday in his emotional speech was a fictional character.


Clarence Decatur Howe: I assure my hon. friend that my speech yesterday was of the type usually given to chambers of commerce, which are not generally considered as being emotional bodies. The man to whom I referred is certainly not a fictional character.


John George Diefenbaker: It sounded like that.



MANITOBA-ALLEGED RESTRICTIVE SALES AGREEMENTS AMONG BREWERIES

[Stage Direction]
On the orders of the day:
Mr. F. S. Zaplitny (Dauphin):: Mr. Speaker, may I direct a question to the Minister of Justice. As I have not given the minister notice he may prefer to take this as notice. In view of the recent disclosure by a representative of the Manitoba breweries that restrictive sales agreements have been in effect among Manitoba breweries since 1936, is it the intention of the minister to order a further investigation into the restrictive trade practices of Manitoba breweries?


Hon. Sluart S. Garson (Minister of Justice):: Mr. Speaker, the only report relating to the brewery industry which has been received by myself as Minister of Justice is the report which was published in June of last year. This report related principally to merger activities of Canadian Breweries Limited; and while it referred to certain quota arrangements in Manitoba and other provinces, it did not elaborate upon them. However, any suggestion that any such agreements were given express or implied exoneration is quite unwarranted.
The matter of such agreements has been receiving further consideration by the combine's branch. In accordance with the usual practice that we do not disclose anything while such matters are under consideration, I can say no more at the present time.
We have not yet received the opinion of counsel upon the Canadian Breweries case, but I can assure hon. members that the matter is not being overlooked. If there have been any delays they have been due to the nature of the case and, in part, to the temporary incapacity of counsel, to which I have referred on previous occasions. When a conclusion has been reached I will promptly make it known to the house.


Stanley Howard Knowles: As a supplementary question, may I ask the minister if the counsel referred to is over his temporary incapacity and back on the job?


Stuart Sinclair Garson: Yes, he is.



INCOME TAX


[Stage Direction]
On the orders of the day:
Mr. Carl O. Nickle (Calgary Souih):: Mr. Speaker, I should like to direct a question to the Minister of Finance. In response to the serious concern being expressed in Canada with regard to the principle of retroactive

St. Lawrence Seaway
taxation measures, is consideration now being given by the minister to abandoning the retroactive features of the proposed amendments to the Income Tax Act with reference to depletion?


Hon. W. E. Harris (Minister of Finance):: Mr. Speaker, I said in my budget speech that we were not introducing any form of retroactive legislation, and I am still of that opinion. However, apparently other members of the community are not of that opinion and tomorrow I am receiving those who feel that they would like to express their opinions.


Donald Methuen Fleming: May I
follow that up by asking the Minister of Finance when he intends to introduce the resolution preceding amendments to the Income Tax Act?


Walter Edward Harris: I think as soon as this interview is over and proper consideration has been given to what is said.



ST. LAWRENCE SEAWAY AMENDMENTS TO AUTHORIZE OPERATION OF BRIDGES, ESTABLISHMENT OF TOLLS, ETC.

George Carlyle Marler: that the house go into committee to consider the following resolution:
That it is expedient to introduce a measure to empower the St. Lawrence seaway authority to construct, maintain and operate international bridges as specifically authorized by the St. Lawrence Seaway Authority Act, and to construct, maintain and operate incidental works; to provide the specific authority for the construction of an international bridge; to enable the authority to establish tariffs of tolls with respect to pedestrians or vehicles using highways or bridges under its authority; and to provide further for certain changes in connection with the administration of the act.
Motion agreed to and the house went into committee, Mr. Robinson (Simcoe East) in the chair.


Wallace Bickford (Wally) Nesbitt: Would the minister give us a statement as to the purposes of this resolution?


George Carlyle Marler: That is just what I was about to do when the hon. gentleman rose. I should like to explain the purposes the government has in mind in bringing forward this resolution as a preliminary step toward the amendment of the St. Lawrence Seaway Authority Act.
It will be observed that the resolution itself indicates three main purposes: first, to empower the St. Lawrence seaway authority to construct, maintain and operate international bridges as specifically authorized by the St. Lawrence Seaway Authority Act and

to construct, maintain and operate interworks; second, to provide the specific authority for the construction of an international bridge; and third, to enable the authority to establish tariffs of tolls with respect to pedestrians or vehicles using bridges under its authority.
The principal need to amend the act arises from changes that must be made, because of the construction of the seaway, to the existing facilities at Cornwall for rail and highway traffic moving across the river. At present both rail and road traffic uses a bridge which spans the north channel between the mainland of Ontario and Cornwall island. On the island itself there is a right of way for the railway and a highway for motor vehicles. The traffic, both rail and road, crosses the south channel between the island and the mainland of the United States by means of another bridge which lies astride the international boundary. The railway facilities are owned either by the New York Central or by one of its subsidiary companies, whereas the right to use the bridges for motor traffic is leased from the railway by the Cornwall International Bridge Company which also operates and maintains the highway across the island. I should like to add that these highway facilities are subject to tolls which are under the control of the bridge company to which I have just referred.
The construction of the seaway will make it necessary not only to demolish the bridge across the south channel, which is to be used by shipping, but also to relocate the railway and highway facilities and in doing so to build a new bridge across the river at Pollys Gut. I am sure that hon. members will appreciate that the responsibilities for this work of demolition and reconstruction rest partly upon the St. Lawrence seaway authority and partly upon its United States counterpart, the St. Lawrence seaway development corporation, as part of the work has to be done in Canada and part in the United States.
Pollys Gut, like the south channel to which I referred a moment ago, is divided by the international boundary so that the new bridge will be located partly in United States territory and partly in Canadian. It is now proposed that the St. Lawrence seaway authority be given the legal capacity to construct, maintain and operate bridges connecting Canada with the United States and, of course, to acquire lands for this purpose; and, more specifically, the authority is to be authorized to construct, maintain and operate the bridge over Pollys Gut to which I have already referred.
The building of the new bridge over Pollys Gut may be the joint enterprise of

the authority and of its United States counterpart, the St. Lawrence seaway development corporation, or separate parts of the structure may be undertaken by each of them. Accordingly, it is intended to authorize the seaway authority to exercise its powers in this regard either alone or jointly or in conjunction with an appropriate authority in the United States.
The demolition of the existing bridge over the south channel and the relocation of the present facilities for rail and road traffic will quite naturally give rise to claims for dam-* ages, particularly by the Cornwall International Bridge Company which, as I said earlier, has leased the right to use the bridge over the south channel and that over the north channel for highway purposes. Though its current lease ends on the 31st of December, 1957, a renewal was negotiated in 1950 for a term ending on the 31st of December, 1982. Because of the complexities of this situation, it is thought it would be desirable that the seaway authority should have, in addition to the power it already possesses of expropriating property, the power to acquire by agreement the shares of the Cornwall International Bridge Company. The proposed legislation will contain provisions for this purpose.
As the existing facilities for highway purposes are subject to tolls, it is necessary to give the authority the power to establish tolls with respect to the use of highways and bridges under its control.
So much for the main purposes of the resolution. The other purpose, that of providing for certain changes in the administration of the act, concerns a few subsidiary matters, namely:	*
1.	To authorize the authority to procure the incorporation of subsidiaries.
2.	To declare that the Navigable Waters Protection Act does not apply to works that are undertaken by the authority, as the present act now provides, or by a subsidiary of the authority.
3.	To provide that the net proceeds of the disposition of surplus property under the administration and control of the authority shall be paid to it so that these amounts may be credited against the expenditures.
4.	To give the St. Lawrence seaway development corporation or other authority in the United States the power to do in Canada such acts and things as may be necessary to enable it to act jointly or in conjunction with the seaway authority or a subsidiary thereof where, by the St. Lawrence Seaway Authority Act, the authority is empowered to do something jointly or in conjunction
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with the St. Lawrence seaway development corporation or other authority in the United States.


Wallace Bickford (Wally) Nesbitt: I have just a few questions.
I thought it would perhaps facilitate matters if I put a number of questions to the minister which he could then answejr. Is there not sufficient authority already in the St. Lawrence Seaway Authority Act, Revised Statutes of Canada, 1952, chapter 242, sections 10, 14, 15 and 17, to carry out the works the minister mentioned without having to amend the act? Second, is more than one bridge contemplated by the minister at the present time? He mentioned just one near Cornwall. Is there likely to be a bridge built by the seaway authority farther up, let us say at Prescott?
Another question I should like to ask the minister is with respect to the Ogdensburg bridge authority. An act was passed in 1952, which is chapter 57 of the statutes of Canada, 1952. In this act passed in 1952, known as an act to incorporate Ogdensburg bridge authority, I see that a certain private company has authority to build a bridge across the St. Lawrence river at Ogdensburg. They can ask permission to commence this bridge in five years, so that it would be July, 1957, before the power expired. I was wondering whether the minister could tell us whether there is any intention on the part of this company of going ahead and building this bridge up the river there. I see there are nine directors of this company, of whom seven are Americans and two are Canadians, one being the ubiquitous Mr. Duncan K. MacTavish. I wonder whether the minister would care to answer some of these questions at the present time?


George Carlyle Marler: If it would facilitate discussion of the resolution I should be glad to try to deal with these three questions summarily. In answer to the first question, as to whether the St. Lawrence Seaway Authority Act gives sufficient power to the authority to do what is contemplated by the present resolution, I think I should say immediately that the answer is no. It is thought that the seaway authority has not the requisite capacity to build the bridge across Pollys Gut to which I referred a few moments ago, and it is therefore necessary not only to give it the legal capacity to undertake this building operation but it is likewise necessary to give it the right to build this international bridge.
The hon. member for Oxford asked whether more than one bridge was contemplated. Perhaps I should, if I may, just go back over the explanation I gave a moment ago. The necessity for building this particular bridge arises from the fact that we

St. Lawrence Seaway have both highway and rail traffic crossing the river at this particular point so that, regardless of the intention of any other authority, public or private, to build bridges across the St. Lawrence river, in order to restore the facilities that now exist it is necessary for the Canadian seaway authority and the St; Lawrence development corporation to replace for the New York Central Railway in particular the railway facilities that are going to have to be interrupted by reason of the construction of the seaway.
By the same token, I am sure the hon. member will appreciate the difficulties of the situation when I again refer to the fact that we have this Cornwall International Bridge Company which has these highway traffic rights, which are of some importance both to those who use them and also to the corporation which collects revenues from the use of the facilities, and clearly it is necessary for the seaway authority to deal with this situation. I am given to understand that the method which it is proposed to follow- that is to say, removing the bridge over the south channel where navigation will pass and rebuilding a new bridge over Pollys Gut where navigation will not pass

is the proper technical method of dealing with the problem.
The hon. member asked more specifically whether more than one bridge is contemplated. We are, of course, talking about international bridges at the moment. I can say to the hon. member that my understanding is that it requires specific legislation from parliament to build an international bridge. The amendments that are contemplated would authorize the seaway authority merely to build the Pollys Gut bridge and not any other international bridge.


Mr. Johnston (Bow River):: May I ask
the minister a question or two? I do not intend to give any lengthy talk on this occasion. When he was speaking the minister made reference to the north and south channel. May I ask whether he feels these channels are navigable and whether Canada is going to have an equal share in the construction of a bridge across both channels or will it span the whole river, including both channels?
May I ask a question about the cost of constructing the bridge? Does Canada propose to bear 50 per cent of the cost and the United States the other 50 per cent?
The third question I should like to ask has to do with the establishment of tolls on an international bridge. I understood the minister to say, and quite properly so, that there would be tolls charged on this international bridge. Can he tell us first, if he has the information, what the toll will be,


and whether it is establishing a principle whereby international bridges may have a toll charge?


George Carlyle Marler: Mr. Chairman, with regard
to the first question I should like to tell the hon. member that at present navigation in this part of the river is to the north of Cornwall island and proceeds up by means of the Cornwall canal, but when the dam is built between Barnhart island and the mainland of Ontario, together with the other associated works, our own canal will cease to function and navigation will thereafter be by means of the south channel on the* south side of Cornwall island, so that what is necessary to do as a consequence of building the seaway is to remove the bridge over the south channel. The bridge over the north channel can remain because it does not interfere with navigation now; and navigation, after the opening of the seaway, will not immediately at least be using the north channel.
In order to permit the New York Central to cross the river, its right of way under the present plans is to be diverted from its present site toward the west, crosses over what I believe is called the Grass river bay, proceeds on to another island and then turns eastward downstream, so to speak, to this new bridge which will be built across Pollys Gut, which leads to Cornwall island. I hope I have answered my hon. friend's question so far as the existing bridges and that which is now contemplated are concerned.
He spoke a moment ago with regard to the cost, and I shall merely say I do not think anything more than a tentative arrangement has been made between the seaway authority and the seaway development corporation with regard to the Pollys Gut bridge.	I would like to say to the hon.
gentleman I think the intention is that the cost would be shared approximately equally, and there is just a question as to whether or not the work would be done jointly; that is to say, both enterprises agreeing that together they shall build the bridge, or whether it shall be done separately in the sense that part of the work, let us say specifically the substructure, would be built by one of the authorities and the superstructure by the other. It does appear that an arrangement such as that would lead to a distribution of costs which would be approximately equal, and I think the general intention is that there shall be an approximately equal sharing of the cost.
In that connection I would merely like to remind my hon. friend that as the capital costs of the building of the seaway, whether it be the Pollys Gut bridge, the locks or

some other part of the work, must in the final analysis be the subject of tolls whether they are paid by the St. Lawrence seaway development corporation or by the seaway authority, in the last analysis must come out of the traffic that is going to use the canal, so that personally I do not attach too much importance to exact equality in any particular operation provided the principles of equity are respected.
The hon. gentleman also asked a question as to the amount of the tolls. All I can say to him is that I do not know what is the tariff of tolls now being charged, and I do not know what is going to happen when these changes are carried out. I am quite sure the hon. member will appreciate the difficulties of the situation. I am thinking merely of the road traffic at the moment. The bridge company really owns three distinct properties, the present bridge over the south channel, the highway across Cornwall island and finally the bridge over the north channel.
If one expropriates the bridge over the south channel I take it that, independently of any other considerations, there may be a claim for total destruction of the whole enterprise because you cannot operate two-thirds without having something in substitution of the remainder. I can conceive that possibly, though I am not predicting the future course of events, the rights of the bridge company might conceivably be exercised over Pollys Gut bridge instead of over the bridge over the south channel. In that event there would be tolls in respect of the use of that bridge, just as there are at present in respect of the use of the bridge over the south channel.
I find it difficult to see all the possibilities. I am hopeful that it will be possible for the seaway authority to reach an agreement with the bridge company by which the authority will acquire by agreement, and not by expropriation-because there is no question of expropriation in this aspect of the question -the shares of the bridge company, and thus eliminate all the long drawn-out business of determining the damages in the rearrangement of the works.
It seems to me that is probably a simple solution but, as hon. members realize, it is quite one thing to talk about making a reasonable arrangement and another actually to conclude one. People's ideas of what is a reasonable price I find vary very considerably, and it may well be that what the authority considers to be a reasonable price for the shares of the bridge corporation is a long way from that which is entertained by the shareholders themselves. At all events, as I hoped to make clear earlier,
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we are not asking that the authority be given power to expropriate the shares, it may exercise the power to expropriate only physical properties. We are asking merely for the power to acquire these shares by agreement.


Charles Edward Johnston: I am not clear on one question. Will this establish the principle that tolls be charged on all international bridges?


George Carlyle Marler: I do not think so, Mr. Chairman. I do not think really any principle is at stake here, particularly as we have a state of affairs that has existed for a long time, and I do not believe it can be suggested that we are consecrating a principle eternally. I rather suspect that if the facilities are built it would be reasonable to expect that tolls will continue, and my own general impression-I do not want to engage in a debate about the virtues or demerits of tolls-is that if there are tolls it is more likely the facilities would be kept up than if there are no tolls and merely hopes for those who would like to have better facilities.


Mr. Michener:: What I have to say is largely in the nature of an inquiry, too, because there are so many uncertainties in a project of this kind which will only be resolved as it is proceeded with. One can readily appreciate that the construction of the canal, the deepening of the waterway and the construction of power plants will make it necessary to relocate facilities, including bridges, and perhaps make it necessary to construct bridges which did not exist before. I would have thought that, as suggested by the hon. member for Oxford, the St. Lawrence Seaway Authority Act was broad enough to permit the construction of bridges but, in any event, there is no harm in confirming that authority by additional legislation.
The consideration that arises in the construction of a bridge suggests to me a reference to the well-established pattern of international bridges which has been developed in the course of some time with respect to bridges and tunnels between Canada and the United States. In the main these are semi-public authorities, and they are all toll bridges or toll tunnels. They are self-liquidating. They have usually been financed by bond issues subscribed by the public, and tolls have been devoted to the paying off of the cost of construction. The bridge authorities with which many hon. members are familiar then turn the structures over to the appropriate governmental authorities when the bonds have been retired, and then it is a matter for the government to decide whether or not tolls should be continued.

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That is a well-established pattern. It is the result of the building of a good many substantial intercommunications between Canada and the United States at no cost to the public, except to those drivers of vehicles and pedestrians who use the bridges.
This raises a question as to whether or not the tolls which would be charged for the use of this bridge would be kept entirely separate from the seaway tolls. It seems to me they have no relationship to the tolls which would be charged for the use of the canal. In one case the users of the bridge would pay their tolls and pay the cost of maintenance and ultimately the cost of building the bridge, and separate accounts should be kept. In the other case the users of the canal, or the shippers, would pay their toll for shipping facilities. I am just pointing this out; doubtless these things have received consideration not only by the minister but by the seaway authority.
If that pattern is followed there will be the question of the reversion to public authority of such bridges as the seaway authority may build and the integration of these into the highway systems of the two countries after the bridge has been paid for. I think that is a desirable course to look forward to, rather than to have the seaway authority charged in perpetuity with the maintenance of structures which are in essence a part of the road transportation system of the country.
I am not clear as to how far the proposed new structure will be from the existing bridge. Perhaps the minister could tell me how many miles distant it is to be. If it is approximately in the same location, different considerations arise, I think. I take it that the existing bridge is a self-sustaining bridge; that is, it is maintained by the tolls that are charged and is self-sustaining. I assume that if necessary the new one will also be self-sustaining. It occurs to me that the existing bridge company might be prepared to undertake the construc-. tion and operation of a new bridge. It might save the authority the expense of acquiring its shares or a site or the franchise of the existing company; however, those are matters for negotiation. I do agree that' the authority ought to have the power to see that proper bridge communication is maintained across the new canal.
One question which arises is whether it has been definitely settled that a subsidiary company will be formed for the purpose of constructing and operating the bridge and, if not, whether the corresponding authority on the United States side, which I believe is called the St. Lawrence seaway development corporation, will undertake the construction of the part of the bridge which is on the United States side.
We would be interested in knowing whether or not the policy has been thought out far enough so the minister could say at this time that when the bridge has been paid for by the charging of tolls in due course, it will become a part of the highway system of the country.


George Carlyle Marler: Mr. Chairman, it is exactly considerations such as those which the hon. member for St. Paul's has just expressed that have lead to the provision in this resolution for the granting of power to the St. Lawrence seaway authority to have a subsidiary corporation. I believe it is the intention of the authority, particularly if arrangements can be concluded with the Cornwall International Bridge Company, to acquire its rights over the existing facilities and to entrust them to a subsidiary corporation so that, just as the hon. member for St. Paul's suggested, the revenues coming from highway tolls would be kept separate from those coming from the seaway.
Perhaps I should not say that this is the sole and exclusive purpose so far as subsidiary corporations are concerned, but I know of no other purposes in mind for subsidiary corporations at this time other than that purpose leading to separating the highway facilities from the collection of tolls from the principal and main activities of the St. Lawrence authority itself which is, of course, to be concerned with tolls from navigation.


Stanley Howard Knowles: Mr. Chairman, I would like to ask the minister just one question, and it is a very simple one. Is the minister yet in a position to give any kind of timetable concerning this whole project, as to when the power station might be in operation and when navigation itself will be opened?


George Carlyle Marler: Well, Mr. Chairman, in giving these dates I do not want the hon. member to think I am giving a personal undertaking that the project will be completed within these time limits, but I am told it is the objective of the power interests to get into the production of power sometime during the end of the summer of 1958. So far as the navigation facilities are concerned, it is expected that the seaway will be open for navigation for the season of 1959. I do not think there has been any departure from those dates.
When I first became associated with the project it was then said it was expected it would be finished toward the end of 1958, and I do not think there has been any substantial departure from that proposed date of completion. Quite obviously it would be academic to expect the navigation facilities

to be completed by December 31, 1958, and I think they would be completed with the opening of navigation in 1959 so far as the seaway is concerned. I believe it is the hope and expectation of the power entities that it will be possible to commence production sometime in the summer of 1958.


Stanley Howard Knowles: Could the minister give a corresponding answer regarding the bridge?


George Carlyle Marler: I think that we must have the bridge finished at that time. One fact I want to emphasize particularly is that it serves both for railway and highway purposes. I do not believe it would be possible to interrupt either the rail traffic or the highway traffic. I think the two must be done so that it would be in operation when navigation commences.


Wallace Bickford (Wally) Nesbitt: Mr. Chairman, I would like to ask one or two questions arising out of answers the minister made in reply to my earlier questions. Could the minister tell us whether or not bridges apart from the one the minister specifically mentioned are going to be built, particularly in the international rapids section of the seaway, or anywhere else for that matter, by the St. Lawrence seaway authority; or are they going to be constructed by private companies?
I am just seeking information. The reason I mention that particularly is the Ogdens-burg Bridge Company, which was incorporated by parliament in 1952 by chapter 57 of the Revised Statutes of Canada. Section 18 of that act sets out that power to commence the bridge may be sought from the governor in council within five years. No further act would be necessary, because permission could be given by the governor in council to commence the bridge within that period of time. Does the minister know whether the Ogdensburg Bridge Company is going ahead? I believe there is a private bill on the order paper concerning that company, but I do not know what it contains and I am just curious as to what is going to happen.


George Carlyle Marler: I am not in a position to make any statement with regard to the Ogdensburg bridge. All I can tell the hon. gentleman is that if it had not been for this particular situation at Cornwall island I do not think the seaway authority would be in the bridge building business at all. I would not like the committee to think for a moment that this is a departure from the main purpose of the St. Lawrence seaway authority which, as hon. members know, is to build a deep waterway from Montreal to lake Erie and not to go into the building of a series of bridges across the river, either
St. Lawrence Seaway
in the international rapids section or anywhere else. If it had not been for this particular situation and the fact that the replacement of the bridge across the south channel necessitates an international bridge I do not think it would have been necessary to bring in this legislation.
The hon. member for Oxford perhaps was a bit more specific with regard to the question of bridges. I think I have dealt clearly with the matter of international bridges. As I understand the situation, if another international bridge were necessary because of the seaway I think we would expect to come back to parliament to ask for authority to build a further specific international bridge, but there is no such intention at the present time.
So far as other bridges are concerned, I think I should say that it is a possible development, although I would not like to describe it as being likely, that after the bridge has been built across Pollys Gut it may be necessary to replace the bridge across the north channel. I consider that to be within the realm of possibility. I would not want hon. members to feel that I have not been perfectly frank, that there has been an attempt to conceal that fact from them. There is that possibility, but at the moment I would not describe it as something that is to take place immediately. I do not know if it will take place or when it will take place, but I say it can take place under the legislation which is contemplated.


Wallace Bickford (Wally) Nesbitt: As the minister has indicated, the seaway authority is not in the bridge building business except when a bridge is necessary because of the seaway itself. I think that could be expanded in more general terms. Many new problems are going to be created by the increased flow of traffic from the ocean to the lakes and by the larger ships going through. Many of these could not be foreseen at the present time. If there are to be other international bridges, to be built either by private companies or by some governmental authority, it would seem to me that the seaway authority should be interested in having a great deal of control over such bridges. With the increased traffic and the larger vessels from foreign countries and elsewhere I would think that control over any bridge built across the St. Lawrence river between Kingston and Montreal or even beyond Montreal should be vested in the authority.
There could be all kinds of things that could not be foreseen at the moment. There is some indication that the Ogdensburg bridge may be built. Just what authority

St. Lawrence Seaway
will the seaway authority have over the height of bridges and so on? There are all sorts of problems, as I mentioned earlier. A bridge might obstruct traffic and other things could happen. Could the minister give us some assurance in this respect?


George Carlyle Marler: I would draw the hon.
member's attention to the terms of the resolution which give an indication of the legislation which is to follow. The first phrase reads:
That it is expedient to introduce a measure to empower the St. Lawrence Seaway Authority to construct, maintain and operate international bridges as specifically authorized by the St. Lawrence Seaway Authority Act.
I think those clear terms of the resolution indicate that specific authority would be required. Mention has been made of the bridge over Pollys Gut. I take it that if contrary to my own expectations at this time it were decided at some future time that the seaway authority ought to be the instrument for building some other bridge of an international character, then that would require a specific amendment to the act. I hope that answers the question.


Wallace Bickford (Wally) Nesbitt: Not the exact question I had in mind. If other international bridges are built across the St. Lawrence, constructed either by a private company or a governmental agency, not by the seaway authority itself, what control if any would the seaway authority have over such bridges?


George Carlyle Marler: Mr. Chairman, control of that kind is not exercised by the St. Lawrence seaway authority. The particular section of the St. Lawrence river with which we are concerned is not the only navigable water in Canada. Broadly speaking, the jurisdiction of the authority will extend from the port of Montreal westward to the end of the Welland canal, but it is not the authority which approves the plan. That is a duty which falls upon the Department of Public Works under the Navigable Waters Protection Act. That act requires that the height of a bridge over a navigable water shall be such as not to interfere with the course of navigation. That is not a function which properly ought to be carried out by the St. Lawrence seaway authority, which has a specific administrative task to carry out. There is general control by legislation to protect navigation against bad engineering or overenthusiastic bridge builders, which is to be found in the statute to which I referred a moment ago.


Mr. Hamilton (Notre Dame de Grace):: Mr. Chairman, earlier in his remarks the minister gave us to understand that the present lease on the existing bridges at Cornwall

would have expired in December, 1957, but was renewed in 1950 until 1982. Between what parties was that lease executed?


George Carlyle Marler: The lease is between the New York Central railway, a subsidiary of the New York Central railway the name of which escapes me at the moment, and the tenant, which is the Cornwall International Bridge Company. As I recall, those are the three parties to the lease which was negotiated I believe back in 1950.


William McLean Hamilton: Is
the federal government a party to that lease in any way? In other words, when the bridge was originally constructed it must have been constructed with the knowledge and acquiescence of the federal government. Is there any way in which the federal government is currently a party to this lease?


George Carlyle Marler: My recollection of it, Mr. Chairman, is that the bridge over the north channel, and the Canadian portion of the bridge over the south channel were built under the authority of legislation adopted a great many years ago. I should not like to affirm this as having been verified just a short while ago, but my impression is that the legislation goes back to 1887. There were provisions in that statute, but unfortunately they did not provide any particular relief so far as the federal government was concerned in considering what might be done in connection with the bridge.
I should like to emphasize the fact, however, that the bridge over the north channel, and likewise that over the south channel, were built as part of a railway operation. They were never intended to be for road purposes when originally built. In fact, as I understand it, when there is a train on the bridge there is no possibility of highway traffic using it, so my hon. friend will understand it goes back quite a long way.


Mr. Hamillon (Noire Dame de Grace):: Yes, I think I know the bridge in question and it is not very large, nothing to be very proud about. As a matter of fact, I guess the only bridge that looks and is worse than this bridge is the Victoria bridge near Montreal; that is just a personal opinion.
However, the point I am trying to get is whether, when this lease was renewed in 1950, there was any measure of acquiescence whatever required on the part of the federal government in order that this renewal could come about.


George Carlyle Marler: I do not want to leave without comment the hon. gentleman's remarks about the Victoria bridge. I do not look upon the Victoria bridge as a modern structure like

the Jacques Cartier bridge in Montreal, but somehow or other the Montreal public seems to be rather glad the Victoria bridge is there. So far as I am concerned, I think the public are rather pleased to see that there are more facilities on the Victoria bridge, despite what the hon. gentleman has just said.
I do not want to digress, Mr. Chairman, because I know the Victoria bridge is not covered by this legislation. I do not want to attempt to broaden the debate to cover it, though if my hon. friend from Notre Dame de Grace would like to talk about the subject when my estimates are before the committee I shall be very happy to discuss the thing as fully as he wishes. It is merely because I feel the subject is outside the scope of this resolution that I resist the temptation to say what is in my mind.


William McLean Hamilton: We
will confirm that date right now. I am just waiting for the opportunity.


George Carlyle Marler: I shall do my best, in spite of the hon. gentleman's remarks, to sleep soundly in the meanwhile. I think it will be found, when the facts are known, that though the hon. gentleman may not be convinced, people who will approach the thing with an open mind will come to the conclusion that there is certain merit in what has been done.
I should like to reply to the hon. gentleman's question with regard to the lease. I would say, though, that the two bridges are he property of the New York Central railway or a subsidiary, and that the federal government was not a party to the renewal of the lease in 1950. The railway company did not require federal consent to lease the property. My understanding of the circumstances is that the bridge company was contemplating some rather substantial expenditures at that time and negotiated a 25-year renewal of the lease so as to give it the opportunity of recovering its new investment over a longer time.


William McLean Hamilton: There is just one more brief observation I should 'ike to make, Mr. Chairman. I feel this resolution is a rather unfortunate piece of draftsmanship in that it has left some of us very definitely with the impression that the seaway authority was being given the power to construct, maintain and operate bridges, in the plural, and conceivably as many bridges as they wished to construct without any further reference to this house. This statement is very definitely made in the opening sentence of the resolution, which reads:
That it is expedient to introduce a measure to empower the St. Lawrence seaway authority to construct, maintain and operate international
St. Lawrence Seaway
bridges as specifically authorized by the St. Lawrence Seaway Authority Act, and to construct, maintain and operate incidental works-
I draw particular attention to the fact that the word "bridges" and works are in the plural. Anyone reading that is very definitely given the idea that this is an all-embracing resolution. Then the minister gives us to understand that this resolution, and the bill when it is introduced, is going to be specifically related to one bridge and one bridge alone, and that if any further bridges are to be constructed the government will have to come back to the house to get further authorization.
Now I, for one, am very glad that is the case. I never have liked and I do not imagine I will ever bring myself to like, the type of all-embracing legislation that hands over to some subsidiary government body rights of action which properly belong to this parliament. The government has been prone to do that on certain occasions in the past. In this instance apparently they are not going to do so, but that does not alter my own feeling that when a resolution comes to this house it should be so written that we can understand what it means and what it is intended to cover before we come into the chamber and have the minister restate the resolution in terms which are, in this case, substantially different from those one would draw from this wording.


George Carlyle Marler: I do not want to prolong the discussion unduly, but it seems to me that the language of the resolution is quite clear for those who will read it and give to each of the significant words the meaning which it normally has. There is no question but that the words "international bridges" means more than one bridge. But my hon. friend who has just spoken conveniently leaves out the effect of the word "specifically".
I have not, in what I have said today, done anything to limit the scope of the resolution. I have merely told him that it was the intention under the proposed legislation to give specific authority to build the Pollys Gut bridge, but my hon. friend does not seem to appreciate that there are two aspects to this situation. The first is to give the seaway authority the power or legal capacity to build international bridges. Then there is a second aspect, to give the power or the right to the authority to build a specific international bridge. I have told him in my remarks it was intended to authorize the authority to build international bridges, but that the only international bridge that would be specifically authorized under the legislation is the Pollys Gut bridge. Surely, Mr. Chairman, it makes it quite clear that if any other international bridge needs to be built in the exercise of the

St. Lawrence Seaway
power which we are now conferring on the authority, parliament would require to be consulted.
Now, Mr. Chairman, we all know that when lawyers come to draft bills and resolutions they draft them in legal language; and having dealt with lay people and clients all my life I have become quite accustomed to having clients say to me, "Why can you not put that in simple language that we all can understand?" When lawyers do that we will all know that the millennium has been reached; and that when the client understands the lawyer there will be no further need for him.


Wallace Bickford (Wally) Nesbitt: To comment on the last
remark of the minister, may I say that in the law school I and I guess a great many other hon. members attended we were always told to put things in as simple language as possible.


An hon. Member:: Why don't you do it?


Mr. Lavigne:: I want to say a word on the resolution. The St. Lawrence seaway authority has the responsibility of replacing existing structures whether it is a house, place of business or a bridge. I believe the reason for the introduction of the resolution is to give the authority certain powers under which they will be able to build the bridge without becoming involved in too many details with a company that has a Canadian and an American aspect. I believe the authority is the only body that can handle the situation in the proper manner, because it will involve quite a lot of added expenses that the bridge company may not be willing to incur but which the authority can take care of by charging certain tolls.
At the present time the toll on the international bridge at Cornwall is $1 one way or $1.25 for a return trip. The port of entry at Cornwall has become quite important from the point of view of customs revenue, and I want to recommend to the minister that the bridge be replaced with a modern structure, if possible, and also with the least inconvenience to the people who have to cross back and forth. I agree with the remarks of the hon. member for Notre Dame de Grace that the present bridge is not very beautiful or attractive, but I want to tell him that it has been useful and appreciated by the people of my county.
Resolution reported and concurred in.
Mr. Marler thereupon moved for leave to introduce Bill No. 216 to amend the St. Lawrence Seaway Authority Act.
Motion agreed to and bill read the first time.



CANADIAN NATIONAL RAILWAYS


George Carlyle Marler: that the house go into committee to consider the following resolution:
That it is expedient to introduce a measure to authorize and to provide for the construction by the Canadian National Railway Company of a line of railway from Bartibog to the Tomogonops river, in the province of New Brunswick, being approximately 22 miles, at a total estimated expenditure of $2,800,000. The measure will include authority for the issue by the company of securities, which may be guaranteed by the government, to finance the construction. To enable the company to proceed with construction forthwith, temporary loans may be made to the company out of the consolidated revenue fund upon terms and conditions prescribed by the governor in council, and may be secured by company securities.
Motion agreed to and the house went into committee, Mr. Applewhaite in the chair.


Mr. Brooks:: Is the minister going to enlarge on what is contained in the resolution?


George Carlyle Marler: Yes, I have a very brief statement I should like to make in connection with this resolution. I was able to announce in the house on March 26 that it was the intention of the government at the first convenient opportunity to recommend legislation to parliament that would authorize the Canadian National Railway Company to construct a line of railway from Bartibog to the Tomogonops river in the province of New Brunswick, a distance of approximately 22 miles. This resolution seeks that authority.
The proposed branch line would commence at a point at or near Bartibog, on the main line of the Canadian National Railways between Newcastle and Bathurst in the province of New Brunswick, and run in a westerly direction to the Tomogonops river in the vicinity of Little River lake, a distance of approximately 22 miles. The estimated cost for the construction of the proposed line is $127,270 per mile or a total of $2,800,000.
Heath Steele Mines Limited, a subsidiary of American Metals Company, has expended large sums in proving up a substantial body of lead, zinc and copper ore and is at present actively engaged in readying the mine for production, including the installation of a concentrate mill having a capacity of 1,500 tons of ore daily. The company has requested the railway to construct the said branch line to its mine.
The prospective traffic on the proposed line would consist of mining concentrates estimated to amount to 120,000 tons per year moving by rail to Newcastle, Halifax or Saint John or other points for export. It is estimated that there would also be 12,000

cords of pulpwood originating on the branch line and that general freight traffic to the value of $115,000 per year will develop. Heath Steele Mines Limited has agreed to guarantee a movement of 450,000 tons of concentrates within the first six-year period of operation, with the stipulation that the railway will be paid a penalty for any shortage below 75,000 tons in any year, subject to adjustment if in the aggregate 450,000 tons are delivered to the railway over the said six-year period.
The arrangement also contemplates that if penalties are paid for the-six year period, the company will be granted a further six-year period in which to recoup such penalties for any excess over 75,000 tons in any year during the second six-year period, provided that credits to the company will cease when all penalties have been so returned by the railway. The president of the railway believes that on these terms the branch line should be profitable. A formal agreement in writing will be negotiated with the company.
The president of the railway advises that the revenue to be received from traffic engendered by the branch line will meet all expenses of operation and maintenance of the branch line, the cost of handling such traffic on the remainder of the system, interest on the cost of construction of the branch line, and interest and depreciation on the necessary equipment, and produce a surplus.
The resolution will, I feel sure, commend itself to the house, and I am confident that hon. members will see the proposed legislation as yet another forward step in the development of our great natural resources and as an instance of the part the Canadian National Railways continue to play in that development. I think all of us are particularly happy that the location of this further extension of our national railway system is in the province of New Brunswick. This rail construction is the first in that province in recent times, and sharply points up the tremendous potential wealth that lies within its boundaries.


Alfred Johnson Brooks: Mr. Chairman, I wish to say just a few words on this resolution. As the minister has pointed out, we were told of this resolution on Monday, March 26, when he notified the house that such a resolution would be brought down.
It is not necessary for me to read the resolution. I imagine it is much the same as what we would find in any other resolution with respect to a branch line of the Canadian National Railways anywhere else in Canada. It will be a part of the Canadian National Railway system and it will be a branch line, as he says, in the province of New Brunswick.
Canadian National Railways As the minister well said, we in New Brunswick are happy that a railway is being built there. It is good news. As he also said, it is a number of years since there has been any railway building in the province of New Brunswick. In that connection I might say that we are becoming more accustomed to having railroads torn up than we are to having them built.
I am pleased indeed that it is the Canadian National Railways that is building this branch line. When the Quebec North Shore and Labrador Railway Company matter was before the house I think a good many of us felt that it was rather a shame that our Canadian National Railways, which is the peoples' railway in this country, was not building the railroad in that potentially wealthy part of this dominion. Speaking frankly, I think that the Canadian National Railways missed a great bet in the Labrador peninsula. However, that has nothing to do with the line that is being built from Bartibog to the Tomogonops river in the province of New Brunswick.
The minister has told us that this matter has been thoroughly investigated, that from all appearances it will be a feasible and practical railroad, and that it will pay. Not only will it handle these metals from this mine which is being operated by Heath Steele Mines Company Limited which, I might say, is a subsidiary of the American Metals Company. The railway will also develop the country further as far as lumber operations are concerned. I understand that there will be production of some 15,000 cords-


George Carlyle Marler: Twelve thousand.


Alfred Johnson Brooks: -or 12,000 cords of pulpwood. Would that be yearly?


George Carlyle Marler: That is the expectation.


Alfred Johnson Brooks: That is the expectation yearly. This is a part of New Brunswick that we have heard a great deal about lately on account of the great mineral wealth that is being found. It is really part of the Bathurst area, I might say. We heard of the Bathurst area first. This Heath Steele Mines Company Limited has been working quietly in the interior of this section of New Brunswick. From the reports of our provincial lands and mines department I understand they have discovered rich base metal ores there containing lead, copper and zinc. I believe there is some silver as well.
The railroad itself is perhaps not to be compared with the railroads that have been built in other parts of Canada. I think we might say that it is a very modest line of railway. It is only 22 miles long. It will be

Canadian National Railways built for $2,800,000. For instance, we cannot compare it with the line which was built to Knob Lake, or we cannot compare it with the line that was built to Lynn Lake a few years ago. I remember the resolutions that came before the house with respect to those railways and the bills that made possible their building. It cannot be compared perhaps with the Chibougamau railway that is being built in the lake St. John and Chibougamau area. Nevertheless, the fact that this railroad is being built into mines in the centre of the province of New Brunswick gives us a certain thrill and a certain feeling that we are in the same category as are some of these other places I have mentioned.
We realize what those other lines have meant for other parts of this Dominion of Canada. We all realize what they have meant to the people in the way of employment. We realize the great wealth they have brought to those sections. We realize that they have meant the growth of the population of those sections. I am thinking of such towns as Seven Islands. Just the other day I was told that the town of Seven Islands had increased in population from 800 to 8,000. We are also told that in the Chibougamau area there is a large city in the process of development. One does not know just what the final results may be in matters of this kind.
I think I should express the hope that this railroad will not be used just as an agency for the siphoning off of the raw materials of that part of our province. Mind you, we are not objecting to the shipment of some raw materials. However, we in the province of New Brunswick hope that it will not be only a matter of producing raw materials in the mines, putting them on the railroad cars and shipping them, as the minister said a few moments ago, either to Saint John or to-


George Carlyle Marler: Halifax.


Alfred Johnson Brooks: -Halifax or perhaps to
Bathurst or Newcastle for shipment overseas. At the present time we are shipping concentrates of ore through the town of Bathurst. Just the other day I read that in the harbour at Bathurst there were over a quarter of a million tons of concentrates waiting for shipment overseas. What we hope is that besides producing the ore the time may come, and that it may not be far distant, when these concentrates or these ores will be processed by smelters in our own province.
There is a great need for smelters in eastern Canada. I have been reading reports from Quebec to the effect that Quebec hopes to have a smelter for the iron ore in its own province. That has reference to the great quantity of iron ore that is being carried


down from Knob Lake to Seven Islands and shipped from there down to the United States. Speaking in general, I think if the iron ore in Labrador were to be smelted in this country-either in Quebec or in the maritime provinces-it would mean much more to the people of this country. We in New Brunswick are therefore hoping that with respect to this rich ore we have, it will not be just a case of producing it and shipping it on this new railroad that is being built in New Brunswick and, as I said a moment ago, sending it out of the country for most of the work to be done by people in other parts of the world, either in Europe or in the United States.
There has been a good deal of newspaper comment lately on this mineral development in New Brunswick. I should just like to quote from the Telegraph-Journal of April 21, just a few days ago, with regard to the further development of this area. This article reads in part as follows:
One of the problems still to be overcome-
This is speaking of the problems in New Brunswick.
-is the development of hydro power to sustain all operations and eventually operate a big smelting plant. This proposed smelting plant, one of Premier Flemming's favourite subjects, will cost an estimated $30 million. Until this is built, ore will be shipped mainly to European smelters.
Some officials are hopeful that sulphur mines may be developed in the ore-streaked territory when base metals of lesser value would be a byproduct. Some of the ores contain up to 40 per cent sulphur.
I was also pleased, Mr. Chairman, to note an article which appeared in the Ensign of Montreal on March 24, in which it reviews the outlook for the different provinces for the next 25 years. The article was written by William J. Dewan. In speaking of New Brunswick he had this to say:
No longer content to remain "one of the weakest links in the Canadian confederation", and sick of being treated by the rest of Canada "as if we were complaining poor relations or querulous beggars", New Brunswick looks for a much happier second half of the twentieth century.
Recent discoveries of large deposits of base metal ores within the province are the major factor in the new outlook.
He mentions the great recent discoveries of minerals in the northern part of New Brunswick, but the important part of the article reads as follows:
New Brunswick fails to see why, within the framework of confederation, a formula cannot be evolved to permit the initiative and industry of any group, aided by a broad and equitable policy of the central authority, to produce a well-balanced economy across Canada for the betterment of the whole nation:
We are very grateful to the Ensign for that statement. I think it applies very aptly

to the hopes and aspirations of the people of New Brunswick at the present time. A few weeks ago the Financial Times also spoke about the situation in the maritime provinces and in New Brunswick in particular. It said:
Mining developments are, however, not just confined to one area. The possibility of mining is spreading far and wide, and this hints at least at the possibility, which shortsightedness may yet ignore, that mining throughout New Brunswick could be expanded into full metallurgical and chemical industries with results similar to those obtained in western Canada from oil and gas.
Given the necessary hydro power, or where fossil fuels are cheaply available of steam power, the pulp, paper, mineral and allied industries are capable of a fairly extensive growth, with growth in population, purchasing power, improved farming, etc., leading to the expansion of consumer goods industries similar to the rest of the country.
Those articles express very well, Mr. Chairman, as I say, the aspirations of the people of our province, and they are brought to mind very forcibly by the introduction of this resolution this afternoon for the building of a railway into the mines of this particular area. I am sure there will be no objection to this resolution from other parts of Canada. I am satisfied that every hon. member is pleased indeed to see that the railroad is to be built. They hope, I am sure, as I do, that it will be of great benefit to the people of our province.
I do not want to be considered one of those -and there are very few in this country- who are objecting to United States capital, as they say, coming into New Brunswick. It is United States capital that owns this mine in New Brunswick to which this railroad is being built, but most of us have no delusions or illusions as far as United States capital is concerned. We know that it comes into this country not for its health or for the health of the people who invest it here. The people who own it are here to get all they can out of the moneys they spend.
Instead of complaining about United States capital coming in, we wish to have more such capital, but we would like to see the American capital smelt and process those minerals in our country. May I use this as an illustration. We can take the Labrador ore again. United States capital owns the mines, owns the railroad, owns the ships and owns the mills in their own country to which the raw material is being shipped. In my opinion that is not a state of affairs which is going to build up this country.
I do not apologize for emphasizing this fact again. I do hope that in New Brunswick and in other parts of Canada where we have American capital and our people provide the labour to produce the raw material, we shall
Canadian National Railways also have American capital or some other capital that will build mills and process the raw material here in Canada.
I do not think it necessary for me to say any more this afternoon, Mr. Chairman. We are very pleased indeed that this resolution has been introduced, and we shall be very pleased when the railroad is built, as we hope it will be.


Mr. McWilliam:: Mr. Chairman, this resolution deals with proposed legislation for the construction of a Canadian National Railways branch line from Bartibog to the Tomogonops river through the constituencies of Northum-berland-Miramichi and Gloucester in the province of New Brunswick.
The subject matter of this resolution is of great importance to the people of Northumberland county, to the north shore area and to the province of New Brunswick as a whole. As we are all aware, base metal and other discoveries will soon come into production in this area, and facilities to move the deposits to a central point are vitally needed. It is judged that until a decision is reached as to the construction of a smelter the deposits from the Little River area will be brought to the deep water shipping terminals on the Miramichi river.
The Heath Steele Mines Limited, a subsidiary of the American Metals Company, are almost in operation at Little River. At the present time they are developing a mine at the site of the discoveries. It is expected that this mine will soon be in production, and the subsequent shipping of the concentrates will follow. In my opinion the construction of this branch line is only a start in the providing of rail facilities for this area. It appears that, based on explorations and the results of drilling, further production will be undertaken by other mining companies in this area, which will necessitate an extension or off-shoot of this proposed branch line. I trust, Mr. Chairman, that this resolution will be given favourable consideration and that a bill based on the resolution will soon be presented and will receive the approval of this house at the very earliest date. I wish to express the thanks of the people of North-umberland-Miramichi to the government for presenting this measure and the manner in which they are expediting it.
If it is in order, Mr. Chairman, I should like to ask the minister two or three questions. I want to stay within the scope of this resolution, much as I am tempted to follow my good friend the hon. member for Royal, and probably bring out some of the history of New Brunswick in regard to our mineral resources and our other resources in the province, and the exportation of the same

Canadian National Railways from New Brunswick. Will tenders be called for the construction of this branch line? Will this project be commenced at an early date after the necessary authorization is granted by this parliament? Can the minister advise as to the approximate time that will be required to construct this line?
Again I wish to say very briefly but nevertheless sincerely that the people of the constituency which I represent and the people of all parts of New Brunswick are pleased that we are making some advances in the mining field. It is going to mean a great deal to the economy of the province. I trust they will be able to increase their industrial and mining output. We look for good things from this mining area, and we feel grateful that the government has seen fit to assist by providing a mode of transportation for this development.


Mr. Nicholson:: Mr. Chairman, I too, am very glad to support this resolution which the minister has brought forward. During the first quarter of this century nearly every parliament spent some time in a discussion of the construction of branch lines, but unfortunately during the past 30 years very few branch lines have been constructed.
I am sure it is a matter of a good deal of satisfaction to all hon. members to find that important developments are taking place in different parts of Canada. I am convinced that people in all provinces are glad to know that New Brunswick has this new important industrial development, and the construction of this branch line is merely an indication of the importance of this industry to the area.
I was hoping that the minister might have been able to include in this resolution some reference to a branch line in Manitoba from Mafeking across to Durban. I understand a proposal is being considered to move materials on the Canadian National Railways to Regina in connection with the establishing of a cement industry. I wonder if the minister could make some comment on that when he is answering questions.


Mr. Drew:: Mr. Chairman, I wish to say a few words in connection with this resolution, because it seems to me that this involves more than the construction of the railway itself. Inherent in the motion now before us is a recognition of the brightening picture in New Brunswick and the Atlantic provinces. There is also the fact that this resolution in itself gives an opportunity to express the sentiments of hon. members of this house in regard to the obligation that rests upon the government of Canada and the people of Canada generally to do everything they can to assist the economic and industrial development of the Atlantic provinces.


In this case, as has already been pointed out, the railway is not long. By Canadian standards it is a very short line, 22 miles. It is an important railway, however, for the people of the province of New Brunswick and particularly for those living in the area which this railway will serve. I should think that in addition to its practical importance in assisting in the movement of ores and other raw material from the area it will serve, there is the encouragement it will give to others in that province and elsewhere to seek new opportunities for expanding the economic and industrial as well as maritime activities of that great province.
One of the things I wish to make very clear is that so far as I am aware no responsible Canadian has suggested at any time that we do not welcome investment from the United States. There are those who have been seeking to build up a straw man in order to knock him over. There are others who have sought to interpret a sound and legitimate argument in regard to an emphasis on Canadian development as evidence of a desire that funds should not come into this country from the United States. That is a known fiction. Only yesterday a prominent Canadian made a speech-


Mr. Lesage:: Mr. Chairman, on a point of order-


George Alexander Drew: I am glad the minister has his crystal ball, because I have not even started the sentence.


Jean Lesage: Mr. Chairman, the point of order is to the effect that the Leader of the Opposition is now discussing the broad issue of United States investment in Canada on a resolution which is very specific.
This is a resolution which says:
...it is expedient to introduce a measure to authorize and to provide for the construction by the Canadian National Railway Company-
-of a branch line in New Brunswick. I do not see how the Leader of the Opposition can be in order when he discusses the broad subject of United States investment in Canada on such a resolution.


George Alexander Drew: Mr. Chairman, I am not concerned with the fact that the minister cannot see it. What I am concerned about is the fact that this is entirely in order. Quite properly there has already been discussion of the fact that funds from the United States have been responsible for creating the need for this branch line. I am pointing out that this is one of the natural advantages which flow from investment of that kind, and I am relating my comments directly to what has already

been said and permitted. I am relating my remarks directly to the broad subject of the coordination with investment of development of this kind and it is on that basis I am making these remarks.


Jean Lesage: Mr. Chairman,-


George Alexander Drew: Mr. Chairman, a question has been raised and unless you state that this is not in order I intend to proceed without interruption from the minister, who would be better in his seat.


Jean Lesage: In speaking to the point of order, Mr. Chairman, it seems to me that I can ask the Chair for a decision. The Leader of the Opposition has just admitted that he intends to discuss the broad subject of United States investment in Canada and I believe, sir, that this is out of order. I respectfully submit that this is out of order.


The Deputy Chairman:: In my short experience with other railway branch line bills that we have had before this house there has been considerable discussion of the financial and other arrangements which preceded the necessity for the construction of a branch line. I do not think one can rule out of order the circumstances which make it necessary for the government to bring in a bill providing for the construction of a branch line.
On the other side of the question, there is a responsibility on the Chair to intervene at that time when the discussion goes beyond what the chairman of the moment regards as a fair discussion of the situation leading to the necessity of introducing the bill.
It is my intention to permit the Leader of the Opposition to proceed, but I know he will agree with me when I say that his remarks dealing with the finanqjal and other matters preceding the necessity for this bill must, of course, be related to the circumstances which lead to the bringing in of the bill, and should not go beyond that.


George Alexander Drew: I would, of course, agree with that, Mr. Chairman, and I would emphasize that point. What I am seeking to. do at the moment is to indicate that one of the reasons this legislation should be welcome is the fact that what we now have before us is the natural result of the interplay of financial and material forces to the advantage of a part of Canada which is entitled to every consideration as one of those provinces which originally came into confederation with the expectation that their advancement would be a primary concern of the government of Canada.
I was referring to certain remarks that were made yesterday by a prominent Canadian during which the emotional statement
Canadian National Railways was made that someone, presumably from the United States, had said to him that if their money was not wanted they could give it back. I doubt very much if there is a single hon. member of this house who believes that any such statement was made. It was just an illustration used by the prominent Canadian in question with a certain recklessness that is characteristic of him. But in any event that statement has no relationship to the problem-


Jean Lesage: To New Brunswick.


George Alexander Drew: That statement has no relationship to the need for the development of resources in this country. I point out that it simply indicates the emotional background of some of the statements that are made and possibly the emotional background of some of the interruptions now being made by the Minister of Northern Affairs and National Resources.


Jean Lesage: Mr. Chairman, on a point of order

and this is not an emotional point of order-I believe the last remarks of the Leader of the Opposition have proved that my point of order is well taken.


George Alexander Drew: I shall be very happy if the minister gets the comfort of the self-satisfaction he has been able to establish, but I am quite sure that he is no nearer to a point of order than he was in the first instance.
What has happened here should encourage those in other parts of New Brunswick, of Nova Scotia, of Prince Edward Island and of Newfoundland to seek financial support for the development of their resources of all kinds which will produce positive results similar to those embraced in the motion now before us. I am sure it is appropriate that on this occasion I should mention the fact that the Atlantic provinces are being very well served at this time by a comparatively new organization known as the Atlantic provinces economic council. I understand that the name chosen by this council draws a distinction which has been established in the minds of the provinces on the Atlantic between the three provinces historically known as the maritime provinces and the province of Newfoundland which has joined us as part of Canada in more recent years.
The Atlantic provinces economic council has as its stated purpose three main functions: first, to undertake a survey of the factors affecting the economic development of the region; second, to develop united action on matters of common concern; and third, to co-ordinate the efforts of all those interested in the welfare, economic and social, of the Atlantic provinces. I mention these objectives because they are objectives to which

Canadian National Railways I believe every hon. member of this house will subscribe. When the original maritime provinces joined Canada they did so with the knowledge that they would suffer certain disadvantages which would result from that wider association.


Mr. Murphy (Westmorland):: I thought
Canada joined them.


George Alexander Drew: Shall we say that they also agreed to establish Canada as one united nation.


Henry Joseph Murphy: That is right.


George Alexander Drew: They did that on the assurance that from the point of view of transportation and economic development there would be a full continuing of the combined nation which would emerge from this association of the provinces. May I assure the hon. member who made the comment about Upper Canada joining the maritime provinces that there need be no argument as to which joined which. All the provinces played their part in bringing this about. The reference I was making to joining Canada was to the historical fact that there was some delay on the part of the maritime provinces in joining because of the insistence on certain support being given to the development of the provinces, which was the essential consideration in that historic association.
I mention that only to emphasize the fact that those of us who represent other parts of Canada, and primarily the government of Canada from time to time as the administrative body associated with the parliament of Canada in its activities, have a very special obligation to recognize the needs and aspirations of the maritime provinces and Newfoundland in the building of their own economies. These remarks apply to Newfoundland as well as to the three original maritime provinces, because Newfoundland has come into this partnership with wide and sweeping assurances. I read the three stated functions of the Atlantic provinces economic council only to emphasize my own belief that we should welcome the opportunity on this occasion, when approval is being given to the building of a line which will help to develop a particular area in New Brunswick, to indicate that we all support the principles set out by the Atlantic provinces economic council and that, so far as each of the provinces along the Atlantic coast is concerned, we recognize our own obligation to assist its economy in every way we can.
We hope that out of this initial development will come secondary developments, where the skills that can be used in employing raw materials will give profitable employment at high wages to many people in that

province. There are undischarged responsibilities by the government of Canada to the province of New Brunswick, as to the other Atlantic provinces. This indicates our support of everything that will bring to effective use the raw materials that can be discovered. We do hope it will go a stage beyond this, and that also there will be encouragement of every kind for the erection of mills, the construction of industries and the expansion of employment opportunities that should go hand in hand right across the whole of Canada with the development of our own natural resources.


Mr. Blackmore:: Before the measure carries, I should like to assure the minister that the Social Crediters in this house and throughout the country will be enthusiastically in support of it.


George Carlyle Marler: I should like to reply to two questions that were asked during the course of the discussion. The first was whether tenders would be called for the building of this branch line. I should like to say the legislation will contain the usual provision which requires that tenders shall be called.
The hon. member for Northumberland also asked whether it was intended that the work should commence at an early date and when it was expected that it would be completed. I should like to tell him that the management of Canadian National Railways is most anxious to have this legislation adopted so they may make an immediate start on the work of construction, and that it is expected the work will be completed not later than November 1, 1958.
Resolution reported and concurred in.
Mr. Marler thereupon moved for leave to introduce Bill*No. 248, in respect to the construction of a line of railway in the province of New Brunswick by Canadian National Railway Company from a point at or near Bartibog in a westerly direction to the Tom-ogonops river in the vicinity of Little River lakes.
Motion agreed to and bill read the first time.



TRANSPORT


George Carlyle Marler: that the house go into committee to consider the following resolution:
That it is expedient to introduce a measure to provide for the continuation for a further period of two years of authority to make regulations for the control of transport of goods in bulk including, amongst other things, the appointment of one or

more controllers and one or more deputy controllers to carry out the provisions of such regulations and the payment of their remuneration.
Motion agreed to and the house went into committee, Mr. Applewhaite in the chair.


George Carlyle Marler: Mr. Chairman, I think that the terms of this resolution are so clear that no explanation of the purpose is really necessary. I might merely remind the committee that in 1954 parliament amended the Department of Transport Act to enable the governor in council to make regulations, and I quote the words of the statute, "for the purpose of ensuring the prompt, efficient and orderly transport of goods in bulk." This amendment, embodied in section 6A of the Department of Transport Act, expires May 31, 1956, and the sole purpose of the legislation which it is proposed to introduce following the adoption of this resolution is to extend the life of this section 6A until May 31, 1958.


John George Diefenbaker: As the minister has said, originally these regulations were passed in 1951 under the authority of the Emergency Powers Act. Then, in 1954 the Department of Transport Act was amended, section 6A, providing for the power to be granted to the governor in council to make regulations for the purpose of ensuring the prompt, efficient and orderly transport of goods in bulk. Amongst the powers granted was the power to appoint a transport controller and deputy controller. I realize the need for some control over freight cars being made available for the various purposes for which they are used. However, the experience of the last year, and certainly since the end of July 1955, has not been characteristic of the type of administration that should exist in connection with this very important matter.
It is not for me to enter into a controversy as to who was responsible. The Minister of Trade and Commerce on a number of occasions explained the situation that prevailed on the prairies whereby farmers found themselves unable to market even a percentage portion of the wheat that they had raised, and I should like the minister to explain the reason for that. The Minister of Trade and Commerce laid the responsibility right on the shoulders of the transport controller. If the Minister of Trade and Commerce was correct in the views and the assumption that he made in that connection, then indeed the transport controller made a colossal failure of the job he had to do. I am not here entering into a controversy at all. I point out, however, that over and over again the Minister of Trade and Commerce not only left that impression in the house but did the 67509-204
Department of Transport Act same thing when speaking to western farmers and to farm organizations in Edmonton and elsewhere.
When one looks over the record of this session one finds a consistent stand taken by the Minister of Trade and Commerce in laying the responsibility for the failure of western farmers to have transport available to them upon the transport controller. The first reference I find is on January 11, 1956, when I asked the Minister of Trade and Commerce what was going to be done and what were the possibilities of an early increase in the amount that might be delivered by farmers to country elevators. His answer is to be found at page 7 of Hansard for January 11, 1956, where he said:
Mr. Speaker, the transport controller is of course an officer of the Department of Transport. However, the department and the wheat board have been exerting pressure on the railroads and on the transport controller to speed up the movement of wheat from the prairies.
Then again on January 19 there was a reference to the situation and to the power of the transport controller, as there was on an additional number of occasions. Who was responsible? Certainly, the position has been a serious one for the western farmer since last fall. There were some 31,000 less freight cars available for the transport of wheat on the prairies between July 31 and January 31 of this year than were available in the same period the year before.
If you look at the report of the bureau of statistics of January 11 you will see that there were 31,000 fewer grain cars available during 1955 than there were in 1954. There were also 4,900 fewer cars available for grain products. But when it came to coal, concentrates, gasoline and fuel oil, sand, gravel and crushed rock there were very material increases in the number of cars available. For iron the increase was some four times. So far as lumber, timber, plywood, newsprint and such other commodities are concerned, there were very considerable increases in the number of cars in every case, but in so far as the western wheat farmers are concerned there was an unexampled disregard of the situation in the west.
The western farmers were in the position of having a very large carry-over. On more than one occasion in June and earlier in 1955 the Minister of Trade and Commerce optimistically said: "We have got nothing to worry about." In effect he said: I can tell the farmers that they will sell every bushel they have got and will have everything moved from farm storage before the new crop year begins. Even at the present moment district after district in Saskatchewan, and

Department of Transport Act the same applies to the other prairie provinces, has not received its fair and reasonable allocation of freight cars.
I should like the minister to explain one thing. Why did the western farmers receive so little consideration with respect to the numbers of freight cars that were made available? Why was there this shortage of 31,000? I direct this specific question to the minister because if I am right in the assumption inherent in the question the responsibility certainly falls on the shoulders of the transport controller. Did the shortage, result from the fact that there is more profit to be made by the railway companies in hauling these other commodities than there is in the hauling of wheat? Is that the reason so little attention was paid to the demands of the western farmers for action in making available to them the necessary cars?
I am not going to repeat the picture in detail. On February 3 I set out the details of the situation as found at page 838 and following of Hansard. I merely summarize what I said then in order to support the argument that I make now. Up to December 8, 1954, 67,791 freight cars were unloaded it the lakehead.


George Carlyle Marler: How many did the hon.
member say?


John George Diefenbaker: 67,791. In the following year, that is, the present crop year, 45,537 had been unloaded by December 8, or 22,000 less. From then on in December and January the situation became worse until on January 10, 1956 the shortage amounted to over 30,000 cars. Indeed, western farm leaders contended that the shortage was some 36,000 cars. I know there has been some alleviation of that condition since but the fact still remains that the powers conferred upon the transport controller have not been used, and powers unused are not effective powers.
The transport control regulations made under the act are set forth in the consolidation of statutory orders and regulations for 1955. The transport controller enjoys tremendous powers. In addition, in case the work proved to be too much for him, provision was made for a deputy transport controller to exercise any or all of the powers conferred upon the controller by these regulations. The powers of the deputy were restricted only to the extent that if orders were made by the deputy they could, after review, be varied, rescinded or altered by the controller himself.
The transport controller has the power to order any person dealing with any bulk transport to transport goods in bulk, to fix minimum quotas, maximum ratios and so


forth. So great are the powers conferred that, no matter what he does, as long as he acts within the powers conferred upon him there is no right of action. If any person fails to fulfil any contract or obligation because of the order of the controller, it is a good defence to an action against such a person to place before the court and prove the allegation that what was done was done pursuant to the order of the transport controller.
These are vast and uncontrolled powers, with the transport controller having the power to override a contract that has been made and, having made the order, to deny the right of any action in our courts to the person aggrieved in consequence of the breach of contract resulting from any order made by the controller. Heavy penalties are provided. There is a penalty of $5,000, and so on.
The regulations were strong, some parts of them, I believe, inexcusably strong, but nonetheless the powers were vast. The controller had powers that almost anyone would like to exercise where, no matter what he did and what contracts he interfered with, he would be acting within the ambit of his authority. I ask the minister to explain this. To what extent was the transport controller responsible for the serious shortage of cars? Was the responsibility for the failure to fill the storage at the head of the lakes and at other points across Canada, when 100 million bushels of wheat could have been stored in those facilities if cars had been available, the responsibility of the Department of Trade and Commerce or was it, as the minister indicated earlier, the responsibility of the transport controller?
The transport controller himself has said that it was not because of his failure at all. I ask the minister to let the western farmers know when he replies why it was that western farmers from October until March were able to market only a trickle of what they had-not even a trickle; the word is altogether too comprehensive-when at the same time 100 million bushels of vacant storage space were available. To what extent did the transport controller use his powers? What orders were made by him during the period from October until the first of April? Were there any derelictions on the part of those directed by the controller to supply cars and make them available for the transport of wheat?
If there were such derelictions, did any prosecutions take place within the provisions of the regulations? As far as cost is concerned of the operation of the transport controller, if I read the reports correctly the cost amounts to some $26,000 a year. What

has been done? What is being done at the present moment? It is a strange thing, Mr. Chairman, that on C.P.R. lines it is almost impossible to secure the necessary transport. Is that because wheat shipped over C.P.R. lines cannot find its way through Churchill? What is the basis today of allocation^ Will the minister take up with the transport controller the equalization of local market facilities so that those places on the prairies-and they are legion-or those marketing locations will receive a reasonable and fair share; so that those areas that up to the present time have been able to market only two, three or four bushels to the acre will have their quota increased; and so that the necessary freight cars will be made available to those areas that have received the fewest freight cars up to the present time in order that a reasonable degree of equality will be assured to all marketing places?
The situation is not as bad as it was two months ago. There has been some improvement. But with the opening now of spring work and the need for cash being made available to farmers, anything that the minister can do, through the transport controller, to assure and direct a fair and reasonable allocation of freight cars in those areas will I know be appreciated by western farmers. They need cash. It begins to look as though the day of entry into the promised land which they had expected was just around the corner-namely the final distribution of the 1954-55 pool-is still being postponed. We are still hopeful. While the wheat board is thinking this matter over and making a determination on it, we are asking the Minister of Transport to increase the number of box cars available in western Canada for wheat transport purposes, thereby relieving the situation of the farmers and also assuring a larger amount of cash available in the hands of the farmers for the spring work and also to meet their debts and obligations which they have not been able to meet in the last few months because while plenty of space was available for the storage of the western farmers' wheat, that storage remained unused and too few cars were available to transport the wheat to the available storage space.


Mr. Johnson (Kindersley):: Mr. Chairman,
the resolution under discussion could play an important part in the life of Canadian agriculture today as it could have done in the past. Last year we had the second highest surplus of grain on record. At the present rate of disposal and with the favourable
Income Tax Act
crop conditions in western Canada it is apparent that we shall have a significant carryover this crop year, one which may be as large as that experienced last year or perhaps even greater.
It is disappointing to me to note that when we have had a transport controller in operation the farmers of western Canada have been paying demurrage to ships in Vancouver harbour because the grain was not in position to fill those boats. The function of a transport controller is to guarantee that the type and quantity of grain shall be in position when it is required. It is therefore some cause for concern to western farmers when, in addition to paying demurrage on boats waiting for cargoes of grain, we find, as reported by the Minister of Trade and Commerce, that there is in the terminals of Canada space for upwards of 58 million bushels. As the cause for this 58 million bushels' space it has been stated that there was a shortage of box cars. One of the factors which is closely related to this matter of the box car shortage is again the transport controller whose responsibility it is to see that cars are in position to move the grain to the terminals and to move other products as they are required.
I asked for a return on the number of Canadian and United States box cars that were in the respective countries and I found the information most illuminating. On December 31, 1955 we find that there was a total of 23,087 Canadian cars on United States rail lines and that at that same date there were 13,539 United States box cars on Canadian rail lines. In other words, we had 9,548 more box cars in the United States than the United States had in Canada. It was at that same time-


Edward Turney Applewhaite: Order. I am sorry to be obliged to interrupt the hon. gentleman but, it being five o'clock, the house will proceed to the consideration of private and public bills.
At five o'clock the Speaker resumed the chair.



PRIVATE BILL


[Stage Direction]
Bill No. 191, respecting Canadian Pacific Railway Company and certain wholly-owned subsidiaries.-Mr. Mcllraith.


Mr. E. D. Fulton (Kamloops) moved: the second reading of Bill No. 52, to amend the Income Tax Act.

Income Tax Act
He said: Mr. Speaker, it is probably too much to hope that the house would adopt the motion and carry the bill through all stages without discussion as we have just seen in the case of a private bill introduced by my friend, the hon. member for Ottawa West. Therefore, it is appropriate that I should give a few words of explanation as to the purpose of this bill and its provisions.
The purpose of the bill is to protect the taxpayer who has honestly, conscientiously and to the best of his ability reported his income and paid his tax, by relieving him from the possibility of suddenly being required to produce records and explanations of things that happened eight or nine years ago or, in some cases more-things which he has not the remotest chance of recalling clearly or explaining adequately-and thus to protect him from the situation which arises when he is required to produce those explanations and accounts over years that have passed and finds that he is unable to do so. He is then penalized by being required to pay additional taxes on a basis against which in effect he is completely unable to defend himself.
Many hon. members will have cases within their own knowledge of taxpayers being confronted with this situation as a result of demands made by income tax inspectors. I know of a considerable number of cases. The effect on the honest taxpayer of demands of this sort for information and the carrying on of investigations on a basis which the taxpayer cannot understand, the requirement of explanations which he is quite unable to give, is very damaging. It varies from extreme irritation, almost going so far in some cases as to bring into question in the minds of decent citizens whether or not our system of government and justice is after all fair. It ranges from that feeling in many cases to a result which actually has a harmful effect on the taxpayer's health. I know of cases, and I am sure other hon. members know of cases, where honest, conscientious men and women have been reduced to conditions of almost nervous breakdown. They have been completely upset. It has a very harmful effect on their health and is entirely unnecessary and unfair to the honest taxpayer.
I want to make it absolutely clear, Mr. Speaker, that I hold no brief and am putting forward no argument on behalf of the dishonest or fraudulent taxpayer who deliberately misrepresents his income and underpays his tax and thus increases the burden on the other taxpayers of the country. In drafting my bill I have attempted to the best of my ability to draft a bill which, if adopted, would protect the honest, conscientious taxpayer by protecting him against the situation I have
IMr. Fulton.]
described, but will still leave the department free to proceed vigorously and effectively against the dishonest and fraudulent taxpayer.
I want to make it clear also that I am not, either in my bill or in what I have to say here as to the demands and investigations that arp being made by the income tax inspectors, attacking decent and conscientious civil servants in the performance of their duty.
I recognize that when income tax inspectors make inquiries from taxpayers with respect to their returns there is apt to be a feeling of misunderstanding on the part of the taxpayer, and I shall attempt in what I shall say, not to represent those income tax inspectors who are efficient and courteous and who approach their task in a proper spirit, as being persecutors. They have a duty to perform.
My purpose is, however, to suggest and to urge legislation in such form that it will be impossible for the income tax inspector to be required to carry out a duty which imposes an unfair burden on the taxpayer and, by achieving that result, it will both protect the income tax inspector and relieve him from unfair criticism and at the same time protect the taxpayer and relieve him-this is its main purpose-from unfair demands being made on him many years after the knowledge of the situation which he is asked about has departed from his^memory.
The present powers and duties of the income tax inspectors in this regard-and I am referring to the opening up of returns and assessments many years old; I am referring to instances where the taxpayer has honestly and conscientiously filed his return, received his assessment and paid his tax, and then years later the return and assessment are reopened and he is asked all these questions and placed under this inquisitorial investigation -the powers and duties of the income tax inspectors are contained in section 46 and section 126 of the act at the present time.
Section 46 of the act provides that the minister may at any time assess tax, interest or penalties and may re-open assessments at any time and re-assess at any time. If there has been fraud or misrepresentation there is no time limit whatsoever. He may re-open and re-assess six years from the date of the original assessment in any other case; that is to say in any case in which there is no fraud or misrepresentation. But the powers of investigation on which, of course, the reassessment, which is contemplated in section 46 would be based, are contained in section 126; they are not confined to cases where there is fraud or misrepresentation, and those powers of investigation contained in section 126 are not limited as to time. So the minister

may,-and of course that means the department-and in practice to my own knowledge does on frequent occasions, subject taxpayers to investigations of returns and assessments much more than six years old where there is certainly no fraud or misrepresentation. In my view, in the case of an honest and conscientious taxpayer, even six years is too long in which to place him in the position where he may suddenly have his return and his assessment re-opened and his whole personal and financial situation investigated by people with these sweeping powers of investigation.
At this time, going on for eleven years after the war, surely the department has caught up with its assessments. If it has not caught up, it should have. So it should not require six years to be certain that an assessment is actually a correct and valid one. In my view, the department should now be able to finalize an assessment within three years. My bill, accordingly, cuts down the time within which the minister can reopen an assessment and send his investigators in to investigate with these tremendous, sweeping powers, to three years from the date of the original assessment. That three-year period will be absolute. After three years there will be no power either to reopen an assessment or to carry on an investigation unless the minister or an official of his department on his behalf alleges at the time of sending out the investigator that there was fraud or misrepresentation. If the department has good reason to believe and is prepared to allege that there was fraud and misrepresentation then there should be no time limit, but only in that case do I believe there should be an unlimited period of time for reopening or investigation.
I urge most strongly that in every other case the right of reopening and investigating an assessment should expire at the end of three years; accordingly, in my bill I have provided an amendment to subsection 4 of section 46 of the act which would provide that the power of the minister to reopen and reassess is confined to three years from the date of the original assessment except in the case of fraud and misrepresentation.
My amendment goes on to provide that after the expiry of three years from the date of the original assessment the assessment shall be deemed to be final except if a taxpayer wishes to reopen it for the purpose of averaging and that once the assessment becomes final then the department shall not have the right to send its investigators out prowling around the country requiring people to answer questions about assessments and returns that are more than three years
Income Tax Act
old, excepting always, as I made clear, the right of the minister and the department to reopen an assessment and make such investigations as they deem necessary, if it is alleged at that time that there was fraud or misrepresentation in the making of a return.
I have also provided another change in the bill. At the present time there is an obligation on the part of the taxpayer to keep all his records and books of account until he receives the permission of the department to destroy them.
I ask you to contemplate the situation of a farmer. This does not apply only to farmers but it so happens that farmers find it more difficult and perhaps they are less qualified to keep records and books of account than are most people engaged in business. The argument I am making applies equally to all classes of taxpayers, whatever their occupation, but it seems in my constituency it is the farmers who are subject at the present time to what I regard as a form of persecution, because no one should be required to go back over his records for the length of time which he is now liable to be required to do.
Picture the situation. These taxpayers are required to keep their books of accounts and records indefinitely. Not many people know that provision is in the act. I know that ignorance of the law is no excuse but you have to take account of a situation of the ordinary Canadian in these matters. Farmers and housewives are quite properly in the habit of cleaning out accumulations of old papers occasionally and books of accounts and records and cheque stubs are tossed into the stove and burned. Then the investigators come around eight, nine or ten years later, and demand production of these records. They have burned them without any intent or desire to hide anything. They have been burned because the taxpayer did not know he had to keep them and then the investigator says, "Ah ha, you must have destroyed these records because you knew if you kept them we would find out that your return was not correct". The taxpayer is then placed in the appalling situation wherein he is under suspicion, in his own mind at least, and I know of cases where it has been suggested V>
taxpayers pretty directly that their records were not available because they took care to see that they were not available because if they were available then the taxpayer would be proven to be liable to a greater tax.
My bill accordingly suggests a further change to provide that a taxpayer shall keep all his records and books of account for

Income Tax Act
six years but that after six years he is at liberty to destroy them, and if he obtains permission from the minister before the expiry of the six years he may destroy them at an earlier date.
The reason I have suggested the six-year period is of course because a six-year period is the ordinary period contained in the statute of limitations beyond which rights of action are extinguished. I fail to see why the government should have any greater right as against the taxpayer than that provided in the statute of limitations.
The final change suggested by the bill relates to section 126 of the act to which I have referred. This is the section which gives the tremendous powers of investigation. I recommend to hon. members that they read this section carefully in order to see the sweeping powers which are given to these investigators to enter one's home or place of business, or any place where you live or keep your books of account or where any one employed by you keeps books of account or any accounts on your behalf, and to audit, examine, seize, and take away such accounts and to require any additional information including the production or the production on oath of any books, accounts, vouchers, letters, telegrams ' and other documents and to retain them, and so on.
This section also provides that the minister, with the approval of a judge of the Exchequer Court of Canada or of a superior or county court upon ex parte application, may authorize any officer of the Department of National Revenue, together with such members of the Royal Canadian Mounted Police or other peace officers and such other persons as may be named therein, to enter and search, if necessary by force, any building, receptacle or place for documents, books, records, papers or things, and to seize and take away any such documents, books, records, papers or things and retain them until they are produced in any court proceedings.
This section contains the most tremendous powers of investigation, search, seizure and so on, without any limit as to time. These powers can be exercised against a taxpayer at any time the minister wishes to authorize them.
My bill suggests that the powers of investi# gation contained in section 126 be limited to three years from the date of the assessment unless the minister alleges there was fraud or misrepresentation in which case they will will be continued indefinitely.
After all, sir, the taxpayer has only 60 days in which to appeal against an assessment. Sixty days is all the time that is given to a taxpayer if he thinks the department is wrong.
rMr. Fulton.) [DOT]
He must make up his mind within that period of time; he has 60 days from the date of the original assessment, whereas the minister now has six years. I am suggesting that this period be reduced to three years which in all conscience should surely be long enough unless the minister alleges that there was fraud or misrepresentation.
I was not exaggerating in outlining the powers of investigation given to the departmental officials and I am not exaggerating when I describe the effect upon honest taxpayers when confronted with these demands, when they are required to produce explanations which they are simply incapable of producing. No reasonable or average person could possibly produce such explanations eight, nine or ten years after the event. I can hardly describe the effect that' has upon the emotions and the minds, and in many cases the health of taxpayers, to say nothing of the effect it has upon their pocketbooks simply because they cannot explain. In many cases a man's recollection has diminished and he simply cannot offer an explanation. However he is arbitrarily reassessed and required in many cases to pay substantial, sometimes almost exorbitant, sums-plus interest on what is alleged to be an underpayment dating back some five, six or more years.
Constituents in various parts of my constituency have been visited by inspectors during the past year or two. An inspector will come to a farmer and require him to produce records, in one case going back as far as 1947. Or an inspector may go to the bank and then come to the taxpayer and ask him to go over his account cheque by cheque, stub by stub. As an example, the inspector [DOT]would say, "Here is a cheque for $25 for the XYZ company back in 1947, what was that for?" How on earth could a busy farmer or any other busy taxpayer be expected to remember back eight years when he had paid a certain company $25? But because he cannot produce an explanation he is liable to arbitrary reassessment. If he has deducted something as an expense and cannot now explain how it constituted an expense he is apt to have it disallowed.
Or inspectors have gone into a bank and obtained a statement of a taxpayer's account for all those years and then have required the taxpayer to produce cheques and receipts to verify the expenditures. If he cannot produce them-dating back seven or eight years-he is subject to arbitrary reassessment. All these powers are given to the government, and they should not be there, but so long as they are there they will be used. Such action produces not only a sense of unfairness on the part of

the taxpayer but inevitably the whole administration of the income tax law is brought under the most violent and justifiable criticism, by taxpayers generally.
I should like to give another example of the attitude of the department in this regard. A short while ago I received a letter from a constituent of mine enclosing a debit voucher for $1 from his bank. This taxpayer assured me that it was not the $1 that was of concern to him, and I know that while he is not a rich man he does not have to worry about one dollar. As I say, he received this debit voucher from his bank. When he inquired as to why they had debited his account for a dollar they said that that was their service charge for the income tax inspectors coming in and going through his account. He told them that he had certainly never agreed to pay that amount. He said he remembered the income tax people coming to him and asking if he minded their going over his bank account. He said he did not as he had nothing to hide, but he had certainly never told them that he would pay any dollar for the service charge. The bank said, "We did not want to charge you, we wanted to charge them but they said that the government would not accept any charges, so we had to charge the dollar to your account."
Here is a taxpayer who agreed to have an inspection made. So far as I know and so far as he knows nothing has been found to make him liable for reassessment. But whether there was or not, I contend that it is improper for the government to carry on inspection and investigation and then require the taxpayer to bear the cost. Whether the amount involved is $1 or $100 it does not matter, it is the principle that is important. This is proof of the fact that these powers are too wide and is substantiation of my argument that to exercise investigation of this kind is simply to inflict injustice on the taxpayers of Canada.
I know of other cases where men have been required to substantiate accounts going back to 1951 and 1952, matters for which they could not now give explanation. They have charged as expenses amounts that were properly chargeable against income in that year but they are unable to produce an explanation at this time. It should not take the department six years, or even more in many cases, to make up its mind as to whether the return of a taxpayer is valid and correct. I can see no reason why this period should not be reduced to three years. I am almost inclined to believe that three years is a little too long, but I want to be reasonable.
I hope that this bill will receive the approval of the government and the house. It seems to me that it is reasonable to suggest
Income Tax Act
that the period be reduced to three years. I hope that the government will accept the bill and not continue to subject the taxpayer to this form of unlimited investigation into matters about which a taxpayer cannot possibly have a clear and adequate recollection. We must bear in mind that the taxpayer has only 60 days in which to appeal if he thinks the department is wrong. Surely the department could accept a limitation of three years within which to make an investigation and reassessment of the taxpayer's return when it thinks he is wrong in filing his return. So I recommend my bill to the house, not as an attempt to chisel or to diminish revenue -I do not think three years will be a hardship on the department-but simply to protect the taxpayer and bring the relationship between the taxpayer and the department and the government as a whole onto a proper and just basis.


Mr. H. O. White (Middlesex East):: Mr. Speaker, quite early in the session I placed upon the order paper a resolution stating that in the opinion of this house the government should consider the advisability of amending the Income Tax Act and the regulations under the act. At that time I was informed that the resolution was too broad and that I should remove it from the order paper and substitute another which would indicate what I had in mind. The days went by that were allotted to private members' resolutions and this particular one never came before the house. I am taking advantage of this opportunity to indicate my support of the bill introduced by my colleague, the hon. member for Kamloops (Mr. Fulton).
In his presentation to the house this afternoon I think the hon. member has been more conservative and more kind in his criticism of the department than I had intended to be. Nevertheless I agree wholeheartedly with what he has said in introducing this bill. Now, I do not intend to repeat some of the criticisms the hon. member brought to the attention of the house, but at the outset. I want to say, as he did, that I hold no brief whatever for those who deliberately set out to defraud the government of this country. I want to point out also that I am not an accountant or a tax expert. I employ an accounting firm to take care of my own income tax returns. I have no personal axe to grind. My relations with the minister's department have been of the very best.
A year ago in this house I did make some remarks about the income tax department and the problems presented to those individuals who are self-employed. I realize quite w^U that the income tax is deducted at the source

Income Tax Act
for the man on a salary, and that is a different problem. I was amazed at the number of letters I received in response to what I said a year ago. I have three folders full of such letters and the bulk of them came from tax areas other than the London district. The bulk of these letters came from the Windsor, Kitchener and Waterloo districts. I want to say this, too, that in my opinion the vast majority of Canadian citizens, and those who are self-employed, are law abiding honest people who are trying to make an honest return. However, as the minister for Kamloops pointed out, a citizen may find himself-


Mr. Mclvor:: Oh, oh.


Harry Oliver White: You may laugh at the department, sir, but let me tell you that I believe in democracy and the people in my constituency will be the judges of this income tax department, and not you. The people will be the judge and I will accept their judgment one way or the other. I am not afraid of the opportunity of accepting it.


Daniel (Dan) McIvor: Mr. Speaker, I rise on a question of privilege. It was only because the speaker referred to the hon. member for Kamloops as the minister for Kamloops that I laughed.


Edmund Davie Fulton: Why laugh at that?


Harry Oliver White: Future events cast their shadows before.


Walter Edward Harris: A very long shadow.


Harry Oliver White: The officials of this department believe they are a law unto themselves and taxpayers have come to me with fear in their hearts about what was going to happen to them. I should like to point out to the minister that there is a widespread and growing resentment of the tactics that have been used by these officials in the past. I am warning his department that there is distinct animosity towards the officials, and a rising tide of fear and resentment. As I mentioned a year ago, a curtain of terror drops down around a taxpayer when these people move in. As I said before, I was alarmed and dismayed at the number of letters I received from Canadians all over Ontario.
This is an important subject because I noticed throughout the throne speech debate speaker after speaker mentioned one aspect or another of income taxes and income tax returns and the impact they were having on the community and people. There are also many resolutions on the order paper dealing with income taxes and this reflects the thinking of the Canadian people and their representatives. There are many sections of the

act that permit varying interpretations, so that in one tax area a taxpayer may be treated differently from a taxpayer in another area. Then, as the hon. member pointed out, the department can go back for a couple of years. I have had it brought to my attention that in some cases the investigators demand payment before they leave the taxpayer's residence, and that would seem to me to be going just a little too far.
Then, what of the income tax appeal board? The general public, especially the small businessman, the individual farmer or those who are self-employed, have not had a great deal of experience with courts of law. They hesitate to have anything to do with them and would sooner pay what the income tax officials say they owe and say nothing about it. But suppose they do pay it, that is no guarantee that a year or two later these same officials will not come back and say there has been another error and the taxpayer owes another couple of hundred dollars or another couple of thousand dollars. In fact, that has happened. Where is it going to end? No one knows where it is going to end. As I say, the people have not a great deal of confidence in the appeal board.
I have before me a judgment issued by the income tax appeal board on April 6 of this year. I know the people concerned in this case because they are neighbours of mine. In fact, I advised them to take their case to the appeal board. In this particular case a girl worked for her father for ten long years in the tobacco fields. There was more or less a tacit understanding between the father and daughter that she would receive $100 each year to keep herself clothed and he would keep $700 per year for her until such time as she might ask for it. Her intention was to take the balance when she married and help start up a home. After ten years she asked her father for the balance and he paid it, but the income tax people came along and asked her for over $1,900. If she had accepted the money each year and placed it in the bank for her own use, she would not have been subject to tax but she allowed her father to be her banker and he used the money to carry on his business and produce wealth for this country.
I am just going to read one or two excerpts from this judgment which is signed by Cecil Snyder, assistant chairman of the appeal board.
At the hearing the appellant testified that she had been employed by her father to work on his tobacco farm from 1943 to 1953, with the exception of the year 1948. It was agreed that her yearly wage should be $800. Her father gave her approximately $100 per year as "spending money" and retained the balance of her wages in trust until

she married. The appellant was married in October, 1953. In March, 1954, she asked her father to give her the balance of her wages. This sum- $8,283-was received by the appellant in March, 1954.
I continue:
The appellant's father testified that he had included the amount of wages due his daughter in the total of wages paid by him in the years in question and deducted the whole as an expense of earning his income when filing his tax returns for these years. He said that the balance of wages due his daughter was not paid to her because she wished him to retain it for her.
As I say, if she had accepted the money and put it in the bank it would not have been taxable but she let her father be the banker and consequently she lost almost $2,000.


Mr. McCann:: He got the benefit of charging it up.


Harry Oliver White: He paid tax on it. He increased his earnings. He increased the value of his production on the farm and you collected tax from him twice over ten years.


Mr. Rowe:: She would have no tax over ten years.


James Joseph McCann: You cannot have it twice.


Harry Oliver White: Counsel for the appellant argued that the amount was the distribution of capital and should not be taxed.
I go on further.
Counsel for the minister argued that the appellant in this case was not in business and was not entitled to compute her income on an accrual basis. He asserted that, as a wage-earner, she must declare her income when received.


James Joseph McCann: Read the judgment.


Harry Oliver White: Oh yes, that is all right. Cecil Snyder said that she could not file her return on an accrual basis but at the very same time she was assessed on an accrual basis. In other words, it was a cruel business. Some have said that taxpayers should go to the income tax offices and find out just how they should proceed, but that is no good. The words of members of the department are not worth the paper they are written on. In that regard I hold in my hand a copy of the Free Press of March 12, 1956 where it is reported that a man in company with his auditor consulted the local officials, this being his only contact with the department, and they agreed that the cash basis method for tax purposes was acceptable to them. Five years later, when the matter finally came before the board, the board said that the taxpayer was overly optimistic in his assumption that his cash method of computing income had been 67509-205
Income Tax Act
accepted. The joker is the word "accepted" in the act. According to the board, the term "accepted" indicates an unqualified acceptance. This man went to the income tax office with his auditor in good faith. He discussed the matter with the officials, they came to an agreement and he believed them. But five years later he finds that what they say is not worth anything because the cash basis was then not accepted.
I must hurry on because there are many things I want to say in the next fifteen minutes. The actions of the board are discouraging production, thrift and initiative. Uncertainty and fear are expressed on every hand by people in all walks of life, by every small businessman and every self-employed individual.
Agriculture is not the only industry that is affected. Many a small businessman is saying: "What is the use?" The net result is that the small businessman says: "I will do what I can myself and let the opportunity to expand go by." I know many farmers who have laid off help and are now going to do what they can themselves. The country is the poorer because of it.
The professional man finds to his sorrow that extra hours worked are wasted hours, and we are all the poorer because of it. Labour is watching the situation very closely. They plan to keep out of the higher income brackets and so we lose their production. Lawyers have advised their clients to settle, indicating that there is this curtain of fear to which I referred. Lawyers advise their clients to settle because they do not want to oppose, fight or antagonize the income tax department for fear that they will come right back at them.


Mr. Lennard:: They do.


Harry Oliver White: And they do. It is a sorry state of affairs. I had another case brought to my attention of a man who was carrying on a private accounting business and died. He had a number of clients whose income tax and payroll accounts he took care of week after week, year after year. But when the accountant died all his client's accounts came under review and these taxpayers had no one to fight their battles. They were at a loss. They did not know where they were at. I know of one case where a widow was asked for $9,000. I went to visit the home and I could see that they were in far from good circumstances. The home was very plainly furnished. The woman had been very careful but she said that sooner than fight she was going to pay the amount. That is another thing that happened.
Many of these people are honest, Godfearing people. It is the first time in their

Income Tax Act
lives they have ever been accused of any crime. They have not even been charged with careless driving or anything else before. To be accused of not paying their proper taxes casts a reflection on these good citizens and sooner than say anything they pay and think they are through with the matter but they are not finished with it. No one ever gets a clearance. They have not got a receipt to show they have paid. I maintain that the hon. member for Kamloops (Mr. Fulton) was far too reasonable when he suggested three years. I maintain that if the government are one-tenth as smart as they would like people to believe they are, surely they can straighten up in a year the accounts of individual taxpayers with annual incomes of $10,000 or less. It is just as easy as that. As the hon. member for Kamloops pointed out, there is a procedure whereby the department can charge fraud if there have been attempts to defraud and recover from the taxpayers.
Many groups and individuals endorsed what I had to say along this line last year. Probably the minister and the house would like to know who some of the organizations are. The stand I took has been endorsed by the Middlesex county council and by the counties of Elgin, Huron, Perth, Lanark, Grey, Hali-burton, Bruce, Lincoln, Waterloo, Brant, Haldimand, Halton and Lambton. All these counties have endorsed my stand and I was not aware of it until it was brought to my attention about three weeks before the present session began. I did not solicit their support. I did not even know they were interested until it was brought to my attention. Copies of the resolution were forwarded to the county of Middlesex by the Middlesex county federation of agriculture, the Ontario farmers' union, several branches of the women's institute including the women's institute of southwestern Ontario at their meeting in Leamington and the Malden women's institute of Essex South, the Canadian Chamber of Commerce, the chambers of commerce of many Canadian cities and the Arthur farmers' union. There are many service clubs which take no part in politics-it is part of their creed, shall I say, to stay out of partisan politics-that are in favour of it also but they do not want to go on record or to be known as being in favour of it. They do not want it to be construed that they are politically biased one way or another.


James Joseph McCann: What was the resolution?


Harry Oliver White: That all these incomes of $10,000 and less be processed and that a final receipt be given within 12 months from April 30 in the year in which the returns were filed. The Arthur farmers' union demands that returns be cleared within two

years of filing and at that time be cleared finally except in cases of fraud. I again warn the minister of the rising tide of resentment against him and his department. Any answer to the contrary is more or less an admission of inefficiency. If they say they cannot do it in this time, let me point out that there are many things they can do. They can get ready for an election in a few days and they can get the returns in in much less time than that.
I want to bring to the attention of the minister-I think I will come to it later anyway-what Eaton's and Simpsons are able to do in their mail order department. I believe some 50,000 orders a day come in and that most of them are processed within 20 minutes from the time they arrive and are on their way within 24 hours.


Walter Edward Harris: They have more employees than the minister has.


William Earl Rowe: I doubt that they have.


Frank Exton Lennard: Don't say that.


Harry Oliver White: Even if they had twice as many employees, look at the length of time you have.


Frank Exton Lennard: Five years, ten years, fifteen years.


Harry Oliver White: The income tax department may make mistakes with impunity but not so the taxpayer. He is branded a crook and he is penalized at compound interest. In some cases, years go by before the taxpayer knows a thing about the matter and then the department comes along and says that he owes them so much; maybe it is $100 but with the interest on it over the years and the penalty, it amounts to more than the original error. If the taxpayer knew of it in time, he could have reviewed the matter and he could have paid the amount. But as the hon. member for Kamloops (Mr. Fulton) has pointed out, no one knows where he is at.


Frank Exton Lennard: You mean in the tax office.


Harry Oliver White: Then we come to the question of estates. I am going to use a rather harsh word. In some of these cases I have advised the taxpayer to appeal the case and to go to the appeal board. Then two or three months later some of the officials have come along and said, "There is an error in this computation and so the tax is not $600 but it is $200". Rather than go to the appeal board the taxpayers settle. The taxpayer is in this bad fix. He has not obtained settlement. He just thinks he has. The department can come back a year later or ten years later or they can come back when the

taxpayer dies and say to his heirs that they owe any amount. What do they know about it? I am going to say this. They not only steal from the living; they rob the dead. I know of two cases in which I advised the parties to take their case to the appeal board. An official of the minister's department in each case came to the taxpayer and apologized and said, "The whole thing is a mistake. Burn up the letters and we will forget the whole thing". The sorry part of the thing is that they burned the letters. Now they have not any proof and they can get caught again. The situation is getting nearly to the point where departmental practice is a refined type of blackmail and there are no flaws in it or no errors.
There are other countries which are also looking into this problem of income tax assessment. I refer to the Tucker commission in the United Kingdom and the ways and means committee of the House of Representatives in the United States of America. As I failed to mention, this also has been recommended by the Canadian Federation of Agriculture, the Canadian Medical Association and the Canadian Dental Association. They all approve the recommendation that profit-sharing plans should not be taxed until the beneficiary actually receives the cash. This reflects probably on the case I quoted earlier. In some cases a man could be taxed and yet never receive the benefits on which he was supposedly taxed.
While I am mentioning this matter, I should like to point out that there is another inconsistency in the act with regard to the depreciation of farm buildings. Suppose a son inherits a farm property with buildings from his father. The son may claim depreciation at fair market value. On the other hand, suppose there are a number of boys in the family, for instance, and the farmer is not in good circumstances. Suppose the son buys the farm, and it is a bona fide sale. If the son buys the farm from the father, then he cannot claim depreciation. That seems to be a rather unfair ruling, but that is the situation. Had the son purchased a similar farm from a neighbour-someone not his father'-he would be allowed depreciation at fair market value. The regulation is extremely unfair.


Stanley Howard Knowles: Six o'clock.


Harry Oliver White: I realize that it is six o'clock. Joking aside, I will say that the income tax is probably the fairest method of collecting taxes because those who are most able to pay are the ones from whom taxes are taken. But the way in which it is done at the present time is extremely unsatisfactory.
67509-205i
Department of Transport Act


Mr. Deputy Speaker:: Order. Does the hon. member wish to move the adjournment of the debate?


Harry Oliver White: I so move.
On motion of Mr. White (Middlesex East) the debate was adjourned.



TRANSPORT


[Stage Direction]
The house resumed consideration in committee of the following resolution-Mr. Marler -Mr. Robinson (Simcoe East) in the chair:
That it is expedient to introduce a measure to provide for the continuation for a further period of two years of authority to make regulations for the control of transport of goods in bulk including, amongst other things, the appointment of one or more controllers and one or more deputy controllers to carry out the provisions of such regulations and the payment of their remuneration.
At six o'clock the committee took recess.

AFTER RECESS

The committee resumed at eight o'clock.
Willis Merwyn (Merv) Johnson: Mr. Chairman, just before five o'clock I was outlining the necessity for the function of a transport controller at a time when we are once again being confronted with a very great surplus of all grains. At a time when it has been stated to me by elevator agents that it is more difficult to get cars than it was during the most severe restrictions during the war it is particularly important that we have an administrative body to look after the distribution of our box cars. I pointed out the conditions which existed in the early part of this year when the Canadian wheat board was forced to pay demurrage on ships waiting for cargoes in Vancouver harbour because of the failure to get adequate quantities of grain in position at the time when ships were in port. This demurrage, of course, is absorbed by the farmers who are selling their grain to the Canadian wheat board and therefore they are directly incurring the charge. I pointed out, too, that in January of this year 58 million bushels of space was reported in the terminals of Canada because of the failure of the railways or the powers that be to spot the necessary box cars to take this quantity of grain from the fields of western Canada.
This spring we have seen the tragic spectacle of piles of wheat being flooded, of farmers desperately trying to get through the snow to recover the grain which they
3238	HOUSE OF
Department of Transport Act left in the fields last fall in the hope that they might be able to get it moved during the winter months.
The whole problem of the distribution and allocation of box cars seems to be a contentious one because in the early part of this year, in fact, on February 17, a series of questions were asked and the Minister of Trade and Commerce stated that he was not responsible for filling the unused capacity; that, of course, was the task of the Minister of Transport through his transport controller, and the Minister of Transport said that the amount of space in our elevators is not a matter that comes under the jurisdiction of the Minister of Transport. There we had a classic example of the Minister of Trade and Commerce telling the Minister of Transport that it was his task to fill the elevators, and the Minister of Transport saying at the same time, it is no concern of mine whether the elevators are filled or not, my job is just to move the grain. It all becomes very tragic when the minister, within the light of the statement he made to the Alberta wheat pool of December of last year, indicated that there were 100 million bushels of space in the terminals because we were told there was a shortage of box cars.
It was indicated by the return that I referred to just before five o'clock that one of the reasons for the shortage of box cars was that' there were 10,000 more Canadian box cars on the United States rail lines than there were United States box cars on Canadian rail lines. I was informed by elevator agents who were in a position to know that they were not being granted authority to load grain into United States box cars which happened to have been spotted at their marketing points. In September of last year I was informed by a reliable source that there was a priority given for box cars out of the western division. The first priority was for lumber. After the railways had fulfilled that commitment of 100 per day they were to use all of their unfits, make them up out of fits to 100 for coal, of all things, in September; then priority on mill orders, Churchill orders and so on down the line. It is a very disappointing spectacle for the farmer in the western part of Canada to see trainload after trainload of empties going through to handle the lumber which, of course, is an important part of our Canadian economy. But at that particular time of the year it was important that we take as much grain as we could from the farms and fill up the terminals so that we would not have 100 million bushels of empty space in those terminals. Of course, Mr. Chairman, that is one of the features which has contributed to the disproportionate number of box cars which are in the United States, because the big 40, the big 2,000-bushel
[Mr. Johnson (Kindersley).l

cars, are the ones that are filled with lumber and taken down to the United States and shuffled around on the United States rail lines, sometimes staying down there for 100 to 190 days before they are returned; whereas if the priority had been given to the shipment of grain at that time I do not think the situation would have been as critical.
We have been very fortunate this year that the Minister of Trade and Commerce has not made the same prediction that he did last year. The committee will recall statements made by the minister, in his perpetual optimism, that we would be sweeping out the bottom of the bin. He modified that by stating that we would have at least an 8-bushel quota. This statement was made by the minister in the middle of July last year. The minister is concerned with other matters at the moment; but that has not stopped the making of silly predictions because we find that his colleague, the Minister of Agriculture, has taken over where he left off. I noticed this afternoon in the Star-Phoenix, of Saturday, April 7, the following:
Medicine Hat, Alberta. Agriculture Minister Gardiner said Friday night more orders for Canadian wheat have come "in the last few days than ever before" and the grain glut situation will be cleared up "right away".
Farther along the article reads:
"This crop year will see us taking more cash from our farms than ever before-even if we do not grow any wheat this year".
That, Mr. Chairman, points up one of the terrific jobs that the transport controller is confronted with if he is hoping to make the prediction of the Minister of Agriculture come anywhere near realization. While I am discussing this I think I should caution the minister about making over-optimistic statements because I feel the statement made by the Minister of Trade and Commerce last year that everything was rosy did a lot to induce people to spend the available funds they had without having a view of the critical situation that would develop in the fall when there was a complete cash shortage. I do not think the Minister of Agriculture is adding anything to the economy of agriculture by making it more difficult for the transport controller.
The Regina Leader-Post noticed this statement and in an editorial on April 17 said:
The west will believe these encouraging predictions when the record of actual shipments is down in black and white.
Those in charge of the grain movement have a twofold responsibility, to get the grain to the lakehead and other export ports, and to draw it from the prairies in such a way that farm marketing opportunities are as equitable as possible.
This is one time when I can agree with the editorial in the Regina Leader-Post. My

advice is to wait and see before we can believe these predictions which have been made. This is particularly true on the basis of the record as it exists at the moment.
The deliveries of grain from the farms up until April 4 are 156-3 million bushels less than the 10-year average, and the deliveries of grain from the farms standing at 255 [DOT] 6 are nearly 50 million bushels less than last year. This points out the incredible task with which we are being faced, because at one time, in January of this year, the carloadings were 36,453 behind the total for the same period a year ago. In spite of the very difficult conditions which prevailed for the railways, with the very harsh winter which we have been subjected to, by the end of March we still And that they were 18,786 behind the same period of last year. Therefore, we can readily see that the task confronting the person in charge of these administrative problems is a grave one.
It is even more serious, Mr. Chairman, when another factor is taken into consideration. One of the duties of the transport controller is to equalize quotas in so far as possible within the operation of the Canadian wheat board. But what do we find as of April 4? We find that in Saskatchewan over half of the 1,107 points are on a 2-bushel quota or less. As of April 4 there were 685 marketing points which had a specified quota of two bushels to the acre or less. We find that in Manitoba there were 86 out of 387 marketing points operating on a 5-bushel quota, perhaps taking advantage of the blunder that was made earlier, taking advantage of the short haul from Manitoba so the terminals could be filled and the boats that are coming in now could have a cargo available.
By taking advantage of this blunder in that way they have certainly given no consideration to the principle of equality because out of 1,107 marketing points in Saskatchewan there are only 26 on a 5-bushel quota. The total for all the marketing points in western Canada indicates that slightly less than one-half are on a 2-bushel quota or less. Out of a total of 2,080 marketing points, 986 are on a one or a 2-bushel quota.
One of the accepted responsibilities of the transport controller is to ensure an equitable apportionment of box cars between the railway divisions. You can readily visualize how difficult it is when a farmer at one marketing point who has a 1-bushel quota sees that at perhaps the next point or at one on another line within 15 or 20 miles the farmers are operating on a 5-bushel quota. Certainly they cannot say it is on the basis of the type or
Department of Transport Act kind of grain they have because the variations in grain do not shift within a radius of 15 or 20 miles.
We find, as was mentioned by the hon. member for Prince Albert, that invariably the Canadian Pacific line is more reluctant to supply box cars than is the Canadian National line. There are areas where the farmers have gone three or even four months without receiving a single box car at a marketing point.
This is a function of the transport controller because individual cases are taken up with him. In his own words, as recorded at page 239 of the proceedings of the standing committee on agriculture and colonization, when asked this question, he said:
.	.	. I call it to the attention of the railway
and say, "I think you are neglecting such and such a station; you should put some cars in there", the cars are placed and that is the end of it.
The transport controller has as one of his important functions the duty of equitably distributing box cars to the marketing points and on the basis of the evidence I have given I would hazard saying that he is a complete failure because there is no equity and no justice in the marketing points as they are indicated in the April 4 Wheat Review. The transport controller could play a very important role if his duties were looked upon as a fulltime job. Unfortunately the resolution before us which sets up the continuation of his duties for another two-year period does not consider the fact that the present transport controller is in a way on loan from the board of grain commissioners.
When Mr. Milner was before the committee on agriculture and colonization last year I asked him the following question, as recorded on page 238 of the proceedings of that committee:


Willis Merwyn (Merv) Johnson: You feel it is not handicapping you as a member of the board of grain commissioners to be transport controller at the same time?


Mr. Milner;: To the extent that I could be putting more time in on the board of grain commissioners when I am doing transport control work, yes; that must be obvious, but if you are suggesting that the work on the board of grain commissioners is being neglected on account of the fact that I am transport controller, I say no.
So the answer you get just depends on which question you ask. In this case Mr. Milner was assuring us that his responsibilities as a member of the board of grain commissioners were not being neglected because he was serving as transport controller but by the same token he has admitted that he is neglecting his duties as transport controller.
In that same series of questions, Mr. Chairman, it was pointed out the difficulties that

Department of Transport Act farmers are having in western Canada, spearheaded by their own elevator company, the Saskatchewan pool, in encouraging the government to introduce a system whereby they would be allowed the privilege of delivering grain to the elevator of their own choice.
In the course of the debate in the committee it was pointed out that that would be a fairly comprehensive job if it were assumed by the transport controller. At one point in the questioning relating to that same task, I asked Mr. Milner this question, as recorded at page 243 of the committee proceedings:
I understand you keep a very close liaison with the Canadian wheat board. I do not see why, if a separate individual were transport controller, this same close liaison could not be held with the board of grain commissioners. Perhaps he could be allotted these duties, these functions, and as Mr. Studer pointed out, that closer checking on individual points could be carried out by him. Is that feasible?


Calvert Charlton Miller: I am not going to give a snap answer to a question which is as involved as that. I do think to the extent that you increased your checking on matters of that kind, naturally the effect would likely be beneficial.


Willis Merwyn (Merv) Johnson: It might be desirable for you to have additional staff?


Calvert Charlton Miller: No.
Mr. Milner has stated that although it is a part-time job and he receives no salary from the Department of Transport, but only as a member of the board of grain commissioners, he has sufficient time to handle the numerous duties which confront him as transport controller in trying to cope with a record crop in western Canada. The resolution which is before us outlines the fact that there can oe the appointment of one or more controllers and one or more deputy controllers to carry out the provisions of such regulations, and provision is made for the payment of their remuneration. I therefore see no reason why the duties of the transport controller could not be enlarged to include those granted him by statute so that the powers could be taken in to provide this service to the farmers of western Canada through the equitable allocation of box cars, and consideration could be given to the principle of delivering grain to the elevator of their choice.
I was rather disturbed at the fact that there did not seem to be anyone here to do Mr. Milner's job in his absence. It seems to me that as a member of the board of grain commissioners he is quite busy in the summer months and he therefore takes his vacation, to which he is fully entitled, in the winter months. I therefore put a question on the order paper in which I asked who assumed the responsibility of the transport controller during his absence. I was thinking about the month of January in particular 
when we have a variation of from 50 to 100 million bushels of available space in the elevators.
The first question I asked reads as follows:
1.	Who is the deputy transport controller?
The second, third and fourth questions were as follows:
2.	When was he or she appointed?
3.	Under what authority was the appointment made and who made the appointment?
4.	What is the salary of the deputy transport controller?
The first, second and third questions were answered simultaneously as follows:
1, 2, and 3. No deputy transport controller has been appointed since the resignation of the former deputy transport controller was accepted on July 2, 1953. Mr. Frank T. Rowan has been performing the duties of deputy transport controller since August 1, 1953.
It does not answer question No. 3 which reads:
Under what authority was the appointment made and who made the appointment?
I presume the minister will be able to give me that information during the course of the discussion on this resolution. The answer to No. 4 was as follows:
Mr. Rowan receives no salary for his work in connection with transport control but is remunerated as an official of the Canadian wheat board.
It is apparent that the Minister of Transport is reluctant to spend any money. The department tries to get someone to fill these part-time jobs as they can find them. That answer rather conflicts with the answer the hon. member for Assiniboia received in the agriculture and colonization committee, and I quote from page 239 of the proceedings as follows:


Mr. Argue:: How many full-time employees
operate under this act?


Calvert Charlton Miller: How many full-time employees?


Hazen Robert Argue: Yes.


Calvert Charlton Miller: There is Dan Kane on the west
coast and a stenographer, and there is my secretary in Ottawa here and myself.
Where does the deputy transport controller come from? He popped up in the answer to my question, but I am suspicious that the functions of the transport controller are being carried on in part by his efficient secretary who works over in the Hunter building. It might well be that that could be done because I assume that under these tremendous powers which .are granted to the transport controller to organize our bulk transport, to look after the filling of ships and so on, directives would be issued. On February 24 I asked:
How many directives to the railways were issued by the transport controller-
The answer came back "None". In other words, the transport controller operates on

the telephone by trying to "joe" the railway companies into doing the things he would like them to do. If they decide that they want to haul lumber or coal instead of wheat there is nothing much that can be done. I can understand that the duties of the transport controller are very important, but it is quite obvious that there has been a slipshod handling of this whole affair by the department as well as a niggardly approach.
We should be in a position to appoint transport controllers who will handle that job as their sole job, who will work as fulltime members of the staff and who will be paid by the department. I would go a step further and submit that this job is so important at this time that we should appoint additional transport controllers to carry on the functions which need to be carried on. I do not think it would be advisable to wait until after the next general election in the hope that additional appointments could be made then. It might be that that occasion would provide an opportunity to retire some war horses, but there again it would be an offside gamble. After all the duties of a transport controller are so important that he should be going about the task of organizing the transportation services of Canada to provide an efficient service to the farmers and businessmen of Canada who are in need of such a service.


Mr. Smith (Battle River-Camrose):: Mr. Chairman, we in this group are happy to support this resolution which proposes to introduce a measure into the house at some later date to provide for the continuation for a further period of two years of the authority to make regulations for the control of the transport of goods in bulk. As has already been pointed out in the course of this discussion, there is something radically wrong with the type of control which has been exercised over the movement of grain from the west to coastal and lakehead terminals during the past number of years.
We were told last fall in no uncertain terms that the reason for the inability of farmers of the west to market their wheat was a shortage of box cars in the west. I cannot help but feel that there was something wrong in the Department of Transport that would permit such a situation to arise. Surely the transport controller and the other officials associated with the movement of goods throughout Canada must have been aware months in advance that there would be a great need for box cars to handle the 1955 crop and perhaps the remainder of the 1954 crop to be found in the west.
In my opinion these cars should have been moved out to western points, not in January
Department of Transport Act or February after this parliament had opened, but early in the fall to enable the smaller elevators in the west to clean out their supplies and allow farmers to bring their wheat to the elevators before the roads became blocked.
However, I do not feel it would be fair to lay all the blame for this situation upon the Department of Transport. I submit that the right hon. Minister of Trade and Commerce must assume some responsibility for the marketing of grain. He should not attempt, as he did last fall, to blame others for the lack of planning which could have been handled quite well in his own department to some extent.
The situation is far from being free from confusion as far as western elevator points are concerned. Some points have a three-bushel quota, others have a four-bushel quota and so on, but there is a lack of uniformity as to how the grain is shipped. For example,
I received this letter from a grain handler who has this to say:
In the first place we were told last fall that cars were to be spotted at elevators in accordance with the number of shipping orders held by each elevator. So far as I am concerned this has never been done. I am at present holding 15 orders for carlots and the only other elevator at this point has 5 orders on hand. This should mean that I get two cars to every one of his, but to date cars are spotted one car for each elevator.
Also I have had these orders since last December and have been unable to obtain cars.
That means to me that there is some confusion existing even now. However, I should like through you to thank the present transport controller for the co-operation and courtesy he has extended to me at all times, and I say that in all sincerity. In my opinion there is no use blaming the individual who is called upon to do a job and who is doing it to the best of his ability with the machinery with which he is provided.
However, on the other hand I feel that there is urgent need for a much closer liaison between the Department of Transport, the Department of Trade and Commerce and the Canadian wheat board so that the confusion which has existed these last number of years will be removed. Surely something can be done within the very near future to make certain that a situation such as we found this last year will not be repeated at another time.
It has been pointed out already during this debate that the box car situation apparently is much better along the lines of the Canadian National Railways than it is along the C.P.R. lines. That is true in my area, and it is particularly true as far as C.P.R. branch lines are concerned. Apparently they do not wish to move box cars into those lines unless
3242	HOUSE OF
Department of Transport Act they are forced to do so. For this reason, Mr. Chairman, I should like to submit that perhaps the Canadian Pacific officials should be brought to task and perhaps called upon to try to offer the same service to the western grain producers that our own Canadian National Railway offers. As I have pointed out, we were very happy to see this resolution introduced, and we will reserve any further comments we may have in this regard until the bill is introduced.
. Mr. Dinsdale: Mr. Chairman, I want to take this opportunity to express support of the resolution we have before the house. On the surface it appears to be a routine resolution. The Minister of Transport is asking for the continuation for a further period of two years of the authority to make regulations for the control of the transportation of goods in bulk, including amongst other things the appointment of one controller or more to look after this function.
This measure, I believe, was first passed in 1954. Prior to that, as I recall, there was considerable agitation in this house that steps be taken whereby the problem of dealing with the transportation of goods in bulk, primarily grain, could be taken care of in a more efficient manner. I recall, for example, when I first came to this house in 1951 the former member for the old Souris constituency, Mr. Arthur Ross, was active in making suggestions of this kind. As a result of similar representations, the measure was finally passed in 1954. Actually at that time it was merely regularizing procedures that had been carried out under order in council. I firmly believe that having the measure spelled out in concrete legislative terms is a much better way of dealing with the matter than the haphazard order in council procedure.
When the measure was originally passed, we were confronted with pressure on our transportation systems from bulk goods other than wheat. It seems to me that in more recent years, judging from the discussions in this house as well as from comments arising across the country, the major difficulty in making provision for the efficient and effective transport of bulk goods arises from the continuing problem of grain congestion on the prairies. Certainly, this was true of the situation that arose last fall. There is no necessity for me to emphasize this particular problem. It has already been covered quite thoroughly by the speakers before me in this discussion today. In supporting the reappointment of the transport controller, I should like to raise the query as to whether there is a real shortage of box cars in Canada. Perhaps 

when the minister replies to the various representations that have been made he will clarify this question.
Are we confronted with an absolute shortage of box cars in Canada? There has been conflicting information given in reference to this particular question. I recall the former minister of transport, Mr. Chevrier, insisting that there was no real shortage of box cars, but that it was just a matter of having them in the right place at the right time. Reading the evidence before the committee on railways that met earlier this year, I discovered that the president of the Canadian National is also of the opinion that there is no absolute shortage of box cars in Canada. Speaking directly to the question, for example, of the delivery of our huge grain crops, Mr. Gordon said that during the current crop year at no time has the Canadian National failed to take up the capacity made available to it at the terminal elevators in the west. Someone has laid down the figures that in order to handle the grain crop at the peak period of the year it is necessary to have 50,000 cars available in the west. This is a fairly substantial number of cars, and I just wonder whether our railways, both the Canadian National and Canadian Pacific, are in a position to meet that demand when it occurs from year to year. Looking at the actual situation that occurred last fall, there is some evidence which suggests that there is a real shortage of box cars. For instance, as has been pointed out before, at the close of the navigation season on the great lakes there was space available in the grain elevators across the country for some 100 million bushels. This immediately raises the query why, if we had sufficient box cars to handle the movement of grain, was this space available? Then again, from August to the close of the navigation season there were 35,000 fewer grain cars loaded than had been loaded in 1954.
During the discussion a few weeks ago of the problem of grain marketing the Minister of Trade and Commerce suggested that the problem that occurred in the west last fall was largely the result of the shortage of box cars that prevailed in western Canada. Now, the query I raise, and I trust the Minister of Transport will be able to help us in this regard, is: is it a real shortage or was it a temporary shortage? Do we have enough box cars in Canada to meet all the demands of the movement of bulk goods and particularly the movement of the very large grain crop that has been produced on the prairies in recent years?
If there is not a real shortage of box cars, it would seem to me that the problem must be one of allocation. We have had many

discussions in this house during the past few years concerning the equitable allocation of box cars. I am not going to go into that question in any great detail tonight. We have had representations before the agriculture committee on this question during the past three sessions and various solutions have been proposed. Judging from the correspondence I still continue to receive on the matter from farm areas, from elevator operators and particularly from pool elevator groups, we still have not solved this difficulty of the fair distribution of box cars amongst the various elevator companies and particularly in the various areas. For example, it has been mentioned that there is unequal distribution between elevators located on main lines and elevators located on branch lines. During a period of grain congestion such as we have faced in recent years there is obviously no legislative solution to the problem. It would seem that the responsibility falls entirely upon the transport controller. If our problem is one of allocation and distribution rather than one of absolute shortage, it seems obvious to me that there is a real necessity for a continuation of the measure that we have before us. In fact, there is an even greater necessity than there ever has been heretofore.
Perhaps I might end my remarks on a more optimistic note and possibly re-echo the sentiments that have been coming from the Minister of Trade and Commerce and the Minister of Agriculture in recent days by referring to the fact that we have been told that the problem of the movement of our grain is being solved quite nicely. According to a press dispatch the Minister of Agriculture was very confident at a meeting in the city of Medicine Hat recently that Canada's grain glut is going to be cleared away during the current year.
I have looked into the question to see just how close to reality optimistic pronouncements of that kind may be. If it is going to be possible to clear up the backlog of grain accumulation that resulted in the tie-up last fall it looks as though a miracle will have to take place. In March the farm union of the prairies presented a memorandum to Mr. Milner, the transport controller, on the question of the provision of transportation in order to get our congested grain to market. They came up with the answer that from now until the end of the crop year 1,085 box cars are going to be needed daily if we are to equal the delivery level of last year. I believe that number of cars is almost a prohibitive figure when we take into consideration the number of box cars available for this purpose in Canada.
Department of Transport Act
I should like to break down these figures into concrete terms. These statistics, I may say, are taken from the 1954-55 Sanford Evans grain trade year book, a very reliable source. Total deliveries of wheat in the crop year 1954-55 were 312-3 million bushels, and the total for wheat and all other grains was 514-7 million bushels, a very large delivery total. Canadian wheat board statistics for deliveries in the current year up to the week ended February 1, 1956, give us the following picture. Total wheat deliveries were 111 million bushels and the grand total for all grains was 199 million bushels.
These figures suggest that if we are going to beat the record of last year-and we will have to go away over last year's total to make any impression on the surplus-if the optimistic predictions of the Minister of Trade and Commerce and the Minister of Agriculture are going to be realized, we still have 315-7 million bushels of grain to be delivered before July 31, 1956. Of this total 201-3 million bushels consist of wheat. On the basis of 1,700 bushels of wheat per box car this means an average of 4,554 cars per week will be required in the period from February 1 to July 31, 1956. Using a six day week, the average daily requirement for wheat movement alone will be 759 box cars. Then there are the coarse grains to be delivered. These total 114-4 million bushels if we are going to equal last year's figure, and on the basis of 2,250 bushels per box car this means an average of 1,956 box cars per week or 326 per day are required in the period from February 1 to July 31, 1956. These figures give the grand total of 1,085 box cars per day.
It is because of concrete evidence of this kind that I heartily support the resolution before the house at the present time. I would again repeat the questions I have asked. Do we have a real shortage? Is it a problem of allocation only? If it is a problem of allocation, the transport controller will certainly have his hands full to cope with the situation facing us at the present time.


Hugh Alexander Bryson: Mr. Chairman, I should like to add a few remarks to those already made with respect to the resolution before us providing for the appointment of a transport controller. At the same time I am sure we all feel that if he is not going to be any more effective in so far as the movement of grain is concerned than the present transport controller then we would like to know just what his duties are going to be. I hope when the minister speaks he will describe those duties quite fully.
The hon. member for Kindersley mentioned the terrific spoilage of grain that is

Department of Transport Act taking place at the present time in western Canada. During the last week or so I have had many letters pointing out to me that serious spoilage is being experienced all through the west where grain is piled outside or in granaries that are inadequate. Certainly that condition could have been overcome to a great extent if there had been a better allocation of box cars and a better movement of grain throughout that part of the country.
I should also like to mention for a moment the reluctance of the Canadian Pacific Railway Company to load box cars with grain on their branch lines. I happen to live in an area where we are faced with that problem. The problem has become so acute during the last couple of years that whenever it is economically feasible the pool elevator company is endeavouring to move its elevators to a Canadian National Railways siding. I think that is extremely unfortunate. It is adding again to the cost of producing grain in those areas. These elevators have been built on C.P.R. sidings in good faith and now they are to be moved. Much of the original elevator is going to have to be dispensed with and it is going to add to the already high costs of producing grain in that area for at least two or three more years.
One of the things that I think has been most annoying during the last year or two is the number of conflicting statements that we have heard with regard to the movement of grain. I refer to statements made by the Minister of Trade and Commerce on the one hand and by the transport controller on the other. I am sure that all of us are quite familiar with those conflicting statements. For instance, Mr. Milner is quoted in the Western Producer of January 21 as admitting that there is a shortage of box cars. He lists adverse weather conditions as one reason for the shortage of box cars in western Canada, at the same time admitting that there is some 60 million bushels' space in the terminal elevators both at the head of the lakes and at the Pacific seaboard. Then again, on February 16 or 17 -I am not sure just which-we have Mr. Milner making this statement:
Transport controller Roy W. Milner,-
This is dated "Ottawa".
-whose powers parliament will be asked to renew for two years, said Thursday there is no shortage of box cars holding up prairie grain shipments.
Then later on we have a statement by the Minister of Trade and Commerce, speaking to the Interprovincial Farm Union Council which assembled not long ago here in the city of Ottawa. At that time he said that because of the box car shortage prairie elevators will not


be emptied before spring. That is a complete reversal of the opinion of Mr. Milner.
Then again, just recently we have Mr. Milner, in western Canada, giving evidence before the select committee of the Saskatchewan legislature, making this statement:
People who claim Canada has a shortage of box cars for shipping grain are misinformed-the grain is moving as fast as export sales allow . . .
Then later on Mr. Milner is reported as saying this:
Mr. Milner said nothing annoyed him more than people who blame all their ills on a so-called box car shortage.
There we have conflicting opinions on the part of both of these responsible people.
I should also like to say this. When this new transport controller, whoever he may be, is appointed I hope he will have delegated to him much wider and greater authority than that which is apparently enjoyed by the present transport controller. I should like to point out what Mr. Milner had to say before the select committee of the Saskatchewan legislature with regard to the allocation of box cars:
Mr. Milner explained that while he could order box cars to a given point, the wheat board could supersede his order by ordering elevator companies not to deliver grain to the box cars.
Then farther on he said this:
I tell the railways to carry out wheat board orders. I tell them, within good railway practice . . .
Here we have the transport controller saying that he allocates box cars on the advice of the wheat board and yet, in the same breath, saying that when those box cars are allocated according to the wishes of the wheat board to a particular point, he has no assurance whatsoever that the wheat board will allow grain to be put into those cars. Hence it would seem that the transport controller has little if any power in that respect. Then he went on to say something that to me was an amazing revelation because I had always believed that the transport controller had extremely wide powers with respect to the allocation of box cars for any commodity in this country or with respect to Canadian box cars in the United States. Nevertheless he goes on to say this:
He said that he had no control over Canadian cars in the U.S. . . .
I therefore hope, Mr. Chairman, that when the new controller is appointed his powers will be set out definitely and that we shall know exactly what those powers are. I should like to place on the record just what the position is in respect of the movement of grain in western Canada. I am going to quote from

a study made on March 1 by the Saskatchewan wheat pool or by competent people representing that organization:
At half the shipping points in Saskatchewan,-
This is on Feb. 22, of this year.
-farmers were still restricted to one bushel per acre delivery quota .	.	. This meant that the
grain income for most half-section farmers at these points since last August had a ceiling of *720.
Then he goes on to point out the position of farmers farming larger portions of land.
At the same date, 612 points were on a quota of one bushel to the specified acre. (There are 1,107 shipping points in the province).
I go back to the preceding paragraph:
On February 22, 32 Saskatchewan shipping points were still on the unit quota of delivery.
They had not even been allowed to load out their first bushel in the current crop year.
The railways had loaded about 26,800 fewer box cars at prairie points during the present crop year than during the same portion of the 1954-55 crop year.
Apparent available space in terminal elevators at the lakehead on February 15 was about 20 million bushels.
We know that that capacity has been substantially increased since that time. They go on to say this:
The review also showed that congestion was much more serious in the southern half of the province than in the northern. In six wheat pool divisions south of a line from Yorkton to Alsask, 65 per cent of the shipping points were still on the 1-bushel quota as compared with 58 per cent for the province as a whole.
The Canadian wheat board had issued several thousand shipping orders to country elevators for the movement of grain which had been unfilled because cars had not been spotted at the elevators. The Saskatchewan wheat pool itself had more than 6,000 orders for grain shipments on hand awaiting the arrival of box cars.
Thus we see, Mr. Chairman, that the situation is indeed critical with respect to the movement and delivery of grain.
A few moments ago the hon. member for Brandon quoted some revealing figures relative to the number of box cars that will be needed between now and July 31 of this year, which is the end of the present crop year, if we are to be able to deliver as much grain this year as we delivered last year. While I am not going to place on record that comprehensive statement that he made, although I have it here, I should like to point out, as he did, that it will require some 1,085 box cars to be loaded every day until July 31 if we are to be able to deliver as much grain this year as we did last year.
I think the figure he quoted was that the total number of bushels of all grains delivered last year amounted to some 514-7 million bushels. That, of course, includes wheat,
Department of Transport Act oats, rye, barley and flax. Up until February 1 of this year we had delivered a total of 199 million bushels. I believe it would be correct to say that the latest figures we have of deliveries up until April 4 are something in the neighbourhood of 255 million bushels as against the figure of 199 million bushels that I quoted for February 1. The fact remains that it is going to take even more box cars from now until the completion of this crop year if we are going to be able to dispose of as much grain as we did last year. Therefore, I hope that when this new man is appointed his work will be reflected in a more orderly and a more realistic allocation of box cars in so far as the movement of grain and grain products is concerned, especially from western Canada, where we are in such a critical position at the present time.


Edward Turney Applewhaite: Shall the resolution carry?


Mr. Castleden:: In speaking in support of the resolution preceding the bill to amend the act to continue the life of the transport controller for some years, I should like to say that the present business demands in the transportation field require that such a man should hold such a position. The matter of the transportation of grain from the western prairies has become a very vital one to the producers in that part of the country, particularly in a year such as 1955-56 when, because of the lack of facilities and the lack of space, a large section of the population in the prairie regions was in a sort of semirecession as a result of having the source of the life blood of their business cut off. They could not deliver their grain. When that is brought about because of a lack of transportation facilities it is something which requires the attention of the government particularly. The increased production in the past number of years in western Canada has placed a strain on that part of the country in so far as the farmers getting returns for their produce is concerned. The situation has become complicated over the years because the western farmers have been struggling in the best way they knew how for years to get out of the clutches of what was previously the Winnipeg grain exchange. They have been fighting for years to get away from the line elevator companies who operated the Winnipeg grain exchange and had complete control. The farmer was compelled to sell to them pretty well at the price which they were able to manipulate in the grain exchange. They held the grain and then sold it on the world's markets at the world price and pocketed the difference.

Department of Transport Act
For many years the farmers struggled to establish the wheat board and in conjunction with that farm organizations, co-operative organizations, under which they would own their own pool organization, the wheat pool, and deliver their grain to their own organization. and have their own organizations sell that grain on the Winnipeg grain exchange to start with, while it was still there. Then later they fought for the establishment of a wheat board.
Gradually, through the years, that fight has been successful and the producers on the prairies thought they had solved their problems pretty well. At any rate, the sale of their products was made through an orderly marketing setup at whatever price the commodities sold at in the markets of the world, and that price was returned to the producers less the costs of handling. That is exactly what the farmer wanted.
The establishment of the wheat board was a blow to the grain exchange; it was a blow to the line elevator companies which operated in that country. The farmer thought it was only right and just that he should have the returns of his labour sent back to him after his grain was sold. Everything seemed to be moving pretty well in the direction of the establishment of something fair and equitable. Then, along with the extra production and the difficulties of markets, a further complication arose which has again taken the cup of success away from his lips which he thought he had won. That complication was the person who was put in control of and arranged for the box cars to reach his elevator. For many years his wheat pool elevator gained and gained business and finally got a little over 50 per cent. Then appeared this new complication, namely, the matter of box car allocation. He found that in spite of the fact he had his own elevator, in spite of the fact it was the wheat board that was handling his grain, in spite of the fact that he had his own terminal elevator and, in many cases, terminal milling companies where he could sell his grain to his own organization, the business that he was able to do through his wheat pools was being cut severely because he could not get box cars. He was thus denied, and in recent years had been denied, a basic right which he had previously almost taken for granted, namely, the right to deliver grain to the elevator of his own choice, the right to deliver his grain to his own elevator because, in the operation of an elevator business, there is not only the job of doing away with the exploitation of the grain exchange and of the line elevator companies but there are the returns which naturally come from the profits of handling his own grain through his

own organization, namely, the wheat pool. Any profits which accrue out of the business of handling grain are returned to the producers in the form of dividends. Surely, then, it is only right and just that the producer should be permitted to deliver the grain to his own elevator.
To the extent to which he was permitted to do that we find there has been a gradual decline in line elevator companies. Some of them were very severely hit and some of them are struggling to exist against the people's movement, the co-operative movement, which has risen to establish some rights for the farmers, to establish the co-operative business as a means of combatting the competitive system which had a monopoly in the handling of grain and which for years had exploited and manipulated the price of grain in Winnipeg. They made it low in the fall when the farmer had to sell, and then when they sold it on the world market they cleaned up for themselves and took the benefits pf the farmers' toil back into their hands and made many millionaires in the city of Winnipeg and on the Winnipeg grain exchange.
Naturally, the grain exchange and the grain companies organized to compete with the farmers, and their fight against the pools has been continuous, strenuous and steady. It has never been given up. They still, I believe, carry some hope in their hearts that some day they might be able to beat down the people's co-operative movement which includes, I would say, a large percentage of the producers in western Canada. The transport controller enters the picture at this point and becomes the key person to the whole situation.
It seemed very unfortunate to many prairie producers that the man who was selected transport controller and who exercises control over the allocation of box cars is the man who was at one time president of the Winnipeg grain exchange and who for many years was the president of one of the largest grain companies in the business. Naturally the co-operative producer looks upon such a man as a person having motives of his own in the handling and allocation of box cars and in business which affects the operation of the wheat pools and their co-operative associations.
I am giving this background to the minister in order that he may understand why there is a great deal of mistrust towards the transport controller and why the farmers look upon the transport controEer as the person responsible for box car shortages when they hear there are insufficient box cars in their region to handle the grain in the faU of the year when they are loaded down with grain and when their bins are full.

There were times when the farmers should have been able to deliver their grain and they were surprised to learn that thousands of box cars were being used by other industries. Last winter was a very severe winter in the west as indeed it was in other parts of Canada. Later on when box cars were available in some small quantity the farmers had difficulty getting into the various towns to deliver their grain. In fact in many cases the railway companies had a great deal of difficulty getting box cars down to the sidings. As the previous speaker indicated, the situation on the branch lines was particularly difficult.
The key to the situation lies in the fact that the farmers feel their own organization is being discriminated against in the matter of the allocation of box cars, and in their constant struggle to find out who is responsible they are given what can only be described as the run-around.
Perhaps this is not under the control of the Minister of Transport and I can understand that he might have difficulty in connection with it, but I can say to him that at the present time the system under which the farmers are supposed to operate leaves much to be desired.
The wheat board is the sole agent for the government in the selling of grain. When it receives orders for selling grain from any particular point it passes on the shipping orders to the various grain companies, wheat pools, or the line elevator companies such as the federal grain company or the Pacific Grain Company, the U.G.G. and others. They pass the orders on to the elevator company at their head offices. The instruction is that the head office shall then designate the various points throughout the various provinces where that particular elevator will be given a shipping order to deliver its grain. It cannot be delivered, however, unless box cars are sent to that point and it is here we feel the transport controller should enter the picture and instruct the railway companies to spot box cars to certain elevators at certain points, at least in accordance with the shipping orders passed out by the wheat board to the various grain companies in the prairies.
In spite of the fact that the grain companies and the delivery points are receiving shipping orders, they find they are not getting the box cars. Who is responsible for the allocation of these box cars?
Well, in the agricultural committee we questioned the transport controller and he said, "I have nothing to do with the rails. I am too busy to interfere with the railway companies. I could not spend my time running the railway companies".
Department of Transport Act


George Carlyle Marler: Would the hon. member permit a question. When did Mr. Milner make that statement?


George Hugh Castleden: When he appeared before the agricultural committee last year, 1955.


George Carlyle Marler: I believe the hon. member will have difficulty finding the page in the proceedings of that committee on which that statement is recorded.


George Hugh Castleden: Before the debate has concluded I shall be glad to look it up.


George Carlyle Marler: Yes. I would be interested in seeing it. I do not recall any such statement having been made.


George Hugh Castleden: I shall be glad to find it for the minister. At any rate, this is what has happened. If the transport controller has no control over the railway companies I can then understand the situation being as it is. However, if he has control over the railway companies and has the right to designate to them that they shall distribute box cars according to the shipping orders and the delivery points designated by the wheat pools and other elevator companies, I cannot understand the present situation. I shall be very glad to have an explanation and I am quite sure that the wheat pools would be glad to know what the situation is in reality.
I wish to describe what is happening at the present time. I have in my hand a report from a small town, Bankend, which is situated on a branch line in my constituency. This is in the form of a letter dated February 6 and it says:
We have today 26 shipping orders on hand at this point, 18 with the pool and eight with the Federal, and we are still on the 100 unit quota at this point.
They have not obtained the 1-bushel quota. The report also states that this group signed a number of resolutions, copies of which were sent to the transport controller, the chairman of the Canadian wheat board and the Canadian Pacific Railway dispatcher.
I took the matter up at once and wrote to the Minister of Trade and Commerce concerning the situation and endeavoured to get some action. It seems that there are some points which are having difficulty getting box cars and the people there are in dire circumstances. At that time they could not get cash advances on their grain and because they lived many miles from a bank and the roads were impassable in many cases they were unable to get a loan from a bank. Many of them were doubtful that they could obtain a loan from a bank even if they asked for one.
After a little bit of action they wrote to me again on March 30 telling me that the
3248	HOUSE OF
Department oj Transport Act train crew came down and in spite of the fact that the line elevator company at that point had filled all its shipping orders only two cars were dropped off at that point, one at the wheat pool, which still had 15 shipping orders, and one at the line elevator company which had no shipping orders at all.
When you try to find out who is responsible you are told that no one is responsible except perhaps the train crew which is not carrying out the order. You try to find out who has given the order and you are told that it is the dispatcher. When you approach him he tells you that he gets his orders from somewhere else. The train crew says that it did not get any orders to spot cars at this point and the dispatcher says he operates on the basis of one car, one elevator. The dispatcher denies the fact that he is giving orders about this and says that he leaves it to the crews. The result is that no one seems to accept responsibility for the allocation by the crews of cars at these elevator delivery points. There is something seriously wrong in the allocation of shipping orders and the allocation of cars when they get there.
In a letter I wrote to the Minister of Trade and Commerce on April 12 I indicated the situation as it existed at that time. Dealing with the box car situation at that point I said:
My attention has been drawn to an unfortunate situation with regard to the spotting of the cars which are being allocated to the above delivery point. A similar situation exists at many other points in Saskatchewan.
It exists also at many points in the constituency of Yorkton, which I have the honour to represent.
According to my informant the Federal elevator at that point has filled all its shipping orders. The Saskatchewan wheat pool, however, has orders for some 15 cars.
On March 30th the train crew spotted one car at each elevator, although the Federal elevator had no shipping orders.
Upon whose orders was that done? Where did they come from? What happened at that point is that the farmers finally took the matter into their own hands. They filled up the one car at the pool elevator which they had and then they proceeded up to the Federal elevator company and moved the box car from there to their own elevator where it could be filled. My letter goes on:
It is evident that the arrangements for allocation of cars to cover shipping orders is not functioning properly and unfortunately the wheat pool is being discriminated against as a result.
At Bankend it is evident that the Federal Grain Company has been receiving more than its fair allocation of cars, since at the present time the Federal elevator has some 3,500 bushels available space whereas the Saskatchewan wheat pool elevator is filled.
Inquiry into the situation at various times indicates that in some cases the train crews do 

not receive definite instructions as to the spotting of cars. In other cases they fail to place the cars where instructions call for them.
Would it be possible to have definite arrangements made with the railroad companies under which cars could be spotted according to the shipping orders as allocated by the wheat board and elevator companies?
I should like to point out to the minister, and this is because of some previous association with the transport controller-I want him to accept my word-that personally I have nothing against the transport controller. In my opinion this whole situation has resulted from something which is failing to operate. The situation is made all the more difficult and creates more bitter feelings against the government and against the minister and against the transport controller when they find this sort of thing happening.
I suggest that he should try to straighten it out and give the transport controller control over the instructions given to the railway companies so that the allocation of cars will take place where it should take place. There should be such co-ordination between shipping orders and the allocation of cars that they are exactly the same. If the minister can remedy that situation he will do a great deal of good.
I know of one place where there is a single wheat pool elevator, and in another place where there is a line company elevator, and in almost every instance the line company is getting the box cars while the wheat pool is not. I know in my own area they seem to leave cars at one place and not at the other.
I do not know why the train crews do that, but surely if instructions were given to the transport controller this could be remedied. If he has not the power to do it, he should be given that power and thus be able to do what should be done.
Inquiries of the heads of the wheat pools, of the heads of the grain companies, of the wheat board and of the railway companies simply result in the passing of the buck to somebody else and saying "It is not our responsibility." If the minister can get this' particular situation cleared up he will do a great deal of good. At any rate he will reestablish to the producers on the prairie a basic right which belongs to every individual, the right to deliver his grain to the elevator of his choice, the right to purchase his commodities where he would like to purchase them. That right has existed for many years.
I might say that this trouble seldom occurred prior to the time when the wheat pool got into the position where it could control by far the greater part of the grain at particular points. Taking Bankend as an example, my own feeling is that if they were

allowed to deliver say 80 per cent of the grain to the pool elevator the situation might be different, but they are forced to deliver grain to the line elevator company because that elevator is getting the box cars and has the space. The farmer must have money and he is put in the position where he cannot do anything about it. He is forced by economic conditions over which he has no control to try to get rid of that grain as best he can. If the minister could remove that injustice I assure him he would have the support of members on this side of the house.


Mr. Campbell:: Mr. Chairman, before the resolution carries, I should like to say something which has been said already, and that is that we in this group will support this legislation in the hope that never again will there be a recurrence of what * we saw last fall. I think there should be two main objectives of the bill to be introduced. First, the bill should provide that grain should always be moved to the terminals, not only to fill orders for overseas but to fill mill orders and also to keep our terminal elevators full.
I heard a number of complaints by elevator agents last fall to the effect that they had mill orders on hand. Mill orders are orders from the milling companies which want grain right away and will take deliveries of those orders. Different elevator agents have told me that they had had mill orders for two or three weeks and could not get box cars. One of my greatest concerns about the whole situation last winter was the fact that while our farmers were in desperate need of money there was a tremendous amount of empty elevator space available during the month of January.
I asked a number of questions during January in an effort to find out how much empty space there was in the elevators, at the lakehead terminals and the far coast terminals. I was told that that amounted to 50 million bushels of space. I tried to find out who was responsible for that situation. I asked the Minister of Trade and Commerce a number of questions but I received no satisfactory reply. Up to the present I am quite certain that no satisfactory reason has been given to this house for the empty space available in our terminal elevators for that amount of wheat. I think the controller should have the power to do these things and see that cars are available so that mill orders can be filled.
Another objective which I think this legislation should have is to provide for the allocating of box cars. The hon. member who just spoke has covered that point rather
Department of Transport Act well. One of the biggest complaints that the farmers in western Canada have is the fact that they have spent a huge amount of money to set up their own elevator system. They have spent a lot of time and effort to build up that organization, but they now find themselves in the position that whenever they haul a load of grain to their own elevator they find that it is full and they have to take that grain to an elevator with which they do not want to deal. If the legislation to be introduced following this resolution does these things, I think it will be doing a great good and will represent a forward step in marketing legislation in this country. I want to warn the government that if it does not achieve these two main objectives it is going to hear a lot from the grain growers in western Canada in the next year.


Frederick Samuel Zaplitny: Before this resolution is adopted I want to express a few thoughts on it. I notice the resolution calls for the appointment of a transport controller and for one or more deputy controllers to carry out the provisions of such regulations as may be laid down, and for the payment of their remuneration. As has already been stated by speakers from this group, we are quite prepared to support the idea of extending the power of the transport controller, and even adding an assistant controller, if we are satisfied it is going to result in a more efficient and more equitable distribution of the box cars in this country. However so far, judging by the evidence that has been placed before this committee, and I think it is rather significant that we have not yet heard from the minister-


George Carlyle Marler: I gave a very brief statement at the start. I do not know what the hon. member expects.


Frederick Samuel Zaplitny: The minister has yet to inform this committee on some of the essential matters with regard to this resolution. I shall mention those in a few minutes and then he will have an opportunity to expand upon his brief statement.
There are two principles involved in which we in western Canada are interested. We are, of course, interested in the over-all situation. We are not so parochial in our views that we are interested only in the movement of grain. We are interested in the bulk movement of raw materials right across this country and we would be glad to help in any way we could to facilitate the efficient movement of other goods in this country. However, I think it is our duty, since we represent constituencies in which agriculture is predominant, to speak up and be heard about the movement of grain. It will be up to other members who represent

Department of Transport Act mining areas, fishing areas or the other areas that may have transportation problems to speak up for the other products concerned.
There are two principles about which we are concerned in regard to the movement of grain and they can be simply stated. The first one is whether there is actually a sufficient number of box cars to move the grain expeditiously from the country elevators to the terminal points and to put it into a position for shipment as orders arrive. Secondly, we are concerned whether any effort has been made on the part of the transport controller, or those who give him his instructions, to so allocate the available box cars for grain that regard will be had for the principle for which farm organizations, particularly the wheat pools, have been fighting for a long time, namely that every farmer should have the right to deal with the elevator of his own choice. This principle is subscribed to by every producer, whether he belongs to a wheat pool association, the United Grain Growers or any line elevator company. They are all jealous of their right to do business with the elevator of their choice.
But it becomes an even more important principle in respect to the wheat pools because of the fact that these farmers have given 25 or 30 years of their time and energy to the building up of a grain elevator system of their own, and which they have financed out of their own sales of grain. They operate it voluntarily during their spare hours and the majority of them receive no remuneration whatever. They feel that they have acquired an asset in this system of handling grain which is very valuable to them. They are wondering, just as we here are wondering, to what extent the government or the transport controller, who derives his power from the government, is following that principle of adequate and equitable distribution of box cars. What efforts are being made to see to it that the grain elevators that belong to the wheat pool system can obtain their fair share of the available box cars? There has been plenty of evidence given here and in the committee on agriculture to show that there is something wrong somewhere; that even at a particular shipping point there appears to be a fine hand of discrimination creeping in which does not give to the wheat pool elevators their fair share of the available box cars. This results in a certain amount of the grain being forced into the hands of those elevators to which the farmers do not desire to haul their grain.
Now, those are questions which have not yet been answered. I hope that when the minister expands upon his brief statement

he will pay more attention to these two principles and give us the answers. I want to add another thought concerning something I have mentioned before in this house and outside, and that is that the government itself could be of more assistance with respect to the movement of grain at a time when there may be a shortage of box cars. At the moment, there seems to be some doubt as to whether there is or is not such a shortage. We have had conflicting reports. In any event if there is an actual shortage of box cars, particularly during the winter season, I think the government would be well advised to provide more storage space for grain. We have now certain terminal facilities for the storage of grain. I believe it is high time the government, either on its own or by advancing moneys to the wheat board, increased the terminal storage facilities in order that more grain could be kept in a shipping position during times when it is not possible to transport grain quickly to the terminals. In addition to the terminal storage space, we should build a system of off-terminal storage facilities. There are many centres where grain is a very important product. My own town is a good example, and the city represented by the hon. member for Brandon-Souris is another good example. There are many places throughout western Canada in which there should be off-terminal storage space.
I want to make it clear that I am not talking about an additional number of country elevators. I have stated before, and I want to say again, that country elevators were built primarily for the purpose of handling grain, of receiving it from the farmers as they bring it in and putting it as quickly as possible into box cars to be shipped away. I believe that is the chief function of the country elevators. They were not designed primarily as storage space, yet in the last ten years or so they have had to serve the dual purpose of being handling facilities for the grain, for which they were originally designed, and also acting as storage bins. In other words, they have played part of the functions of terminal elevators. There should be off-terminal storage space built in strategic towns throughout the prairie provinces in which grain could be stored and put into a position where it could be shipped out as soon as cars were available.
I do not know how familiar the minister is with conditions on the prairies. I am sure the Minister of Trade and Commerce is quite familiar with them, as is the Minister of Agriculture. But perhaps he will be interested in knowing that there are certain conditions under which farmers have to deliver their grain. The conditions are altogether different now from what they were 20 or 25 years ago,

or even 15 years ago. There was a time when the farmers used to thresh their grain, during the days of the threshing machine, put their grain into their granaries and then deliver it by sleigh in the winter time or by wagon in the summer time. In other words, there was a trickle of grain continually moving from the farm to the grain elevator. Under those circumstances it was possible for the grain elevators to move the grain out as it came in and there was not the sudden run on box cars and space that there is now.
Conditions have changed. Farming methods have changed. This is the day of the combine, of mass production and quick harvesting. If weather conditions are favourable in the fall the harvest time is cut very short. There is a great production of grain from the fields in a very short time, and the most convenient and least expensive way for the average farmer to deliver his grain today is to take it right from the combine in the field, put it into a truck, deliver it to the elevator and dump it. That is the most efficient and least expensive way of doing it. Of course, in the last five or six years the farmers have not been able to do that to the extent they would like because of the grain congestion, but I am giving the minister the picture so he will realize that there is that problem, that there is need for available space at the time of the year when grain becomes suddenly available on the farms.
There is something else. The winter that is now disappearing on the prairies was an exceptionally severe one. While many of the grain elevators were full to capacity in the fall and there was absolutely no possibility of farmers making deliveries, as the winter wore on and some grain was shipped in box cars to the terminals the roads became blocked. We had the curious situation a month or six weeks ago, perhaps in some instances even now, where the roads were blocked and country elevators were empty, but even though the farmers had a huge amount of grain in their granaries on their farms they could not deliver it because there was no road on which they could drive. There again you have another bottleneck, another delay at a time of the year when every day means a loss to the grain farmer.
For these reasons I believe that the government would be well advised to look into the possibility of increasing terminal storage space in the first place so that grain may be moved as quickly and as continuously as possible to the actual shipping points where it can be loaded on boats and taken away. This is a matter of bringing the whole business of the
Department of Transport Act movement of grain to a more up-to-date position. We need a more efficient and synchronized way of doing things.
As I mentioned at the beginning of these few words, the resolution calls for the appointment of a controller and one or more deputy controllers and the provision of remuneration for them. Before the resolution passes I should like the minister to tell the committee why he is recommending the appointment of a deputy controller or perhaps more than one deputy controller. Is it because the controller finds that his work has become so heavy that he cannot handle it? Does the government envisage giving the present controller and his deputy more authority than they have had in the past? Are we to expect that the controller is to be given other duties which he does not now possess? These are questions which I think should be answered before the resolution is adopted.
I should also like the minister to answer certain additional questions. For example, I think the committee should be told now in clear and unequivocal terms just what the powers of the present controller are, what they are to be and to what extent he has exercised the powers that have been given to him. We would also like to know how many box cars have actually been allocated in the last twelve months as the result of the powers exercised by the transport controller. We would also like to know if there is an over-all shortage of box cars in Canada taking into consideration the hauling of all bulk goods. We would also like to know if there is any particular reason why the shortage of box cars for grain has been as serious as it apparently has been according to statements made in recent months.
These are some of the things we want to know. I think the minister also should be able to tell us just -which minister in the government is the responsible minister with respect to the whole business of the control of the distribution of box cars. We have had various statements made by the Minister of Trade and Commerce. On occasion we have even heard from the Minister of Agriculture. Personally I have not heard very much about it from the Minister of Transport, but it does seem to concern at least those three departments. It may even concern others. It might be a good idea if these three ministers were to set themselves up as a sort of box car committee in the cabinet. It could perhaps be a junior treasury board. They might find a suitable vault in the east block where they could go into hiding and remain in confinement until they have the problem licked.

Department of Transport Act


George Hugh Castleden: I should like to direct a question to the Minister of Transport. Has the controller power to instruct any railway company to allocate box cars to an elevator at a delivery point? Does that power rest with the controller?


George Carlyle Marler: Mr. Chairman, I am sorry that some of the hon. members who have participated in the debate seem not to have understood the brief statement I made at the beginning of the discussion which I think set forth in very simple terms the exact purpose of the amendments to the Department of Transport Act that it is contemplated to make when the resolution is adopted. I said ;hat the sole purpose of the resolution and of the amendment to the Department of Transport Act was to extend the life of section 6(a) until the 31st of May, 1958.
I had thought when I said that was the sole purpose that hon. members would understand that it was not contemplated by the resolution or by the legislation to follow that there would be a new appointment of a transport controller or that there would be any enlargement of the powers which he has under the statute to which I referred a moment ago. There is no necessity for a new appointment. I will admit the language of the resolution seems to suggest the appointment of a deputy controller but I am sure if hon. members will refer to the original legislation adopted in 1954 they will see that that legislation made provision for the appointment of one or more deputy controllers. Therefore in that respect, though the resolution may appear to suggest something new, that is already provided for under the existing statute.
Some hon. members spoke during the discussion this afternoon and this evening as if the transport of grain was the only responsibility of the transport controller. The hon. member for Dauphin, who has just spoken, made it clear. I think, that that was not his conception of the situation but other members who preceded him certainly gave the impression that the transport of grain was the only responsibility which the transport controller had to discharge.


George Hugh Castleden: That was the one we were complaining about particularly.


George Carlyle Marler: I am not particularly looking at the hon. member for Yorkton in making these remarks. Perhaps he may find that some of my remarks will fit what he has said and if so perhaps he can put the cap on and wear it.


Hazen Robert Argue: Tell us what the transport controller has done in these other fields.
::ur. Zaplitny.l


George Carlyle Marler: If the hon. gentleman will allow me to continue my remarks, I hope that I shall be able to satisfy them. I admit that is perhaps asking a great deal, but I shall try to do so.


Hazen Robert Argue: Tell us what he has done.


George Carlyle Marler: What I was saying when the hon. member interrupted me was that the transporting of grain is not the sole responsibility of the transport controller. Under the statute he is charged with the responsibility for the carrying out of the prompt, efficient and orderly transportation of goods in bulk; and goods in bulk include a number of items such as grain and grain products, ores and minerals; ferrous metals; iron and steel scrap; sand, stone and gravel; pulpwood; wood pulp; poles and logs; coal and coke; and sulphur and phosphate. I am not suggesting, Mr. Chairman, that the hon. gentlemen opposite are more concerned with those other items than with grain. I fully understand their interest in grain and I fully understand that that appears to be the prime responsibility of the transport controller.
A moment ago, Mr. Chairman, we spoke of the powers of the transport controller. Some hon. gentlemen seem to consider that the powers which he has under the statute are extremely far-reaching. Others seem to think that the powers should be more extensive. The hon. member for Prince Albert suggested that as the powers did not seem to be exercised frequently-because there was not a large number of written directives issued by the transport controller-therefore that suggested that the powers were ineffective. I suggest that if the powers did not exist, the transport controller would be wholly ineffective. It iS only because he has the powers that are provided for in the statute that he is able to carry out his duties effectively.
In considering what has taken place in 1955 in the movement of grain and what has taken place say since the beginning of the present crop year, from August 1, 1955 up to the present time, I think there has been on the part of hon. members a disposition to overlook the fact that the year 1955 was one of substantial activity for all forms of transport in Canada. It was a year of substantial activity not only for the railways but for water carriers and air carriers. In fact, in a general sense I think 1955 will go down in history as a good year for transportation.
I think that in a broad sense the railways have done a good job in transporting grain and in carrying out the movement of grain that they have been asked to undertake. I shall not for a moment attempt to conceal from hon. members the fact that, if they take the trouble to look at what might be called

the box car census, they will find that at August 15, 1955-the nearest date to the beginning of the crop year-the total number of box cars in the prairie and Pacific regions was close to 45,000 cars. In round figures that is about 5,000 cars less than in the preceding year, as of August 15, 1954 and about 10,000 cars less than the box car population as of August 15, 1953.
Hon. members have spoken about the present situation and have asked whether there was in fact a shortage of box cars to move the grain crop. I do not want to take up too much of the time of the committee, but I might say that the question was discussed when the C.N.R. accounts were before the standing committee on railways and shipping owned by the government. I think that Mr. Gordon's evidence on that subject merits reading and consideration. I shall merely summarize it by pointing out that he emphasizes the point that the question of whether there is a shortage at any given time depends on the volume of traffic to be moved and on the way and time in which you wish to move it. I will not attempt to read his evidence which is rather lengthy. However, I think that hon. members will find it informative and constructive. But, Mr. Chairman, it seems to me that perhaps one of the most interesting demonstrations of the fact that our box cars are sufficient to move the grain crop can be had by looking back at what happened in earlier years. In 1952-53, for example, the total export shipments of wheat and other grains amounted to something more than 400 million bushels. I suggest, to start with, that the box car population in 1952-53 was less than it was in 1955-56. When we look again at the figures for the crop year 1953-54, when exports amounted to nearly 265 million bushels, I suggest that there again the box car population was sufficient to move the wheat that Canada was able to export in that year. I think also that when hon. gentlemen opposite will have the opportunity to study the figures-I am not suggesting that it is an immediate one but when the figures for the current crop year are written-and when consideration is given to the climatic conditions which have had to be met by the railways in this past winter, I think they will find that what has been done by the railways and what has been done by the transport controller will merit general commendation.


George Hugh Castleden: I wonder whether the
minister will permit a question?


George Carlyle Marler: Yes.


George Hugh Castleden: I was' wondering whether, perhaps before continuing his statement tomorrow, he could find out, since the number
Department of Transport Act of cars in the prairie regions was greater in 1955 than it was in 1954, why it was that the-


George Carlyle Marler: I did not say that.


George Hugh Castleden: I understood the minister
to say that.


George Carlyle Marler: No.


George Hugh Castleden: Did you say there were 5,000 cars less?


George Carlyle Marler: I said there were 5,000 cars less in 1955 than there were in 1954.


George Hugh Castleden: And 10,000 less than in 1953?


George Carlyle Marler: Approximately 10,000; not exactly 10,000 but approximately that number.


George Hugh Castleden: In about the first six
months car loadings, as far as farm deliveries are concerned, were almost 100 million bushels down.


George Carlyle Marler: Mr. Chairman, let us talk about the same thing at the same time.


Hazen Robert Argue: Ten o'clock.


George Carlyle Marler: I do not see how we can talk about the box car population and at the same time talk about car loadings; and I do not see how, when we are talking about the number of box cars, we can then proceed to talk about hundreds of millions of bushels of wheat.


Hazen Robert Argue: Ten o'clock.


George Carlyle Marler: I think it would be wiser if we talked about the same thing. Perhaps if the hon. gentleman would allow me to do so, I might finish the statement tomorrow. Then if I have not answered all of the questions I shall try to do so.


Some hon. Members:: Agreed.
Progress reported.



BUSINESS OF THE HOUSE

Walter Edward Harris: Mr. Speaker, we shall continue with this debate tomorrow. Then we shall take the resolution with respect to the Northwest Territories Power Commission Act; then the resolution with respect to the judges; then the two motions in the name of the hon. member for Yorkton (Mr. Castleden) with respect to certain papers that he wishes tabled; then the resolution standing in my name with respect to the Veterans' Business and Professional Loans Act; and then that in the name of the Minister of Mines and Technical Surveys (Mr. Prudham).


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

[Stage Direction]
The following answers, deposited with the Clerk of the house, are printed in the official report of debates pursuant to standing order 39:

Mr. Pearkes: 1.	How many bands are authorized for the regular armed forces of Canada?
2.	Where are these bands located?
3.	To which arm of the service do they belong?
4.	How many bandsmen are authorized for each band?
Answer by: Hon. R. O. Campney (Minister of National Defence):
1.	There are 23 full-time bands.
2,	3 and 4.
Service Location No. of bandsmen
authorized
R.C.N. Halifax, N.S	 38
Cornwallis, N.S. ..	35
Shearwater, N.S. ..	21
Victoria, B.C		21
HMCS Ontario_______	17
HMCS Magnificent 17 Army Halifax, N.S.
(2 bands) .... 110
Valcartier, P.Q....	55
Montreal, P.Q		55
Camp Borden, Ont.
(2 bands) ____ 110
Toronto, Ont	 55
Winnipeg, Man		55
Calgary, Alta		55
Vedder Crossing,
B.C	 55
Stockum, Germany 55 Edmonton, Alta. ) To be Camp Borden, Ont. >[DOT] formed at a Camp Sarcee, Alta.) later date.
R.C.A.F. Rockcliffe, Ont		55
Downsview, Ont. ..	55
Edmonton, Alta. ...	55


R.C.A.F. RESERVE OFFICER TRAINING
Mr. Dinsdale: 1.	How many Royal Canadian Air Force reserve (a) officers; (b) N.C.O.'s have trained under the M.A.T.P. scheme each year since its inauguration?
2.	How many students have trained under the R.O.T.P. in each of the services each year since its inauguration?
3.	How many R.O.T.P. trained personnel are now serving in the Royal Canadian Air Force reserve, and of these, how many trained under the M.A.T.P. scheme last year?
Answer by: Hon. R. O. Campney (Minister
of National Defence):
1.	(a)	(b)1951-	52	
78	nil1952-	53	
183	nil1953-	54	
278	nil1954-	55	
497	601955-	56 (to 15 March)	
481	572.	Navy	Army	Air force	Total1953 .	.. 102	212	237	5511954 .	.. 175	362	348	8851955 .	. . 220	500	495	1,2151956 .	, .. 232	550	605	1,387
(Strengths for 1953-55 are as of 31st March; and for 1956, as of 29th February.)
3.	Five personnel who trained under the R.O.T.P. scheme but failed to graduate are presently serving in the R.C.A.F. reserve. They were not trained under the M.A.T.P. scheme during the past year.


FRESHET DAMAGE, FRASER RIVER, B.C.
Mr. Goode: 1.	Is there co-operation between federal engineers and engineers employed by the British Columbia government on anticipation of potential freshet damage on the Fraser river?
2.	If so, what form does this co-operation take?
3.	What is the viewpoint of federal engineers on the Fraser river flood potential in 1956?
Answer by: Hon. Jean Lesage (Minister of
Northern Affairs and National Resources):
1.	Yes.
2.	The staff of the comptroller of water rights of British Columbia undertake snow surveys in the watershed of the Fraser river to determine the amount of snow cover and its water content. This information is distributed to other interested agencies, including this department. The British Columbia-Yukon district office of the water resources branch of this department obtains through its hydrometric survey network daily telegraph reports of river stages at key points in the Fraser river basin. These reports are forwarded to the comptroller of water rights, the diking commissioner of British Columbia, and, on request, to the British Columbia department of highways and other agencies, companies and individuals. From these river reports and daily weather reports an endeavour is made to forecast the river tendencies which may be expected in the lower Fraser river valley during the ensuing 24 to 48 hours. These forecasts are provided to the comptroller of water rights and the diking commissioner for British Columbia for such action as they and the British Columbia government might deem appropriate.
3.	The responsibility for the assessment of the flood potential on the Fraser river rests with the government of the province of British Columbia. Our water resources branch assists that government by supplying the information outlined in the second part of this question. The comptroller of water rights has indicated that a somewhat greater than average snow cover exists in much of the Fraser river basin which might increase to some extent the possibility of flood occurrences. Experience has shown, however, that in most

years there is sufficient snow cover in the basin to result in a flood, but the actual occurrence of flood is dependent primarily upon weather conditions in April and May. Unseasonably cold weather in late April and early May delays the snow melt and the consequent spring rise in the river. If weather conditions were to change and high temperatures prevail, snow melt would be accelerated rapidly and flood conditions could occur. In 1948 weather conditions changed rapidly and high temperatures accompanied by rain prevailed. Since accurate long-range forecasts of weather conditions are not yet possible, there is no way of determining, with any degree of certainty at this time, what changes might take place in the weather during the run-off period. As a consequence it is impossible to predict with any degree of accuracy the flood conditions which may occur in 1956.
Questions


PER CAPITA INCOME TAX STATISTICS
Mr. Smith (Battle River-: Camrose):
1.	During each of the years, 1951 to 1955, inclusive, what is the income tax per capita for each of the provinces of Canada?
2.	During the same period, what amount of income tax per capita was paid by (a) farmers; (b) industrial workers; (c) professional persons; (d) clergy, in each province?
3.	During the same period, what is the average tax paid by lawyers, medical doctors, dentists, opticians and teachers, in each province?
Answer by: Hon. J. J. McCann (Minister of National Revenue):
1.	No information available.
2.	No information available.
3.	The records of the taxation division are not maintained in such a way as to show the average tax paid by lawyers, medical doctors, dentists, opticians and teachers in each province.

Wednesday, April 25, 1956


COMMITTEES OF THE HOUSE
[Stage Direction]
Second report of standing committee on agriculture and colonization.-Mr. Jutras.

[Stage Direction]
Third report of standing committee on banking and commerce.-Mr. Hunter.