1956-08-04

[Stage Direction]
On the orders of the day:
Mr. Howard C. Green (Vancouver-Quadra):: Mr. Speaker, according to a radio report this morning the government of red China is claiming that there has been no invasion of Burma. Perhaps the Secretary of State for External Affairs could tell us whether there has or has not been such an invasion.


Hon. L. B. Pearson (Secretary of Stale for External Affairs):: Mr. Speaker, I am glad to deal with the question asked by my hon. friend. We have had further information on this Burmese incident. That information indicates that, while the situation is potentially serious, of course, there is nothing to justify some of the alarmist headlines and reports that appeared some days ago and were based, as I understand it, in the first place on a report which appeared in an English language newspaper in Rangoon, the accuracy of which has since been denied by the Burmese government itself. The difficulty seems to be over a remote part of the border between China and Burma which has never been formally established to the agreement of both countries. That particular area of the border is therefore in dispute. It may well be that the action which has been taken by the Chinese troops in that area is to force a settlement of that part of the boundary and on their terms.



MILAN BABIC


[Stage Direction]
On the orders of the day:
Mr. George H. Hees (Broadview):: I should like to direct a question to the Secretary of State for External Affairs. Now that he has received a letter from Milan Babic of Toronto outlining how he was detained for 20 hours, searched several times and grilled several times-


Some hon. Members:: Order.


George Harris Hees: -does the government plan to make a strong protest about this outrageous treatment of a Canadian citizen to the United States government? Is there an officer at our consulates who is available 24 hours a day to Canadian citizens? If so, will the
minister advise the United States government that that is the case? If it is not so, will he arrange that it is so in the future?


Lester Bowles Pearson: The hon. gentleman has been more fortunate in his receipt of information from Mr. Babic than I have because the letter to which he refers has not reached me, though we sent him a telegram two or three days ago asking for details. I have received a telegram from Mr. Babic which states:
Regret did not reply sooner to your wire as just received. Preparing complete account to be sent to you by mail special delivery.
I have not received it yet, but it may be in the mail, Mr. Speaker.


George Harris Hees: It is in the mail. If the minister will check, he will find it there because I have a copy of the letter.


Some hon. Members:: Oh, oh.


Mr. Weir:: Did you write it for him?


George Harris Hees: The situation is as I have stated it.


Mr. Howe (Port Arthur):: Why don't you fix it?


George Harris Hees: Will the minister answer the second part of my question? Is there an officer at our consulates available 24 hours a day?


Mr. Pickersgill:: They go off work at six o'clock, as the hon. member suggests in other cases.


George Harris Hees: If so, will the minister advise the United States government to that effect? If not, will he arrange that it is so?


Lester Bowles Pearson: We will take appropriate action when the letter is received, I am sure. In so far as the consulate at New York is concerned, they do not work in the consulate 24 hours a day. It is possible, however, to get somebody 24 hours a day because there have been arrangements made with the telephone company of New York for that purpose.



REQUEST FOR HOLIDAYS FOR PAGE BOYS

[Stage Direction]
On the orders of the day:
Mr. C. W. Hodgson (Victoria. Onl.):: Mr. Speaker, I should like to direct a question to the Minister of Public Works or whoever

Inquiries of the Ministry is responsible. Has the minister considered yet whether the page boys are to be relieved of their duties at six o'clock for the balance of the session?


Hon. Robert H. Winters (Minister of Public Works):: I am sorry, Mr. Speaker, but I did not hear that question.


Clayton Wesley Hodgson: Will the page boys be relieved of their duties at six o'clock for the balance of the session?


Robert Henry Winters: I am not quite clear, Mr. Speaker, how that matter becomes the responsibility of the Minister of Public Works.


Clayton Wesley Hodgson: I said the Minister of Public Works or whoever is responsible.


Hon. W. E. Harris (Minister of Finance):: Mr. Speaker, I shall look into the matter and give an answer later.


Mr. Fulton:: We did not hear the answer, Mr. Speaker.


Mr. Speaker:: This is a matter that comes under my jurisdiction. Standing order 44 does not allow questions to be put to the Speaker from the floor of the house. See citation 302, Beauchesne's third edition. However, I take it that some members are very ingenious and they manage to put the questions anyway in some other form. Is it the pleasure of hon. members that the page boys be relieved of their duties at six o'clock?


Some hon. Members:: Hear, hear.


Mr. Speaker:: As a matter of fact, shall we do away with them altogether during these summer months?


Some hon. Members:: Agreed.


Mr. Speaker:: Perhaps through the usual channels opinions may be gathered from the various parties and the whips can report to us.



REPORTED VISIT TO NEWFOUNDLAND BY MEMBER FOR BROADVIEW

[Stage Direction]
On the orders of the day:
Mr. H. A. Hosking (Wellington South):: have in my hand a copy of the Evening Telegram, St. John's, Newfoundland, for July 27, 1956. It contains a picture of the hon. member for Broadview and below the picture it says:
George Hees, national president of the Progressive Conservative party, will arrive in St. John's on a visit to Newfoundland on August 18, Malcolm Hollett, leader of the Progressive Conservative party in Newfoundland-


Edmund Davie Fulton: Question, question.


Mr. Garson:: We are giving you some publicity.


Some hon. Members:: Sit down.
IMr. Hodgson.]


George Harris Hees: What a wind-up.


Some hon. Members:: Order.


Mr. Speaker:: Is the hon. member raising a question of privilege?


Henry Alfred Hosking: I am asking a question of the minister from Newfoundland.


Mr. Speaker:: Will the hon. member put his question?


Henry Alfred Hosking: My question is, is it the opinion of the minister from Newfoundland that the people from Newfoundland are so ill-informed that the writer of this article does not realize that the member for Broadview has been fired as president of the Conservative association and that he has been replaced by a member from the province of Quebec?


Mr. Speaker:: When a question is directed to the government it must be on a matter of administration.


Clayton Wesley Hodgson: I think it would be well if the hon. member for Wellington South got out of the gutter.



FLAX AND RYE


[Stage Direction]
On the orders of the day:
Mr. E. G. McCullough (Moose Mountain):: should like to ask the Minister of Trade and Commerce if he has received a telegram from the Saskatchewan farmers' union stating in part as follows:
Since wheat board has announced intention to extend quotas on open market grain now to include flax as well as rye, we urge complete marketing jurisdiction of these grains be placed under wheat board operations, thereby according complete price equality to producers regardless of space situation at country elevators.


Clarence Decatur Howe: I have not received such a wire personally. It may be in the department, but if so it has not been brought to my attention. The fact that this is a partial holiday for most people in Canada may explain the reason it has not been brought to my attention.


Edward George McCullough: May I
ask a supplementary question? When the minister receives this telegram, which I understand has been sent to him, would he consider immediately introducing a bill to make provision for the Canadian wheat board having jurisdiction to handle flax and rye? I might say that with the temper of the house we could get that through without any trouble.


Clarence Decatur Howe: Unfortunately, the government has promised the house there will be no further bills introduced this session.



NATIONAL DEFENCE


Mr. Paul Hellyer (Parliamentary Assistant to the Minister of National Defence):: Mr. Speaker, the hon. member for Winnipeg South Centre (Mr. Churchill) has asked about low flying over the cities of Winnipeg and St. James, and a report has now been received.
Since the construction of Stevenson field the city of Winnipeg has greatly expanded. Residential areas on the west side are now in danger of surrounding the airport. At the same time the international, itinerant and local civil traffic, which accounts for more than half of the total flying at this field, has increased greatly.
In order that this volume of traffic may be accommodated safely, an arrival procedure known as a circuit is sometimes necessary. This pattern which, at Winnipeg, is under the control of experienced Department of Transport officials, is done in excess of 1,000 feet above ground and permits an orderly transition to final approach. In conformance with these requirements, a number of aircraft may fly over certain areas. Residents estimating the altitude by sound alone may believe the aircraft to be low flying; whereas in fact they are at the maximum safe legal altitude for the procedure involved.
R.C.A.F. operations at Winnipeg are comprised mainly of navigator and radio officer training. This training, of course, includes night as well as day exercises. For these flights as for all other operations based at Stevenson field, only competent and qualified pilots are used.
There has not been any confirmed instance of actual low flying reported over Winnipeg with the exception of one isolated case involving an aircraft from another base. In this case, the pilot was subjected to severe disciplinary action.



PUBLIC WORKS


Robert Henry Winters: Mr. Speaker, yesterday the hon. member for Burnaby-Richmond (Mr. Goode) asked a question about dredging at the Searle elevator in New Westminster. This elevator and wharf are leased by the New Westminster harbour commissioners to the Searle 67509-445
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Grain Company Limited. Under the terms of the lease the commissioners assume certain obligations to maintain at all times adequate depth of water in the berths and in the channel to and from the main channel of the Fraser river.
The present lease expires August 31, 1956. We are still engaged in discussions and considerations as to what the long-term arrangement and allocation of responsibilities will be. In the meantime, the government has authorized the Department of Public Works to undertake the dredging for a period of one year following the expiry of the present lease; that is, until August 31, 1957.

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



DEPARTMENT OF AGRICULTURE

[Stage Direction]
47.	Prairie Farm Assistance Act administration, $502,137.
Mr. Bryce:: Mr. Chairman, on three or four occasions this session I have talked about the Prairie Farm Assistance Act, therefore it would be a matter of repeating myself if I started to go into details. However, I had hoped that the minister would have brought in some amendments to the P.F.A.A.; in fact, I am disappointed that he did not bring in an amendment to deal with the farmer who bought land from the provincial government after 1940 and cannot participate or even get any assistance from the P.F.A.A. fund.
The fund is in this position: A man who bought crown land contributed to the fund every load of grain he sold to the elevator. That is quite definite and plain and he cannot participate in any of the benefits of the act. For that reason I do not think the government should collect from these people.
Perhaps a test case should be made of this to see if it is really possible to collect money from them without giving them any benefits. It may be wise to have a decision of the Department of Justice on this question.
I do not need to point out to the minister that this is a very sore point in the north of my constituency. I had hoped that the minister would have brought in an amendment to correct this grievance. In fact, even at this late date I ask the minister to give it some consideration.
I could never understand how the government can collect money from farmers contributing to the P.F.A.A. fund when the act distinctly says they cannot participate in the benefits.
I have had a great deal of correspondence with the minister concerning P.F.A.A. and while he was good enough to send some of

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his officers to explain the act I am still receiving complaints from people who are wondering why they were left out.
One matter has always puzzled me and it is not because I have not endeavoured to understand it. I am referring to where the line is drawn dividing the people who can get paid on crown land and those on the south side of the line who cannot get paid.
I am going to send over to the minister a map of Selkirk constituency and I will ask him if he would be kind enough to have the officers of his department draw the line on the map so that in the future when I am challenged about it will be able to take out this map and show people where the line is.
I am not going to say any more at this time. I have conveyed to the minister the wishes of the farmers of my constituency regarding this act. The act has been of considerable value to many people in my constituency who suffered the loss of their crops. I know that the minister could improve this bill a great deal if he were to bring in amendments.
I am now sending over to the minister the map I have referred to. I hope the minister will put the line on it. If he does he will save me a lot of arguments this fall.


Right Hon. J. G. Gardiner (Minister of Agriculture):: Well, Mr. Chairman, while the map is being sent over I would just like to say that any change in the line would have to be made by legislation. The line has been set by legislation and I think on two different occasions the question has been raised in the house. I would say that the map which is submitted will be considered. There is some question, of course, as to where the line should be drawn across the north. It may possibly be that the line is not in exactly the right place but we will consider that before the next session and if legislation is necessary we will bring it down.


William Scottie Bryce: But will you be kind enough to have an officer of your department draw the line that you are dealing with now on the map I am sending over?


James Garfield Gardiner: Oh well, that should be a simple matter for them to do and I will see that it is done.


William Scottie Bryce: Thank you; I hope it is done.


Mr. Smith (Battle River-Camrose):: Mr. Chairman, I would like to ask the minister a few questions regarding the Prairie Farm Assistance Act. I am referring particularly to the form which farmers are forced to fill out in respect to individual farms. My first

question is this. Are the farmers left with a duplicate copy of the statements they give to the inspector?


James Garfield Gardiner: I am sorry but I am not able to hear the question.


James Alexander Smith: Are the
individual farmers left with a duplicate copy of the statement they give to the P.F.A.A. inspector when he calls around?


James Garfield Gardiner: I understand that that has not been done in the past but it has been arranged that it will be done in the future. Someone asked that question earlier in the session.


James Alexander Smith: Are all
farmers required to make a statutory declaration that the answers given to the questions asked are true?


James Garfield Gardiner: Yes; there is to all intents and purposes a statutory declaration taken.


James Alexander Smith: I understand that that will be uniform throughout the west.


James Garfield Gardiner: That is correct.


Mr. Argue:: Mr. Chairman, we in this group contend that the present payments under the Prairie Farm Assistance Act are too low. The act was brought in in 1939 at which time a maximum payment of $2.50 per acre was provided on half the cultivated acreage up to a maximum of 400 acres. The maximum payment has been $500; when the crop yield was from 4 to 8 bushels per acre the payment has been $300.
Since 1939 the cost of production and the cost of living have eaten away most of the value of the payments that were established in 1939. Today we have a dollar which is perhaps a 50 cent or a 40 cent dollar, but still the payments under the Prairie Farm Assistance Act remain the same. I suggest that the time has come when the government at least should double the payments under this act. Last year the hon. member for The Battlefords brought in a resolution on behalf of this group to that effect.
I would point out that today $1,000 will buy less than $500 would have bought in 1939. There is not only that factor to be considered, there is the factor of the one per cent charge which today brings in two and a half times as much revenue as it did in 1939 because of the increase in the price of wheat. I should like to ask the minister whether any consideration has been given by his department to increasing the benefits under the Prairie Farm Assistance Act, to doubling the benefits as I have suggested to the point where

a farmer would have the protection that he should receive under the act.


James Garfield Gardiner: Mr. Chairman, as hon. members who were here throughout the sitting last night know, I dealt with this question at that time. I regret very much if my hon. friend was able to watch a football game while I remained here to take up this matter, but in any event the matter was dealt with. Just to answer the question which has been asked, I would say that we have given consideration to the matter and have decided that the act as it is at the present time does meet the situation in spite of the fact that there has been a lowering in the value of the dollar. That was provided for when the terms of the act were drawn to make it possible for a person who is affected drawing, not only the sum provided in the act but also to have earnings from the marketing of whatever grain he has. It was estimated that the increase in the price of grain or the decrease in the price would take care of any difference that occurred. Our examination of the records indicates that that has been the case. The amount which the farmer receives now, with the exception of the man who has no wheat per acre, and there are very few of those, there is anywhere from two to three bushels an acre to be sold, and when those facts are taken into consideration the return in proportion to costs is just about the same now, or a little higher in most cases, than it was in 1939.


Hazen Robert Argue: I am sure that no one understands the gobbledegook we have just listened to now.


James Garfield Gardiner: That is the football game you are talking about.


Hazen Robert Argue: Any farmer knows that $500 today will not purchase as much as it did in 1939.


James Garfield Gardiner: If my hon. friend will read my speech in reply last session he will find it is all there and it has been proven outright.


Hazen Robert Argue: I have read it, and it is gobbledegook, but there was more gobbledegook last time than there is now because the minister took longer to say the same thing.


James Garfield Gardiner: We get all the gobbledegook when you are speaking.


Hazen Robert Argue: I want to tell the minister that the farmers in western Canada are completely dissatisfied with the amount paid under the act. There have been certain improvements made in the past in regard 67509-4451
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to the area where it is paid, and that is all to the good, but the schedule of payments is completely inadequate.
I wish to say that I was in the chamber last night when the minister made his remarks on this subject, and I am sure I would have had a much more enjoyable time if I had been able to go to the football game. Last night, if I remember correctly, the minister's excuse was that there is sufficient money to pay the grocery bill. Was that not it? Today he has gone to a certain quantity of the wheat that a farmer may or may not have to be considered to have a crop failure.


James Garfield Gardiner: You will find that is what I said last night; you were not listening.


Hazen Robert Argue: I wish to point out that, even though the price of wheat has increased substantially since 1939, the purchasing power of a bushel of wheat is no greater today than it was in 1939, so that any wheat a farmer may have when he is said to have a crop failure, one, two or three bushels of wheat per acre will buy no more than the wheat in 1939, and the prairie farm assistance benefit is worth not much more than one-third of what it was worth in 1939.


Mr. Thomas:: Last year when the minister's estimates came up, I pointed out to him that there was a large area of land in western Alberta, a good part of which is in my riding, that had been exempted from the act when it was drawn up; that since that time the new methods of farming, different types of crops, new knowledge and so on have made at least part of that land productive; and that still most people, although they are paying into the P.F.A.A. all the time, are unable to get any benefits out of it. I asked the minister last year if he would consider putting that land under the act because it is now a productive area and these people are unable to come in under the benefits. I would ask the minister whether any consideration has been given to that area and, if so, what decisions were made.


James Garfield Gardiner: As I understand it, it is the same question that was raised by the hon. member for Selkirk with regard to a section of Manitoba. That is, we amended the act some few years ago to make it impossible for lands which the government disposed of after a certain date, January 1940, to come under the act, the understanding being that should the provincial governments of Manitoba, Alberta or Saskatchewan make agreements with the farmers,-in Saskatchewan it is an agreement on a 33-year lease, and in the other two provinces it might be

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-a sale of the land to the farmer-we maintained that if the governments in the prairie provinces were disposing of land to farmers after the date when this act came into effect they should do so on terms which made it possible for the farmer to carry on without the benefits of this act. So a line was drawn which left out from under the act the area where the lands had not yet been disposed >of or had been disposed of after that date.
Through the southern parts of the province the same thing applies, namely that where submarginal lands, as they were referred to last night, are defined as submarginal lands by the provincial governments, they do not come under this act at all. If the provincial governments' enactment adds to those lands, then those lands are taken out. We simply stated in the act at that time that if the provincial government were leasing those lands to farmers who were on adjacent lands and bringing them back under cultivation or back where they would otherwise come under the terms of this act, these lands are not covered by this act.
On the question of paying in, everybody in Canada pays in to this act. This is not an insurance bill, as was suggested a few moments ago. It is not an insurance bill in any sense of the term. If it were, we could not pass it. Insurance bills can only be passed by the provincial governments. The first thing we had to satisfy the authorities here on, including the justice department, at the time we put the act through was that this is not insurance. It is not the paying of a fee in order to get a service. When the act was first drafted, it did not have in it any terms for the paying of one per cent. After the discussions which took place in this house, the farm organizations in the west suggested that in order that it might not be said that they were getting payment from a fund which was created entirely by setting up a tax collected from all the people of Canada, they should make a special contribution, and that special contribution is in the nature of one per cent on the grain sold. Hence the one per cent is simply a payment in order to make it possible for the farmers to contribute something throughout the years towards the fact that they may collect. I would point out to my hon. friend also what happens in spite of the fact that some people who may collect may not have any grain at all. Some of the people who collect may have only livestock, and when they do have those for sale nothing is paid when they sell. If they have only livestock, they may grow some grain ih order to feed the livestock. But they collect just the same as do the people who have only wheat. Such a person does not pay

anything in, but he collects. Both sides of the picture do turn up in this particular legislation.


Ray Thomas: I understand that, Mr. Chairman; but what I wanted to know was this. What possibility is there of these people getting in? I refer to those people on what was at that time considered to be submarginal land and left out of the act until examination had been made, as a result of agreement between the provincial and federal governments. I was wondering what the possibility is of some of these people, on what was considered at that time as being submarginal land, getting in under the act now. Owing to improved methods and improved knowledge they are now able to grow fairly substantial crops in this area. Would it be a provincial responsibility to request that these lands be included under the act or would it be a federal responsibility or would it be a matter of negotiation between the two governments? If so, which government should initiate the discussions? Is there any possibility at all of their getting in?


James Garfield Gardiner: My understanding is that at the time this matter was before the agriculture committee when the legislation was last going through the house, the lands in the special areas-which I presume are the lands which are referred to-in Alberta were specially dealt with in the legislation. If there is any reason for taking another look at it, we can do it along with the province. The representatives of the provincial government were here and they appeared here before the committee at the time we dealt with the matter previously. I will have to check back and see what lands are involved and if it would be necessary to have further hearings on the matter. I do not know whether or not the hon. member for Peace River recalls the discussions that took place at that time. I think he does so because his northern area was concerned. We did try to meet conditions there then. If developments have taken place which indicate that we have not met them, that matter can be discussed again.


Ray Thomas: This does not apply to the special areas. It applies to the grey wooded soil along the foot of the foothills.


The Chairman:: Shall the item carry?


Mr. Low:: No, Mr. Chairman. There is one question that I should like to ask the minister, but before I do so I should like to say this about the act. In the main there is satisfaction with the changes that were made some years ago and which have just been referred to in the interchange between the minister and the hon. member for Wetaskiwin. Up in my country I think that those changes

were accepted with considerable enthusiasm and that they have worked well. But there is still a good deal of dissatisfaction amongst the people over two rather specific things. One is the very close definition of "farmer". The matter was dealt with last night by the minister and I can understand the position that he takes. But oftentimes people get the feeling that the regulations are used in order to cut out as many farmers as possible from receiving benefit. I am not saying that is the case, but I say that the feeling is there.
For example, here is the case of a chap who works only part time on the railroad and who works a farm close by. He operates that farm as an efficient farmer and is doing well with it. In a normal year he gets more out of his farm than he gets out of his job on the railroad. But just the same, when a year comes along when he does not get a good crop and when he applies for prairie farm assistance because the yield has fallen below 4 bushels an acre, they say this to him: "You cannot have it because your chief income this year comes from your job on the railroad." I can understand that that chap would have a case for justifiable complaint.


An hon. Member:: Justifiable homicide.


Solon Earl Low: That sort of thing, I believe, is resorted to in many cases. I wonder whether it would not be possible to recast the definition of "farmer", taking into account the sort of thing I have mentioned. In these cases the people are farmers in the full sense of the word. They are carrying on quite efficiently. They feel themselves to be entitled to the benefits because they are paying what they consider to be a sort of premium.
That brings me to another point. I wonder whether the minister and his department have given consideration to what has been urged, very largely by the hon. member for Acadia, namely, that a crop insurance program be considered, and that part of what is now being done under the Prairie Farm Assistance Act be transferred to such a crop insurance program. I think the only way in which we shall ever get satisfaction out of the paying of a premium out of the product produced by the farmer will be through a crop insurance plan rather than through this prairie farm assistance. A great many of the farmers have come to look upon P.F.A.A. as a sort of crop insurance program. Whether that view is realistic or justified, they look upon it as such because they pay a premium as they think. One per cent over the years out of their production justifies them to a degree in thinking that they should receive benefits whenever their yield falls below 4 bushels an acre, whether or not they are considered to be farmers under the act.
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Another question is this one of river lots. I wonder whether the minister has had any experience with them. As I understand it, under the act or the regulations-I cannot tell which-the river lots that are registered as river lots are treated as separate townships. Very often in the bends of these large rivers, like the Peace river, you can find areas that are called river lots and are registered in the land titles office as such.
I have not been able to find out why the department looks upon these river lots as separate townships rather than having them registered as part of the township to whichi they belong. This past year quite a number of the people who occupy river lots found themselves unable to get benefits under the act, although their own yield fell away below the eight bushels per acre. They were told by the officials in Edmonton that they could not get benefits because their river lots were registered or were looked upon by the department as separate townships, and since they were separate townships they could not be dealt with in the ordinary way.
I just wondered if the minister had much experience with that sort of thing, and if he would have an answer as to why river lots are looked upon, no matter how large or small they may be, as separate townships. Why could they not be attached, let us say, to a contiguous township for the purpose of payment under the act?


James Garfield Gardiner: If I understand what the hon. member for Peace River has been saying with regard to the river lots it does not exactly conform to what our experience with the matter is. We did find, for the orderly administration of the act, it was impossible to bring river lots under the terms of the act. We, therefore, had a meeting with the provinces of Manitoba, Saskatchewan and Alberta where these river lots are and had an understanding reached as to what would come under the terms of this act as constituting a township. I would be surprised if any small area had been called a township, any small holding of an individual. The objective was to put enough of these river lots into an area to make up an area approximately the same as a township, and then to decide whether or not they were entitled to payment on the same basis as other townships are. It was simply a matter of defining them. There is quite a long list of them here. There are 6i pages for Manitoba, about a page for Saskatchewan and about two pages for Alberta, listing the areas that are defined.
For example, group 70 is river lot township "B", improvement district No. 102; lots 1 to 41 inclusive in township 67, range 14, west of the fourth; townships 67 and 68, range 15,

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west of the fourth; township 68, range 16, west of the fourth, all in the Lac la Biche settlement. Now, that is one and there are two pages of those, so I think what my hon. friend has in mind has been done, that we have brought them together for the purpose of making areas that, to all intents and purposes, would be about the same size as a township.


Solon Earl Low: I have a letter, Mr. Chairman, from Mr. Rowbotham in Edmonton, in which he says that these river lots are treated as separate townships. I gathered from that that, regardless of their size-


James Garfield Gardiner: He is wrong in saying that about river lots. They are in groups, and when you put them together in a group and give them a number then they are dealt with the same as townships.


Solon Earl Low: Now, would the minister comment on the other two questions? I will just repeat them. Is his department prepared to give some further and early consideration to this whole question of the definition of a farmer under the act? Is his department giving any consideration or any study looking towards an arrangement in Canada for a crop insurance program to take over part of the functions now performed by prairie farm assistance?


James Garfield Gardiner: 
Solon Earl Low: Just one more question in connection with insurance. I think I appreciate fully what the minister has said, but as far as the constitution line is concerned, in the United States crop insurance was instituted on a federal basis, and we have a federal constitution much the same as theirs. I understand it is not quite the same. I think the major difference is the residual powers; but certainly they got around state rights in some way over there. I was wondering whether some consideration had been given to a method of getting around it in Canada so that a federal scheme of crop insurance might be instituted. The minister would not say it is impossible, would he?


James Garfield Gardiner: Well, I would say the advice we have had up to date is that under our constitution it is impossible; but I would not say it is impossible to change the constitution.


Solon Earl Low: I do not think it would be necessary to go quite so far as that. Was it not possible to have marketing plans instituted in Canada by agreement with the provinces?


James Garfield Gardiner: Just in war time. In wartime, of course, the constitution all goes by the board and everything comes under the War Measures Act, and we did all kinds of things in wartime that we cannot do at other times; but the matter of entering into agreements is quite different from the matter of adopting an insurance act that brings everybody under it. For example, we entered into an agreement with all the farmers to pay them $23 a hundred for hogs, but that is an agreement. We agreed to buy the hogs, that is all. That kind of thing can be done, but if we were to try to compel people to do certain things, well, that would be different.


Solon Earl Low: Yes, I agree.


Ray Thomas: When crop insurance came up for discussion in the house the minister, of course, said that it was a provincial responsibility. He indicated at that time
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that the only conditions under which his department would consider such a thing as crop insurance would be if the initial move was instigated by one of the provincial governments, or a number of provincial governments. If a number of provincial governments indicated to the federal government that they would be willing to come into a crop insurance scheme, then it could be instituted. I was wondering whether the minister has up to this date, or since then, received any request from any of the provincial governments that the federal government consider coming in with them in a crop insurance scheme?
While I am on my feet I might mention one thing. The minister mentioned the case of a man asking for prairie farm assistance, and he had found out that he had made $1,800, and at the same time he was receiving unemployment insurance. The minister always likes to point out that there are two sides to a question. I should like to point out that I have had one or two instances of farmers who have applied for prairie farm assistance. I know of one instance where the prairie farm assistance administration turned him down because they said he was employed, he had another means of livelihood. He lost his job and applied for unemployment insurance, and they told him he could not get unemployment insurance because he was a farmer. Therefore, it works both ways.


Edward George McCullough: Mr. Chairman, I want to take some exception to what the minister said in the early part of his remarks. I suggest to him that if he would like to get his estimates through without too much controversy he should not utter complete untruths. I am now referring to the remarks he made with respect to the hon. member for Assiniboia.


James Garfield Gardiner: He corrected it and I accepted it. He said he was not there.


Edward George McCullough: There is no member in this house who has more fidelity to his duty as a member, and in particular in respect of agriculture, and this is known by all hon. members.
I want to say a few things in support of what the hon. member for Assiniboia has said. He pointed out that the farmer's dollar, his purchasing power, is worth about 50 per cent of what it was worth in 1939. I support that contention. According to the minister, the act was set up in 1939, not as an insurance policy but as a policy under which the farmer, when he lost his crop, would at least be able to pay his store bill. Because of the cost of living today it does

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not even do that. No matter what gob-bledegook the minister may use in respect of this matter, as the hon. member for Assiniboia pointed out, the fact remains that in 1939 and 1940 the farmer was getting an average of only 50 cents a bushel for his wheat in those first two years of the war; while today the price of wheat has gone up, it still leaves him in much the same position.
The payments made under the Prairie Farm Assistance Act are completely insufficient to enable the farmer to meet even the dire needs of his family, if he loses his crop. Therefore, I go along with the bill which was proposed by the hon. member for The Battlefords last year, which asked that something be done with the act to include the payments in it. I suggest that if it were increased 100 per cent, that is, if the payments were increased to $1,000, it would be in line with the intention of the government as stated by the minister in 1939 when the act was passed.
I want to refer to the point raised by the hon. member for Peace River and others in connection with payments made under the act to part-time farmers who are finding it very difficult to get along. Figures have been given to the house to indicate that the western farm income has gone down so drastically since 1952 that it is necessary for the small farmer to go out and try to get additional work in order to bolster his income. I want to give credit to the western Prairie Farm Assistance Act administrators. When we take these individual cases to them they are given very good consideration and payments are made to those individual people; but the fact remains that there is still a lot of controversy and there are problems in the administration of the act with respect to the farmer who does not come under the complete designation of a farmer who perhaps has additional income. If he takes up his problem with a member of parliament and he in turn tries to get a re-hearing of the case he will not likely lose any payment under the act. However, I think this is something which should be clarified.
I do not go along with the minister's repeated statement that this is not an insurance scheme but is a scheme in which everybody in Canada participates by paying into the fund. I want to point out to him and to other members of the committee who do not perhaps understand the situation that this act is no different from many other pieces of legislation in this country. I know that on one occasion the minister made the statement that people in Montreal pay into this fund. He meant, of course, that the taxpayers paid into the fund because a portion of the fund is taken out of the consolidated revenue fund.

In that regard I might point out to him that there is no single group in Canada that has subsidized the consumers of Canada more than the western farmer. During the 4-year period of the British wheat agreement all wheat consumed in Canada was subsidized by the western farmer. We received $1.25 a bushel f.o.b. Fort William and Port Arthur, whereas we were getting $1.55 for export wheat under the British wheat agreement. The difference was purely and simply a subsidization by the western farmer. We are not kicking about those things but we are pointing out that the western farmer is caught in a cost price squeeze.
The act drafted in 1939 did meet the dire need created by crop losses-


James Garfield Gardiner: It never did do that.


Edward George McCullough: -but
today it is not sufficient and I suggest to the minister that he should take cognizance of what we on this side of the house have said and try to draft legislation which will more adequately meet the situation which obtains today.


Mr. Zaplitny:: I would like to ask the minister one or two questions and I hope he will not say, as he said last night, that he knows what I want him to say and he will not say it.


James Garfield Gardiner: I will if you make the same kind of proposition.


Frederick Samuel Zaplitny: No, this is a little different. Section 11 of the Prairie Farm Assistance Act provides for the 1 per cent levy. There are certain penalties provided further along in the act in the case of licensed companies, elevator agents and so forth, if they do not comply with the provisions of that section. I would like to ask the minister if there have been any prosecutions within the last two years under section 11 of this act?


James Garfield Gardiner: I did not catch the question because I have another one here from Hansard.


Frederick Samuel Zaplitny: I asked if there had been any prosecutions under section 11 of the Prairie Farm Assistance Act?


James Garfield Gardiner: No, there has been none.


Frederick Samuel Zaplitny: None in the last two years?


James Garfield Gardiner: I do not remember any at any time, but there has been none in recent years in any event.


Frederick Samuel Zaplitny: In addition to that, Mr. Chairman, I think it is my duty to place on the record a resolution passed by the Manitoba farmers' union at their convention last fall dealing with this act. I am not asking

the minister to do anything about it immediately because he has already indicated that it is not the intention to bring in any amendments during the course of this session but I think it should be on the record because there are one or two excellent suggestions contained in it. The resolution reads:
Be it resolved that we petition the government of Canada for the following amendments to said act-
That is the Prairie Farm Assistance Act.
(a)	Payments on crop losses to be made on the individual basis.
(b)	Payments to be based on the actual cultivated acreage in the year of the crop loss.
(c)	Payments to be made on damage from all or any natural causes.
(d)	Payments to be made to all who contribute to the scheme, or-those not eligible for payment within a qualifying area to be exempt from contributing to the plan upon application for such exemption.
(e)	A statement to be attached to payment cheque, stating upon what basis payment is being made.
In the interests of saving time I will not comment on all of these points but I do want to point out that paragraph (e) in particular is, I think, a perfectly reasonable request and would as a matter of fact save a great deal of trouble and correspondence so far as the administration is concerned.
Quite often when farmers receive their prairie farm assistance payment a cheque is sent to the farmer stating the amount and sometimes he is not able to calculate on what basis the amount was arrived at. In order to do so he has to write to the prairie farm assistance board or if it is more convenient he complains to his member of parliament who has to handle it for him. This requires correspondence back and forth, file keeping and extra unnecessary work. I think it would be quite simple to include with the cheque a statement showing on what acreage and on which parcel of land the payment is being made, the amount per acre, and the total amount. I think that would save the department a great deal of administrative work.
I might point out, too, that the situation referred to in paragraph (d)-and I do not need to enlarge upon it because it has already been discussed-is a real injustice that might be rectified. Under certain provisions of the act there are certain parcels of land which are not eligible for prairie farm assistance and particularly that land which was purchased by a farmer after January 1, 1940 from the provincial government.
Of course, that does not apply to V.L.A. land and certain other lands. There is a great deal of the kind of land I have referred to being farmed in the province of Manitoba. Farmers who farm that land and grow grain
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year after year have been contributing the 1 per cent levy under the provisions of the act with no hope whatever, unless the act is eventually changed, of ever benefiting at all from the fund.
Over a period of years the 1 per cent contribution amounts to a considerable sum of money. If the government is going to take the stand that this land is sub-marginal, or for one reason or another is never to be eligible for prairie farm assistance, I think the fair thing to do would be to exclude those farmers from the 1 per cent levy.
I think there is a great element of unfairness in asking a farmer to contribute year after year 1 per cent of the value of his grain into a fund and then telling him that under no circumstances can he receive any benefit from that fund. As a matter of fact, if the farmers refused to pay the levy I do not think the government could do anything about it. I am not advising them to refuse because there is always hope while there is life and the act may be amended to have them included, but if it were challenged in the courts it is doubtful whether the courts would uphold the government in a situation where the participants in the fund raising or levy are denied any benefit. Under those circumstances I think the farmers could successfully challenge that section.
Instead of doing it that way, I think it would be wiser either to include as much as possible of that land by entering into a new agreement with the provinces with regard to that kind of land, or else, in areas where the governments both provincial and federal feel there is no possibility of including the land, if it is definitely submarginal in their opinion, then it should be excluded from the 1 per cent levy in order to bring about some, sort of rough justice at least.


Ray Thomas: Mr. Chairman, a few moments ago I asked the minister whether or not any of the provincial governments had approached his department regarding a crop insurance plan. I would like the minister to answer that question if he could.


James Garfield Gardiner: No, there has not been any proposal.


Mr. Nicholson:: Mr. Chairman, before the item carries I have a short question. The minister is no doubt aware that he has been very generous recently in having had a Social Credit candidate as one of his P.F.A.A. officers in Saskatchewan. I am referring to Mr. R. F. Claypoole of Mistatim.


Hazen Robert Argue: He got by the blood test.


Alexander Malcolm Nicholson: I think I would be remiss in my duties if I permitted this item to pass without drawing attention to the fact that

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the minister has been very generous. Mr. Claypoole apparently received the sum of $892.17 for his services as a P.F.A.A. officer during 1955. My question is this. Was Mr. Claypoole continued on the payroll after he became a Social Credit candidate in 1955?
I have received no criticism of the work Mr. Claypoole has done. As far as I know he has been a very faithful officer of the P.F.A.A. administration. Could the minister advise us whether Mr. Claypoole continued on the payroll after he became a Social Credit candidate?
My second question is this. I hope we will never have to qualify for P.F.A.A. payments in my area but now that the election is over I hope the fact that Mr. Claypoole has been a Social Credit candidate will not be held against him if his services should be required for the work of P.F.A.A. in the area.


James Garfield Gardiner: I may have some questions to ask about that myself. I would like to know who nominated Mr. Claypoole, for one thing. The fact is that we have not done anything about it. Mr. Claypoole is still on our list and is called upon when he is needed. I do not know how much work he will do in the future nor do I know how much he has done in the past but apparently he did get paid for his work last year. Whatever the future may hold for Mr. Claypoole, it will not be because he has been a candidate of the Social Credit party. If we do not use his services it may be for some other reason.


James Alexander Smith: Is this a good inspector in the opinion of the department?


James Garfield Gardiner: I suppose he is or we would not have used him or put him on in the first place. He has been on for some years and I presume has given good service. I do not know whether hon. members understand how these men are called up. It is on the same basis as those who are used to check hail insurance. The hail insurance companies have a list of people whom they call up and who can give service in the summertime. Some of them are professors in agricultural colleges. We have made a ruling that no one is put on the list who is tied up to a job which would make it impossible for him to operate when we want him. Sometimes we may need him three days out of a year, or three weeks or three months depending on the kind of crop. For example, last year up in that section there was a great deal of inspection to be done because the act had been changed and new things applied. The men had to give considerable time. As a rule a man will be called up perhaps for two or three weeks. He does his work and

then goes back to his other job. We do not consider he has a job with us at all, we just call him up because he is efficient at doing that job and is not looking for something permanent from us.


[Stage Direction]
Item agreed to.
48. To provide for a grant to the Federated Women's Institutes of Canada, $3,000.
Mr. Mclvor:: I should like to congratulate the minister upon his liberality in connection with the women's institutes. He recognizes that these women are doing an outstanding job. The vote is for $3,000 and I would like to see it $10,000. These women's institutes are doing a great work all across Canada in preserving the produce of the farms and helping farm wives to measure up and keep the farmers in tune with the time.


Mr. Herridge:: Does the hon. member realize that this amounts to 5 cents per member per year?


Hazen Robert Argue: Liberal generosity.


James Garfield Gardiner: This is to send a delegation to the international meeting being held in Ceylon.


[Stage Direction]
Item agreed to.
602. To compensate the New Brunswick potato marketing board for certain losses on payments to producers for potatoes marketed from the 1953 potato crop, which were not specifically covered by an agreement under the Agricultural Products Co-operative Marketing Act, $177,000.
Mr. Montgomery:: This item is to cover losses which were not covered specifically under the agreement and I should like the minister to indicate what it has cost the treasury and what features there are on which losses have been paid that were not covered by the agreement.


James Garfield Gardiner: The total amount paid is $2,680,000, and this additional amount of $177,000 is to be paid after consultation with the banks. As hon. members know, the government guarantees the banks against losses up to an amount not exceeding 80 per cent of the average price of the previous three years. In this particular case the amount guaranteed was about 40 per cent of the average price of the preceding three years and the payments being made are to cover that guarantee.
There was some law-breaking in connection with this and a committee made up of representatives of the Department of Finance, the Department of Justice and the Department of Agriculture made an investigation which indicated that some payments had been made which should not have been made. This $177,000 cleans up everything that is not involved in the possible charges.


Gage Workman Montgomery: How much has the 1956 potato starch program cost the government?


James Garfield Gardiner: Approximately $5,000.


Gage Workman Montgomery: The minister mentioned an investigation but no report has been made public. As the taxpayers' money is being used I submit that this report should be made public or be tabled in the house.


James Garfield Gardiner: It is not customary to make reports or bring down returns when a matter is still under what might be called police investigation. I do not know what the position will be after this is completed.


Gage Workman Montgomery: Apparently the investigation has been completed and it is a matter of deciding whether there will be prosecutions. I cannot see why the report should be withheld until that is decided.


James Garfield Gardiner: There may be two sides to a question of that kind and up to the present we have not thought it wise to publish the report. We are still making inquiries as to whether some people broke the law and should be subject to prosecution.


Gage Workman Montgomery: Do I take it from the minister that this $177,000 will be all used to settle these claims, or will there still be outstanding claims?


James Garfield Gardiner: It will all be used to cover the guarantee which we gave, and there are some more still in question.


Mr. Brooks:: Is it the intention of the government to publish this report later?


James Garfield Gardiner: I would not like to answer yes or no because it concerns two or three other departments.


Alfred Johnson Brooks: If it is found that there has been wrongdoing would it not be in the interests of the public to publish it?


James Garfield Gardiner: I think if there has been wrongdoing anywhere it will be aired in the courts. It is not usual to indicate what evidence you have or that you lack evidence before a case of that kind is proceeded with. If it is not proceeded with I do not know what will happen.


Alfred Johnson Brooks: It is not the intention of the government to suppress it in any way if there has been wrongdoing?


James Garfield Gardiner: No. Whatever proceedings are followed in connection with cases of this kind will be followed in this case.


[Stage Direction]
Item agreed to.
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41. Prairie Farm Rehabilitation Act and water storage, $4,142,965.
Herbert Wilfred Herridge: I should like to say just a few words on this item. For a number of years this group has urged the extension of the operation of the Prairie Farm Rehabilitation Act to all agricultural areas in Canada, and quite recently the hon. member for Dauphin had a private members' motion on the order paper to that effect, which received the support of all members of this party. As a British Columbia member, ever since I have been in this house I have been urging the extension of the operation of this act in the province of British Columbia, but so far none of us have been able to influence the minister or the administration in that respect.
I am just going to read a paragraph from an editorial in Country Life of September 1955, which asks the minister a question. I might mention that Country Life is the official organ of at least 98 per cent of the agricultural organizations of British Columbia and, I should think, almost a similar percentage of the farmers in the country. This is entitled "No Wonder There's No P.F.R.A. in B.C.":
From Vanderhoof came a press release this summer which indicates that the Canada and British Columbia agricultural departments are cooperating to make a survey of central British Columbia to determine the possibilities from an agricultural standpoint.
Country Life is mighty pleased to hear of this action because we feel it is long overdue.
At that, it isn't nearly enough. The work should be extended over the entire province and co-related with the future prospects of industrial development and population increase.
For years farmer groups have been hounding the province and Ottawa to have the Prairie Farm Rehabilitation Act enlarged to include this Pacific coast province. The appeals fall on deaf ears.
With the exception of Pemberton and VLA projects the assistance of P.F.R.A. has been denied B.C. and we cannot find it in our hearts to blame Ottawa overmuch for this oversight.
Most of the blame can be laid on the doorstep of the British Columbia government. It is little use to cry to Ottawa that B.C. needs development of its agricultural resources when no surveys have been made to provide an overall picture of the future possibilities of this graet province agriculture-wise.
We are told in a broad sweeping way that five per cent of the land in B.C. is useful for agricultural purposes. But what we haven't been told is what each untilled section can best be used for and whether there is a sound economic future in developing any particular section for agriculture.
In view of our repeated requests throughout the years for the extension of the operation of the act to British Columbia, I want to ask the minister this question. Is there some substance in the contention in this editorial, and are we wasting our breath in this house until the government of British Columbia organizes surveys of the areas suitable to the operation of the Prairie Farm Rehabilitation Act?

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James Garfield Gardiner: The question that is raised is not just along the line that has been suggested by the editorial. I spoke to the organization for which, I think, this newspaper speaks, last fall when I was out in British Columbia, and they raised the same question as to why we did not apply P.F.R.A. to British Columbia. I indicated to them that the name itself suggested why we do not, that it is prairie farm rehabilitation, and I think it will be agreed that outside of some very very small areas in British Columbia that term would not apply. Then I went on to say that P.F.R.A. did not even apply to all the prairie provinces; it applied only to the Palliser triangle, which is probably considerably less than half of the prairie provinces, and so it is put there for certain reasons, one of the reasons being that during the time that the lands were owned, operated and controlled from Ottawa they settled those areas in a manner which was not suitable to the districts, and it was thought that Ottawa should do something to change that situation.
That act, as is known, was brought down in 1935 by the government previous to this one. Very little had been done at the time we came in. We changed the act somewhat and went on to administer it from there. It was impossible at that time, and it might be impossible yet, to get the exact terms or anything approaching the exact terms of the P.F.R.A. here, even P.F.R.A. outside on the prairies, and I explained all this to them at this particular meeting, and they said after the meeting was over that they understood why it was not done.
I think that the question that is raised in this article has not especially to do with the P.F.R.A. It has to do with these special votes that we have already considered and passed. There was one there that was especially for British Columbia. It started in the Pemberton flats and went on to operate in other places, more particularly in assisting returned men to settle on lands in the fruit-growing areas in my hon. friend's constituency and elsewhere. We did pay toward those lands out of this special fund. That special fund, in so far as British Columbia is concerned, I think, what is considered to be probably the last vote, is in here now and has already been passed to clean up those expenditures that we had undertaken before. Between now and the next session there may be something else that has to be put in that vote, but there is no intention this session of putting in new amounts to start new projects in connection with that vote.
What they have in mind is, I think, since the lands and resources are entirely under the provinces-and in British Columbia they

have always been-that is a provincial responsibility, and, if they were coming here to ask for assistance, then they should have all the details that are necessary in order to place the case before the government here. Then the matter would be considered on its merits at that time.


Herbert Wilfred Herridge: I thank the minister for his complete answer. I might mention that the works that were undertaken in the fruitgrowing areas were in Okanagan south.


James Garfield Gardiner: Yes.


Herbert Wilfred Herridge: I understand, then, that you would expect that if an application were to be made for further assistance under this act, British Columbia would base that application on a survey of the areas which they were considering at that time.


James Garfield Gardiner: They would be in a much stronger position if they did.


Mr. Hahn:: I have been interested in that question, and I raised the question earlier in the session, as indicated at page 3455 of Hansard this year and again on May 10, when the minister indicated something of what he has said today. I do not want to extend the debate any further, but he did raise a few questions in my mind in his answer, which I suppose is not unnatural. He said, as I recall it, that the reason for non-extension was that certain sections were settled in British Columbia that were not suitable to Ottawa. The area about which I spoke earlier in the session was the lower mainland of British Columbia, which was certainly suitable for agriculture but which required particular work.
Later he went on to say that the reason why it is not extended is that lands and resources have been under the provinces, and these have been under the province of British Columbia, ever since confederation. I am satisfied that lands and resources are under each of the provinces. Today we have the P.F.R.A. in Saskatchewan and Alberta, and those provinces have control of their lands and resources. I cannot agree with the argument of the minister when he makes that particular statement.
I wish to ask him, though, as he has perhaps indicated that this is not going to be extended this year, has he not received a request from the British Columbia government as outlined by the member for Kootenay West and as outlined by the minister himself, for an extension of this particular service under the special act that the minister cited a few moments ago, asking that special consideration be given to the lower mainland of British Columbia, more particularly to the section of

the Mud bay diking area and the Colebrook diking area and the others raised earlier this session?


James Garfield Gardiner: All I can say is that there have been applications made and that so far the government here has not been prepared to spend money on those projects.


Frederick George Hahn: Is the reason for it included in the two reasons mentioned just a few minutes ago, namely that the areas are not settled in a way suitable to the wishes of Ottawa or because the provinces have controlled all lands and resources since confederation?


James Garfield Gardiner: I did not understand that I said a few moments ago that it was because they were properly settled or not properly settled. If I did, I want to withdraw it because I did not intend to say that. The reason I gave was that the lands and resources are under the provinces. I think my hon. friend misunderstood what was said with regard to the P.F.R.A. area. Those lands and resources were not under the province-either the province of Alberta or the province of Saskatchewan-when those provinces were set up. They were settled from Ottawa until 1931. Practically all the land in those areas had been homesteaded. All that were fit to homestead were homesteaded before that time. So it was decided here over 20 years ago -21 years ago this month, to be exact-to make some expenditures in that P.F.R.A. area because of the past history of it, and that past history does not apply any other place in Canada. All the other lands were under the control of the provinces right from the time they went into confederation.


Frederick George Hahn: I fully recall when the provinces received their provincial autonomy in respect of lands and resources and that it was in 1931, because I lived in Alberta at that time. But it seems to me that P.F.R.A. came into effect a while after that period. Was it not about 1934?


James Garfield Gardiner: In 1935.


Frederick George Hahn: Then am I to gather that P.F.R.A. was instituted in compensation for or in lieu of the fact that from 1905 to 1931 the provinces did not have control of their natural resources?


James Garfield Gardiner: I would not say it was in compensation. It was realizing the fact that the people had been put on land where they could not earn a living. They were in the drought area. It was realized that there were 1 million people settled there and that a very considerable part of them were having some difficulties on account of the fact that drought prevailed there. The Prairie Farm
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Rehabilitation Act was set up for the purpose of trying to alleviate their position and the Prairie Farm Assistance Act was set up to take care of them in the meantime. We attempted to get as many people as we could out of the area. We have been moving them out into irrigated districts, some of them in Alberta even when the person was moved from Saskatchewan.


Frederick George Hahn: I have one final question, or at least I hope it is final. Has the department any particular question on which they are making a decision in respect of the extension of this special grant to the province or this special allowance that is being considered, but not at this time? I understand we passed it earlier. In other words, at this time is any consideration being given to any project in British Columbia that the government might assist in?


James Garfield Gardiner: No. The position is that when we went into the Pemberton flats and had this vote set up for the purpose of taking care of the situation, the settlers in the Pemberton flats were returned men of the first war. They had been put on the land by the federal government. They had been put on land in that area which, as matters turned out, was flooded periodically. The stream in question, namely the Pemberton river which flows through that area, overflowed its banks. If even a tree fell into the river it started a dam to form from the silt that came down from the mountains, and started the river running in through these men's farms. When we went there first, these men could not work their farms at all in the summer months because the river had spread across their farms. We undertook to dike that river so that their lands would be safe. We did that because they were returned men who were put on the land by the federal government. We carried out that project at considerably greater cost than any of us thought would be involved when we started. Then we took on a similar thing down in the Okanagan district for returned men of the second war. They were largely sons of returned men of the first war. The fathers lived down on the flats near the river. This was at Penticton. There is an area above that on the higher lands on which the sons who came back from this war wanted to settle. We joined up with the Department of Veterans Affairs and the provincial government in making it possible for them to settle there.
Then the other project that was proposed was at Kamloops and it also had a percentage of returned men on it. But eventually we came to the time when, because of the discussions that were going on with regard to

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the marketing of apples and the marketing of fruit in general, we could not take the position from here that we were going to extend the production of the crop in British Columbia, and that any responsibility for that action would have to be taken by the provincial government. I think that the provincial government and ourselves were somewhat in doubt as to whether we should be extending apple growing at a time when we were finding difficulty in marketing the apples that were there. But the projects that we dealt with at Pemberton, Penticton and elsewhere through that area were for returned men and we thought we had some special responsibilities in that regard. The provincial government put in roads and helped put in bridges and that kind of thing for which they felt they had a responsibility. We made agreements and carried them out.


Frederick George Hahn: From the answer I have received, Mr. Chairman, I fully realize that the minister did not answer the last question I put to him. He has given a fine historical background of the present condition to which I have referred.


James Garfield Gardiner: Mr. Chairman, I must say that if I did not answer it, I intended to do so, because I said this. Both the provincial government and ourselves came to the conclusion that we should not be extending apple-growing areas in British Columbia at a time when we could not market the apples we already have. We said definitely to the British Columbia government that, under no circumstances, will we take responsibility for saying that a change should be made in the farming operations in British Columbia, that such a thing will have to be done by the provincial government and that we will consider the question as to whether we will support it. But the main reason why we have come to the end of the expenditures at present is that we were dealing only with returned men and we think we have gone as far as we can in that matter.


Frederick George Hahn: The point I wish to make is that the district about which the minister is speaking is the apple-growing district. I am not interested in the apple-growing district because apples are not the chief crop, by any means, in the area which I represent and the area about which the minister of agriculture for the province of British Columbia wrote to this minister, as I understand it, asking for an extension. The province of British Columbia apparently has changed its mind in respect of this question which the minister has explained so well. But I am more particularly interested in this matter: What consideration is going to be
TMr. Gardiner.]
given in future and what consideration must be brought to the government's attention if there is going to be any extension? Is it going to be necessary, for instance, that the province of British Columbia prove to this government that there are war veterans in these areas or that the major number of the farms are operated by war veterans? Is that one of the underlying reasons behind the extension of P.F.R.A. or the special grant, or is it just a matter of application by the provincial government? I should like to know,-and I am satisfied my province and more particularly the farmers would- how they are ever going to be able to get assistance from the federal government. We had the mudflats flooded, the dikes went out. I think the provincial government spent some $10,000 in assisting the farmers there. I do not know what the federal government did, if anything. We have each of these diking areas, as I mentioned,-and I do not wish to have to repeat this-which are growing vegetables or used generally as a market-gardening area of British Columbia. That is the finest part of it, at least on the lower mainland, and it is most important that these people get some assistance. Has it been established to the satisfaction of the federal government and the provincial government alike that this is entirely a provincial responsibility? Are they agreed? If so, then I do not wish to take up any more of the time of the house.


James Garfield Gardiner: That is the case.


Frederick George Hahn: That is, it has been definitely established between the two governments it is a provincial responsibility.


James Garfield Gardiner: That is not only the best farming area in British Columbia but it is the best farming area in Canada and the best farming area in the world that I know anything about. The lands were originally owned and operated by the province. They are entirely under the administration of the province. We are not assisting in that kind of thing anywhere else in Canada, so we do not assist there.


Mr. Charlton:: Certainly, it is not my intention to hold up these estimates, but in view of the remarks that have just been made by the hon. members for the Kootenays, and since that suggestion was made to the minister, I want to say that we in this group also have suggested on various occasions that the Prairie Farm Rehabilitation Act be extended to take in all of Canada. I have suggested before in the house that I thought it probably could be worked in co-operation with the provinces. A scheme could be designed to

take over flood control, conservation and rehabilitation. There are just as many places in eastern Canada as in western Canada that should not be farmed, as the minister well knows. I think probably this whole question could be worked out in co-operation with the provinces and would go quite far towards working out flood control, conservation and rehabilitation of land that is not suitable for agricultural purposes.


[Stage Direction]
Item agreed to.
42. Major Irrigation and reclamation projects in the prairie provinces, $7,050,000.
Edward George McCullough: I want to deal with a situation that has been brought up many times in this house by me as well as by other members from Saskatchewan, namely, the flood situation which developed in Saskatchewan last year. I want to say first that I think this government has been profound in its indifference and its inaction in respect to the situation in that province.
At the beginning, I want to say to the Minister of Agriculture that he did make certain statements in Saskatchewan during the course of a visit there, as recorded in the Leader-Post of February 18, 1956, which should be smacked right on the nose at this time. The minister is reported to have said that flood relief is a provincial responsibility and the government failed the people. They waited for us, he said, while the other provinces went ahead with what they had to do and billed us later. I would like to say right at the beginning that nothing could be more false because in the early days of the flood, not only did the provincial authorities set up committees of the municipalities throughout the province to gather information and determine with all possible expedition the extent of the damage, but in addition they immediately set up a fund of $1,600,000 for an emergency drainage program. The government also voted $1 million in the supplementary estimates for the municipalities.
I want to say, Mr. Chairman, and I think all members of this house will agree, that I want democracy in this country to work for the benefit of all our people. We do not want discrimination, and we have had discrimination. I am asking that this Liberal federal government come out from behind the curtain and be fair with all the people of Canada. I want to say, too, that I think the statements made in this house by the Prime Minister concerning the flood have been completely misleading. They misled the provincial authorities in the early stages of the disaster
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which struck that province. On many occasions I asked what assistance was this government going to give to the province of Saskatchewan-


James Garfield Gardiner: I rise on a point of order, Mr. Chairman. If my hon. friend was going to discuss that he should have discussed it on the last item. This question has nothing to do with the large projects here, and that item has been carried.


Edward George McCullough: I would
suggest to you, sir, and to the house that perhaps the minister would like these estimates to go through. I have been waiting for some time for the other members, and I am speaking on 41.


William Alfred Robinson: Item 41 was carried some time ago.


Edward George McCullough: I do
not care if it is 41, 42 or 43; they were all allowed to stand.


Some hon. Members:: No.


Edward George McCullough: I can
understand why the Minister of Agriculture would not like me to make my remarks.


James Garfield Gardiner: I have no objection to my hon. friend making remarks. He says that what I said was false, and everything he has said up to the moment is false. I can answer everything here or elsewhere anytime, but he is out of order; it is not this item.


Edward George McCullough: I am
going to leave it to you, Mr. Chairman. I say that perhaps I am using live ammunition and pretty heavy artillery on the minister and he does not like it.


William Alfred Robinson: It is not a question of artillery, it is a question of relevancy. If I may interject here, we are now on an item dealing with major irrigation and reclamation projects in the prairie provinces. Now, I presume, without having too much knowledge of the item-would the hon. member please resume his seat-that it deals with specific items of expenditure. If that is the case, we must relate our remarks to those specific items. I would ask the hon. member to co-operate in that respect.


Mr. Castleden:: Speaking to the point of order, I would say that I believe the hon. member was on his feet getting ready to speak on item No. 41 when several people shouted "carried".


Some hon. Members:: No.


William Alfred Robinson: On the other hand, may I say this? When the hon. member rose I said "on 42", and the hon. member proceeded to speak on 42.

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Hazen Robert Argue: The hon. member for Moose Mountain has been in his seat all morning waiting to make a speech on the flood situation. It may be that No. 41 was passed, but I suggest to you that we would make better progress in committee if you did not firmly rule that 41 was passed or you let him make his statement on 42.	1 think it is a little
debatable whether prairie farm rehabilitation would cover the project to which the hon. member refers or whether it might more properly come under a general reclamation project as was done in connection with the floods in Manitoba. In any event, I would suggest, Mr. Chairman, that the hon. member for Moose Mountain be allowed to proceed.


William Alfred Robinson: In that respect, of course, I cannot transgress the rules of relevancy. It is my duty to apply them to the best of my ability. I am in the hands of the committee. If the committee wishes to give the hon. member for Moose Mountain permission to revert to No. 41 for the purpose of making this statement, I am in the hands of the committee. Is the committee agreed?


Clarence Decatur Howe: Surely, at this stage of the sitting we should abide by the rules. There is no reason why the hon. member should be allowed to depart from them.


Edward George McCullough: I am
not just too clear on this point. I do not think the Minister of Agriculture will disagree with me when I say that this whole matter has been confused by his statements. In other words, I do not know just what item is the proper one under which to deal with this matter. There has been a reference made to the Water Conservation Act; the reference has been made to P.F.Jt.A., and I am not too sure that I am out of order regardless of what this item says.


Clarence Decatur Howe: The Chairman says you are out of order.


Edward George McCullough: I
would have to refer to these various pieces of legislation, so I think I am quite in order.


James Garfield Gardiner: The hon. member was in the house, there is no question about that. We had a discussion here for at least half an hour about flood control and what this government did about flood control. In answer to the hon. member who just took his seat a few moments ago, I stated that we did not do that in any of the provinces of Canada and therefore we were not going to do it in British Columbia. Now, that was the question. That is the question that is being raised now, this matter of handling
[The Chairman.]
flood control in those areas. The detail of the item we are on now appears on page 132, and it is as follows:
Bow river irrigation project, St. Mary's irrigation project, South Saskatchewan river development, Boundary dam, Fifty mile reservoir, Buffalo Pound lake reservoir, engineering services for major irrigation and conservation projects.
Those are all the items that make up the $7,050,000. There is nothing in here about flood control at all. Anything that I may have said or anyone else may have said with regard to flood control does not properly come under this item.


Edward George McCullough: Unless you rule me out of order I feel, sir, that 1 am quite in order. While we were discussing the item some hon. members called out "carried". I rose to my feet immediately, and whether or not we were on the present item or the previous item, I think I shall have to leave to the Chair to decide. I felt that I was quite in order in rising at this time to make my remarks. I want to continue, Mr. Chairman.


Clarence Decatur Howe: May we have your ruling, please?


William Alfred Robinson: Order. I regret there has been a misunderstanding with regard to the passage of item 41, but I think it is quite clear that item 41 carried. When the hon. member for Moose Mountain rose to his feet I said, "On resolution 42", and the hon. member commenced his speech. He well knows that if he had wished to speak on item 41 he would have said, "No, Mr. Chairman, on 41". Therefore, I must rule that item 41 was duly carried and that we are now discussing item 42.
The hon. member well knows also that when we are discussing an item in committee of supply we are governed by standing order 59, subparagraph 2, which reads as follows:
Speeches in committee of the whole house must be strictly relevant to the item or clause under consideration.
As the Minister of Agriculture has pointed out, the details of resolution 42 are found on page 132 of the blue book. The particular projects are as follows:
Bow river irrigation project, St. Mary's irrigation project, South Saskatchewan river development, Boundary dam. Fifty mile reservoir, Buffalo Pound lake reservoir, engineering services for major irrigation and conservation projects.
These are specific projects, and I regretfully must rule that a general speech on flood conditions would not be relevant to this item.


Edward George McCullough: In
view of your ruling, Mr. Chairman, the only

thing I can ask is the indulgence of the committee to revert back to the other item, if the committee feels inclined to grant it.


William Alfred Robinson: Has the hon. member permission to revert to resolution 41?


Clarence Decatur Howe: No.


Mr. Goode:: I think some members of the committee should reply to that. The hon. member is an experienced member of parliament. He sat here and knew that item 41 had passed. He has been on his feet much of the time this morning. He knows exactly how to handle himself. I think your ruling is correct, and we should now go on with the business of the committee.


William Alfred Robinson: Resolution 42.


Hazen Robert Argue: Mr. Chairman, at this time I want to express the support of the C.C.F. group and the C.C.F. government of Saskatchewan for an immediate start on the building of the Saskatchewan dam.
The Minister of Agriculture still has an item in the estimates for $500,000 entitled "South Saskatchewan river project". The minister has kept this thing alive in the press and in the house for only one purpose, and that is to mislead the people of western Canada into thinking that he or the government has some intention in the near future to do something about this project. Although the Minister of Agriculture and other colleagues of his in the cabinet at every election campaign for the last 10 years or more have dangled this before the people of Saskatchewan, nothing has been done about it. One excuse after another has been used. In the 1945 federal election campaign and in the 1949 federal election campaign, the line was, we are making surveys, we believe it will be in the national interest, elect us and we will be prepared to proceed with the building of the South Saskatchewan river project. But in spite of all the promises nothing has been done. Instead of getting ahead with the project we are going back.
The minister has taken the attitude over the years, until very recently, that the federal government was prepared to build the project. Now they are trying to slough off some of the cost on the provincial government without any clear commitment that they are prepared to go ahead with the project. The Prime Minister has set himself in opposition to this project. He has asked the people of Canada to produce hundreds of millions of dollars for the St. Lawrence seaway, for projects in other parts of Canada-


Henry Alfred Hosking: Do you disagree with that?
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Hazen Robert Argue: Not at all. But he has said, as far as the people of Saskatchewan are concerned, they will not get the dam. "We do not think the project is in the national interest." I suggest to you that that is rank discrimination against the people of one province and of one section of Canada. The Prime Minister himself is the great obstacle to this project. The Minister of Agriculture, of course, knows that perfectly well. When from time to time we ask the Minister of Agriculture questions on the orders of the day about the South Saskatchewan river project and when the Prime Minister is in his seat, the Minister of Agriculture is not true to his normal form when he is prepared to stand up and make a statement quickly and in a clear voice, and debate the issue if necessary; he slumps back in his seat, looks at the Prime Minister, worried. He wonders whether he can get a nod; he takes another look at the Minister of Trade and Commerce and, because the Minister of Agriculture knows full well that his colleagues in the cabinet, with the Prime Minister of this country, are determined that this project shall not be proceeded with because they have said so-


William Alfred Robinson: It being one o'clock-


Walter Edward Harris: Before we do that, may I say I think it is obvious that we are getting behind in our plans for prorogation. We have accommodated my hon. friend, I think, twice in this debate. I wonder whether the committee would agree to sit on until we complete it; otherwise we shall not even reach our understanding.


Alexander Malcolm Nicholson: I am quite anxious to cooperate, but I think we should remember the staff are under a tremendous strain. We can duck out, but we should think about the Hansard staff and the protective staff. They have a very tough job these days and they should get their regular luncheon period.


Walter Edward Harris: I think we can abridge it by half an hour at least.


Alexander Malcolm Nicholson: Could we give the staff an hour and a half from the time we finish until we meet again?


Walter Edward Harris: I think an hour would be sufficient, surely, if we could go to half past one and meet again at half past two.


Edward George McCullough: Mr. Chairman, I object to any changes being made in the procedure of this house. We have been sitting here from eleven o'clock in the morning to eleven o'clock at night.


Hazen Robert Argue: You asked for it a little while ago.

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George Hugh Castleden: That is what you wanted. There is no unanimous consent, sir.


William Alfred Robinson: It being after one o'clock I do leave the chair.
At one o'clock the committee took recess.


[Stage Direction]
AFTER RECESS

The committee resumed at 2.30 p.m.
Hazen Robert Argue: Mr. Chairman, at one o'clock I had been saying that the Prime Minister of this country has told us time and time again that as far as he is concerned building the South Saskatchewan river dam is not in the national interest. The people of Saskatchewan resent that attitude very much because they feel they are entitled along with the other provinces in Canada to a share in the beneficial public works that are inaugurated in this nation. They resent it, too, because they believe the South Saskatchewan river project is one that is very definitely in the national interest because it is important to a large geographic area and because a large irrigation project such as the South Saskatchewan dam would mean the irrigation of some 500,000 acres of land. This would assist in stabilizing agriculture in western Canada, would save the provincial government undertaking fodder and seed measures from time to time and would go a long way toward stabilizing the whole economy of that region and subsequently the economy of the nation.
In spite of the fact that the Minister of Agriculture knows full well it is the Prime Minister and others of his colleagues in the cabinet who are standing in the way of the South Saskatchewan river project the minister does not hesitate to make public statements that are misleading, and not in accordance with the facts. As a matter of fact the Minister of Agriculture has attempted to transfer to the government of Saskatchewan the blame for no progress being made on the South Saskatchewan river dam. He went out in his recent Saskatchewan election campaign and not only attempted to blame the Saskatchewan government for the delay of the federal government but he came rather close to using political blackmail when he said that as long as the provincial treasurer of Saskatchewan, Mr. C. M. Fines, occupied that post, as far as he, the Minister of Agriculture, was concerned, there would be no development of the South Saskatchewan river project.
The Minister of Agriculture made other statements as reported in the Regina Leader-Post of June 12 under the heading "Gardiner Blames Fines for Delay", and said that the

federal government was prepared to pay 75 per cent of the cost and the province had refused to pay the other 25 per cent.
In case it might be said that I am not quoting from the press report correctly I shall quote the article. The first paragraph reads as follows:
Estevan (staff)-Speaking in support of Jim Cinnamon, Liberal candidate for the Souris-Estevan constituency, agriculture minister James G. Gardiner, at the Canadian Legion hall Monday, blamed provincial treasurer, C. M. Fines for the delay in building the South Saskatchewan river dam. Mr. Gardiner said the dam was a provincial matter-
Listen to this.
-and except for the matter of costs and size of the project, was no different from the proposed dam for Long Creek. He said the federal government had agreed to pay 75 per cent of the cost and that would leave $20 million for the provincial government to find.
As soon as the premier of the province of Saskatchewan saw this report in the Regina Leader-Post he immediately sent the following wire to the Prime Minister under date of June 14, 1956:
Right Hon. L. S. St. Laurent,
Prime Minister of Canada,
Ottawa.
Rt. Hon. James G. Gardiner has stated publicly at Estevan June 11 that federal government prepared to pay 75 per cent of the cost of South Saskatchewan river project. Saskatchewan government prepared to accept this offer if it is made with full authority of federal cabinet. Please confirm.
T. C. Douglas.
Of course, the answer was that the Minister of Agriculture was not speaking for the federal government when he said they were prepared to begin the project if the Saskatchewan government would produce $20 million.


James Garfield Gardiner: Who made that reply?


Hazen Robert Argue: The Prime Minister made the reply that he was not prepared to start the South Saskatchewan river dam.


James Garfield Gardiner: I mean what was the reply to the telegram that was sent by the premier to the Prime Minister?


Hazen Robert Argue: The Prime Minister made the reply-


James Garfield Gardiner: Certainly he made a reply and he did not say what you are saying.


Hazen Robert Argue: He made the reply that there would be no start made on the South Saskatchewan river project.


Walter Edward Harris: Read it.


James Garfield Gardiner: Read the telegram.


Hazen Robert Argue: 1 will read the telegram and after that I will read the statement the Prime Minister made in the house a few days ago.


Walter Edward Harris: Ah, that is different.


Hazen Robert Argue: The telegram sent by the Prime Minister under date of June 18 reads as follows:
Ottawa, June 18, 1956
Honourable T. C. Douglas,
Premier of Saskatchewan,
Regina, Saskatchewan.
Re your telegram of South Saskatchewan project I understand Mr. Gardiner's speech to which you refer contained no statement of any federal offer but was mainly recapitulation of portion of his letter to you of January 10, 1955 concerning costs attributable to power and statement that provincial government had never proposed to pay fully and promptly for these power costs. I do not believe this is the time to try to work out arrangements by telegram on this important project.
Louis St. Laurent.
Well, the Prime Minister was a little shifty in that telegram, too, but of course the Saskatchewan election had not yet taken place. After the election was over, however, the Prime Minister spelled out exactly what he had in mind in writing that telegram when he replied to a question of mine on July 16 last. As a matter of fact I merely repeated to the Prime Minister the same question I put to the Minister of Agriculture, who was the acting Prime Minister at that time, a few days after the Saskatchewan election. The question reads as follows:
Has the federal government now decided that the building of the South Saskatchewan dam would be in the national interest? Has the government made any offer to Saskatchewan as to the terms on which it would agree to proceed with such construction?
The Prime Minister replied as follows:
Mr. Speaker, the answer to the two questions is a negative one. No decision has yet been made that the government would take the responsibility of recommending that project as one that is in the national interest.
The Prime Minister has shut the door on the South Saskatchewan river project but the Minister of Agriculture does not hesitate to go out to Saskatchewan-


James Garfield Gardiner: The Prime Minister said the government has taken no decision.


Hazen Robert Argue: This is the question:
Has the federal government now decided that the building of the South Saskatchewan dam would be in the national interest?
The Minister of Agriculture knowing that no decision had been made to build the project-as a matter of fact knowing that decision after decision had been made not to build the project-said in Saskatchewan,
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according to the Regina Leader-Post, that the federal government had agreed to pay 75 per cent of the cost and this would leave $20 million for the provincial government to find.
I would like to learn from the Minister of Agriculture whether or not the government at this time has decided to proceed with this very valuable and important work?


William Alfred Robinson: Shall the resolution carry?


Hazen Robert Argue: No. I have asked the Minister of Agriculture whether the government-


James Garfield Gardiner: When you get all through I will answer all that you are saying; go ahead.


Hazen Robert Argue: We would like to hear from the Minister of Agriculture an explanation for the kind of antics in which he was engaging a few weeks ago.


James Garfield Gardiner: Are you all finished?


Edward George McCullough: If the
minister needs to be smoked out perhaps a few more blasts at him will accomplish that fact. I confirm what the hon. member for Assiniboia has said. The minister took the opportunity to go down to my constituency during the election-


Clayton Wesley Hodgson: No, he wouldn't do that!


Edward George McCullough: -and
once more he held out a carrot for the people of my province before the election. Of course, as hon. members of this house know full well, he was not successful in his attempt because we had the good fortune to elect the C.C.F. candidate, a young man who is a student of economics, and he is now sitting in the legislature there.


James Garfield Gardiner: We won by 300 votes in your constituency and that is what is worrying you.


Edward George McCullough: That is all right. It is pretty understandable why the Liberals in this house are particularly touchy on this question because it has been their practice during provincial elections and sometimes during federal elections to go out and try to convince the people of Saskatchewan that this government intends to do something about this very valuable project. That has been the history of this matter before every election. The minister in particular has indicated that he was in favour of this very valuable project in order that the people of Saskatchewan might assume that the federal government had some intention of going ahead with the construction. In spite of the fact that for years the provincial government has in my opinion upped their agreement in

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respect to the cost of this project the federal government still reneges and refuses to take any action in the matter.
I agree with the hon. member for Assini-boia that the time has come for the federal government to really take definite action. I do not think it is satisfactory for the Prime Minister to be the only one needing to be convinced. I believe the people of the province have the right to ask the Prime Minister to make up his mind. I know full well that when the St. Lawrence seaway project was mooted in this house I was astounded with the rapidity and agility with which the government undertook the project. I supported it because I thought it was in the interests of Canada, but I do not think politics should be played with this matter or that there should be discrimination against the people of Saskatchewan just because they happen to have a government which the Liberal government here in Ottawa does not favour. As I indicated this morning in respect to flood damage -I think this is almost a comparable situation-in that case this government has given only a mere pittance of $60,000 in connection with another disaster in the province. Now in connection with this particular matter they will not come up and give a single dollar.
I might say further that it astounded some of us when the St. Lawrence seaway project was broached in this house that no argument was offered that the rich province of Ontario was going to be subsidized to the extent of $30 million annually in the way of power. That will be the result of that project. We were not unhappy about it and we went right along with it, but in this case where it has been proved by surveys which have been made to be a worth-while project we think there should be action by the federal government.


An hon. Member:: Carried.


Edward George McCullough: Let me
say to hon. members that I have sat here for some weeks without rising from my seat. If the hon. member would like to go home, let him buy his ticket and leave. We have some important things to discuss and I intend to discuss this matter.
On May 17, 1955, there was a motion before this house for the construction of the South Saskatchewan river project. I recall that on that occasion every Liberal member from Saskatchewan voted against the immediate construction of that project. The Minister of Agriculture sees fit to go out and criticize the provincial government for not being ready to do this or that, as he did on the occasion I indicated this morning. But he was completely wrong in respect to

flood assistance and the same with this project. The Saskatchewan government has been ready at all times to undertake this on any fair basis that the federal government will agree to. On May 17, 1955 when this motion was before the house every last Liberal member from the western provinces voted against it. The hon. member for Rosthern, the hon. member for Qu'Appelle and the hon. member for Swift Current-Maple Creek all voted against it, as did the Minister of Agriculture. The only reason the minister could give for having voted against it was that it was a vote of non-confidence in 'he government.
If we had more help from western Liberal members on this matter we might get somewhere. I know it has been the usual thing for the Minister of Agriculture to say in the west, "Send us a few more Liberals if you want to get something done on the prairie provinces." They have half a dozen more of them here now but I do not see any more support for this worth-while project.
I do want to point out that we feel there has been an injustice done in respect to this worth-while project. The 1953 survey -I might note that that was an election year-carried on by the federal government was an intensive survey. A report was made to this government. There again the only person who needed convincing was the Prime Minister. I suggest that the time has come when this government should take some action and not leave this matter dangling in the air. I shall be interested to hear the comments which the minister will make when I sit down. I say once again that when he spoke at Estevan in my constituency he led the people to believe that the government had changed its mind and something would be done on this project.


James Garfield Gardiner: Mr. Chairman, I cannot let these remarks go by without making an answer although I hesitate to take up the time necessary to give a full answer. I think I shall read from the same paper from which my hon. friend quoted a few minutes ago in order to place that answer on Hansard. I quote from the Regina Leader-Post of June 18, 1956, as follows:
Mr. Gardiner said he had made the statement often that the South Saskatchewan river project was definitely a provincial responsibility no different from the situation at Estevan where the provincial government contemplated a dam and reservoir.
"When it undertakes construction of the program at Estevan, which it should, the provincial government admits that responsibility. It is understandable, however, that because of the greater cost of the S.S.R. dam, the province should seek financial support from Ottawa," he said.
"This possible support has been discussed at meetings between the province and me, usually

under the chairmanship of Premier Douglas, always after a full discussion with my colleagues in council.
"The provincial government agreed that if the federal government would undertake to construct the dam, which it was estimated would cost $80 million, the former would pay 25 per cent of the cost," he said.
This would relieve the federal government of any charge that it was paying for power for the province provided the province also paid for the penstocks as part of the power plant. (Penstocks are the pipes in the dam carrying water to the turbines.)
However, Mr. Gardiner said, his government had stated that agreement on these points did not commit it to an expenditure of 75 per cent of the cost of the dam and reservoir.
"Prime Minister St. Laurent has always maintained he is not yet convinced the dam is sufficiently in the national interest to justify federal investment of $60 million. The provincial government has not considered it sufficiently in the interests of the people of Saskatchewan to offer to pay more than 25 per cent", he said.
"Mr. Fines has from the beginning questioned whether it would be in the provincial interest to pay even 25 per cent of the costs. In 1950 he questioned whether the province should pay any part of it. Eventually in 1954 and 1955 he went along with proposal it might pay 25 per cent provided the dam was built with federal money and the province was allowed to pay its share with earnings from power after the dam was completed."
Mr. Gardiner said he refused to accept Mr. Fines proposal because it would not be acceptable to the federal government and it would be indirectly subsidizing power development. He offered an alternative: that the provincial government pay its 25 per cent as the work progressed by assigning $2 million each year for ten years from the revenues it was entitled to under the tax rental agreement with Ottawa.
"Mr. Fines took the position he would not be able to finance the province under those conditions," Mr. Gardiner said.
"I asked him then if he could pay half and give provincial treasury bills payable over 20 years for the balance."
This was the only proposal he ever made without first consulting the government, Mr. Gardiner said, and Mr. Fines stated he could not agree to it.
"I was very pleased he had turned it down when I returned to Ottawa and found it would not have been acceptable there either," he said.
At this point, Mr. Gardiner said, he arranged meetings between committees of the two governments and was present at them on the invitation of the Prime Minister. Both Mr. Douglas and Mr. Fines never made any suggestion they were prepared to make any change in their attitude toward paying for the penstocks, he said
"I still contend it will be necessary either that Mr. Fines change his mind or we get a new provincial treasurer if we are to get consideration of an early decision on the dam."
That is the statement that was made. My hon. friend says that the Prime Minister has definitely said, "We are not going to build the dam." The Prime Minister has never said any such thing. Each time that the questions have been asked in this house, they have been to the effect "Is the government now prepared to proceed?" and the Prime Minister has said no to that question,
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but he has never said no to the possibility of the South Saskatchewan dam project being carried out if terms satisfactory to both governments can be arrived at at some time.
As has been stated by my hon. friend, no one questions the fact that I have always advocated the dam. I still advocate it and I am going to continue to advocate it, no matter what position either he or anyone else takes on it. I think it is in the interests of Saskatchewan if it is not in the national interest, and I am still open to conviction on that point, but whether it is in the interests of all Canada or not I know it is in the interests of Saskatchewan and I want to say that if I were head of the government of Saskatchewan today I would build the dam. I should like to know why the government of the province of Saskatchewan is not prepared to come right out and say, "We will spend even more than 25 per cent; we want the dam built", and try to convince the rest of Canada that they are so much interested in building it that the rest of Canada should help to the greatest extent possible.


Mr. Knight:: Would the minister permit a question? Did you permit the Alberta government to pay in toto for the dam that was built there?


James Garfield Gardiner: We insisted on the Alberta government agreeing to pay dollar for dollar what we pay, and that is quite a different thing from paying 25 per cent.


Hazen Robert Argue: In Alberta there was a division dollar for dollar on the whole project but not for the dam itself.


James Garfield Gardiner: There was a division of SOSO in the expenditure on the irrigation project that is based upon the dam, but the dam in Alberta is solely an irrigation dam. It has nothing to do with power, nothing to do with supplying water to communities; it is purely an irrigation dam. There was that arrangement made as between the Alberta government and the federal government.


Hazen Robert Argue: When the Minister of Agriculture was engaged in so-called negotiations with the cabinet of Saskatchewan, he was not under the instructions of this government to discuss the terms of an agreement.


James Garfield Gardiner: That is an absolutely false statement and it is only based on the remarks of a gentleman who has all the files in his possession in Regina, and I have them all before me on this desk, and they are before members of this house, and it can be proven from those files that every discussion that I had in Regina with the government was first under discussion with the federal government here. The only time I departed

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from the undertakings given at cabinet as to the things I was to discuss was the incident I mentioned where I suggested that they pay only half the amount and give bonds spread over 20 years to pay the other half.


Hazen Robert Argue: Then the statement of the minister is wholly and completely inaccurate and false. I am not the one to throw the word "false" into this debate at any time. I do not use that term, as far as members of this house are concerned, but when the accusation is used at me I do not hesitate a moment to throw it back. When the Minister of Agriculture entered into these negotiations with the cabinet of Saskatchewan, he had not the authority and was not under instructions from the federal government to conclude and sign an agreement.


James Garfield Gardiner: Yes, and the provincial government understood that from every letter written to them; every time I met them that was made absolutely certain, that there could be no undertaking that it was an agreement until such time as the proposed agreement was ready for signature.


Hazen Robert Argue: When the agreement was ready for signature, there was no signature from the federal government. The minister was out there engaged in loose talk and without authority from the federal government, from the cabinet, to sign an agreement. But I am really astounded at his statement that if he were premier of Saskatchewan today he would be prepared to place the total burden of building the south Saskatchewan project on the economy of Saskatchewan itself-


James Garfield Gardiner: I did not say that.


Hazen Robert Argue: -while other parts of Canada were getting many of their projects aided by the federal government, and I am glad and proud that the government of Saskatchewan has said to the Minister of Agriculture that neither he nor anyone else will lead Saskatchewan into signing an agreement that is not on the same general terms as similar agreements signed by other provincial governments with the federal government.


James Garfield Gardiner: The words of my hon. friend have made it necessary for me to read something else.


Hazen Robert Argue: He has a lot of files.


James Garfield Gardiner: The hon. gentleman says
that I made the statement that were I premier of Saskatchewan I would be prepared to build the dam and charge it all up to the people of Saskatchewan. I did not say any such thing. I said that if I were premier of the province today I would go ahead with the building of the dam, and I am quite sure that

if I were premier of the province today, in the light of what our friends in the opposition have said and even in the light of what my hon. friends in the C.C.F. party have said -I do not expect they will ever be at the head of the government here, but they feel there is a possibility of that-and after all they have said, there is no question that if they were here they would pay part of the cost. There is no question that if the opposition were here they would pay part of the cost, and if proper arrangements are made I think there is no question that any government would pay part of the cost. If I were premier of the province of Saskatchewan I would go ahead with that idea in mind, not the idea that this is a responsibility of the federal government and that they ought to do it, which was the beginning of my hon. friend's speech this afternoon, that some time or other I had said that we would do this and therefore, he says, we ought to go ahead and do it.


Hazen Robert Argue: Hear, hear.


James Garfield Gardiner: Even if I had said that, which I did not, I am not the whole government of Canada, and I am quite prepared to admit this. There are others who have something to say about this, but in order to refute what has been said I am going to read the last letter that went to the premier of the province of Saskatchewan signed by myself.


Hazen Robert Argue: What is the date?


James Garfield Gardiner: January 10, 1955.
Dear Mr. Douglas:
I have your letter of January 3, 1955-
This is the letter that I was reading at Estevan, by the way.
-and in turn am somewhat surprised that you have returned to the position taken in your letter of June 16 when you state:
"If and when the federal government has decided to proceed with the dam we will be glad to discuss with you or with the federal cabinet any details which require clarification."
You will recall that taking that position in June resulted in a discontinuance of discussions between you and me until November 3, 1954. The reopening of those discussions was only made possible by your letter of August 24, in which you stated:
"However the government of Saskatchewan is quite prepared to give consideration to a proposal from the government of Canada setting forth the share of the cost it thinks the government of Saskatchewan should assume, whether or not the proposal is accompanied by an undertaking to construct the dam." I did indicate to you in my letter of August 31, that I had asked Mr. L. B. Thomson to renew discussions with your government. The basis upon which Mr. Thomson renewed those discussions was a draft revised up to September 9th, 1954, which contained the proposal that Saskatchewan pay all costs related to the generation and transmission of power at the main damsite and that Saskatchewan pay 25 per cent of the total cost of the dam which was indicated

as approximately $80,000,000 as work proceeded and did not include the cost of the penstocks which it had already been proposed the government of Saskatchewan should provide for.
Before we were able to arrange a further conference, you wrote the Prime Minister on September 22, 1954, and in that letter stated:
"I would be very glad to go to Ottawa to discuss this matter with you and your colleagues if you can indicate a suitable time for an appointment. . .	. I feel that this is an opportune time to
review the question of commencing construction of the South Saskatchewan dam."
The Prime Minister replied on September 29, to say:
"If we can come to the conclusion it should be proceeded with, we will not have any serious difficulty in working out the right kind of an agreement with your government. I note that you would be prepared to come to Ottawa for further discussions whenever it might seem that such discussions would expedite a decision,"
That the dam should be proceeded with.
With regard to the question of whether I was discussing this matter under the knowledge of the government:
The Prime Minister indicated in the same letter that I planned to bring the matter before the government of Canada and in commenting on this in your letter of October 5, 1954 you write:
"However, I feel that before any decision is made by your government we should have an opportunity of presenting to your cabinet some of the reasons why we think the construction of the South Saskatchewan dam is in the national interest."
My hon. friends say I have not been discussing this matter with the government. I have nothing from the government. The letter continues:
The Prime Minister replied on October 15th that I would meet you in Saskatchewan shortly and on my return and after a report had been received "we will then let you know if this will appear to us to be an opportune time to ask you to come and meet a committee on the cabinet."
This correspondence resulted in my arranging a meeting with you and other members of your government on November 3rd, 1954. It was immediately contended by Mr. Nollet at that meeting that if the provincial government were going to pay the cost of the penstocks, the federal government should lessen the provincial cost by paying for part of the irrigation cost. I maintained that would result in Canada indirectly paying for power and I was sure the government would not agree.
It was then suggested by some one of your government that 25 per cent of the cost would more than cover all power costs, including the penstocks. I made inquiry and was told that this question had been raised in discussions between officials but had not been discussed with the federal government because the estimates of cost of the penstocks had not yet been determined. I stated I was bound by the conditions of my letter of June 8th, 1954, and that this question should be left for further discussion when the officials had reported.
When we met on December 1, I opened by saying this would be my last appearance personally to discuss the South Saskatchewan river dam with the Saskatchewan government. If any further discussions were necessary after I reported back to Ottawa, I thought they could best be carried on between committees of the two governments, as
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suggested by you. The same condition of uncertainty existed on the cost of the penstocks because estimates were not available. Since then reports have been made by officials which would indicate that to include 75 per cent of the cost of penstocks in federal payments would result in the federal government subsidizing in some degree your "development of hydro-electric power." I submit, therefore, that it must be agreed by the province that the penstocks are their responsibility if we are to proceed to a consideration of' national interest without further discussion.
The two conditions set out in my letter of June 8th, 1954, which was a statement of government policy, were:
"First, it must not directly or indirectly or in effect subsidize in any degree your development of hydroelectric power.
"Second, we must be able to show that the making of this large federal contribution is in the national interest."
As indicated above if the cost of the penstocks included in your 25 per cent payment, your development of hydroelectric power will be subsidized by Canada and therefore must be opposed. The question of responsibility for the cost of the penstocks must be settled before the government of Canada can know what their contribution will be.
Our discussions on November 3rd, 1954, the recent report of the officials on the costs of the penstocks, and my discussion with members of the federal government convince me that it is necessary to have a council meeting such as was stated in my letter of December 22nd, 1954, and that before it will be possible to arrive at a favourable decision on the matter of national interest, it will be necessary to try to come to agreement on the question of responsibility for payment of costs of penstocks and provision for the payment of the province's costs. These agreements can only be reached, if at all, through the meeting in Ottawa of committees of cabinet representing the two governments.
Yours sincerely,
James G. Gardiner.
That is the final letter; and as a result of the writing of that letter I arranged between the premier of Saskatchewan and the Prime Minister for a meeting of those two committees. Those two committees did meet. I was present at the meetings and the discussions end there, all of which my hon. friends will find when they read the record of what was said in the election showing that the statements made that are being brought forward here this afternoon are statements that did not conform with the facts.
Chairman: Shall item 42 carry?


[Stage Direction]
Item agreed to.
DEPARTMENT OF TRANSPORT 435. Departmental administration, $1,777,100.
William Alfred Robinson: Shall the item carry?


Some hon. Members:: Carried.


An hon. Member:: The hon. member for Danforth is on his feet.


Mr. Small:: I have been trying to catch your eye, Mr. Chairman.

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An hon. Member:: He is easy to see.


Robert Hardy Small: There are a couple of items in the estimates of the Department of Transport that I should like to touch upon. One is the railway grade crossing fund and the other has to do with the Canadian National Railways. Both of these matters come under the supervision and control of the Minister of Transport although he does not have anything to do directly with the operation of them.
Last year when the government implemented the report of the board of railway commissioners they increased the railway grade crossing fund from $1 million to $5 million. There was also a revision of the percentage that the railways and the municipalities would receive. This revision was to relieve the railways and the municipalities who were hard pressed, so under it the municipalities would pay 25 per cent, the railways would pay 15 per cent and the grade crossing fund would absorb the remaining 60 per cent of the cost of crossing protection. The board was also given authority to make grants towards the reconstruction and improvement of some of the present installations up to the extent, I think, of $150,000, and particularly in cases of grade separation. As was mentioned last year, the amount of the fund was increased from $1 million to $5 million.
At the time the increase was made we in this party, and I think the majority of the opposition, expressed the opinion that the amount, while it was large, was still inadequate to take care of the situation with which we were confronted. According to the over-all picture presented last year by the board of transport commissioners, it would take somewhere in the neighbourhood of $700 million and about 33 years to take care of this situation, which we all agree is deplorable, and there would only be 1,400 grade separations completed in that time. Thirty-three years is practically one-third of a century. At the same time, while we are trying to improve the situation there is bound to be an increase in the number of level crossings. At the present time, there is somewhere in the neighbourhood of 33,000 level crossings in the Dominion of Canada, and I believe there are 29,600 that are what we would call unprotected crossings. This would leave 3,400 protected crossings in Canada, and that would include the grade separations. The program that the board outlined in connection with grade separations, meaning overpasses and underpasses or subways, would leave a great deal to be done after it was completed.

The annual report of the board of transport commissioners was just received the other day so there was not very much time to go over it and analyse it. It was a very comprehensive report. This report covers the situation up to December 31, 1955, but covers the grade crossing fund only up to the end of March 31, 1955. A great many of the reports we receive in this house are compiled on the same basis, so they are a year behind when we receive them and almost useless. We are discussing something that is past and gone; we are really not up to date. I think the departments would be well advised if they would try to rectify this situation so that we could have reports that were up to date. If they cannot give us the information up to the end of March 31 of the present year, they could at least bring it up to December 31 of the previous year. At the moment, these figures are not much good because, in this particular case, you are discussing a report of the board of transport commissioners on the grade crossing fund which only goes up to March 31, 1955, which is a year and some few months away from the time we are discussing, perhaps the government could look into the matter to see if something could not be done toward improving this condition.
In this report the board has not given complete figures for the year 1955; they have not brought the figures up to date from the time the board made its report in 1954. However, the statistics on accidents have been brought up to date as of December 31,1955, and tabled in February, 1956, and comparisons are made with the years 1951-54. The number of accidents for this year is given as 510, and that is about the highest year in the table when compared with 1951, when it was 490. There were 20 more accidents this year than in the previous highest year. According to the board's report there were only 116 new installations of automatic protective devices last year, and there were 74 existing protective devices which were improved upon. Some progress was shown, therefore, but there were also 181 new crossings opened and 31 closed, while there were four highway diversions. Contributions from the fund amounted to $1,219,613, and the projects approved for construction 1955-but that does not necessarily mean starts were made on the work-were 59 railway bridges; 31 overhead bridges and subways; 89 protected crossings with flashing lights and bell; 27 electrically controlled gates and flashing lights. This is all very good, but it does not give us the picture of whether or not there has been any over-all progress in the elimination of these level crossings. I think we are probably slipping back, as we have been

from year to year. The situation is getting beyond us. I do not see anything about the completion of grade separations, so I can only speak of my own knowledge and I know that the Woodbine avenue subway in the city of Toronto was completed last year. It is a very great improvement.
I assume that there must have been a great many requests to the board for work to be undertaken. Naturally, that would follow because when you increase the fund by about 400 per cent you are going to have demands for some work to be done. However, it all hinges upon just how far the municipalities, the railway companies and the provinces can go. If they have not the funds available to keep up with the money that is provided by the federal government, naturally the program is going to be slowed up. This causes us to ask ourselves if we are attacking the problem from the right angle. Although the fund was increased to $5 million last year that increase was not effective until after the house prorogued and therefore there could not be much spent from the fund and it did not really become operative until after the first of the year.
This year's report of the progress that has been made will probably give us a better picture of what has been accomplished with the $5 million that has been set aside. I do not think we have to wait for the report; I think we can probably decide that it will not be adequate to take care of the situation in the future. The board has mentioned that neither the railways, the municipalities nor the provinces are in a position to take full advantage of the fund that has been placed at their disposal.
When one examines the reports of accidents that have taken place he finds that one thing stands out. There were 510 accidents last year, and 80 per cent of them, or 410-I stand to be corrected on that figure-[DOT] occurred at unprotected crossings. The ratio of accidents at unprotected crossings is the same percentage as at protected crossings. At the turn of the year there was a series of appalling accidents at grade level crossings in the Ottawa district. In the riding adjacent to mine, York-Scarborough, there was an accident right on the borderline on the northeast perimeter of the Danforth riding and the southwest perimeter of York-Scarborough riding. This appalling accident happened there on Christmas day last year.
Scarborough has some 82 grade level crossings of various kinds. Eleven or 12 of them require grade separation, and about 50-odd require what we call protection. Two of them had something done last year. One underpass or grade separation may have been provided. Further applications have been made 67509-446
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this year to have more projects started, but that does not mean the board is going to grant them. Around the Toronto area, particularly in the Etobicoke area, the accidents are keeping pace with the number that occurred in years gone by.
I should like to refer to the situation in Brockville, which is evident to one as he goes back and forth to Toronto. I do not know whether there have been any accidents there, but it is certainly a miracle if there have not been any. The people in the city of Brockville certainly must be very patient. The roads are blocked there, particularly when there are freight trains in the station, or when a change-over is being made. The length of time the people have to wait for the crossings to be cleared is provoking. It is a wonder that there are not more accidents at those street crossings.
The board of transport commissioners is to be very highly commended for their action in connection with the railway diversion that took place at the St. Lawrence seaway project. The location of the railways there has to be changed, and a good many subways, underpasses or overpasses or whatever you wish to call them, have to be installed. The railways and the department of highways were adamant in their stand that they did not want to undertake the cost; they did not want to foot the bill for putting in new grade separations. The board had the matter before it, and it is to be highly commended on its adamant position. They insisted on having the proper number of subways installed to protect the people.
It was the same old story that we heard at the time of the erection of the union station in Toronto. It stood idle for over ten years for the simple reason that they could not bring the railways to the point where they would construct the grade separations to protect the travelling public in Toronto. The matter finally went before the courts and they were ordered to put them in. The same situation would have prevailed at the St. Lawrence seaway project if the board had not taken a sound and strong attitude. They took the position that grade separations had to be installed to protect life. In my opinion that is one place where the board proved its worth.
Last year the situation had become rather serious because of the deaths on the highways at grade level and other crossings. A board was formed known as the national accident prevention board, of which the former minister of defence was made chairman for a time. He was succeeded by Mr. Ash, who was the chairman of the Ontario safety league. They got off to a rather late

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start, but they have made some wonderful progress. They followed one of the suggestions made in the board's report last year, that an advisory committee should be formed to assist in overcoming the mounting number of accidents on the highways and at grade level crossings. That is one of the right steps to rectify the situation. Greater effort will have to be made to prevent accidents in the future. Probably some of the expenses connected with that campaign can be drawn from the fund, or provision can be made to use funds from the grade level crossing fund to augment the staff who are working on the prevention of accidents in the future. If that fund were used in this way it would be money well spent.
The task of eliminating grade level crossings is an enormous one. At present not much can be said about accidents at grade level crossings this year. As I said, probably next year we shall have a better opportunity to obtain a more complete and thorough analysis of it than this year.
I should like to deal for a moment with the annual report of the Canadian National Railways. I see from the report that in 1954 the Canadian National Railways had a deficit of $28,758,000. In 1955 they had a surplus of $10,717,000. That looks like a pretty good performance, but there are some observations I should like to make which may throw a less favourable light on it. These are the conclusions I have come to. This surplus was built up from the increased revenue accruing from freight traffic. Four-fifths of the revenue came from freight traffic. Then there was a slight increase in the intercity passenger traffic.
In the intercity service, where the traffic was up a little, the increase was stimulated by a greater effort to secure patronage by an improvement in the speed, service and standards and what they call "specials". I suppose that would be excursions between the cities. However, this was offset by a drop in commuter traffic which was induced by modifications to the suburban service. I suppose by "modifications" they mean there was a decrease in the service that was given.
However, I was intrigued by the reference to the punitive deferral on maintenance. No matter how close the balance is in renewing and replacing, it is not only risky but generally it has dire results. The results are poor plant, faulty equipment and bad service. That is eventually what happens.
Further on in the report mention is made of labour. While there was an increase in wages in the payroll of $794,939 over 1954, there was a staff reduction of 2,366, and this no doubt was brought about by the deferring
of a maintenance plan and by other means of escaping or evading necessary maintenance. Although they say they want to avoid it I think they have walked right into it, because when you take the average annual wage of the employees involved at $3,152, there would be a payroll saving of $7,500,000, which would make up three-quarters of the 1955 surplus. The future will tell whether this was a good operation. In 1955 there were 116,583 employees and in 1954 there were 118,949 employees, which means a decrease of 2,366. The payroll in 1955 was $375,600,000 and in 1954 it was $376,397,939 which is an increase of $797,939. I can only conclude that this is not a good operation.
Another matter I would like to touch upon is one about which a great deal has been said since the first of the year. I am referring to commuter service, particularly as it relates to the railways. I have already referred to the intercity traffic and service and how the railway really concentrated on increasing the patronage and improving the service. I would like to ask what efforts have been made toward improving the lot of the commuting population and increasing the patronage. Of the entire passenger traffic last year 44 per cent was made up of the commuter population.
Perhaps I could approach this matter best by reading from the report of the board of transport commissioners for Canada for the year ended December 31, 1955. I shall refer to an application of the Canadian passenger association for rescission of the board's order No. 75234, dated September 21, 1950, which prescribed commutation fares. An application was brought for an increase in rates, particularly in the Oakville area. This reference appears on page 14 of the report. I do not think the background details are necessary, and I shall begin by reading the following excerpt from the report:
The commutation rates in effect when the application was made in May 1954, were prescribed by the board in 1950 by order No. 75234. The railways in this application sought rescission of that order concurrent freedom to increase commutation rates approximately 100 per cent, half of the proposed increase to be effective immediately followed six months later by the full increase. The application affected a number of areas including the Toronto and Montreal areas and the first hearing was held at Toronto and related to commutation services and fares in that area. Following that hearing the board held in a judgment dated August 4, 1954, that in dealing with commutation services the time had arrived to apply a general rule that a railway is entitled to charge commutation rates at a level that will return at least the railway's reasonable and actual out of pocket cost of furnishing the service concerned and that the railway should not be required by the board to provide or continue to provide commutation services which will not meet that cost. The board thereupon authorized adjustment of commutation rates in the Toronto area as applied

for but subject to the condition that the increases be made effective in three stages, namely approximately 50 per cent of the increase not earlier than September 30, 1954, another 25 per cent not earlier than six months from the date of the first increase and the final portion not earlier than another six months thereafter. Subsequent to that judgment hearings were held in Montreal. The railways submitted that the application if granted would do nothing more than give the railways a fighting chance to recover mere out of pocket costs; also that when rates are shown to be below the compensatory level the board has an obligation to see that they do not remain below that level but that the railway may, in their sole discretion, fix commutation rates at any higher level they wish if such rates are less than the coach class passenger rates and if there is no unjust discrimination. Opposing municipalities did not object to rescission of the 1950 order but maintained that the proposed increase of 100 per cent was excessive and that all the railways need is an increase of 35 per cent.
Mr. Chairman, I should perhaps read the next paragraph because this will have little meaning unless I do.


Henry Alfred Hosking: Your time is nearly up, so you had better get going.


Robert Hardy Small: It reads:
The board held that when the railways on their own initiative and for many years have caused commuter rates to be established in given areas and sought to have them increased the board can quite legally and properly consider with respect to both commuters and the railways the reasonableness of the proposed increased fares and the manner in which they are to be applied; and that on the facts before the board in the present case, it has jurisdiction to prescribe the rates and to fix, determine and enforce just and reasonable commutation rates; that while further evidence and investigation are necessary before final judgment can be rendered, sufficient proof was made to justify the railways putting into force an increase of 50 per cent as it appeared that even if the commuters are given the benefit of every reasonable doubt the revenues with such rates in effect will not exceed the out of pocket costs properly chargeable to commuter service.
Order No. 75234 was rescinded and the applicant railways were authorized to adjust their commutation fares in accordance with the judgment 12 i are.as ?ther than the Toronto area, to which the board s judgment and order of August 4, 1954 remained applicable. At the end of 1955 the board was continuing its investigation upon the applica-
I believe my time is getting short.


The Deputy Chairman:: I am afraid I must advise the hon. member that he has gone beyond his 30 minutes.


Mr. Carter:: Mr. Chairman, there are two or three matters I should like to bring to the attention of the Minister of Transport. Perhaps it would eliminate repetition and save time if I referred to them on this item instead of taking them up separately.
First I should like to thank the minister for the attention my riding has received from his department. We appreciate what his 67509-446J
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department has done during the past four or five years in the way of improving aids to navigation. A great many fog stations have been rebuilt and the equipment modernized, but there is still a great deal more to be done. We need a great many lighthouses, light and whistle buoys and bell buoys, and we trust that the provision of the new supply ship which we hope will be in operation before another year will make it possible to provide these additional aids.
I should like also to express appreciation for the sympathetic consideration I have always received from the senior officials of the department both here and in Newfoundland, and for the efficient manner in which they have dealt with the various problems I have presented to them. Since mine is a coastal riding, hon. members will understand that the Department of Transport plays a vital part in the life of my constituents.
Strange as it may seem, I should like to say a word of thanks to the Canadian National Railways. I am particularly appreciative of their efforts to assist the producers of my province in the marketing of their fish. A recent visit was made by their senior expert on fish tariffs and rates which resulted in the working out of a beneficial freight rate for the fresh fish producers of my riding.
I should like also to thank Canadian National Telegraphs for the various small telephone stations they have established during the past year. One of these stations which was recently established made possible the saving of a human life, which alone justified any expenditure the department might have made, even though it might be a long time before the expenditure will be offset by the revenue received.
I should like to draw to the attention of the minister a Canadian Press report which appeared in the Newfoundland papers of June 6. According to this press report the deficit on the ferry William Carson for the year 1955 amounted to $4,500,000. I do not know how that figure was arrived at, but I assume it resulted from taking item 460 in the amount of $3,496,250 and adding a similar item in the supplementary estimates in the amount of $1,123,830. The publication of this report caused considerable consternation in Newfoundland, when it was thought that the deficit on the ferry operation would amount to such a tremendous figure. I believe there must be some misunderstanding there, and perhaps these figures indicate the deficit on the whole railway operation rather than on the ferry service alone. I would be grateful for any light the minister can

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throw on this matter, either when he replies on this item or later when we are dealing with item 460.
These figures on the deficit point up a startling fact. The railway operation in Newfoundland is vital to the economy of the province. We are dependent entirely upon the Newfoundland railway and the coastal services to meet our transportation needs.
I would be the last to deprecate what the Canadian National Railways have done to improve the services. They have spent many millions of dollars in improving the roadbed and providing modern and up to date equipment, but in spite of that the service today is relatively worse in comparison to the needs than it was 20 years ago.
The startling fact which I feel should be pointed out to hon. members is that this situation must continue and will worsen as time goes on. In the first place the Newfoundland railway was never built to meet the needs that exist today. In the second place the Newfoundland economy is expanding at such a rapid rate that it never will be possible for the railway to catch up, no matter how many millions of dollars are spent in the future. Even if the present system were converted to standard gauge I do not think it would be adequate. In my opinion what is needed is a completely new transportation system.
I read in the press a few days ago that a survey party was on its way to Newfoundland. The press report did not indicate the scope of the survey to be undertaken, but I submit that a most comprehensive survey is needed. Before we begin to analyze the transportation problem in Newfoundland we must have a very clear picture of what the transportation system should do. It is not just a matter of carrying passengers and goods from one point to another; it is much more than that.
Newfoundland can be divided into three economic subdivisions, each of which is independent of the others. The first function of any transportation system should be to integrate those three economic subdivisions into a single economic unit. Having done that, the second and more important function is to integrate the whole province into the economy of the mainland. Until those two objectives have been achieved Newfoundland will never enjoy the benefits of confederation. We have had seven years' experience, and we know just what we are talking about. We know also that, just as the railway integrated British Columbia into the economy of Canada as a nation, so must the transportation system of the Canadian National Railways do the same for Newfoundland.

I point that out to the minister because there is not another minute to lose. We cannot construct the railway overnight. At best it will take years, possibly five or ten years, to develop a transportation system that will meet the needs. We must remember that our present railway was built when our population was 250,000 people. Today we have a population of 425,000 people, and in 20 or 25 years' time we expect to have a population of over 800,000 people. For these reasons it is important that we begin thinking and planning and working out a solution to this problem now.
The other point to which I wish to draw the attention of the minister is the inadequacy of the coastal services. My riding is a coastal district. The railway touches it only at each end, and in between points from east to west are served by Canadian National Railways coastal boats. This service is very slow. It has been modernized as far as the ships are concerned, with one important exception on which I shall enlarge a little later, but the sailings are much too infrequent for the business needs of the riding.
We all know that communications are the key to economic development. Certainly my riding is one of the "have not" ridings of the whole province of Newfoundland. Economic development cannot take place unless communications are much more improved. There is one particular part of the coastal service about which I want to speak especially, and that is the Placentia bay area. I have been talking about this for the past four years. I have brought it up in the railway committee, and the president of the Canadian National Railways has always assured me that this problem would be taken care of just as soon as the William Carson ferry was completed and put into operation. We waited patiently for a year for the ferry to be built, and now the ferry has been built for a whole year and she is still not in her regular service, and it looks as though it might be another year before that problem is taken care of.
I want to point out to the minister, as I have done to the Canadian National Railways, that even when the ferry goes on her regular schedule across the gulf, the diverting of the S.S. Bar Haven to the Placentia bay service will not solve that problem, because whilst the Bar Haven is a satisfactory ship for one part of the bay, she is certainly not adequate for the other parts. At present this area is served by a cargo vessel. There is nothing wrong with the vessel as a ship, and there is nothing wrong with the captain or the crew; they are the equal of any in the world. I travel with them every year and I enjoy my

trip with them; but I see for myself the conditions under which passengers have to travel and I can tell hon. members that at times, particularly in the fall and winter when the weather is stormy and the days are short, the conditions are indescribable. There is no word that I know that can adequately describe them. If any newspaper like Week End or the Toronto Star wanted a good photo story, I submit they could get one if they sent their photographers down to take a trip on this vessel.
The only way to solve this problem is to construct a vessel especially for this service. That is what the Reid Newfoundland Company did 50 or 60 years ago. The places are the same today as they were then; the geography is the same; the harbours have not changed. They found it necessary to build a ship especially for that service. I have urged that now for the past six years, but my pleas have fallen on deaf ears.
I must say it is almost inhuman to expect these people to go on putting up with this service much longer. There is no other service; they have to take that or leave it. They are not treated as second-class passengers, nor even as fourth-class passengers. I doubt that there are many places in the world where the passengers travel under the same conditions. As I said before, this is no reflection on the captain or the crew; they go out of their way to make the passengers as comfortable as they can. But the ship has only eight berths. Very often it has to carry 40 passengers and the rest have to sit up all night in rough weather, tossing about in what I call indescribable conditions. I urge the minister to use his influence with the Canadian National Railways to tackle this problem without another minute's delay.
In conclusion I should like to remind the minister once again of the plight of the telegraphers in Newfoundland. I referred to them in the debate on the speech from the throne. I have had correspondence about them since, and I understand that some negotiations have been going on with a view to alleviating their conditions.
The situation arises from a change in policy on the part of the Canadian National Railways, replacing the present Morse instruments with a telephone service. The people in the community deplore the telephone service because they say it is not private; the telephones apparently go out of order very quickly and are out of order for a very long time before someone can arrive to get them working again.
The worst part of it, of course, is that the change-over to telephones from Morse instruments is going to result in a reduction in
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salary for the operators. Most of them are, as I pointed out earlier this session, now existing on meagre salaries of around $100 or $113 per month, and it is almost impossible for them to live and bring up their families on that amount, but they are trying to do so. There is no alternative work there for them. They are employed the full day in a separate office away from their place of residence. They have regular business hours that they must maintain irrespective of the amount of traffic they handle, and there is no opportunity for them to supplement their earnings. It is not a part-time job at all; it is a fulltime job.
This reduction from $100 or $115 down to perhaps $75 or $80 is going to make it impossible for these people to live at all. 1 hope when the minister speaks he may be able to bring us up to date as to what has happened in the meantime, but if developments have not reached that stage yet, I urge upon him to keep this problem in mind and to do his best to have a solution worked out at the earliest possible date.


Hazen Robert Argue: Some of us are rather concerned at recent developments in freight rates in this country. We have seen, since the end of the war, a great many increases in freight rates. There was a long series of increases from 1948 to March, 1953. We had thought in 1953 that perhaps this series of increases might be ended for a substantial time to come. Those increases were as follows:
April 8, 1948	 21 per cent
June 16, 1950	 20 per cent
February 11, 1952	 17 per cent
January 1, 1953	 9 per cent
March 16, 1953	 7 per cent
That series of increases in freight rates totals 98 per cent. Time and time again it was pointed out before the board of transport commissioners by counsel representing the three western provinces and the maritime provinces, that any increase in freight rates adds immensely to the cost of long hauls, particularly in certain commodities, and that the total effect of any increase in freight rates is to make the burden of freight rates still more unequal in this nation. Any increase in freight rates increases the burden on the freight users of the prairies and the freight users in the maritimes provinces.
When the railways ask for an increase in freight rates and are given one, they have found that they are not able to take the increase they are given and apply it equally to all the traffic they have. They have found that a large part of their traffic is subject to competition, such as water competition and perhaps truck competition. Hence they have been obliged to take the increase that has been granted and apply

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it to less than all of their traffic. There has been a deterioration in the amount of traffic to which a given freight rate could be applied.
This whole phenomenon has come to be known as attrition, an abrasion of the increase that has been given. It is estimated that for every dollar of increase that is given, perhaps only 60 cents or 70 cents is in fact effective. Each further increase in freight rates therefore adds an additional burden to those manufacturers who must compete by using long freight hauls, and particularly to that of the consumers who have to pay the freight rate, because it is often passed on to them.
I do not think there is any economic justification or any justification from the standpoint of national policy for further increases in freight rates at this time. If anyone will look at the profits of the railway companies over the past few years I believe they will see that while gross revenues at certain times have gone down, the net profits of the railway companies have gone up. The railway companies have been able to make certain savings through dieselization, through increasing freight train speeds and by increasing the size of freight trains. I am convinced that the savings which the railway companies have been able to make render unnecessary any increase in freight rates at this time. If you add in the last increase in freight rates, namely the so-called 7 per cent interim increase, you find that since 1948 freight rates in this country have been increased by the phenomenal figure of 112 per cent, and there does not appear to be any end to it.
From press reports and other statements I have noticed that there has already been an indication that if further wage increases are given those in the non-operating unions, there will subsequently follow increases in freight rates. As a matter of fact, when this 7 per cent interim increase was being considered that thought went through the whole proceeding. The recent application was for a 15 per cent increase. Was consideration given?


Mr. Marler:: Mr. Chairman, I think the hon. member should realize that this is a matter which is now before the board of transport commissioners. While the hon. member may not be put under any disability as to the consequences of what he says, I think the position is extremely unequal. I am clearly not in a position to debate and discuss a matter which is before the board of transport commissioners and as to which there may be an appeal to the governor in council. I am therefore in the
[Mr. Argue.}
position of being unable to reply to this argument with regard to the proceedings now before the board.
I did not complain, Mr. Chairman, when the hon. member spoke about increases in the past, but when he deals with matters which are currently before the board I am placed in an invidious and unfair position.


Edmund Davie Fulton: An untenable position.


Hazen Robert Argue: On that point, Mr. Chairman, may I say this. The minister may find himself in a rather difficult position, but the point is not whether the minister or I or any other member of this house may be in a rather difficult position but rather that here is a case where a grave injustice may be done to the freight users and the people of this nation.


George Carlyle Marler: Mr. Chairman, this whole question is sub judice at the moment, and it seems to me that it is quite improper to pursue the discussion and deal with such current matters.


Edward Turney Applewhaite: I might point out that it has been decided-see citation 251- that the board of railway commissioners, now the board of transport commissioners, is a court of record. I know that remarks somewhat similar to those which the hon. member is now making were made earlier in the session. At that time the gist of the remarks was not to affect the decision which the board of transport commissioners was making but rather, I think, to make an appeal to the cabinet to exercise certain powers which it had as to deferring or upsetting the decision which the board of transport commissioners had made at that time by way of interim judgment.
The minister is correct in saying that if this matter is still before the board of transport commissioners for decision the argument which the hon. member for Assiniboia wishes to make should be made before that board in an exactly similar manner as if it were a case before the courts. The case would be argued in this house only after the courts had rendered a decision, if it was within the power of this house to take some action to amend the decision.
I think the hon. member for Assiniboia will agree with me as far as I have gone. If he is able to restrict his remarks to any action which he feels the cabinet should or should not have taken on the judgment which has been rendered, I do not think I could interfere with him. But if the purpose of his remarks is to influence a decision which the board of transport commissioners is arriving at, then of course they would be definitely out of order here at this time.


Hazen Robert Argue: On the question of whether or not the question is sub judice, may I say this. I think it should be pointed out that it is perfectly in order for any member of this house, I take it, as a citizen of this nation or for any other citizen to discuss the question of freight rates any place in Canada, including such places as in the newspapers and on public platforms. I do not feel that we in this house should be relegated to a position inferior to that which may be taken by any other citizen of this nation who is not a member of this house. We can go across this nation, as some of us will, and discuss this very matter.
The second thing I wish to point out is that the case is not now before the board. If I may explain-


George Carlyle Marler: The hearing has been set for September.


Hazen Robert Argue: If I may explain what happened, I should like to do so. They had a nice little cosy meeting of the board of transport commissioners, and they decided that they were not going to have any long, detailed discussion at the present time. Although there was before the board an application for a 15 per cent increase they did not say, "We will wait until this case can be reviewed in its entirety and then a decision can be made". No, they did not say that. They said, "We will give the railway 7 per cent without a hearing, without any consideration". Then there was an adjournment. As the minister points out, the adjournment is now in effect. This particular question is not today being discussed before the board of transport commissioners.


George Carlyle Marler: May I suggest that a hearing has been fixed for the month of September. Consequently the issues which my hon. friend seems to want to discuss are before the board at this time. My understanding of parliamentary practice is that it is not the custom to debate issues in the House of Commons, or in fact in any legislative body, which are before the courts. It seems to me that is a sound principle. I have been in the same position as my hon. friend, where I have wished to discuss issues that were before the courts and where the rule has prevented me from doing so. I can say to him that the rule does not stop him from talking about it outside the House of Commons, but certainly the rule and tradition have always been that one does not discuss in the House of Commons or any parliamentary assembly issues that are before the courts.


Solon Earl Low: May I just say a word on this point of order; I presume it is a point of order that has been raised. I believe the
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minister's contention would be very well taken if in fact the hearings were going on now or if a 7 per cent interim increase in freight rates had not been granted. Now I contend the 7 per cent is history. It is not contingent in any way upon what happens at the September hearings. Consequently, Mr. Chairman, I contend we are quite within our rights in discussing all the issues involved at least within the 7 per cent increase that has been granted. If in the discussion of that 7 per cent we do touch upon the principles involved in connection with it, certainly it would seem to me we would be in order.


Edward Turney Applewhaite: I think there is really very little need for the committee or the hon. member for Assiniboia to be in any difficulty. Citation 252, which I am going to read because it is not very long, says:
Matters which have been adjudicated upon by the railway commissioners and taken in appeal to the governor in council cannot be considered sub judice while the appeal is pending, because the governor in council then acts in an administrative and not a judicial capacity, and therefore such matters may be debated in the House of Commons.
The point is that the board of transport commissioners does act in a judicial capacity. The House of Commons acts in a legislative or executive capacity. The member for Assiniboia will agree with me that is not the position of the application for the 15 per cent increase before the board of transport commissioners, the hearing of which has been postponed. The fact that the hearing has been postponed does not mean that it is not before the board of transport commissioners. Therefore I think he did make a specific reference to that application, and such specific references to the application should not be carried on at the present time.
However, a general discussion of freight rates is in order. Any criticism of the action which he may choose to take to offset that increase which has been granted is also in order. With reference to the hon. member's suggestion that this puts a member of parliament in a lower position than a newspaper reporter, there are circumstances under which newspapers can be impeached for contempt of court by attempting to try a case which is before the courts. Of course that is going very far. Hon. members in this house are protected from every sort of action by their parliamentary immunity; therefore I think they have a greater responsibility than others for remaining within the bounds of not discussing matters which are sub judice, and within that general thought I am sure the hon. member for Assiniboia can continue.


Hazen Robert Argue: I think perhaps I can make my remarks within the bounds you have set by the statement that you have just made,

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Mr. Chairman. But I would point out, with regard to your reference to the press, and what might be done if this question is discussed in the press that this important economic question will be discussed outside of parliament, and I do not think any action of any kind will be taken.
I think I can keep my remarks within your statement that one can discuss things that have happened in the past, increases that have been made in the past, even though such increases may be only interim. With that in mind, I want to make it quite clear that I believe the 7 per cent interim increase, the thing that has now been done, was wrong. The board of transport commissioners, I feel, made a tragic blunder in providing the 7 per cent increase at the time it was granted without sufficient evidence before the board for anyone to decide whether or not that 7 per cent increase was justified.
It is not a matter that affects only the people of the prairie provinces. The hon. member for Cape Breton South has pointed out on more than one occasion that the people in the maritime provinces are adversely affected by increases in freight rates. The people of British Columbia are adversely affected by any increase in freight rates. I am sure that the hon. member for Kootenay West is much better acquainted than I am with the position of the fruit producers in his province.
It has been stated by the British Columbia small tree fruits association, representing the British Columbia fruit industry, that it is virtually impossible for that industry to absorb further increases in freight rates. This was pointed out before the 7 per cent was granted; that the price of apples has been reduced progressively from $1.32 per box in 1952 down to just 77 cents per box in 1955. They point out that with an increase in freight rates of 7 per cent the industry is going to be placed in economic jeopardy. I believe the government is going to have to take a look at its whole transportation policy to see if some alternative can be found to further horizontal increases in freight rates. Some other measures will have to be adopted.
I notice that those of us who feel that other measures must be adopted are not alone. An organization as powerful and as prominent as the Canadian Manufacturers Association has made a statement that some other system of alleviating the distress of the railways must be found. They have said this:
Thus the law of diminishing returns inexorably asserts itself, and it is becoming increasingly apparent that recourse to means other than a general freight rate increase will ultimately have to be found to maintain the railways in a healthy condition.

I think the government should consider now a type of transportation policy that will include, wherever it may be necessary in order to hold down freight rates, wherever it may be necessary to provide equality of freight rates, a system of subsidies and controls so that this may be brought about. We have already had certain steps taken in that direction. A few years ago we had provided by law a $7 million subsidy paid for the maintenance of the trackage in northern Ontario. The purpose of that $7 million subsidy was to help assist the railways in moving freight over that area, which is considered a relatively barren area. It was the belief of parliament when the $7 million subsidy was granted that it would go a considerable distance toward enabling equalization of freight rates to take place.
I believe it is time now that the government considered the whole question of subsidies for the railways, the whole question of controls, and made certain that out of this government policy two things come about: first, no further increases in freight rates and, second, an equalization of those freight rates now in existence.
May I refer to one other thing that is past history in this country, but which I am fearful may be brought up to date before too long. That is the whole question of whether the railways have the right to charge demurrage on box cars of grain waiting to unload at terminal elevators. This question was decided-


Mr. Marier:: This is again a question which is before the board. Surely my hon. friend is not going to pursue another matter which is under consideration by the board?


Hazen Robert Argue: Not at all; I am not going to pursue a question that is before the board. I am merely going to make reference to a very wise decision that was made by the board of railway commissioners for Canada on August 15, 1937. Back in the 1930's there was an application before the board for demurrage charges for the unloading of grain at terminal elevators. Great controversy took place at that time as to whether demurrage charges should be allowed to the railway companies. It was decided at that time that while the railway companies might be allowed to charge demurrage on other freight traffic, the question of charging demurrage on grain was an entirely different proposition. In the judgment of that day-and it is an old judgment, dated August 15, 1937-at page 197, I find the following. I think it is something that members in this house might consider. It reads:
I cannot refrain from repeating that I think we should consider the question of western grain

transportation as distinct from the transport of other commodities. While the principle underlying the application of a demurrage charge is sound in respect to rail transportation in general, and should be applied where cars are unreasonably or improperly detained by shippers or by consignees, in my opinion an exception should be made in regard to western grain at terminal points. Parliament seems to have recognized a distinction as between western grain and other transportable commodities not only in the Canada Grain Act, but also in regard to railway rates for the transportation of grain. While ordinary freight rates are subject to the jurisdiction of the board under the provisions of the various sections of the Railway Act, parliament itself enacted maximum rates for the transportation by rail of western grain to the head of the lakes. Subsequently, the board made the same scale of rates effective for shipment of western grain via Pacific ports. I am not aware of similar action by parliament in respect of any other commodity. I think, therefore, that one may well hold that shipments of grain to terminal elevators may be treated as an exception to the general demurrage tariff. For many years, the railways have so treated it, and I can find no sound reason at the present time for altering the method adopted by the railways in the past.
I believe that was a sound and wise decision, Mr. Chairman; I believe it is something that should not be left as a decision of the board of transport commissioners, but rather that the government should adopt it as a matter of policy and bring in a measure to place in the Railway Act of this country a provision which will prevent railway companies from charging demurrage in the unloading of grain.


Henry Alfred Hosking: Mr. Chairman, I wish to enter this debate on behalf of the numerous people who are unable to procure telephone service at this time. The reason I speak on the estimates of the Minister of Transport is that the board of transport commissioners has some little say with regard to the rate charged by the telephone companies across Canada.
A great shortage of telephones existed during the war period, and that is understandable. When the resources of this country were required to fight and win a war it was not realistic to think that telephone service should be given to everyone at that time. The existence of shortages was true with respect to almost every commodity at the end of the war. There were no automobiles; there were no refrigerators; there were no electric stoves; there was none of the things that so many households required at the end of the war. But the telephone system, because of, you might say, a monopoly permitted by this government, is the only industry which, some 11 or 12 years after the war has not caught up with the scarcity which existed then. I would think there are more people wanting telephones today than there were at the end of the war. The telephone companies have not approached their problem in 67509-447
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a manner that will permit them ever to catch up with the shortage that exists.
The telephone companies give various excuses. I need only to look at my own city to see how they have mismanaged the problem of supplying people with telephones. I do not disagree with government policy. I agree that we cannot have two or three different telephone companies servicing one area, but I do know this. If two companies were permitted to service an area where new houses are being built, there would be salesmen at the doors of those houses before the people moved in, offering them telephones. The companies would not take the position that the house is there and at some time the people are going to have to come to that particular company and beg for a telephone. They would not take the position that the customer has to wait until they decide that now is the time, we shall give him a telephone. They would be out after business, and they would be looking to this tremendous market as a means of earning money.
The thing that I do not understand is why the shareholders of the telephone companies have not explained very clearly to their management that they have done a poor job, that they have done the poorest job of all the companies in the Dominion of Canada that are supplying the needs of the people. There is not an automobile manufacturer that will not give you a car today. There is not a company building refrigerators that cannot give you a refrigerator, or a company manufacturing electric stoves and washing machines that cannot give you a washer or electric stove. You can go out and buy a suit of clothes; you can buy a pair of shoes. You could buy none of these things as you wished at the end of the war; neither could you get a telephone then. You can get these other things today, but you cannot get a telephone.
The telephone companies have looked on the progress of Canada with the most bleak, barren and unimaginative program that was ever presented to the Canadian people. I think it is time the shareholders took a look at their companies and said to the management, "Now is the time to take a new look at the situation, and when you see in a city a couple of hundred houses being built, you get prepared to supply those houses with telephones before they are built, not a year or two years afterwards." They say, "Well, we have not the supplies; we just cannot do it physically."
Let me tell those telephone companies this. They are in the position of a city, only on a much smaller scale. What has to be supplied in a city in which new houses are being built? They have to supply schools, hospitals, sewage

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capacity and waterworks. I would suggest to those telephone companies that for every dollar they spend on buildings and switchboards the taxpayers of the community have to spend $1,000 to supply schools, hospitals, sewage plants and pumping stations. For every dollar the telephone companies pay for stringing a line to a new section of the city, the city has to pay $1,000 to put down sidewalks, streets, sewers, gutters, storm sewers and all the things that make up the services of a city. When you go to the house owner you will find that to buy his home he spends $1,000 for every dollar the telephone company has to spend to put a telephone in that home. When this huge project is being planned and developed in Canada we have the telephone companies blithely saying that people will have to wait until they are ready to give them telephones. The companies know that people cannot obtain telephones from anyone else.
I think it is time the board of transport commissioners took a look at the telephone companies and said to them, "You have the sole right to service these homes and when you service them you make a profit on it; and we are going to see that as long as there is an application for a telephone in any area that you cannot fill within a week, which is a reasonable period of time, you will have no right to raise your rates in that area."
If this were done I am quite convinced the management of the telephone companies would take a new look at the situation and would come to grips with this matter and do something about it. Of all the companies which provide services in this country I think the telephone companies have done the poorest job.
There is one other thing which provokes me a little, and I would hope the government would take a look at the telephone bills they receive for the long distance calls they place. I go to my telephone in my office in this building and make a long distance call to Guelph or Toronto. Thirty seconds later I pick up the receiver of my telephone and try to dial a local number. What do I get? I get long distance. If the call happens to extend more than three minutes I am charged an extra minute for those 30 seconds. Do the people of this country realize that most of us who place three-minute long distance telephone calls are being charged 30 per cent extra on such calls? This is the only business I know of that operates that way, and one can do nothing about it. Telephone companies to me are not well run businesses. I think it is time the telephone companies realized that their service is not quite as good as they like to think it is.

I would like to ask the minister if he would recommend to the board of transport commissioners that they take a look at the handling of communications in this country.
I know the same situation obtains in most of the provinces, but the Bell Telephone Company is particularly at fault. It is no doubt the largest telephone company, and it has set an extremely bad example. I would hope that the minister with his capacity for getting things done could suggest to the board of transport commissioners that the board has the means of telling the telephone companies to take a look at their service to see if they could improve it.
If this is done I am sure we will not have thousands of people being told they will get a telephone when one is available, which may be a year from the date on which they make application. That situation was understandable at the end of the war and it might have been tolerated five years after the end of the war, but to have this situation existing 11 or 12 years after the cessation of hostilities is completely unrealistic, and it is nonsense to suggest to people that they should wait for a year to have a telephone installed.


Mr. Bell:: Mr. Chairman, it is with a great deal of regret that I break my self-imposed silence of nearly two weeks' duration to make a few remarks on the estimates of the Department of Transport, particularly as they affect the maritime ports and Saint John, which is my main consideration.
At first glance the estimates appear to indicate that the past year has been a good one. I think for the first time traffic and tonnage are up, construction has been moving along at Saint John and Halifax and the local spirit is picking up. However, the situation is not quite so good as far as longterm planning for the future of these ports is concerned. This is a worry to all of us in the east.
I shall begin by referring to the St. Lawrence seaway. The minister was in Saint John in February of this year and viewed the harbour there. We were very glad indeed to see him in the old loyalist city. While there the minister made a remark to the effect that he thought the St. Lawrence seaway would benefit the maritimes to some extent. I do not know what the result will be, and I do not think anyone is qualified to say. We were disappointed that the matter of the seaway had not been considered in relation to the ports there to the degree that the other economic effects of the seaway were considered.
Two or three things come to my mind with respect to the seaway and its impact on our

future development. I think first of the icebreaking activity that is carried on each year to an increasing extent in the St. Lawrence. There is an article of recent date which suggests that there is considerable merit in the year-round navigability of the St. Lawrence, but the suggestion is made that it would be necessary to spend large sums of money on improvements designed to conserve the warmth of lake Ontario. The second suggestion which concerns me is that a large number of small icebreakers could be maintained to keep the shipping channel open.
I notice in the estimates of the department this year that three new icebreakers are mentioned. I also notice that according to a recent report the Russians have now completed an atomic energy powered icebreaker which it is anticipated will overcome the icebreaking difficulties they have experienced. This is an atomic powered icebreaker especially designed to meet their problems, and probably before long we will have plans for a similar project in this country.
I would like to refer to another matter somewhat along the same line of the icebreaking activity that occurs in the St. Lawrence. I have spoken about this matter before, as have other hon. members who are perhaps more qualified to deal with it. We all remember that on April 23 of this year an accident occurred involving the grounding of a ship in the St. Lawrence. The minister was questioned about it in the house. A veteran Quebec city navigator, Mr. Roger Arcand, is reported to have said that the authorities were pushing traffic ahead too early, and this caused the situation that developed. The exact words of Mr. Arcand as reported in the Montreal Gazette of April 23, 1956, were:
Authorities are running great hazards in pushing shipping through too early.
We all know about the early season the St. Lawrence had. I have only one thing to say in this connection. In view of the good work that is being done in relation to short-term planning, and in view of the publicity the department is giving to the ports and the booklets it is publishing, the long-term view for the future is not being properly attended to. We must have a statement as to the future plans of the department with regard to safeguards, and icebreaking in particular. We want to know what is to be the future of our maritime ports if it is found possible to keep open the St. Lawrence throughout the year.
There is also a lack of long-term planning with respect to shipping through our maritime ports. The city of Saint John was the
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site of a recent meeting of the Canadian port committee, at which time Mr. W. C. Perron of Ottawa made the statement that Canadian ports-I suggest that this is particularly true of the maritime ports-are in a serious position, and encouragement must be given either locally or by the federal government to developing plans for the fostering of our ports. I shall not read the quotation because I do not want to take up the time, but I mention it to indicate the serious problems which must be considered by the department in developing its future policy.
As I have said, we are pleased with the day to day plans in connection with construction and publicity for our ports, but the future of this investment by Canada is a matter of concern. We are wary and suspicious of the seaway. We wonder just how this icebreaking activity is going to be developed throughout the entire year. We notice a stepping-up of departmental plans in this regard. With modern inventions it may be possible to solve the problem of keeping the St. Lawrence open all year. We want to know where we fit into that picture. Even at this late hour I should like the minister to indicate what the experts of the department have to say in this regard.
Another matter that concerns our future is the lack of a definite policy with respect to our merchant fleet. We read recently that 24 nations are meeting in London to consider the Suez situation, and Canada is not to be one of them. It is all very well to sit back and say that here is some responsibility we will not have to accept or worry about, but we must not forget that those 24 nations have much more prestige in foreign affairs than we have simply because we do not have merchant ships which would be using the canal.
We all know what has been said in the past about our merchant fleet. I mention this again in the hope that the minister will take a look at the serious situation of our merchant fleet, and that attention will be given by the department on a long-term basis to dealing more seriously and generously with our maritime ports.


Mr. Batten:: Mr. Chairman, I should like to make a few remarks with reference to the operations of Canadian National Railways in Newfoundland. In my province transportation has always been a most difficult problem. In the early years of the seventeenth century when settlers came to Newfoundland they were forced by the rigours of geography and economics, and by the no less rigorous dictates of early legislation, to settle along the coast in harbours and coves from which they could prosecute the fisheries. It was natural


Mr. Holowach:: Mr. Chairman, my purpose in rising at this time to take part in this debate on the first item of the estimates of the Department of Transport is respectfully to draw the attention of the minister and his officials to several troublesome and acute problems connected with air and rail transportation which face the people in Alberta generally, and particularly those in the city of Edmonton. I am just as anxious as anyone else to expedite the business of this house. I shall therefore come to grips

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with the problem quickly. In order that the minister may better appreciate the reasoning ot the people back home and their concern with respect to this matter, I should like to give a few facts as a background.
As the minister knows, it is my privilege to represent in this house one of the three Edmonton constituencies. That city continues to enjoy unprecedented development, and it is looked upon as one of the fastest-growing communities in Canada. We consider our development to be of national significance. The significance of our development is seen not only in the mounting population of that city. It is reflected in the volume of commerce as seen by the vast increase in passenger traffic and in wholesale and retail sales; and in all this the minister's department is concerned, as he knows very well, because it involves things brought into that area and affects every commodity that is transported through and sent out of that part of the country.
Like everything in Alberta, it is a story with drama. It is connected with the resourcefulness of our people and the thrill of developing the northwest. By reason of its geographic location I think Edmonton lends itself very well to being perhaps the most important shipping point for that north country and to winning for Canada an important place in intercontinental traffic. I have here a clipping from the Edmonton Journal for February 27, 1956, in which the following is stated:
Northern Mining and Edmonton
All signs point to a big season for mining and prospecting in the northland this summer . . .
From Edmonton's standpoint it is worth noting that a record-breaking season is expected in both the lake Athabasca and Great Slave lake mining fields. These are supplied from and through the city ...
All this activity in northern Saskatchewan and the Northwest Territories, and to a lesser extent that in north-central British Columbia and the Yukon, is important to this "gateway" and supply centre. One feature which especially deserves the attention of Edmontonians is transportation. This is the key to northern mining development.
I do not care what variety of political opinions exist in this house; I think hon. members must agree that Edmonton is the logical air shipping centre for the great north land. However I would say that airport facilities there are totally inadequate. This has been recognized in the surveys being made by aviation authorities and international airlines systems which are pioneering in transcontinental passenger service such as Scandinavian Airlines, Canadian Pacific Airlines, Trans World Airlines and Northwest Airlines. The people back home in Edmonton believe that the federal

government is overlooking the tremendous advantages we have there, as is evidenced by the slow way in which they are proceeding with the building of the proposed international airport in that city.
I wish to make it quite clear, Mr. Chairman, that my remarks are not in any way to be construed as a criticism of the minister.
I will be the first to say that the minister is handling one of the heaviest of the departments and is doing the job admirably. However, I am expressing the views of the people back home, namely that until they see some enthusiasm and drive in connection with the project they will continue to believe that the authorities lack imagination and are bogged down with various political considerations. I just cannot understand why, in a jet age such as that in which we live, the government should continually lay plans that will bring benefits only 10 years or 20 years from today. In time of war we can proceed to get things done rapidly, but in time of peace we keep dragging our feet.
I just do not understand the reason for that difference in approach. After all the objectives are the same, namely to act quickly in the best interests of our people. There is no question at all that there have been unwarranted delays in the building of the international airport in the city of Edmonton. In looking back, one can see that it is a case of attrition that has been going on for many years.
I should just like to give the facts briefly, in rough chronological order, and these facts speak for themselves. About 1949 the city of Edmonton began to press the federal government for airport reallocation to the city of Edmonton. Some time later the federal government responded by promising to build one in the future. Five years later, namely in December, 1954, in a general statement issued by the minister and his colleague the Minister of Mines and Technical Surveys, it was announced finally that Edmonton was to get a new major airport built to international standards, and that orders had been given for an examination of possible sites. Some seven months later, namely on June 16, 1955, in reply to my inquiry-as appears in Votes and Proceedings of Thursday, June 9, 1955- I was informed that no tenders had been called for and no survey contracts had been awarded. Approximately a year later the Minister of Mines and Technical Surveys made a statement in Edmonton, and this is reported in the Edmonton Journal of April 5, 1956. The article is headed "Airport Survey to Begin Soon" and it reads in part as follows:
An aerial survey of the new federal airport near Nisku, 16 miles south of the city's centre on

the west side of the Calgary highway, will commence just as soon as the snow clears, Hon. George Prudham, Minister of Mines and Technical Surveys, said Thursday.
The minister said initial contour work is necessary in the area which comprises 16 square miles. Surveys will be made of administration and other building sites and the locations of runways which will be two miles in length. Soil tests and other engineering work also has to be done.
"Before contracts can be awarded, all this engineering and other work has to be done. It will take most of the summer," said the minister. "The intention is to call for tenders next winter so that work can start just as early as possible in 1957," he added.
Mr. Chairman, I am not disputing the honesty of the minister's statement as to the date of the actual construction. However, I am saying that the time schedule is far too slow and that it ignores the urgencies of the matter. We grant that the present airport in Edmonton will serve us for some time, and in any event will be an addition to the proposed airport. However, for reasons of public safety, having regard to economic prospects, and in order to enable Edmonton to keep up with the quick pace of international air development, we ask the minister to reconsider the time schedule, and we urge that immediate action with the highest possible level of construction this summer be undertaken so as to achieve the early completion of this proposed international airport in Edmonton. Public opinion back home is fairly strong on this matter. I think the minister would like to know just how strong it is. In the Edmonton Journal of February 5, 1956, the following appears:
Faster Action on Airport Needed
Judging by mines minister Prudham's statement this week, the federal government has yet to recognize the need for moving along rapidly with the new Edmonton airport.
He says detailed surveying of the site is to commence in the spring and plans are to be ready for a call for tenders a year later. Construction presumably would be started sometime in 1957. This is not good enough. The citizens of Edmonton do not share the government's desire to stretch out the undertaking for political reasons. They want their city to be just as soon as possible in a position to take advantage of great new prospects in air transport.
It is astonishing and disturbing to look back and see how long the business of obtaining this necessity has taken to date.
It goes on to point out this:
Public patience has distinct limits, however, and no one should be more concerned about this fact of political life than the member from Edmonton who is a Liberal cabinet minister. He is in a position to get some action for his constituents and they will expect him to do so. Mr. Prudham should make it his aim to have construction commence this year. The future of his home city in intercontinental air transport, a matter which should be of more than passing interest to him, is waiting on his efforts.
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The second problem, Mr. Chairman to which I wish to call attention is one of long standing, and it is becoming more burdensome and complex day by day. I refer to the ever increasing discriminatory freight rates imposed on the prairie provinces generally and the people of Alberta in particular. I wish to point out to the house that in the matter of freight rates we are the hardest hit province in Canada. It is clearly an injustice that should not be tolerated by the federal government. I wonder whether hon. members know that we in Alberta are called upon to pay rates from eastern Canada in many cases twice as great as the rates on the same goods from eastern Canada to Vancouver, even though the city of Vancouver is some 600 miles farther west than Edmonton. Does the government know that many industries and concerns interested and willing to come to our province for various purposes are unable to do so by reason of the vicious freight structure? I should like to know whether all the people of Canada know that the recent decision of the board of transport commissioners hoisting freight rates by 7 per cent was ordered before the evidence was allowed to be heard from the railways or the opponents of this increase.
In doing this I believe the commission acted without precedent, and in fact ignored the submission made by the eight provinces. As reported in the Star Phoenix of June 12, 1956, by John LeBlanc, Canadian Press staff writer:
Alberta counsel J. J. Frawley, speaking for the lawyers for eight governments present at the session said they do not believe the railways have made a case "for any increase, interim or otherwise".
There have been other statements made by people in that connection. Mr. Ben S. Plumer, chairman of the Alberta wheat pool, stated in Calgary that the railways did not have to prove their need for greater revenues, even though the federation of agriculture filed a vigorous protest. In handling the railway submission in this manner the board has set a dangerous precedent. Further, James Patterson, president of the Manitoba farmer's union, charged that the board had granted a freight rate increase to the railways before giving the effective groups a full opportunity to express their views on the matter. The producers' share of the consumer dollar has reached an all-time low, and the economy of farm production is completely lost in the rapidly climbing marketing and transportation costs. I think, Mr. Chairman, this type of action is setting back the relationship and the progress that we have made over the years.
There is another very serious problem, in addition to the pyramiding freight rates,

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which is hitting hard at our western producers and consumers. That is, the present administration is allowing the technique of agreed charges to overcome the one and one-third rule established by parliament in 1951. At that time it was clearly shown that the one and one-third rule was in the public interest. May I point out that people everywhere are asking just what happened to the recommendations of the Turgeon commission report which resulted in 1951 in the enactment of reform legislation.
I think we will all recall that at that time the legislation enacted forbade the railway companies from imposing any rates to Alberta in excess of one and one-third times the same rates for commodities from the east to the west coast. During the past year we have had a rash of agreed charges covering just about every type of commodity from frozen food to canned goods, varnishes and so forth. Let me just give an example of how serious these freight rate agreed charges are. Steel bars shipped from Hamilton to Vancouver cost $1.30 per hundredweight. The same steel bars shipped from Hamilton to Edmonton cost $3.23 per hundredweight. Sheet steel shipped from Hamilton to Vancouver costs $1.10 per hundredweight. The same sheet steel shipped from Hamilton to Vancouver costs $2.30 per hundredweight. Paints and varnishes shipped from Montreal to Vancouver cost $2.25 per hundredweight. The same shipment of ingredients to Edmonton costs $3.35 per hundredweight.
Here is another example, and I quote this by reason of the tremendous amount of construction in the Edmonton area at this time. Glass windows shipped from Montreal to Vancouver cost $2.56 per hundredweight. Glass windows shipped from Montreal to Edmonton cost $3.32 per hundredweight. It seems to me that simply because people reside outside of a community in which there is cheap water competition, that is no reason for this government penalizing them by unfair freight rates. It is my view that if there are inadequacies in revenue to the railway companies, if and when they are properly justified these problems can best be resolved at the government level where the whole country shares the load and not as it now is, with the prairie provinces paying the full shot.
We all know the maritime provinces enjoy the benefit of government subsidies in freight rates. I believe they have had them since away back in 1927. In the matter of these discriminatory freight rates which we have to face I think the situation is very similar to the one that existed in the United States prior to 1918, when such discrimination was

imposed upon those states which lie directly south of the province of Alberta, such as New Mexico, Idaho, Nevada and so forth. In the early 1920's they enacted their interstate commerce act and got rid of that discrimination once and for all.
This points out clearly that in the matter of an equitable freight structure we Canadians are 40 years behind the times. We know that by reason of section 52 of the Railway Act the minister has the right to vary or rescind any of the decisions of the board of transport commissioners. I would suggest to him that he approach this serious problem with a view to a complete overhaul of the whole freight structure, because certainly the provinces in the west have been milked far too long and far too much.


Mr. Buchanan:: Mr. Chairman, I could not let the discussion on this matter pass without asking the Minister of Transport to direct his attention to the problem of the maritime provinces. We in Nova Scotia are at the end of a long transport haul, and we are very remote from the central market. The Maritime Freight Rates Act was designed to even up this disparity, but with the succeeding increases in freight rates the advantage of the statute to Nova Scotia has been very greatly lessened.
I would respectfully ask the minister to give a searching reconsideration to the position of Nova Scotia in respect of these freight rates, with a view to restoring the traditional role of the maritime freight rates.
(Translation) :


Mr. Gagnon:: Mr. Chairman, since I have had the honour of sitting in this house I have, on several occasions, voiced the grievances and complaints of the people of the kingdom of Saguenay and of Chicoutimi county in particular, regarding the quality of the transportation services given us by that public-owned company called the Canadian National Railways.
I must say frankly and quite humbly that, although my remarks have been judged quite to the point by my electors, they have not brought about the results I expected. There is a French saying to the effect that days follow days but that they are not all alike. Well that old saying certainly does not apply to us, as far as railroad service is concerned. Since 1887 or 1888, when the railroad was completed which has Chicoutimi as its terminus, the situation has changed very little or not at all.
While the jet planes of the R.C.A.F. station at Bagotville whizz by at supersonic speed, and while Chicoutimi motorists can get to Quebec city in two hours, our good old rail-

road still takes nine hours to cover the distance between the ancient capital and the metropolis of the Saguenay.
While in all other fields of economic activity, we are at the forefront, we lag way behind as far as railway passenger and freight service is concerned.
In the matter of speed and comfort, we are still in the horse and buggy days. If we want food on the train, we either have to bring a lunch, as the first settlers used to do, or be content with sandwiches which are sold at fancy prices. Even then, we cannot have those sandwiches toasted because the toaster only works if the train is travelling at full speed, which it never does.
If the train leaves Montreal at 7 o'clock at night, it does not get into Chicoutimi until the following morning at 7.30, when it is on time. In other words, it takes 12J hours to cover a distance of 300 miles, which averages less than 25 miles per hour. Very often, especially during the winter, it comes in late.
There is further evidence. I shall quote a few paragraphs of a letter sent to the board of transport commissioners as well as to the president of the C.N.R. by the local chamber of commerce of the Saguenay district.
Jonquiere, Que., January 18, 1956.
Board of Transport Commissioners,
Ottawa. Ont.
Copy to Mr. Gordon, President, National System, Montreal, and to Mr. Gauthier, Superintendent, National System, Quebec.
Gentlemen:
At the last meeting of the chambers of commerce of the Saguenay district, we were shown a report on the very bad service given to our population by the railway during the holiday season.
It has been shown that the passenger train which normally arrives at Chicoutimi at 7.30 a.m. has sometimes been as much as 10 hours late. For your information, we have all the hours of arrival between December 18 and December 29 last.
This year, the railway cannot blame these delays on cold weather or snow since we have had very fair weather . . .
For the local Chamber of Commerce of the district of Saguenay (Sgd.) Phillippe Tremblay, Secretary.
At this point I call to witness my good friend, the very distinguished Minister of Northern Affairs and National Resources (Mr. Lesage) with whom I had the privilege to travel to Chicoutimi on the 1st of May last. We were on our way to a ceremony which was to start at 9 o'clock in the morning, and we pulled into Chicoutimi at 10.30.
I let it be distinctly understood that I am not attaching any blame to the railway per-
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sonnel. Far from it, as I know from experience that they fulfil their duties perfectly. From the conductor to the baggage man, all are efficient, devoted and courteous.
The engineer and fireman work wonders to deliver us safe and sound at our destination. Unfortunately they cannot eliminate curves, nor rush along at a hundred miles an hour on this snaky, meandrous line.
I offer no criticism of the minister since I know that he is kindly disposed on our behalf. He proved it by authorizing the construction of the St. Felicien-Chibouga-mau line. But I do blame the C.N.R. management and the government, who never bothered to listen to our representations or requests, and who never have given our area the attention it deserves.
I have said, and I am repeating now, that we are unfairly treated by the federal government. The deficiencies from which we are suffering, notably in Chicoutimi-antiquated station, inadequate and incomplete harbour facilities, lack of proper accommodation for postal and other official services, level crossings-all these can be blamed on the lack of interest of the Ottawa government.
Yet, our section of the country is, in the whole of Canada, one of those which pay the most taxes. That should be taken into account.
Without delay, the Canadian National Railways should act on pigeon-holed improvement projects about which, every once in a while, the vice-president of the company gives us a talk in Chicoutimi.
I urge the minister to use his influence in our favour and to demand that we be given decent treatment. The future of our business community depends on it.
It is inconceivable that it should take twice as much time to go from Montreal to Chicoutimi by railway as it takes by automobile.
Secondly, may I voice my support of the request sent to the Minister of Transport (Mr. Marler) by the Association of Shipowners of the St. Lawrence and the Port Alfred chamber of commerce concerning the installation of a radio-telephone station on the Saguenay river.
An improvement of this type would be a great help for navigation on this river, and would also be very valuable to all those using it.
I hope that this request will be considered justified and that action will be taken accordingly.

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I would also like to draw the minister's attention to the necessity of building a civilian airport in our district.
The lack of such an airport is a serious gap, considering the development of civil aviation and the fact that the R.C.A.F. base station at Bagotville does not allow private aircraft to land there.
The hon. minister wrote me recently to tell me that he does not think the time has come to authorize such a project.
If I may renew that request, I would ask him to reconsider his decision in the light of the new arguments which have been submitted to him by different public bodies of the region.
I would like now to call the attention of this house to a fact which has made me particularly happy, and it is that the title page of the recently distributed Canadian National timetable is printed in both our official languages. It is the first time, to my knowledge, that such a move is made, and I am happy to congratulate those who sponsored it.
We would be happier still if the facade of the new hotel being put up in Montreal would also indicate the French character of our country. In the meantime, let us be thankful for what has been done, and let us work and hope for what remains to be done.
Trans-Canada Air Lines have also put out on June 1 last a French issue of their timetables. It likewise deserves congratulations, and the progress of bilingualism in the administration of crown corporations is noteworthy. In conclusion, I would ask the minister whether it would be possible for him to table in this house a copy of the contract between the Canadian National authorities and the U.S. controlled Hilton company, concerning the operation of the new hotel which is going up in Montreal.
(Text):


Solon Earl Low: Mr. Chairman, I hope the minister will get his estimates under way and I do not want to hold them up unnecessarily. I am going to try to be the very soul of brevity and put before him the pith and substance of what is a very strong case for the western people, at least, in relation to what now seems to me to be an abomination.
First of all I would like to invite the minister to come up to my constituency this summer, if we ever get through here, and I would suggest that he come about blueberry time. I would like him to see for himself what is going to happen when the Pacific Great Eastern Railway has completed its line

into Dawson Creek on the south side of the Peace river and into Fort St. John on the north side. There will be a gap of something between 90 and 100 miles between Hines creek on the north side of the river and Fort St. John that will be left without a railway link, and consequently there will be no outlet to the Pacific coast for all the territory on the north side of the Peace river. Therefore it will be necessary for the people in the great northern Peace river country to pay for that very long back haul of 275 to 300 miles into the city of Edmonton before they can even start to get their goods out to markets either on the Pacific coast or at the head of the lakes.
There is no reason why the railways of Canada should not complete this link, and there is every good reason for doing so. I believe the people there have a good case, and it would be well for the minister to look into it by a personal visit to see for himself what is involved. I entreat the minister to come out to that part of the country and see this situation for himself as soon as he possibly can. That is all I am going to say about the matter. By the way, I might add that we will treat the minister very well if he comes out to see us and we will ensure that he gets plenty of blueberries. Incidentally, he may be able to gain a few votes, too, if he comes out to that territory; and I think that is a fair suggestion coming from me.
I would like to say a word about what has been in the past a very great interest of mine. I refer to the great increases in freight rates that have taken place since 1945. Freight rates in western Canada have increased by more than 100 per cent since that year. Those people who live on farms out there have to pay freight rates both ways, that is on everything they buy coming westward and everything they sell that goes eastward, and they are beginning to wonder what is the end of this thing and how in the world they can ever find justice.
A few years ago there was a concerted outcry by members of parliament from western Canada against what was then a very discriminatory set of freight rates. It was largely because the members of the various parties in this house forgot politics and united in that outcry that we were able to obtain the appointment of a royal commission that went into the whole matter, and after their studies were complete they recommended amendments to the Railway Act to provide for overcoming the discrimination through the use of the one and a third freight rate rule and the equalization principle.

I am now suggesting that the time has come when members of parliament from the western provinces should again forget their political affinities for the time being and unite in an outcry against the injustice which is prevailing today. I think this must be done, and I believe it is the only way we can strengthen the minister's hand in accomplishing this. I am not blaming the minister at all, nor am I blaming his department. I am saying, however, that the people of Alberta, Saskatchewan and Manitoba have been euchred-and I used the term "euchred" advisedly-out of the benefit of the one and a third rule established by this parliament.
Those people thought they had something when the amendments to the Railway Act were made some years ago, and as a matter of fact they did have something; but the weapon the railways used to euchre the western people out of the benefits under the one and a third rule was agreed charges. These are contract charges; that is what they are. These charges are increasing by leaps and bounds. They are coming in great numbers every day. The railways are making increasing use of them as a means of circumventing the legislation passed by this parliament, and they are doing so deliberately. Agreed charges are not only increasing but the tragedy of the situation is that the board in its weakness when it was confronted by what was virtually a threat made by the railways, yielded to the railways' demand that the one and a third rule should not apply to agreed charges.
When I speak of the threat I should say this. The railways virtually threatened that if the board insisted on the one and a third rule applying to agreed charges they would not haul on transcontinental rates at all. Of course the board in its weakness yielded, and since then the railways have completely nullified the one and a third rule which was written into the act by this parliament a few years ago. As a result we in the prairie provinces are right back where we were during the period from 1914 to 1951. That is, we are again subject to a set of rules that are grossly discriminatory in every respect. My friend the hon. member for Edmonton East has given enough examples of this, and I do not need to take the time of the committee to repeat them. I would like to refer, however, to the example of skelp which is used in the manufacture of pipe. We are using a great deal of skelp in the western provinces today. The rates on this commodity into Alberta from eastern Canada are set at $2 per hundredweight, but under an agreed charge arrangement the railways are hauling exactly the same material from Hamilton into Port
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Moody in British Columbia for 95 cents. It costs more than twice as much to send it from central Canada to Alberta as it does to send it from central Canada to tidewater in British Columbia, which is 750 miles further along.
That is the kind of thing against which our people have set themselves and against which we are setting ourselves. If the members from western Canada would unite in demanding justice we would get justice in connection with this matter. As I say, some effective alternative must be found to the present practice of granting permissive flat horizontal percentage increases, because it is unfair and unjust when applied to the already discriminating freight rates.
I think I shall just leave it at that.


Mr. Gillis:: Mr. Chairman, this is the fourth time the estimates of this department have been before this committee, and I think if I were the minister I would give up. I did not intend to say anything at this time, but if there is to be a general debate on freight rates I shall have to say something, as freight rates constitute the principal problem facing Nova Scotia.
In his presentation to the Gordon commission dealing with the future of Canada in the economic field the premier of Nova Scotia stated emphatically that one of the greatest detriments to that province in its development from an industrial standpoint, and with respect to industry already there, is the freight rate structure. He contended that that prevented the products of the province getting into the main markets of Canada. I do not intend to go into this in detail as we have heard it time and time again. We have been talking freight rates ever since I came into this house.
I want to say to the minister that freight rates are not an east, west or central problem; they are a national problem. You must take a square look at them from the national standpoint. Year after year in this house we support the wage demands being made upon the railways, particularly the Canadian National. Every time there is a wage increase on the Canadian National it must be added to the bill. They are not accumulating any surpluses to take care of these increases and there is only one way they can get the revenue to meet their commitments; that is in the form of freight rates, passenger rates and so forth which must be paid by the public. Year after year we hear the cry from the east and the west and the centre, but mostly from the east and west because the centre is not affected.
Twenty-five years ago Nova Scotia had an offset to these freight rates provided by the Maritime Freight Rates Act, but rates in

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that area have increased 100 per cent since that act was established while the rates in central Canada, in Quebec and Ontario, have not moved at all. The rates were equal when the Maritime Freight Rates Act was first drafted, but with the increase in rates in that area and with the rates in central Canada remaining stationary, any advantage we may have had has been lost.
I think the time has come when instead of arguing for agreed charges, for equalization and all these things which are only palliatives, we should take a square look at the matter from the national standpoint. I submit that what is needed today is an overall transportation policy which would integrate rail, water, air and truck transportation under a competent body, with regulatory bodies to see that the transportation which was economical in a certain area should be used there. I think that is the only solution I would suggest.
We have been arguing the other matter; we have had complaints from the far east and from the west, and we are getting in an impossible position. We find it impossible to move our goods to the markets in the east and the west, and we find it impossible to bring the things we need from those markets. Despite all we have heard about agreed charges and other palliatives the condition is getting worse and worse.
I believe that the railways are fast approaching the position in this country where they will have to be considered as service organizations. We just cannot continue to go on as we have been year after year. The Canadian Pacific makes a little money, but not from its railway operations; it has other operations which are subsidizing the railway. To a very limited extent the Canadian National gets a little outside revenue. I have been on the railway committee for the last 16 or 17 years and every time we look at the accounts of the Canadian National we find a huge deficit which the government must fix up or a small surplus in one year with an anticipated deficit the next. Quite often we would have Mr. Gordon tell us that he expected a surplus of half a million the next year, but that on the other hand he expected an increase in costs because of wage increases and adjustments, with the result that there would be an anticipated deficit.
You cannot go on like that. An alternative must be found. The alternative is not to try to modify the rates to the west or to do something for the east or to try to go on as we are. I think we must recognize what I indicated a moment ago, that we are fast approaching the point when the railways will
[Mr. Gillis.l
have to be looked upon as service organizations. We have two transcontinental lines with not enough people to use them to the extent that would make them profitable. They are necessary to the development of the country, but you cannot go on piling these costs on the consuming public year after year. It is retarding development in different sections of the country.
As I said a moment ago, we must integrate all the transportation systems of this country under a proper board with the power to regulate. Until we do that I think we are just talking to ourselves.


Mr. Patterson:: Mr. Chairman, I have been listening to hon. members participate in this debate and I notice that most of their observations have been with reference to the effect of freight rate increases upon the prairie provinces. It has been intimated that Alberta is suffering the most from the increases which have taken place. That is also the picture as far as British Columbia is concerned. These constantly mounting freight rates are imposing an additional hardship upon the province of British Columbia as well.
I am thinking particularly of those who must bring feed grain from the prairie provinces. In our province, especially the area which I have the honour to represent, the economy lends itself to the production of poultry products, the raising of dairy cattle and so on. Many people are dependent upon feed grain brought from the prairie provinces. A year and a half ago the freight rate subsidy was reduced by almost 50 per cent. The result was that out of the $3 million which the federal government hoped to save, about $1 million came out of the pockets of the British Columbia consumers when at the same time they used less than 10 per cent of the freight assistance grant. I would suggest that it is very unfair. I know I am speaking of Something that comes under the Department of Agriculture but I just want to show the position in which our farmers find themselves now with the increased rates. I feel that insult is being added to injury, because these people are going to be put in the position where it will be almost impossible for them to carry out operations in this field.
So I would suggest that the minister take some kind of action and do what he can to impress upon the board of transport commissioners and those responsible for these decisions that something will have to be done or we shall find that the economy in the whole of these western provinces is upset. That is all I want to say in this connection. I want to say again that I cannot see why the board

of transport commissioners should authorize an interim increase without hearing the case. That thought has been presented on several occasions this afternoon.
I had intended to speak a little longer in this connection but I do not want to take the time of the house, except to say this. When this government are paying out millions of dollars for storage charges because they cannot find markets, then why in the world is it that these freight rates are increasing to the extent that the markets are being lost because of the high freight rates?
There is just one other matter, and it is in connection with the Fraser river, which is a navigable river. I should like to call the minister's attention to some facts I placed on the record earlier this session-I shall not take the time to repeat them-regarding the Fraser river and the necessity for some action to dredge and channel it in order to take care of many of the problems arising there. At the time of the building of the Agassiz bridge-


George Carlyle Marler: That is a matter of public works. Would the hon. member co-operate-


Mr.   Patierson@: I think the Department of Transport has the responsibility for shipping and so on-


George Carlyle Marler: Not the dredging.


Alexander Bell Patterson: I am talking about shipping. At the time of the building of that bridge, if 1 understand the facts correctly, the provincial government was forced to change its plans, to make the span higher to facilitate the passage of shipping under that bridge. I think it cost them an additional $1 million or so to make that alteration. The whole area is becoming more and more industrialized. Industry is opening up and wants to open up, yet the river is not suitable for navigation because of the sandbars, the lack of channels and so on. I am just making this request, that the Minister of Transport and the Minister of Public Works get together and try to work out some solution to the problem, because in doing so they will not only take care of the problems in regard to transportation but also the problems of river erosion and so on. I just make the request that these departments co-operate in working out a solution to the problem.


George Carlyle Marler: I have taken note that some 25 members have spoken on this first item of my estimates. I take it that it is not the general wish that I should reply to each of these individually. I may assure hon. members that there are 95 other items in the estimates of the Department of Transport, and when these items come before the committee, if there are
Supply-Transport
any questions that hon. members would like to have answered I shall certainly be glad to deal with them.
I would, in the very few minutes that remain, like to touch on one or two points very hastily, as there will not be further opportunities of discussing them. With respect to the question of freight rates, I am sure the hon. gentlemen will realize that it would be most inappropriate for me at this time, while the whole subject of freight rates is before the board of transport commissioners, to say anything on this subject one way or the other; because I assume that if those who are not satisfied with whatever decision may be rendered by the board carry an appeal to the governor in council, it would be unseemly that I should have already committed myself to any position on this very important subject.
I should like hon. members to remember when considering the question of freight rates that the wage agreements, the changes in wage scales in the current year, have added or will add to the wage bill for the two railways in the current year approximately $35 million, and in the year 1957 approximately $80 million. So I think the hon. gentlemen should not overlook that very important fact when they come to consider the position of the railways.


Hazen Robert Argue: Consider paying a subsidy instead of increasing the freight rates.


George Carlyle Marler: I listened patiently to the hon. gentleman for most of the day, and perhaps he might spare me the interruptions in the very few minutes that remain.
I should like to say with regard to the Newfoundland services of the Canadian National Railways that since confederation the C.N.R. has invested something over $50 million in improvements in the system down there and, simply because that investment has not produced all the improvements that were expected and anticipated, a group of senior officials of the railway are to go to Newfoundland to see what can be done in the way of bringing about further improvements and what can be done to meet the demands that are being made upon the railway. In that connection I should mention that there are two vessels provided for the coastal service, the William Carson and the Bonavista, which should be in service without too much further delay.
I should like to say, with regard to the questions raised by the hon. member for Saint John-Albert, that we shall have an opportunity for discussing icebreaking operations in the St. Lawrence when we come to a further item in the budget, and I shall reserve my comments on that subject until that item is dealt with.

Supply-Transport
The same applies to the Edmonton airport, but I should like to tell the hon. member at once that when I went to Edmonton last year and saw the various sites being considered by the department for the new airport I said publicly at that time that nothing in the way of physical work could be done in this year, 1956, and that nothing could be done under intelligent, proper planning, until the beginning of 1957, when we hoped to be able to call tenders.
On the subjects of the one and one third rule and agreed charges, all I shall say is to suggest to hon. members who have spoken that they should read the last report of the royal commission presided over by Mr. Justice Turgeon, where the whole subject was discussed very fully and where the decision was reached that the one and one third rule did not apply to agreed charges.
I hope that the remaining 95 items of the Department of Transport budget will pass more rapidly than the first.


Mr. Hamilton (Notre Dame de Grace):: have a very simple question. Would the minister like to indicate to the house the item under which the Canadian National Railways and its affairs can be discussed? I do not think there is a direct reference to that under any item.


George Carlyle Marler: I do not know what particular subject the hon. member has in mind to discuss. All the affairs of the Canadian National Railways were examined by a select committee in the early part of the session. We had almost three days on the accounts of the Canadian National Railways, and I hope it is not intended to reopen the whole discussion that took place at that time. If it is on an item of freight rates, I think under the board of transport commissioners would be an appropriate time to discuss it. However, on the question of the railroad generally, I find it difficult to see where that would apply, unless it is on the ferry items, where there is provision for that.


William McLean Hamilton: Specifically in this case I personally wish to hear more from the minister in regard to his promise made on April 24 to inform the house about plans for the Victoria bridge, which is causing considerable concern to many people.


George Carlyle Marler: I suggest that we can deal with that under the St. Lawrence seaway.


[Stage Direction]
Item agreed to.
William Alfred Robinson: Shall I rise and report progress?


George Carlyle Marler: Unless the committee would like to sit for another hour.


William Alfred Robinson: Is there unanimous consent?


Some hon. Members:: Yes.


Some hon. Members:: No.


William Alfred Robinson: Apparently there is not unanimous consent.
Progress reported.
Resolutions adopted in committee of supply this day reported and concurred in.


Mr. Deputy Speaker:: I understand that the hon. member for Parkdale (Mr. Hunter) requests leave to revert to presenting reports of standing and special committees. Is that procedure agreeable to the house?


Some hon. Members:: Agreed.



BANKING AND COMMERCE


Mr. John Hunter (Parkdale):: Mr. Speaker, I have the honour to present the ninth and tenth reports of the standing committee on banking and commerce in English and in French.


Mr. Nowlan:: Small loans.



BUSINESS OF THE HOUSE

An hon. Member:: No business?


Clarence Decatur Howe: The business for Monday was announced last evening.


[Stage Direction]
It being four minutes after six o'clock the house adjourned, without question put, pursuant to standing order.
[The following items were passed in committee of supply]:

[Stage Direction]
41.	Prairie Farm Rehabilitation Act and water storage, $4,142,965.
42.	Major irrigation and reclamation projects in the prairie provinces, $7,050,000.
47.	Prairie Farm Assistance Act administration, $502,137.
48.	To provide for a grant to the Federated Women's institutes of Canada, $3,000.
Administration service-
591.	Departmental administration-further amount required, $21,900.
Experimental farms service-
592.	Experimental farms service administration- further amount required. $34,000.
Central experimental farm, including research and co-ordinating divisions for the experimental farms service-
593.	Construction or acquisition of buildings, works, land and equipment-further amount required, $32,000.

Branch experimental farms, substations and illustration stations-
594.	Construction or acquisition of buildings,
works,	land and equipment-further amount
required, $302,600.
Production service-
Animal pathology-
595.	Operation and maintenance-further amount required, $25,000.
596.	Construction or acquisition of buildings,
works,	land and equipment-further amount
required, $104,000.
597.	Live stock and poultry-further amount required, $57,000.
598.	To provide for grants to fairs and exhibitions in accordance with regulations of the governor in council and for payments pursuant to agreements in force on March 31, 1956, with exhibition associations covering the construction of buildings and other major undertakings-further amount required, $615,000.
Supply
599.	Special grant to royal agricultural winter fair, Toronto, $250,000.
600.	Grants to agricultural organizations, as detailed in the estimates-further amount required, $3,400.
Marketing service-
601.	Subsidies for cold storage warehouses under the Cold Storage Act, in the amounts detailed in the estimates-further amount required, $1,636,552.
Special-
602.	To compensate the New Brunswick potato marketing board for certain losses on payments to producers for potatoes marketed from the 1953 potato crop, which were not specifically covered by an agreement under the Agricultural Products Co-operative Marketing Act, $177,000.