1957-12-03

RAILWAYS, CANALS AND TELEGRAPH LINES FOURTH AND FIFTH REPORTS OF STANDING COMMITTEE  CONCURRENCE IN FIFTH REPORT

[Stage Direction]
Mr. G. K. Fraser (Peterborough) presented the fourth and fifth reports of the standing committee on railways, canals and telegraph lines, and moved that the fifth report be concurred in.
Motion agreed to.

Hon. Gordon Churchill (Minister of Trade and Commerce):: Mr. Speaker, I thought I might take a few minutes to give a brief, interim report on the Canadian trade mission which is now in the city of Glasgow. I returned this morning from Glasgow, and I thought perhaps the house would like to know how the mission is getting on. Hon. members will recall that it left Canada on November 21 with the approval of all parties in the house; that it consisted of over 50 people representing all provinces and about 20 of the major industries in this country, and representatives from the fishing industry, agriculture and labour.
The mission arrived safely by T.C.A. on November 22 and was received in the customary friendly way by the people of the United Kingdom. We were met at the airport by the secretary of state for commonwealth affairs, the president of the board of trade, our own high commissioner, Hon. George Drew, and Sir William Rootes, who is chairman of the dollar exports council. Mr. Drew and I, along with Sir David Eccles and Lord Home, then paid a visit to Prime Minister Harold Macmillan, who spent half an hour with us discussing the purpose of the mission and wishing us well on our tour of the United Kingdom.
The reception by the people of the British isles, according to members of the British press, has surpassed anything within recent years except perhaps a visit from a member 96698-112
of some royal family. There has been an intense interest in the mission throughout the United Kingdom.
The press conference on the day we arrived had representatives from almost every newspaper in the United Kingdom. I counted more members of the press at the conference than there were members of the Canadian trade mission, and some of our reporters estimated there were 100 members of the press present on that occasion. This gives you an idea of the interest which was created in the mission before it set foot in England. The response since has been tremendous. Every day, on TV or radio or in the press, word has been carried throughout the British isles concerning the trade mission. The London newspapers, cramped though they are for space, have given some attention to the mission, and the newspapers in the provinces have in their turn given very good attention to the trade mission.
When we arrived in Glasgow just two days ago we were of course met at the station by a pipe band and 500 people who arrived to bid the Canadians welcome. They were not invited particularly, but they knew about the mission through the publicity the British press had given to it. The preparations made in the United Kingdom for the mission were elaborate and very well done indeed. The board of trade, under Sir David Eccles and his officials, operated closely with Sir William Rootes of the dollar exports council and with our own high commissioner and his officials at Canada House in the preparation of every detail for this mission, the largest and most representative to reach the shores of England.
The interest of the British businessmen in the mission has surpassed all expectations, either on our part or the part of the people in the United Kingdom. The mission is visiting quite a number of industrial plants in England, Wales, Scotland and Northern Ireland to see for themselves the progress of British industry. So much interest has been created in this visit that 700 British firms, in addition to the ones we are visiting, have written to the board of trade, the dollar exports council or Canada House asking for an opportunity to meet the members of the mission. This was totally unexpected, but we have made provision for that because within ten days' time the members of the mission will be in London for a three-day stay and offices have been provided for the purpose of seeing that the British businessmen who are

Trade Mission to United Kingdom, interested may meet face to face with our Canadian representatives. This will give you some idea of the interest that has been aroused in the United Kingdom as a result of this visit.
Before I left we had seen a number of industrial plants, and all of us were impressed by the progress that has been made. It appears that a full recovery has been achieved in England from the war damage and from the early post-war years. The factories are coming into full production. They are efficient and well managed. A considerable amount of automation has been introduced into the factories. The British workingman is working efficiently and rapidly. The housekeeping arrangement in the factory was a matter of considerable comment by experienced members of our mission. All told, we were surprised and delighted to see how well advanced British industry is. We were similarly delighted and pleased to see the great interest that the British people have in Canada.
We announced that we had arrived to fulfil two main purposes: first, to investigate for ourselves and see the progress of British industry and its productivity; and second, to inform British businessmen of the great opportunities awaiting them in Canada. We pointed out that our imports into Canada reached the total of $5,700 million per year; that Britain prior to the second world war enjoyed an 18 per cent share of imports into Canada; that such share had now dropped down to about 8J. per cent to 9 per cent; and that in our opinion there was an opportunity at this stage for British businessmen to reenter the Canadian field and to bring to our shores some of the products which they can so skilfully make because they have the skill and the ingenuity.
We noted with a great deal of interest their very fine apprenticeship system to train their mechanics and their technical experts. We also noted their courses for training their managerial staff. We saw with our own eyes the amenities that are provided for people working in the plants in the way of up to date canteens, recreational facilities and medical and hospital facilities. Along with Sir William Rootes, Mr. Schollie, our labour representative, and Mr. James Duncan, I had the pleasure of meeting with a group in one of the factories, of the shop stewards and others who were selected to represent the views of those who are engaged in the work in the factories. We exchanged opinions and told them about our mission, and they gave us some of their views with regard to what can be accomplished by British industry.
All told, the mission has been a great success. It has carried the name of Canada

to the British isles in a way that name has not been carried since the end of the war. The warm feeling of the people in the United Kingdom for Canada cannot be fully expressed by me here this afternoon. It must be experienced to be completely appreciated.
Canada stands very high in the opinion of the United Kingdom. Among the members of our mission and the British people we met over there in conference after conference, there was general agreement that this is a very appropriate time for Canada and the United Kingdom to draw more closely together, not only in trade but in all other ways.

On the orders of the day:


Mr. F. S. Zaplitny (Dauphin):: May I direct a question to the Minister of Trade and Commerce. Did the minister take advantage of his trip to the United Kingdom to discuss further the offer of the United Kingdom to Canada of a free trade area? If so, can he report any progress as the result of such discussions?


Gordon Minto Churchill: Mr. Speaker, I had no opportunity to participate in any such discussion. We were so busy looking at British industrial plants that our time was fully occupied. There may be an opportunity to do so some time in the future to satisfy my hon. friend.


Mr. W. M. Johnson (Kindersley):: Can the
minister inform the house if there has been any concrete evidence of results of the trade mission, in the form of orders which have been placed with the various representatives who are in Great Britain?


Gordon Minto Churchill: Mr. Speaker, we did not attempt to have a day to day report as to what the individual members of the mission did. After all, there are 50 members in the mission representing 20 major industries in this country. My hon. friend knows enough about business to realize that some negotiations extend over several days or several weeks before they are completed.


Mr. H. R. Argue (Assiniboia):: Can the
minister say whether any discussion took place during the recent mission for the purpose of expanding Canadian exports to the United Kingdom?


Gordon Minto Churchill: The purpose of the mission was not to expand Canadian exports during the course of the discussions. That will come, of course, as a result of increased trade between the United Kingdom and Canada, because if they earn sufficient dollars they

will be able to buy more Canadian products. We did not enter into any discussion along that line at the time I was there.


Hazen Robert Argue: Were any facilities made
available so the farm representation on the delegation might negotiate such further increases in sales, or discuss them?


Gordon Minto Churchill: There are three agricultural members of the delegation, who are all experienced farmers. They are spending this entire week under the guidance of Scottish and English agricultural experts in visiting farms and other establishments in the British isles. They have open to them an opportunity to see first-class herds of beef and dairy cattle. They have an opportunity to see the development of farm machinery in Great Britain. They have an opportunity to look at the research facilities in agriculture in that country. I think their time will be fully occupied this week in making that type of investigation.


Mr. F. G. J. Hahn (New Westminster):: I should like to ask a supplementary question. Is the minister prepared to indicate to the house whether in his opinion the decline of trade with Britain from 18 per cent in pre-war days to 8.5 per cent to 9 per cent today is by reason of the fact that Canadian industrialists and the Canadian government are not prepared to accept inconvertible or blocked sterling?


Gordon Minto Churchill: Mr. Speaker, I think the
decline in trade between the United Kingdom and Canada did not result from the policy enunciated by my hon. friend. I think he overlooks the fact that during the course of the war years British industry suffered very severely from bomb damage. We had plenty of examples of that in the stories told us of that bomb damage, and the remarkable recovery that has been made surprised the members of the mission. On the other hand, many of the industries of Britain had to divert their attention to the production of war materials. As a result of these two causes their trade with Canada was curtailed. They have now repaired the bomb damage, and their plants are again producing the materials for which they were originally designed, with the result that they are ready to come over here and re-enter the Canadian market.


Mr. Daniel Mclvor (Fort William):: The
minister mentioned visiting Glasgow. I was wondering why he did not visit the city which is the headquarters of the greatest linen manufacture in the world, Belfast in the north of Ireland?
96698-112i
Trade Mission to United Kingdom


Gordon Minto Churchill: Mr. Speaker, it is with
the greatest regret that I will not be with the mission on Friday when it visits Belfast. As my ancestors went from England to Ireland and thence to Ontario, Ireland has a special spot in my heart, and I would be glad to be there with them on Friday.


Mr. A. W. Stuart (Charlotte):: Will the Minister of Trade and Commerce state whether or not the Canadian trade delegation will visit southern Ireland? If not, was an invitation extended to southern Ireland to meet the delegation at the proposed meeting in London?


Gordon Minto Churchill: No proposal was made, in
organizing the trade mission, that a visit should be paid to southern Ireland. The second part of my hon. friend's question asks whether or not an invitation would be extended to the people of southern Ireland to meet with the trade mission in London. We have not extended invitations to anyone to meet us in London. The 700 requests I have mentioned came from British businessmen throughout the British isles, on their own initiative. We cannot accommodate any more. Other requests may come within the next few days and we will try to meet them, but we cannot, ourselves, extend invitations because we cannot look after all the people who want to see us.


Mr. E. G. McCullough (Moose Mountain):: should like to direct a question to the Minister of Trade and Commerce in respect of the trade delegation. Can the minister inform the house whether or not any preliminary or concrete negotiations were entered into	to	increase bacon	and	beefproduct sales	to	Britain? If not,	why	wassome official	step not taken in	order to
restore our market for these products in the United Kingdom?


Gordon Minto Churchill: No preliminary discussions were held with the United Kingdom with regard to that. The present trade mission, as I have pointed out, is interested primarily in getting British exports to Canada. We have, in conversations with some of the people we have met, indicated the extent of the decline	in	trade between	our	two
countries, and how that has affected our agricultural producers.


Andrew Wesley Stuart: I should like to direct another question to the Minister of Trade and Commerce. How many textile manufacturers were contacted by the Canadian trade mission in London?


Gordon Minto Churchill: I regret that I cannot answer that question because I have not the information available.

Beef Cattle-Exports


Mr. D. F. Brown (Essex Wesl):: Mr. Speaker, I would like to direct a question to the Minister of Trade and Commerce. Could he tell us if his trade mission to Great Britain has visited automobile factories in the United Kingdom with a view to making purchases of more automobiles, and if so with what result?


Gordon Minto Churchill: Mr. Speaker, the trade mission is visiting a whole series of factories in England, some of which may be automobile factories. I do not know of any arrangements with the United Kingdom with regard to the purchase of British automobiles-


An hon. Member:: Could we have a yes or no answer?


Gordon Minto Churchill: Ask a simple question and you will get a simple answer-


Donald Ferguson Brown: I think I have asked a simple question.


Gordon Minto Churchill: I am not suggesting that the question of the hon. member is not a simple one. I was directing my remarks to some of his friends opposite.
[Later:}


Donald Ferguson Brown: Mr. Speaker, may I ask a supplementary question of the Minister of Trade and Commerce. Since the purpose of the trade mission was to increase purchases from the United Kingdom, would he tell us now whether in visiting the automobile plants it was the intention to increase purchases of automobiles from the United Kingdom?


Gordon Minto Churchill: Each member of the trade mission had an opportunity to visit the plants for which visits had been arranged by the committee in charge, and also any other plants to which he might like to pay a visit. As to what those individual members of the trade mission do, as to whether or not they place orders, is entirely up to them. This mission was sponsored by the government with the approval of the entire House of Commons for the express purpose I outlined earlier today, but individuals on that mission are free to place orders or not as they see fit.



BEEF CATTLE-STATEMENT ON EXPORTS TO THE UNITED STATES

Hon. D. S. Harkness (Minister of Agriculture):: Mr. Speaker, I wish to make a statement in connection with exports of beef cattle from Canada to the United States, as this is a matter of considerable concern and uncertainty at the moment.
During the past few days there have been conflicting reports as to the status of the last

quarterly quota on cattle weighing over 700 pounds entering the United States, with news reports to the effect that United States customs were collecting additional duty on cattle over 700 pounds. The latest information available is that, as of November 23, 93,200 head of cattle over 700 pounds from all countries have entered the United States during the last quarter of the year, which would leave a balance of 26,800 head to fill the quota of 120,000 head permitted under the quarterly global quota. Actual exports of cattle weighing over 700 pounds from Canada to the United States for the last quarter are not available, but the exports approximate
79.000,	with Mexican imports approximating
14.000.
We are advised that United States customs officers have not been instructed to and are not as yet collecting extra duty, but they have been instructed to date stamp all invoices in view of the fact that the quarterly quota is approaching completion.
Notwithstanding the fact that United States customs collectors are not actually as yet collecting extra duty, there is reason to believe that certain United States customs brokers handling shipments of Canadian cattle are collecting extra duty as a protection to themselves. This is probably the basis for the news reports that additional duty is being collected. It is customary for the United States customs officers to start collecting duty when the cattle quota for those over 700 pounds is approaching completion. Any duty collected by either the United States customs officers or brokers on cattle which eventually prove to be within the quota will be refunded.


Right Hon. J. G. Gardiner (Melville):: May
I ask a question in regard to cattle shipments. As I recall the total number allowed under the arrangement made at GATT it was about 400,000 for the whole year, with
120,000	each quarter up to a certain number. Are there any other figures with regard to the total number down to the present time?


Douglas Scott Harkness: Mr. Speaker, I can readily get those figures but most of the exports of cattle to the United States, as far as beef cattle are concerned, have taken place during the last quarter. The exports, I think, up to the last quarter were only in the neighbourhood of something under 5,000 head.
[Later:}
On the orders of the day:


Edward George McCullough: Mr. Speaker, I should like to address a question to the Minister of Agriculture arising out of his statement to the house with respect to the news in the papers that there will be

an increase in the customs tax on cattle over 700 pounds going to the United States. Can the minister say whether or not the quota for the export of Canadian cattle to the United States has now been reached? Further, in view of the imbalance of trade with the United States, will the minister say if he will try to get the United States authorities to increase the permitted quota of Canadian cattle to the United States in the fiscal year?


Douglas Scott Harkness: Mr. Speaker, I dealt with that matter fully in the statement I made half or three-quarters of an hour ago, and if the hon. member was not in the house at that time he will find the answers to his questions in that statement.


Edward George McCullough: I was in the house at the time and I listened very carefully to what the minister said. As I recall it, he did not make any statement as to the number of cattle going to the United States, or as to whether or not the government has given any consideration to asking the United States government to increase the quota of Canadian cattle permitted under this agreement.


Douglas Scott Harkness: Mr. Speaker, I gave in the statement the number of cattle which had gone to the United States so far this year and the amount of the quota which was still open for the balance of this quarter. As far as the latter part of the question is concerned, we have not approached the United States to ask for an increase in the quota. As a matter of fact we have not come anywhere close to filling the quota for several years past. Therefore there would be no reason, I would think, in going at the present time to ask that the quota be increased.



REQUEST FOR REPORT ON MISSION TO COMMUNIST CHINA

[Stage Direction]
On the orders of the day:
Mr. H. A. Bryson (Humboldl-Melforl):: Mr. Speaker, I should like to direct a question to the Minister of Trade and Commerce. Now that the trade mission which was dispatched to China has completed its work, is the minister in a position to advise the house regarding trade possibilities with that country?


Gordon Minto Churchill: The visit of a trade commissioner hardly constitutes a trade mission. I have not yet received a report from him on his return.


Hugh Alexander Bryson: Will the minister make a statement to the house as soon as that report is received, as he suggested he would do some time ago?
Inquiries of the Ministry



UNITED STATES


[Stage Direction]
On the orders of the day:
Hazen Robert Argue: Mr. Speaker, I would like to direct a question to the Minister of Finance. My question arises out of a news service report that the United States cabinet has approved a proposal to be presented to congress asking for an additional $1,500 billion for its surplus disposal program in the coming year.
Would the minister care to comment on this disturbing report, and does he feel the United States government is keeping faith with any understanding that was achieved when he recently met members of the United States cabinet?


Hon. Donald M. Fleming (Minister of Finance):: The hon. member was good enough to send me notice of his question, but it reached me about two minutes before I entered the house. I have not seen the report, but we will look into it and advise the hon. member as to the results of our inquiries.



FURTHER STATEMENT AS TO IMPORTS FROM JAPAN

[Stage Direction]
On the orders of the day:
Hon. J. A. MacLean (Minister of Fisheries):: On Friday last, November 29, the hon. member for New Westminster asked if I had received a letter from the united fishermen and allied workers' union concerning the importation of Japanese canned salmon. I replied at that time that I had, but to clarify the situation I think I should add to the brief answer I gave at that time.
The 1956 and 1957 salmon catches in British Columbia failed to produce sufficient supplies of certain species of salmon to fill the requirements of the Canadian market. The Canadian consumption of canned sock-eye salmon has been running in the vicinity of 300,000 cases annually. In the sockeye season just ended only about 225,000 cases were packed, as compared with the average of 440,000 cases for the preceding five years.
The small catches in 1956 and 1957 were due principally to the failure of the runs of salmon to a number of the major producing areas, particularly in the north. Prior to the 1956 salmon fishing season in British Columbia it was known that one of the major river systems would not be a large producer. Hence in the fall of 1955 it was anticipated that there would be a shortage of canned Canadian sockeye salmon from the 1956 season.
In anticipation of the short packs of sockeye and pink salmon in 1956 and the short pack in 1957 of sockeye, the industry considered

Inquiries of the Ministry that it was most desirable to share the available Canadian canned salmon pack with buyers in the United Kingdom, which market has been a traditional one for Canadian canned salmon and is an important one to retain. The maintenance of the British market for Canadian canned salmon is important for both the fishermen and the operating companies of British Columbia.
Because of this situation it was necessary for the processing companies to supplement the stocks of canned salmon for the Canadian market by importing some species of canned salmon from Japan. This has resulted in the appearance of Japanese canned salmon in Canadian food stores, and has no doubt puzzled some consumers who have always looked upon canned salmon as an exclusively Canadian product. In view of the short supplies in 1956 and 1957 of some species of Canadian canned salmon, chiefly sockeye, it would seem to be good business to make available to the consumer a continuous supply of canned salmon, and this was done by importing high quality canned salmon from the only available source of supply, Japan.
When it was foreseen that there would be a short supply of Canadian canned salmon in the 1956 pack year, processing companies consulted with and advised the united fishermen and allied workers' union of their intention to bring in some supplies of the canned product from Japan. The union at that time concurred in the proposal of the companies. Approximately 165,000 cases of sockeye salmon were imported from Japan in 1956, and in the same year about 40,000 cases of pinks and approximately 40,000 cases of cohoe. The figures I have quoted are for full cases of 48 pounds.
In view of the small Canadian pack of sockeye salmon in 1957 it is understood the processing companies expect to import from Japan, but only sufficient quantities of canned sockeye salmon which will meet the requirements of the domestic market until the new Canadian pack of 1958 is available. The canned salmon industry of British Columbia is confident that the current shortage of sockeye salmon is only temporary, and that in 1958 ample supplies of Canadian production will again be available.
In the meantime, however, it is felt to be important that the market demand for sockeye salmon be satisfied, and that the competitive position of sockeye salmon with other foods be protected. I consider it fortunate that this supply shortage of canned salmon can be filled from Japan, an important buyer of such Canadian products as wheat, pulp, iron ore and other raw materials. It is fortunate too that the temporary shortage of Canadian

canned salmon is chiefly confined to the sockeye species. The industry feels that sufficient supplies of Canadian produced cohoe, pinks and chums will be available to the Canadian consumer.
It is important to emphasize that all canned salmon entering Canada must be inspected for quality and high standard under the regulations for the inspection of canned salmon of the Canadian Meat and Canned Foods Act. The same rigid inspection is given to imported canned salmon as to the Canadian product. This inspection is carried out by the inspection service of the Department of Fisheries at its Vancouver laboratory.
In addition to the Canadian government inspection regulations, I am informed that the major importing companies send their own personnel to Japan to inspect very thoroughly all parcels of Japanese canned salmon which they expect to purchase. Thus it can be said that the Japanese canned salmon product undergoes very careful and thorough examination for quality, first by the purchasing companies and then by the Department of Fisheries, before the product is offered for sale in Canada.
With respect to price, I am informed that the basic price of sockeye salmon in Japan, plus freight and 15 per cent duty, plus labelling and selling costs, is so close to the current Canadian market price that there is little or no margin of profit for the Canadian importer.


Donald Ferguson Brown: Mr. Speaker, might I direct a question to the Minister of Trade and Commerce?


Mr. Irwin:: I have a supplementary question, Mr. Speaker.


Mr. Speaker:: Would the hon. member for Essex West defer his question?


Donald Ferguson Brown: Yes.


Thomas James Irwin: Will the minister tell us whether he is doing anything about the use of Canadian labels on Japanese products?


John Angus MacLean: Mr. Speaker, the hon. member for Fraser Valley (Mr. Patterson) asked a supplementary question in the same regard on Friday last and I said I would answer him fully today. In connection with the question asked on the matter of imported Japanese canned salmon, may I say this.
The matter of using brand labels on canned salmon from Japan was a decision of the companies importing the product. There are no Canadian regulations against the use of such brand labels on imported canned salmon. It would appear obvious that the companies made the decision on the basis that they had spent, over many years, large sums of money

in advertising their brand labels, and being satisfied with the quality of the imported product, not to have used the established labels would have meant the loss of then-advertising and sales promotion campaigns of many years. The practice of using established brand labels on imported canned fish products, where quality is assured, is a common one. The labels mentioned by the hon. member for Fraser Valley are also used on imported canned fish products from other countries, such as shrimps from the United States, sardines from Norway and many other fish imports.
As to the size of the lettering on the labels, "Product of Japan", this condition is governed by section 26 of the Meat and Canned Foods Act. The key words in section 26 are that these words should be printed in a "plain and conspicuous" manner. I might point out for the benefit of hon. members that in the case of meat products there are no specific requirements by the Department of Agriculture with respect to the height or size of labelling on importations of canned meats. In other words, the regulations concerning country of origin are identical for canned fish products and canned meat products.
As far as the labelling of imported Japanese canned salmon is concerned, I am satisfied that there have been no attempts to deceive the Canadian consumer in so far as tne designation of the country of origin is concerned. In one or two instances where the Department of Fisheries considered the words "Product of Japan" were not sufficiently conspicuous on the label, this condition has been corrected by the importing companies willingly and without delay.
I might add that all the canned salmon imported from Japan has not been brought into Canada by British Columbia canning companies. In quite a number of cases imports have been made by brokers in Montreal and other centres.


Mr. Winch:: When?


John Angus MacLean: Over the last three years.


Harold Edward Winch: Are you saying that in this last year any imports have been brought in by a broker from Japan?


John Angus MacLean: No; in the previous two years, 1956 and 1955.


Harold Edward Winch: Only the big three in British Columbia can import from Japan on British Columbia labels.


Some hon. Members:: Order.


Harold Edward Winch: Answer that one.


John Angus MacLean: There are five companies, actually, which are importing salmon from
Inquiries of the Ministry Japan, and there is no restriction on any person bringing in salmon from Japan provided they pay the duty and meet the regulations.


Harold Edward Winch: Is my hon. friend saying-


Some hon. Members:: Order.


Mr. Speaker:: Would the hon. member allow the minister to finish his statement?


Harold Edward Winch: That is not correct, and I know it is not correct.


Mr. Speaker:: Order.


John Angus MacLean: In quite a number of cases-


Harold Edward Winch: Mr. Speaker, may I ask a question of the minister?


Mr. Speaker:: No. The hon. member will please keep his seat until the minister has finished his statement.


John Angus MacLean: These companies concerned, Mr. Speaker, I am sure jealously guard the quality of the canned fish products which they are selling under their own brand labels. These same companies, I am most confident, have a long-term interest in the salmon fishing and processing industry of British Columbia.


Hon. L. B. Pearson (Algoma East):: I should like to ask a supplementary question, Mr. Speaker. Will the minister be good enough to inform the house when the rest of his estimates will be coming up for consideration?


John Angus MacLean: This is not a question of estimates, Mr. Speaker. They are two matters about which questions have been asked and about which a great deal of misunderstanding has grown up. I therefore thought I should ask the indulgence of the house at this time to put the matter straight.


Mr. Speaker:: I did not intend to deny the floor to the hon. member for Vancouver East; if he has a question to ask he may do so now.


Harold Edward Winch: I should like to ask the minister if he can give information to this house to the effect that the importation of salmon from Japan in the last 18 months could only have been done in the name of the big three of British Columbia, who have an arrangement with the big two in Japan? I have given information to the department of the Minister of Justice (Mr. Fulton) and it has not been disproved. Will the Minister of Fisheries deny that statement?


John Angus MacLean: It is not my intention, Mr. Speaker, to go into commercial transactions which may take place between people who are engaged in the salmon importing business, but I can assure my hon. friend that salmon has been imported into this country by

Inquiries of the Ministry brokers who are not connected with the processing of salmon in both 1955 and 1956.


Mr. Sinclair:: In Vancouver and Montreal.


Frederick George Hahn: It
has been drawn to my attention that while the minister has been answering questions respecting the contents of the can and the label on the can, it is actually labelled "c-a-n", which would indicate to any housewife that it was a can-


James Sinclair: Just a can.


Frederick George Hahn: I am fully aware that it is a can but the minister was asked about the contents.


Some hon. Members:: It was just a can.



AUSTRALIA


[Stage Direction]
On the orders of the day:
Mr. Louis Lewry (Moose Jaw-Lake Centre):: Mr. Speaker, I would like to direct a question to the Minister of Trade and Commerce, to inquire whether his department has yet started negotiations with Australia for the sale of Canadian wheat to that country.


Gordon Minto Churchill: If Australia wishes to buy Canadian wheat, we are prepared to sell.



AGRICULTURE


Douglas Scott Harkness: I wish to announce that the agricultural prices support board has been authorized to continue to support the price of fowl to March 31, 1958, at 23 cents per pound at Toronto, live weight basis, for No. 1 fowl 5 pounds and over, or in other words the same basis that has been in effect since July of this year.



NATIONAL DEFENCE


[Stage Direction]
On the orders of the day:
Mr. M. J. Coldwell (Roselown-Biggar):: would like to address a question to the Minister of National Defence. Will the minister table a new white paper on defence before the defence estimates come before us later this week, as has been the usual practice, or does he intend to base the debate on the white paper that was presented by the previous government?


Hon. G. R. Pearkes (Minister of National Defence):: On the white paper as presented earlier this year. It is not the intention to present a new white paper before my estimates.


Major James William Coldwell: That is to say, the one presented by the former government?


George Randolph Pearkes: That is correct.



CHURCHILL


[Stage Direction]
On the orders of the day:
George Randolph Pearkes: Mr. Speaker, on Thursday last the hon. member for Springfield asked whether the Minister of National Defence was aware of a reported shortage of electrical power in the town of Churchill. He then added the erroneous information "which is now supplied by his department". The Department of National Defence does not supply any electrical power to the town of Churchill, nor has it facilities for so doing.



NORTHERN AFFAIRS


[Stage Direction]
On the orders of the day:
Hon. Jean Lesage (Montmagny-L'Islel):: would like to address a question to the Minister of Northern Affairs and National Resources.
According to a news item in the newspaper Le Devoir this morning, seven missionaries are in distress in the Arctic because the supplies that were shipped to them did not reach them at their stations at Repulse Bay, Pelly Bay and Igloolik. What action does the minister intend to take, if any, to see that supplies do reach them for the winter?


Hon. Alvin Hamilton (Minisler of Northern Affairs and National Resources):: Mr. Speaker, I will take this question as notice. This is the first time it has come to my attention.



COLUMBIA RIVER


[Stage Direction]
On the orders of the day:
Jean Lesage: Mr. Speaker, I have another question to direct to the minister of northern affairs, of which I gave him notice. Has he now received the final report of the British Columbia Engineering Company regarding the possibility of a diversion of the waters of the Columbia to the Fraser river? Also, has he now received the final report of the Montreal Engineering

Inquiries of the Ministry Company Limited regarding the possibilities referred, and if so is his refusal to table this of developing the water resources of the document at this time based on some under-Columbia basin by integrating the program standing with the government of that with that of the United States?	province?


Francis Alvin George Hamilton: I should like to thank the hon. member for Montmagny-L'lslet for having given me notice of this question. The answer to the first question is yes, on January 9, 1957.
The answer to the second question is as follows. A report by Montreal Engineering entitled "The Development of Canada's Water Power Resources in the Columbia River Basin", which examines several alternative developments, was received by the department yesterday, December 2, 1957.


Jean Lesage: Is it the intention of the minister to table these two reports?


Francis Alvin George Hamilton: I would suggest, Mr. Speaker, that we would like to examine them first and decide then.


Jean Lesage: If the report in the first case was received on January 9, 1957, I am sure the report has now been examined. Is it the intention of the minister to table the British Columbia Engineering Company report.


Douglas Scott Harkness: Why didn't you table it?


Jean Lesage: I was not asked for it.


Francis Alvin George Hamilton: Mr. Speaker, I think it is very important that we get the answer of the Minister of Northern Affairs and National Resources on the record. I suggest the hon. member knows there are very good reasons why we are unable to table reports of such a nature dealing with such a matter until such time as things have progressed to a greater extent than they have today.


Jean Lesage: I am sorry that I have to ask another question, but I should like to know what the minister means when he says "until things have progressed more than they have up to now". What has the minister done to see that they do progress?


Francis Alvin George Hamilton: Mr. Speaker, I have made it very clear that when we have information to report to this house it will be given.


Mr. T. S. Barnett (Comox-Alberni):: I should like to direct a question to the Minister of Northern Affairs and National Resources related to the question asked him earlier by the hon. member for Montmagny-L'Islet. Could the minister tell the house whether the government of British Columbia also has copies of the engineering report to which he 96698-113


Mr. Speaker:: Order. Before that question is dealt with I think I should give my view that it is not the sort of question that should be asked in this house, because it relates to something that could only be answered by the government of British Columbia. I would therefore suggest to the hon. member that the question is not in order.


Thomas Speakman Barnett: I wonder, with deference, if I might make reference to my reason for presenting this question to the minister. My understanding is that in relation to this matter connected with the Columbia river there is in effect an agreement between the governments of Canada and British Columbia, and in that connection I understand there has been in the past some arrangement for the exchange of these documents. I was going on the assumption that this document might come within the purview of the agreement, and it was for clarification of that point that I had in mind in presenting this question.


Mr. Speaker:: I do not think that alters my view. The question has been asked of the minister as to whether his government has received a copy, and he has dealt with that. Now we are asking if the British Columbia government has received a copy, and it seems to me that is not a question which should be asked.


Jean Lesage: May I, with deference, speak to this point? I believe what the hon. member asked was this: "Has the Department of Northern Affairs and National Resources forwarded copies of these reports to the government of British Columbia?"


Mr. Speaker:: If that had been the question I would have allowed it, because it would have been a question as to this government's action. The question was whether the hon. member could be informed whether the British Columbia government had received it. The hon. member may want to modify his question, but as it is it is out of order.


Mr. H. W. Herridge (Kootenay West):: have had a supplementary question, Mr. Speaker, which I would now like to direct to the Minister of Northern Affairs and National Resources. My question is a result of his reply to the hon. member for Mont-magny-L'Islet, who asked a question concerning the development of the Columbia

Inquiries of the Ministry river. There is a feeling in British Columbia that the government has reached a state of inertia with regard to the Columbia.
Would the minister please answer this question. Have there been any negotiations undertaken between representatives of Canada and the United States, or are negotiations now being undertaken between the representatives of Canada and the United States, with respect to the development of the Columbia, the settlement of downstream benefits, and things of that sort?


Francis Alvin George Hamilton: Mr. Speaker, on a number of occasions in this house I have tried to get this question on a plane where we could handle this matter in our own way-


Some hon. Members:: Oh, oh.


Francis Alvin George Hamilton: I know how anxious the house and all Canadians are to receive information on this matter, because this is one thing that is of very great importance to all the people of Canada. I can assure this house that we have moved as quickly and with as much urgency as we know how; and the way we are going at it will, I am sure, in the final analysis be measured in the results we have achieved; just as in the case of the results we have achieved in the maritimes and, I hope, Saskatchewan.


Jean Lesage: This was done before you came in.


An hon. Member:: Just sitting down doing nothing.


Francis Alvin George Hamilton: I think the Columbia will be judged in the same way.


Jean Lesage: May I ask a supplementary question. Since the meetings in Washington on May 20, have the documents which were supposed to be prepared both in Washington and in Ottawa been exchanged between the two governments with respect to the Columbia development and downstream benefits generally?


Francis Alvin George Hamilton: Mr. Speaker, the answer to that question is, to my knowledge, no.


Jean Lesage: Has the Canadian government prepared the documents it was supposed to prepare and to exchange with the United States authorities? If not, what is the reason for the delay?


Hon. Howard C. Green (Minister of Public Works):: The hon. member for Okanagan-Revelstoke (Mr. McLeod) some days ago asked the Prime Minister the following question:
Is the present Canadian ambassador to the United States continuing the efforts of his predecessor to


have the question of downstream benefits on international rivers considered a top priority problem for settlement with the United States? Could we have an up to date report on the progress, if any, that has been made?
I have an answer here which I was prepared to make today for the Prime Minister in the following words. I am sure my hon. friend will understand that in such matters it is inappropriate to endeavour to state publicly just what the current degree of progress is. However, I may say that the government has given the matter of the Columbia river a high priority, and a good deal of time is being devoted to the examination of all facets of this complex problem. In particular, recent developments in British Columbia and further information on the engineering aspects of the question have introduced new elements for consideration.
The hon. member for Montmagny-L'Islet will remember that earlier this afternoon the Minister of Northern Affairs and National Resources pointed out that the final report from Montreal Engineering had been received only yesterday. Now there are many different factors to be considered, and these are all being dealt with as quickly as possible by the government. But I suggest to him, and 1 am sure he will agree, that it would be very unwise to have an interim statement made in the house where there is the necessity for the completion of negotiations with another country.


Jean Lesage: I am sorry, Mr. Speaker, but the Minister of Public Works himself when he was on this side of the house-


Some hon. Members:: Question.


Jean Lesage: -was the one to press the other side on that subject-


Some hon. Members:: Question.


Jean Lesage: -and to insist on obtaining answers to his questions. My question to the Minister of Northern Affairs and National Resources was a very simple one, and I have not been answered.
1 Later:l


Major James William Coldwell: Mr. Speaker, my supplementary question to the Minister of Northern Affairs and National Resources is a very simple one, which was originally asked by the hon. member for Kootenay West (Mr. Herridge). Are negotiations proceeding between Canada and the United States regarding the Columbia river basin? That is all.


Howard Charles Green: I can answer that question-


Some hon. Members:: Oh, oh.


Howard Charles Green: I have already dealt with the question in the statement which I read for the Prime Minister. Negotiations have not been suspended at all.


Jean Lesage: But nothing has been done.


Major James William Coldwell: But I understand there has been no exchange of documents.


Howard Charles Green: No which?


Major James William Coldwell: It takes three ministers to answer a simple question?


Howard Charles Green: These negotiations with respect to this question have not yet been completed, but they will be completed at the earliest possible time.


Jean Lesage: They have not been continued, you mean.



PRIVILEGE


[Stage Direction]
On the orders of the day:
Mr. William Anderson (Waterloo South):: Mr. Speaker, I rise on a question of privilege. As a new member in this house I have not made my maiden speech as yet, but I have been a regular attendant and very interested in following the procedure. After 16 years of municipal experience, including four years as mayor of the city of Galt, I felt I did not want to waste the time of this house simply to get my name in Hansard until I had something very definite to contribute.
I want to point out that in all my public service I have been very active and regular in my attendance. Now I am coming to the point. It was, therefore, a big surprise when I read in my local paper that while on a speaking engagement in Waterloo South on Thursday, November 28, addressing a Liberal association in the riding of Waterloo South, the hon. member for Bonavista-Twillingate (Mr. Pickersgill) made a statement to this public meeting at Galt that so far in the session he had not noticed me in this house, and that he did not think anyone else had noticed me either.


Some hon. Members:: Shame.


Donald Methuen Fleming: A contemptible personal
remark.


William Anderson: He also stated that in former years they had always known when a contemporary of his was in the house.


Mr. Pickersgill:: That is perfectly true.


William Anderson: Had this order been reversed the statement would be more correct. Coming from a former cabinet minister a statement of that kind is of the lowest order, and
96698-113J
Inquiries of the Ministry would imply that I had not been in attendance. I simply want to make this short statement to bring to the attention of my constituents the fact that I have been a regular attendant at all the sittings here.


An hon. Member:: Is this your maiden speech?


William Anderson: Although the hon. gentleman opposite has not noticed me as yet I feel that he may very well do so in the future, as I intend to get my feet under the table before I sound off; and it is my intention to serve all the citizens in my riding to the best of my ability.


John Whitney Pickersgill: Mr. Speaker, I apologize to the hon. member for not having noticed him. I will not make the same mistake again.


Mr. Gauthier (Portneuf):: You are on the
record now. You are all right.



POST OFFICE DEPARTMENT


[Stage Direction]
On the orders of the day:
Herbert Wilfred Herridge: Mr. Speaker, in view of the minister's previous insistence on the practice of exactitude, rectitude and promptitude by the Post Office Department, I want to address a question to the Postmaster General. Does the minister know that it has recently been the practice of the haberdashery branch of his department to issue the postmen summer clothing just prior to the coming of winter? Can the minister assure the house that he will take action to correct this Rip Van Winkle approach to life and the seasons on the part of the branch concerned?


Hon. W. M. Hamilton (Postmaster General):: Mr. Speaker, I thank the hon. member for giving me notice of all except the first sentence of his question, and dealing with that first sentence I want to say that I am all in favour of exactitude, rectitude and pulchritude as well.


James Sinclair: We know that.


William McLean Hamilton: Both my officials and I are aware of this situation, which is a serious one-which was a serious one-across Canada throughout the past summer. It arose because the previous government-


Some hon. Members:: Oh, oh.


William McLean Hamilton: -awarded the contract for this clothing to a contractor who had already demonstrated

Inquiries of the Ministry unsatisfactory performance but who apparently had a special attraction for them, before this government took office.


Mr. Marler:: What does the hon. gentleman mean by that?


William McLean Hamilton: In
view of discussions I have had with my very able officials, Mr. Speaker, I do not anticipate that this situation will arise again, particularly-


James Sinclair: Not until next Christmas.


William McLean Hamilton: -because there are no Rip Van Winkle characteristics about the new government.



FINANCE


[Stage Direction]
On the orders of the day:
Mr. Stanley Knowles (Winnipeg North Centre):: Mr. Speaker, may I direct a question to the Acting Prime Minister. Is the government aware of the statement that was made over the C.B.C. this morning by Mr. John Maclean of the Financial Post that it looks as though there has been a cabinet leak. He also said this always gives the Prime Minister the twitches. Can the Acting Prime Minister say whether the government has run down this and other reports to the effect that there has been a cabinet leak concerning an excise tax change?


Howard Charles Green: Mr. Speaker, the Minister of Finance will answer that question.


An hon. Member:: Who is the Acting Prime Minister?


Donald Methuen Fleming: Mr. Speaker, I received at my
office just a short time ago a telephone message from Mr. Maclean, and I gather that the substance of his telephone call relates to the matter referred to by my hon. friend. Apparently Mr. Maclean made something of a broadcast this morning in which he made reference to a statement appearing in an address I delivered yesterday relating to the October figures for the consumer price index in Canada-


James Sinclair: When does parliament get those figures?


Donald Methuen Fleming: -and suggested these might have been advance figures. The message from Mr. Maclean indicated that on looking into the matter he found and now fully realized that these figures had been made public several weeks ago, that I had referred to them in the house already on several

earlier occasions, and that his remarks suggesting that there had been some leak in this respect were entirely without foundation.
ILater:]


Stanley Howard Knowles: Mr. Speaker, may I ask a supplementary question, either of the Prime Minister or the Minister of Finance, arising from the fact that the Minister of Finance must have misunderstood my previous question. I asked about what Mr. John Maclean said over the C.B.C. this morning. My reference was not to the premature release of D.B.S. statistics, but to Mr. Maclean's reference to the fact that it appeared as though there had been a cabinet leak regarding excise tax changes. My question was, has the government run down this and other reports concerning a cabinet leak in that field?


Donald Methuen Fleming: I thank my hon. friend for his clarification. He will understand that I did not hear the broadcast in question and I did not have a copy of the script, but simply went by a message that reached my office. If he is referring to an alleged leak in relation to the matter of excise tax, let me assure him and the house that there was no such thing as a leak from any cabinet source, from the Department of Finance or any government official. What he refers to is pure and simple newspaper speculation.


Stanley Howard Knowles: Has
the government ascertained where the newspapers got the basis for that speculation?


Mr. Speaker:: I think that clearly goes too far. How can the government be expected to know where the newspapers get their information?



BRIDGES


[Stage Direction]
On the orders of the day:
Mr. Alexis Caron (Hull):: Mr. Speaker, in the absence of the Prime Minister may I direct a question to the leader of the house. Last week the mayors of Hull and Ottawa sent telegrams to the Prime Minister and the premiers of Ontario and Quebec relating to the construction of a badly needed bridge over the Ottawa river east of the present Alexandra bridge. Can the minister tell us if the question has been discussed with the premiers of Quebec and Ontario?


Howard Charles Green: Mr. Speaker, if I remember correctly the Prime Minister dealt with this question some days ago. It is my understand-

ing that a new bridge could only be built by agreement among the different parties concerned.


Alexis Pierre Caron: Is it the intention of the government to take up the matter of the building of such a bridge with the premiers of Ontario and Quebec in the near future?


Howard Charles Green: This would be an interprovincial bridge and, as I pointed out a moment ago, if a new bridge is to be built it would have to be by the three governments co-operating, namely the federal government and the two provincial governments. I think the federal government throughout has taken the position that it is willing to co-operate.


Alexis Pierre Caron: That does not answer my question. I want to know if it is the intention of the government to discuss the matter with the premiers of Quebec and Ontario.


Mr. Speaker:: I think the hon. member has had an answer to his question. He has had two attempts to clarify it, and it seems to me that is sufficient.



LABOUR CONDITIONS


[Stage Direction]
On the orders of the day:
Donald Ferguson Brown: I should like to address a question to the Prime Minister, but in his absence perhaps his parliamentary assistant could take it as notice. Has the Prime Minister received a letter from the city clerk of Windsor, acting on behalf of the metropolitan committee composed of mayors and reeves of Windsor, Riverside, Tecumseh, Lasalle, Sandwich East township, Sandwich West township, Sandwich South township, St. Clair Beach and Ojibway, dated November 22, requesting an appointment to meet with him and the Minister of National Health and Welfare and the Minister of Public Works?
Since the Prime Minister is not present perhaps I might be permitted to ask an additional question. Was the Prime Minister advised of my telephone request of November 28 to his secretary attempting to arrange such an interview? Also-


Some hon. Members:: Order.


Donald Ferguson Brown: -has the Prime Minister had drawn to his attention my letter to him dated November 28, requesting such an interview by the committee? If so, would he kindly indicate when he may meet with this committee?


Howard Charles Green: Mr. Speaker, I do not know whether I am supposed to answer that question as parliamentary assistant to the Prime Minister,
Inquiries of the Ministry as Minister of Public Works or in what capacity, but I understand that the answer has gone out and it has been suggested that the delegation should meet the Prime Minister next Wednesday.



AIRPORTS


[Stage Direction]
On the orders of the day:
Mr. D. M. Fisher (Port Arthur):: I would like to direct a question to the Minister of Transport. What steps has your department taken to provide emergency facilities at the lakehead airport following the disastrous fire of last Friday?


Hon. George H. Hees (Minister of Transport):: I would like to thank the hon. member for his courtesy in advising me of his intention to ask this question and I would also like to thank the hon. member for Fort William (Mr. Mclvor) for having advised me of his intention to ask a similar question.
This fire destroyed power and communications facilities, and interrupted the operation of the control tower. Immediately after the fire an emergency team from the departmental district headquarters in Winnipeg proceeded over the week end to the lake-head and have since, I believe, been successful in restoring communications and power on a temporary basis. They are also exploring the possibility of restoration of control tower services on a temporary basis. Permanent reconstruction of the necessary facilities will, of course, be proceeded with as soon as possible.


Daniel (Dan) McIvor: A supplementary question, Mr. Speaker. Whereas the airfield outside Fort William is the first government baby which the former minister of trade and commerce planted in Fort William, and whereas it is our duty to see it is properly protected and nourished, I ask the minister if he has received any request from any source that the field be removed further west of Fort William. I thank him for his courtesy.


George Harris Hees: Mr. Speaker, I have had no such request.



PIPE LINES


[Stage Direction]
On the orders of the day:
George Harris Hees: Mr. Speaker, on Friday last the hon. member for Moose Jaw-Lake Centre

Inquiries of the Ministry (Mr. Lewry) asked if I could obtain the pressure rate being applied during a test of the Trans-Canada pipe line prior to the break which occurred near Mortlach on November 3, in view of the statement that the pipe was designed for	a	working	pressure	of	826
pounds.
The board of transport commissioners advise me that the answer is 852 pounds per square inch. I might add that this portion of the Trans-Canada pipe line, which is designed for	a	working	pressure	of	826
pounds, must be tested at a pressure of 910 pounds per square inch before the company is authorized by the board to operate the pipe line.
The board state that the pressure had been raised to 910 pounds in the section of pipe between valve 9 and valve 12, and it was when the pressure was being equalized in the sections between valves 9 and 12 and valves 12 and 13 that the break occurred when the pressure in the portion between valves 12 and 13 reached 852 pounds.



POSTAL SERVICE


[Stage Direction]
On the orders of the day:
Mr. Stanley Haidasz (Trinity):: Mr. Speaker, I should like to ask the Postmaster General whether he is aware that it costs more to send a 20-pound parcel direct to England than it would cost to send a similar parcel direct to Germany; and, if so, what steps has he taken to rectify this unjust discrepancy?


William McLean Hamilton: Mr. Speaker, I will be very glad to look into the matter and give an answer to the hon. member, perhaps by correspondence, as this question might very well have been put on the order paper. However, I might point out to him that this is a matter which would, I should think, come within the purview of the international postal union and not within the purview of any individual government.



PUBLIC WORKS


[Stage Direction]
On the orders of the day:
Mr. H. J. Murphy (Westmorland):: Mr. Speaker, I should like to direct a question to the Minister of Transport. In view of a news report in the Charlottetown Guardian of November 30 that the minister had stated he was particularly interested in making the

Prince Edward Island causeway a toll road, will he tell the house what progress is being made on this project?


George Harris Hees: I am very glad to advise the hon. member and the house that I have never made any such statement.



BUSINESS OF THE HOUSE


[Stage Direction]
On the orders of the day:
Stanley Howard Knowles: Mr. Speaker, may I direct a question to the Minister of Finance arising out of the statement regarding the business of the house which was made yesterday by the Prime Minister. I refer in particular to the statement of the Prime Minister when he said that in so far as changes in income tax are concerned, those changes could be made by notice. Does this statement of the Prime Minister, coupled with the statement that there will not be a formal budget at this session, mean that any tax changes to be made by the government will be made merely by means of government notice, without any moving of the motion or any debate this session.


Donald Methuen Fleming: If I accurately apprehend the hon. member's question, I would say that he has not grasped the purport of the Prime Minister's remarks.


Stanley Howard Knowles: Then would the Minister of Finance explain what the Prime Minister meant by his statement yesterday?


Donald Methuen Fleming: Mr. Speaker, I think it will be simpler if I told the hon. member and the house that I hope the estimates of the Department of Finance will be before the house before the end of this week, and at that time I will be glad to deal fully with all these matters.


Stanley Howard Knowles: Can
the Minister of Finance not say what the Prime Minister meant yesterday; whether at this session there will be notices of motions regarding tax changes, and if so will those motions be moved at this session?


Donald Methuen Fleming: Mr. Speaker, I think the hon. member will have a full and complete answer to his question if he will just wait a day or two until the estimates of the Department of Finance are before the house, because at that time I propose to deal with all subjects relating to the government's financial policy so far as they arise this session.


Stanley Howard Knowles: supplementary question, Mr. Speaker. May I ask the Minister of Finance whether, when he speaks to his estimates, he will be giving us what will amount to a balance sheet or a budget statement indicating the state of the finances of the country at the present time.


Donald Methuen Fleming: It is a question of degree, I should think. I do not think that at the stage we have reached of this short session it would be expected that I should enter upon a detailed review of the whole economy of the country, as is normally done by a minister of finance during a budget speech, when he points up the highlights of the lengthy white paper it is customary to table.
However, I would assure the house that I have expected at all times-and I shall be happy to do this, since the house will expect it of me-to give a statement of the balance of ways and means to indicate precisely where we stand financially, as the hon. member is asking.



REPORTED PRESENCE IN CANADA OF RUSSIAN TRADE MISSION

[Stage Direction]
On the orders of the day:
Edward George McCullough: Mr. Speaker, may I direct a question to the Minister of Trade and Commerce arising out of a news item to the effect that there is a Russian trade delegation presently in Canada and that they are interested in many Canadian products. It is also mentioned that they are interested in wheat. Can the minister state whether or not this trade delegation has been met by officials of the government, and whether or not there is any hope that we might have a sale of some of our Canadian wheat to Russia?


Gordon Minto Churchill: Mr. Speaker, I am aware
that there is a Russian trade delegation in Canada, just as there was a Russian hockey team here a little while ago.


Some hon. Members:: They are still here.


Gordon Minto Churchill: Russia has been buying
wheat from us, and some of that wheat is still being shipped to Russia. Whether or not they are in the market for more wheat at the present time, I do not know.


Some hon. Members:: Why not?



PUBLIC BUILDINGS


[Stage Direction]
On the orders of the day:
Donald Ferguson Brown: Mr. Speaker, I wish to direct a question to the Acting
Canadian National Railways Prime Minister in his capacity as Minister of Public Works. On November 22 the minister stated that he would be glad to look into the situation respecting demolition of the buildings preparatory to the erection of a new post office in Windsor. May I ask if he is now prepared to give an answer?


Howard Charles Green: Mr. Speaker, I am rather surprised at the hon. member asking me this question. I explained to him a few days after the opening of this session in October that one of the big difficulties in going ahead with this demolition work is that his own government did not provide anything in the estimates which we could use to do the work, and that is still the position. However, I will say this. We are trying very hard to devise some way to get around that difficulty, so we can get authority from the treasury board to go ahead with the work. All our problem in this regard has been caused by the former government.


John Whitney Pickersgill: Nonsense. You brought
in supplementary estimates.



CANADIAN NATIONAL RAILWAYS


George Harris Hees: that the house go into committee to consider the following resolution:
That it is expedient to introduce a measure to authorize and to provide for the construction by Canadian National Railway Company of a line of railway from Optic lake to Chisel lake in the province of Manitoba, being approximately fifty-two miles, at a total estimated expenditure of $8,840,000, not to be exceeded by more than 15 per cent; and also to authorize the purchase from The International Nickel Company of Canada, Limited, by the said railway company, of a line of railway from a point on the Hudson Bay Railway line at or near Sipiwesk to a point on the Burntwood river at or near Mystery lake in the province of Manitoba, a distance of thirty miles, more or less, at a price not exceeding $5,400,000; to authorize the issue by the said railway company of securities that may be guaranteed by Her Majesty in right of Canada to finance the construction and purchase of the said lines; and, in order that the said railway company may forthwith proceed with construction and the purchase of the said lines of railway, to authorize temporary loans to the said railway company out of the consolidated revenue fund upon terms and conditions prescribed by the governor in council and secured by securities of the said railway company.
Motion agreed to and the house went into committee, Mr. Courtemanche in the chair.


George Harris Hees: Mr. Chairman, I intend to
make a short statement at the opening of this debate. First I would ask to have distributed among hon. members some eight copies of a map showing the area in which the railway lines are being built. I have

Canadian National Railways always found it a lot easier to follow what is going on if I could see on a map where the particular projects were being constructed, and I would ask that the maps be distributed amongst hon. members.
This resolution seeks to authorize the Canadian National Railways, first, to construct a line of railway from Optic lake to Chisel lake, in the province of Manitoba, a distance of 52 miles, at an estimated cost of $8,840,000; and second, to purchase and operate as part of the Canadian National Railways system a line of railway being constructed by the International Nickel Company of Canada, Limited, between a point on the Hudson Bay Railway near Sipiwesk and a point on the Burntwood river near Mystery lake, also in the province of Manitoba, a distance of 30 miles, at a price not exceeding $5,400,000.
The main purpose of the proposed railway lines is to provide outlets for the mines which are being developed both at Chisel lake and in the vicinity of Moak and Mystery lakes. In addition, the lines would aid in the development of a substantial area which shows evidence of possessing considerable mineral wealth.
Chisel lake lies about 80 miles northeast of The Pas and 52 miles east of Optic lake, which is a point on the Lynn lake line of the Canadian National Railways. Substantial ore reserves, consisting mainly of zinc and copper, are being developed in the Chisel lake area on the property of the Hudson Bay Mining and Smelting Company, Limited, and rail service to move this ore to the mining company's mill at Flin Flon will be required by 1960.
The Mystery lake branch line would serve principally to move large nickel deposits owned by the International Nickel Company in the vicinity of the townsite of Thompson, and also in the Mystery-Moak lakes area, a short distance to the north. It would also serve the International Nickel processing plant at Thompson, consisting of a mill, a smelter and a refinery, in addition to the townsite itself with a population of 8,000 people. The deposits in the Mystery-Moak lakes area will be linked to Thompson by a private railway owned and operated by the International Nickel Company. The 30-mile railway which the Canadian National proposes to purchase would therefore connect the townsite itself with the Hudson Bay Railway.
The construction of this line has been financed by the International Nickel Company because it was desirous of obtaining railway service at the earliest possible date and the Canadian National Railways did not have the necessary parliamentary authority to make the required capital expenditures. In the circumstances, the management of Canadian

National agreed to let the nickel company build the line with the company's own funds and subject to the authorization of parliament, to purchase the line upon its completion, provided construction was to the entire satisfaction of the railways chief engineer and in accordance with standards of construction approved by the board of transport commissioners.
To guard against excessive costs which might result from the desire of the nickel company to construct the line in a short period of time, it was agreed that the purchase price would be the costs which Canadian National would have incurred if the line had been built by it in the normal course of events and under a normal construction schedule. Limited operations by the Canadian National under a temporary lease arrangement have already begun over this line in order to meet the urgent needs of industry.
I am advised that in both cases the mining developments to which I have referred are of such magnitude that the construction, in one instance, and the purchase, in the other instance, of the proposed branch lines would constitute good business ventures. Nevertheless, the Canadian National has secured from both of the industries concerned guarantees of a minimum volume of traffic or minimum revenues for a period of ten years with adequate penalties should traffic or revenues in any year fall short of the guarantee.
I trust that the resolution will commend itself to the house as an important step towards the development of a substantial area of northern Canada and the opening up of new frontiers. Perhaps the house will permit me to add that when the bill that will follow the resolution has been given second reading I propose to move that it be referred to the committee on railways, canals and telegraph lines.


George Carlyle Marler: Mr. Chairman, the resolution now before the committee is preliminary, as the minister has indicated, to the introduction of a measure to authorize Canadian National Railways to do two things; first, to construct a line of railway from Optic lake to Chisel lake in the province of Manitoba, a distance of approximately 52 miles, at a total estimated cost of $8,840,000 and, second, to purchase from the International Nickel Company of Canada a line of railway from a point at or near Sipiwesk on the Hudson Bay Railway to a point on the Burntwood river at or near Mystery lake in the province of Manitoba, a distance of 30 miles, at a price not exceeding $5,400,000.
I should like to mention to the committee that as favourable consideration was given

to both of these projects by the former government of which I was a member I may assure the committee that it is not our intention to delay the passing of the resolution or the measure which will follow the adoption of the resolution. I think, however, that the presentation of this resolution does afford an appropriate occasion to emphasize the importance of railroad development to the economy of Canada.
I do not want to spend much time in dealing with this aspect of the question but I do think it is fair to point out that railroad building in Canada came to a virtual halt many years ago. We had some 42,047 miles of railway in operation in 1930, 42,248 miles in 1948 and 42,953 in 1952. The difference between the last two figures which I have just given is explained by the inclusion in the statistics for the first time of the 705 miles of railway in Newfoundland which were taken over in 1949. But I should like to emphasize that since 1952 a number of important projects have been carried out, a large part by the Canadian National Railways and some by other railway companies.
I may mention by way of illustration the 144 miles of line from Sherridon to Lynn lake in Manitoba which, of course, makes possible now the construction of the proposed branch line from Optic lake to Chisel lake. I might mention also the 300 mile line partially completed between Beattyville-Chibou-gamau and St. Felicien in the lake St. John area in Quebec, and also the shorter lines from Terrace to Kitimat in British Columbia, from Hillsport to lake Manitouwadge in northern Ontario and more recently the line fom Bartibog to the Tomogonops river in New Brunswick. In addition to these, there are two other important projects, first, that of the Quebec, North Shore and Labrador Railway, a line about 300 miles in length from Seven Islands to Knob lake, and the more recent project of the Pacific Great Eastern 256 miles in length from Prince George, British Columbia, to Dawson Creek.
What is particularly gratifying, I think, to all Canadians in considering the railroad development that has taken place in relatively recent times is that the purpose has been to promote the further development of our natural resources. In some instances it has been the development of iron ore; in other cases, the development of deposits of base metals; in other cases it has been the development of timber resources and, as many hon. members know, in the case of the line between Terrace and Kitimat it has been the development of hydroelectric power for the production of aluminum from imported bauxite.
Canadian National Railways
It is rather significant, Mr. Chairman, that this same pattern is being followed in the case of the two branch lines which are covered by this resolution. I am not familiar with the development expenditures which the Hudson Bay Mining and Smelting Company proposes to make in connection with the zinc and copper deposits to which the minister referred in his explanation a moment ago, but it is a matter of public knowledge that the International Nickel Company last year, before the actual commencement of the Sipiwesk-Mystery lake branch line had been undertaken, announced its intention to spend $175 million for the development of these mineral deposits.
So that, Mr. Chairman, the matter of satisfaction to Canadians is, it seems to me, that railroad development marches forward hand in hand with the development of our natural resources and not only makes possible the development of those resources but also makes it reasonable and good business for the owners or operators of these mineral deposits to lay out very substantial sums for development purposes.
Another matter that I think is of importance and also a source of satisfaction to those who have been interested in transportation in Canada is that in all of the cases of branch lines to which I have referred-there may be other examples which might be cited also-except the Beattyville-Chibougamau-St. Felicien branch line, the traffic in prospect has been sufficient to make the project selfsupporting either immediately or in the shortterm future and it has not been necessary for the government to provide substantial subsidies to make possible the building of these various branch lines. The exception, of course, is the Beattyville-Chibougamau-St. Felicien branch line for which a subsidy of $25,000 per mile was granted by the government because it believed that the construction of that line, which was self-liquidating in part, would open to development a large area of mining territory which ultimately would prove advantageous to the Canadian people. The other exception which I perhaps should mention is the offer of a subsidy which was made in connection with part of the P.G.E. in British Columbia but that is not, of course, connected with the resolution now under consideration.
From what the minister has said in introducing the resolution it is quite clear that this same characteristic, that is to say, of there being adequate traffic to support the project, applies to the two branch lines which are provided for in the resolution now before the committee. In other words, the Canadian

Canadian National Railways National Railways are to lay out rather substantial sums to provide for the capital cost but the revenues, or perhaps I should say additions to the operating profit, which will be in prospect will be sufficient to meet the annual cost of operation and to provide a reasonable return on the company's investment.
As the minister has pointed out, arrangements have been made with regard to future traffic over the branch lines which have been completed by Canadian National Railways with the mining interests that are to be served by these lines. I take it, Mr. Chairman, since the minister has said the bill will be referred, after second reading, to the standing committee on railways, canals and telegraph lines, that we shall have an opportunity then of going more fully into the traffic arrangements that have been concluded between these two mining companies and the management of Canadian National Railways. Consequently I do not think any useful purpose would be served by my making now any more extensive remarks with regard to those traffic arrangements.
There is only one point which I should like to draw to the attention of the minister particularly, and that is the purchase price of the line to be acquired from the International Nickel Company. During the course of his remarks, he gave the impression that one reason why this particular branch line had not been completed by Canadian National Railways was that the company did not have the necessary parliamentary authority to make the expenditures that would have been needed for that purpose. This is not my own recollection of the circumstances, Mr. Chairman. As I understood the circumstances earlier this year they were that the International Nickel desired to have this branch line completed at a much earlier date than would have been possible had Canadian National proceeded to build it with railway forces or by contractors in the usual manner and by saying "in the usual manner" I mean that no additional expense would have been incurred by the railway in order to hurry the completion of the line before what might be described as a normal date.
When the matter was discussed with me earlier this year, it was represented to me that this was, in the view of the nickel company, a crash program that had to be undertaken, and as I understood the arrangement between the Canadian National and the company it was to the effect that the railway company would pay the nickel company the cost that would have been incurred by Canadian National if the construction of the branch line had been carried out at a normal
[Mr. Marler.l
pace and in the fashion in which such branch lines are usually constructed. I have a record of the cost figure which was considered at the time to be the maximum amount which the railway would be called upon to pay to the nickel company. As I would say to the minister, and he will have the necessary information available in his files, that the cost as set forth in the resolution substantially exceeds the figure which was mentioned at the time the matter came under consideration under the former government.
I do not raise that point as an objection, Mr. Chairman, because I realize fully that the figure we had in mind earlier this year was an estimate, and an estimate made at a time when the work had not been completed and when all the physical difficulties, the delays and the costs had not been definitely established. I should like to suggest to the minister that when the bill is considered in the standing committee on railways, canals and telegraph lines, arrangements be made to explain why there has been, over this relatively short period, such a substantial increase in the estimated cost of this branch line. I have no doubt, because of my own experience and association with the management of Canadian National Railways, that the management will be able to give convincing reasons why there is a difference between the two figures. But I do think I should emphasize the matter as it does seem to me that an explanation would be desirable, and I am sure it will be freely given.
I conclude by saying I do not wish for a moment to delay the passage of this resolution, and that it is our intention, for the reasons I have already given, to support not only the resolution but the legislation which is based on it.


Stanley Howard Knowles: We
in this group are pleased to give our general support to this resolution, and we welcome the statement of the minister that the bill, after second reading, will be referred to the standing committee on railways, canals and telegraph lines. I should say that I am happy, not only to indicate the general support of this group for this legislation, but since I am the first member from Manitoba to speak since the matter has been raised I may say that in Manitoba we welcome whole-heartedly these developments that are taking place in the northern part of our province.
We in this group, of course, are anxious that the benefits from these developments might accrue to the people of this country. We are anxious also that, in view of the important part played by the railways in making these developments possible, the

workers who run the railways might get the best possible wages and working conditions as a result of their employment on the railway lines of this country. With these general comments, as I say, we are pleased to give our support to this legislation and to learn that the bill will be referred to the standing committee.
With regard to the last point that was raised by the former minister of transport, the hon. member for St. Antoine-Westmount, it seems to me that the discrepancy between the original estimate of what the Canadian National Railways would have to pay for the Mystery lake-Sipiwesk line and the amount of $5,400,000 which is set out in this legislation should be explained today rather than waiting until this legislation is before the standing committee. The Minister of Transport can speak as often as he likes now that we are in committee on this resolution, and I would hope that he would tell us what he knows with reference to the matter that has been raised by the hon. member for St. Antoine-Westmount. I noted that the last speaker did not give the amount of the estimate made earlier this year. Certainly if the difference between that estimate and this figure of $5,400,000 is of any size, I would say we are entitled to an explanation today rather than having to wait until a later time.
The hon. member for St. Antoine-Westmount will not mind if I take a moment to correct him on his geography. After all, coming from the city of Montreal as he does, he may not be acquainted with the wilds of northern Manitoba. I did note that he referred to the construction not long ago of the branch line from Sherridon to Lynn lake. I heard him say that it was the construction of that line that now made it possible to build the branch line from Chisel lake to Optic lake. Perhaps if the hon. member will look at the map, he will realize that Optic lake is on the part of the line between Cranberry Portage and Sherridon, which has been there for many years.


George Carlyle Marler: I stand corrected, Mr. Chairman.


Stanley Howard Knowles: am sure the hon. member would like to have that correction made in so far as the geography of northern Manitoba is concerned. As we have indicated, Mr. Chairman, we welcome the fact that this legislation will be referred to the standing committee and on that basis we are happy to give it our general support.


Mr. Johnston (Bow River):: I should like to say that we in this group will go along with the second reading on the understanding
Canadian National Railways which the minister gave that the bill will be referred to the committee where we can have a more thorough study of it. From just looking over the map here it seems to me that the price may be rather high per mile of construction. Of course, that is information that we cannot get at the moment.
I hope we shall be able to get that information when the bill is before the committee.
Then there is the question of the other smaller line of 33 miles, I think from Mystery lake to Sipiwesk and whether or not the price that the Canadian National Railway Company is going to pay for it would include the rolling stock. Those are all questions that have a bearing on the judgment we shall be able to use when we come into the committee to decide whether or not we shall go along with the proposition as outlined here in the resolution.
Generally speaking, Mr. Chairman, we in this group do not want to delay anything that would lend progress to the development of any part of Canada. It seems to me that the construction of these two lines could add to the development in those areas. If that is so and if the cost is reasonable, I am sure that, all other things considered, we would have no objection to giving our consent to this bill provided, of course, that the information we get in the committee leads us to believe that this is an essential service and that the price is in accordance with ordinary business standards.
Having said that, I think I will leave any further remarks I have to make until we come to the committee stage. Through experience I have found that to be the proper place in which to get the information you desire; and in most cases, when a proposition like this is explained to the committee, I have found that the committee has always been reasonable in granting permission and allowing the construction of such things to proceed.


Mr. Simpson:: In rising to speak on this bill that is now before us, I would point out that it is one which includes two distinct measures. It provides for the construction of a rail line between a point called Optic lake on the Cranberry Portage-Lynn lake line on the C.N.R. to Chisel lake in the province of Manitoba and for the purchase from the International Nickel Company of Canada of a line from Sipiwesk on the Hudson bay line to a point near Mystery lake, the new townsite of Thompson. From experience in that area I should like to say that those are two measures that should receive the hearty support of this house.
Hon. members from all parts of this house have shown of late great concern, and rightly

Canadian National Railways so, as to what government action should be taken with regard to making possible the continuation of various developments closely related to the base metal mining industry in various parts of Canada. It has been quite evident that their concern has been in relation to the employment or unemployment situation, and in this regard I heartily concur. I might say that in both of the cases we are presently considering we have before us a concrete example as to how we can not only assure continued employment for a great number of people over an expected long period of time but can also open the way for untold hundreds to join the ranks of the permanently employed.
The construction of this one line will give immediate employment to many construction workers and at its completion it could easily be a life-saver for a mining town near its extreme end, a town which could quite conceivably soon turn into a ghost town if further development in this area is not continued at the present time. I am referring to the town of Snow Lake at the extreme end of this Chisel lake line. It is a gold mining town and unfortunately has fairly well come to the end of its resources. In that section there are roughly 900 to 1,000 people who have been there for many years. Through hard work and their own labour they have built their homes. Having their homes there now, they consider it to be home. Very fortunately the mines that are going to be served by this Chisel lake branch line are within a very few miles of the town of Snow Lake. The furthest shaft from Snow Lake town would be only eight miles, I would say; and at the present time there is a good highway from this shaft to the town of Snow Lake. Hence the completion of that rail line to Chisel lake is going to mean a great deal to the people in Snow Lake who at the present time are just wondering what is going to happen to the homes into which they have put their entire life savings.
Authorization of the other line is also going to mean a great deal. At the present time at the townsite of Thompson there are approximately 500 construction workers from all parts of Canada. The amazing and gratifying thing about this development is that quite conceivably by 1960 we can expect to have in that area a population of anywhere from 8,000 to 10,000 people. The benefits to all of Canada and to Manitoba in particular are inestimable. It is going to be a great boon to the economy of the entire country. I might say that anybody from that area will heartily endorse this measure which is currently before us.
I might say that I was quite interested in the point brought out by the hon. member for


Winnipeg North Centre with regard to the statement by the hon. member for St. An-toine-Westmount. I was not quite sure whether or not I had heard correctly but judging from the answer, apparently I did hear correctly. I might point out that that portion of the line on which Optic lake is a station has been in operation for approximately 25 years. The start of the Chisel lake line at this time will tie in very conveniently with the development work which is going on in that area. At the present time there are two shafts, as I mentioned, in the process of being sunk and the program is to bring them into production at a time between now and 1960. Hence any delay we might have in starting work on the Chisel lake line could seriously affect these people about whom I am concerned at the town of Snow Lake. I would heartily recommend to all hon. members of this house that they endorse this proposition whole-heartedly.


Mr. Mitchell:: May I be permitted to say a few words on this resolution, Mr. Chairman, inasmuch as one part of it concerns a company which has its operations in the constituency which I have the honour to represent. International Nickel, or as it is more commonly known in our area, INCO, as you know have their general offices and most of their smelting and mining operations in my constituency. It is common knowledge in our area that considerable activity has been taking place in the Moak lake and Mystery lake areas and a great many of our men have been transferred to those places, particularly those in the higher level salaried positions. We have known for some time that considerable money-which has already been referred to by the member for St. Antoine-Westmount-to the extent of $175 million is expected to be spent by this company in this area.
With this fact in view, it has been intended to try and get out their ore to a smelter as quickly as possible, and as has been suggested here this afternoon, speed was of the essence in this regard. I understand that this line is now in operation and the smelting processes which will soon take place will be able to guarantee operation at a faster pace than would have been the case if they had waited for the building of this line by Canadian National Railways. There is no doubt that this is going to add to the economy of northern Manitoba and, at the same time it is not going to hurt us a great deal in the area from which I come. Considerable aftersmelting operations will have to be carried out in our area, particularly the refining of the matt. There will be further opportunities

lor the transport companies in the transportation of this matt or unprocessed ore to our area for further development.
The company over these years has felt this is a desirable development and the building of the line, and now the authorization of this committee to be set up following second reading, will repay them for the moneys which they have expended to construct this line. For this reason I certainly have no hesitation in supporting this bill and I feel that I can recommend it to all members of the house.


Edward George McCullough: I shall only take a moment or two in saying that I would like to agree with the members who have already spoken. I am sure every member of this house will agree that we would like to see the promotion of these projects which will bring into exploitation our natural resources. I use the word exploitation rather than just straight development because I think it should be remembered that these resources are non-renewable. When we go into the bowels of the earth and we exploit our mineral resources or our oil resources then, of course, they are not renewable. I would just like to point out that we in this party certainly want to see our resources exploited but exploited for the greatest good to the greatest number of our Canadian people.
Some parts of Canada have ghost towns where the resources have been exploited and I think it has not always been the fact that the return from the exploitation of these resources has gone to our people but rather that it has gone into the profits of the company exploiting them.
I would like to make one further point and that is that if it is true, as the former minister of transport has indicated to the committee this afternoon, that the figures in the resolution today are higher and do not correspond with the former figures for the cost of construction of these two rail lines, then I think it is important that the committee should find out definitely the former assessment of costs for such construction. I want to say that I believe the cost to the Canadian people will be a straight subsidy to the company. I am not of course trying to suggest that we do not want this development for the people of Canada and particularly for the people of Manitoba, but I would like to point out that this is a subsidy to the company, in my opinion, which will mean that they will be able to exploit these resources-


George Carlyle Marler: A subsidy to which company?


Edward George McCullough: -and the charge for the traffic carried and the use of the railway will, to some extent at least, pay back the
Canadian National Railways expenditure of the Canadian taxpayer. However, as I say, I do support it and I hope we will receive an early report back from the committee and that it will pass the house and there will be exploitation of these great resources in northern Manitoba.


George Harris Hees: Mr. Chairman, there has been some concern regarding the difference between the estimate made before the railway line was started and the actual cost now that it has been completed. I was quite surprised to hear the hon. member for Moose Mountain refer to it as some sort of subsidy and I am not quite sure just what he means-


Edward George McCullough: Mr. Chairman, I was referring to the whole amount. I considered it as a subsidy for the company, not just as a general increase.


George Harris Hees: Well do I take it, Mr. Chairman, that the hon. member means that the $5,400,000 is a subsidy to the company?


Edward George McCullough: In effect, yes.


George Harris Hees: Well, Mr. Chairman, this is the kind of investment which I think railways have always made and have found to be profitable. It is the kind of thing which has been gone into thoroughly by the management of the railway company and, at a cost of $5,400,000, they estimate it is going to be a money-making proposition for the railway and for the country. I fail therefore to follow the hon. member's reasoning that the building of the railway to develop our natural resources is in some way a subsidy to a particular company.
I believe it is participating in the development of this country and I think most of the hon. members of this house believe that this country should be developed. Furthermore, in a country the size of Canada transportation, in my view, must precede development because our distances are so great. Unless you have transportation facilities you simply cannot develop the country.
With respect to what the hon. member for St. Antoine-Wesmount said about the difference between the estimate made early last year and the actual all-in cost, I am afraid I do not have the answer to that at the moment. I have asked my parliamentary assistant to find out from the management of the railway company the reason for this difference. I assume it is the sort of thing which so often happens when an all-in cost turns out to be considerably higher than what the estimate has been, but , as I say, I have asked for the information from the railway company and hope to have it very soon. If it is not available today it will certainly be available for the committee when it meets in the next day or so. I refer, of course, to the committee

Canadian National Railways on railways, canals and telegraph lines. The officials of the railway companies will be available to answer questions and I hope they will have the explanation for the committee in a very short space of time.


Edward George McCullough: Mr. Chairman, in view of what the minister has said, could he tell the committee how long it would take after these railways are in operation for the cost to be returnable on the operations?


George Harris Hees: The estimate is within 10 years, Mr. Chairman.


Stanley Howard Knowles: There is another point which I would like to make, Mr. Chairman, which arises out of the statement made by the hon. member for Sudbury when he reminded us that the head offices of the International Nickel Company are in his constituency.
I realize it is a little out of the field of the Minister of Transport, but there is a suggestion I should like to make to the government, that is that the government should be reminded of what is now being done; that there are a number of instances such as this where natural resources are developed or exploited where wealth is produced in some parts of the country, such as Manitoba, and the head offices are in another province. Perhaps the government will bear this in mind when making federal-provincial fiscal arrangements.
Resolution reported and concurred in.
Mr. Hees thereupon moved for leave to introduce Bill No. 196, respecting the construction of a fine of railway by Canadian National Railway Company from Optic lake to Chisel lake, and the purchase by Canadian National Railway Company from the International Nickel Company of Canada, Limited, of a line of railway from Sipiwesk to a point on Burntwood river near Mystery lake, all in the province of Manitoba.
Motion agreed to and bill read the first time.


The Acting Speaker (Mr. Rea):: When shall this bill be read a second time?


Some hon. Members:: Now.


Stanley Howard Knowles: By
leave.


George Harris Hees: the second reading of the bill.


George Carlyle Marler: I understood that the minister was going to say a word on the bill.


George Harris Hees: Mr. Speaker, this bill is to authorize the Canadian National, first to construct a 52-mile line of railway, referred to in the bill as branch line No. 1, from Optic lake easterly to Chisel lake at a cost not exceeding $8,840,000 and second, to purchase from the International Nickel Company of Canada a 30-mile line of railway, referred to as branch line No. 2, between Sipiwesk, on the Hudson Bay railway, and a point on the Burntwood river, in the Mystery and Moak lakes area, at a price not to exceed $5,400,000.
With regard to branch line No. 1, substantial ore reserves consisting mainly of zinc and copper, are being developed by the Hudson Bay Mining and Smelting Company in the Chisel lake area. Rail service to move this ore to the mining company's mill at Flin Flon will be required by July 1, 1960. The bill provides for the completion of the line by November 1, 1959, or such later date as the governor in council may approve.
Chisel lake lies about 30 miles north of the Hudson Bay railway and is therefore closer thereto than to the Lynn lake line. However, if a branch line were built from the Hudson Bay railway the distance to be covered to Flin Flon, to which point the ore will be moving, would be 195 miles, whereas, under the present plan, the distance from Chisel lake to Flin Flon will be about 100 miles. The line is to serve primarily the Hudson Bay Mining and Smelting Company, but it will also aid in the development of a substantial area which shows evidence of possessing considerable mineral wealth.
The Canadian National has secured a guarantee of a minimum volume of traffic, under which the mining company has undertaken to ship not less than 350,000 tons of raw ore or in the alternative 70,000 tons of concentrates per annum for a period of ten years. The mining company will pay a penalty on a tonnage basis if shipments in any year fall short of the guaranteed annual tonnage. Any surplus over the guaranteed tonnage accruing in succeeding years would lead to an appropriate refund of penalty by the railway. If, at the end of the ten-year period, an accumulated shortage exists below a total figure of 3,500,000 tons of ore, or 700,000 tons of concentrates, a further period of five years will afford an opportunity for the mining company to recoup the penalties paid. If in any year of this five-year period the mining company ships ore or concentrates in excess of the annual guaranteed tonnage, the railway company will make refunds to the mining

company on a tonnage basis to the extent of such excess, but the total of such refunds is not to exceed the total amount of penalties paid by the mining company.
Branch line No. 2 has been constructed and is being completed as a private project of the nickel company. This was done because of the desire of the nickel company to have rail service available as quickly as possible and, therefore, in advance of the time when parliamentary approval for the construction of the line by the Canadian National could be secured. The nickel company indicated that it would likely take special measures to expedite construction, which would add to the cost of the line. In agreeing to purchase the line, the management of Canadian National made such agreement subject to the condition that the price to be paid to the nickel company would be the costs which the Canadian National would have incurred if the line had been constructed by it in the normal course of events and under a normal construction schedule.
The line will serve principally the new mining developments of the nickel company in the vicinity of the townsite of Thompson and the Mystery-Moak lakes area. These consist of large nickel deposits. The line would also serve the International Nickel processing plant at Thompson, consisting of a mill, a smelter and a refinery, in addition to the townsite itself with a population of
8,000	people. The site of the deposits in the Mystery-Moak lakes area will be linked to Thompson by a private railway owned and operated by the nickel company.
It is expected that the traffic that will result from the establishment of these mines will give the Canadian National earnings sufficient to warrant its purchasing line. There has nevertheless been included in the agreement between the railway and the nickel company a traffic guarantee clause. Under this traffic guarantee, the nickel company has undertaken that the gross tolls received from the traffic to, from and over the branch line will equal in annual value one-tenth of the purchase price of the line in each year for a period of ten years. The agreement provides that if the gross tolls do not meet this guarantee, the nickel company will provide 20 per cent of the difference to the railway company. If, at the end of the ten-year period, the nickel company has paid to the railway company any money under the traffic guarantee clause, the nickel company has a period of five years to recoup the money so paid. During this period of five years, the nickel company will not be under any obligation to the railway company respecting a traffic guarantee, but if in any year for a period of
Canadian National Railways five years the gross tolls received by the railway company exceed in amount one-tenth of the cost of the line the railway company will make refunds to the nickel company to the extent of 20 per cent on each such excess. Refunds to be made by the nickel company to the railway company, if any, during the five-year period are not to exceed the amount of any deficiencies paid to the railway company by the nickel company during the ten-year period to which reference has been made.
The line was sufficiently constructed in October, 1957, to be ready for operation and the nickel company requested that the railway inaugurate service immediately. A temporary lease arrangement was therefore made between the Canadian National and the nickel company under which the Canadian National undertook to operate the line at a rental equivalent to 4J per cent interest on the capital sum invested by the nickel company in the construction of the line under a normal construction schedule. This arrangement was approved by the order in council P.C.1957-1356, dated October 9, 1957, and was subject to the issue of an order of the board of transport commissioners under section 279 of the Railway Act for opening the railway for traffic. Such an order was issued on October 17, 1957, and a spike-driving ceremony took place on Sunday, October 20. The line has since been operated by Canadian National under the lease arrangement just referred to.
As I indicated when the resolution was before the house, it is my intention when the bill has been given second reading to move that it be referred for consideration to the committee on railways, canals and telegraph lines.


Stanley Howard Knowles: Before the minister sits down I wonder if he would answer a couple of questions? He has referred to these agreements between the railway company on one hand and the International Nickel Company and the Hudson Bay Mining and Smelting Company on the other hand. I noticed no reference to those agreements in the bill. Can he tell us the status of those agreements? Will copies of them be tabled for the records of parliament and brought before the committee? What comment has he to make on that aspect of the matter?


George Harris Hees: I am not too familiar with these things, Mr. Speaker, but as I understand the agreements they are pretty straightforward and I think there will be no difficulty in bringing them before the committee if the

Canadian National Railways hon. member so wishes. They appeared to me to be very straightforward agreements with no complications in them.


Stanley Howard Knowles: I did not raise any question as to their straightforwardness but it seems to me since parliament is being asked to pass the legislation with a knowledge of these agreements that copies of them should be included in the records of parliament in some way. Perhaps the minister could look into the matter of having them tabled.


George Carlyle Marler: Mr. Speaker I will not take more than a minute to say what I have to say about the bill. I do not think the hon. member for Winnipeg North Centre (Mr. Knowles) is quite correct in suggesting that the practice has been to table these traffic guarantees when bills of this kind have been discussed in parliament though I think the substance of those agreements has generally been communicated to the committee when it looked into the possibility of making the investment which is in effect authorized by the bill.
I have had the opportunity of looking at this bill and I have found no very significant departure from the form in which these bills customarily are drafted. I can see no objection to the bill and I am quite prepared to support the adoption of second reading still with the reservations I made earlier with regard to the costs. I would not wish to create or leave on the record the impression that I believe the difference in cost between the purchase price as represented earlier this year and that provided for in the bill is not susceptible to justification. I am sure there is an explanation for it and I feel quite satisfied the management will give us that explanation when the matter is considered in committee.
So far as the bill itself is concerned the standard clauses are embodied which provide for competitive bids and for the issuing of bonds in the usual terms. I would like to point out to hon. members of the house that there is not in any sense of the word a subsidy by the government for the construction of these two branch lines. In effect the purpose of the bill is to authorize the Canadian National Railways to use capital funds of its own for the purpose of developing these two branch lines and there is no question of subsidy which implies that part of the cost would not be subject to reimbursement by the Canadian National Railways if the company felt obliged to borrow from the government in order to obtain the funds necessary for these two developments. I consider that the matter is a purely routine
[Mr. Hees.l
question of building two branch lines and I think we should not hestitate to adopt the bill.


Edward George McCullough: Mr. Speaker, could the minister say if these branch lines are strictly for the development of the ore deposits and do not represent an opening up for any other type of development road?


George Harris Hees: Mr. Speaker, there is believed to be considerable additional mineral wealth in these areas and of course these branch lines will be available for transporting any additional ores that are discovered. Both companies hope and expect to develop considerably more mineral wealth than has already been discovered and of course these lines will profit by transporting those ores in the future if such ores are in fact discovered.
( Translation) :
Mr. Gerard Legare (Rimouski). Mr. Speaker, having read the resolution and the bill now before us, I was struck by the similarity between the measure now introduced and the previous request for the construction of a railway line on the north shore of the Gaspe peninsula.
The bill would authorize the Canadian National Railways to construct a 52-mile branch line in Manitoba, whereas the proposed Gaspe line would be 55 miles long, extending from Matane to Ste. Anne des Monts.
Also provided for in the bill is the purchase of a 30-mile branch line, whereas, in Gaspe, the railway would have to buy the line operated by the Canada and Gulf Terminal Railway less than 35-miles long, extending from Mont Joli to Matane.
This particular line begins at Mont Joli, in my constituency. It will be realized that the extension of this line in the Gaspe peninsula would be of great benefit to everybody in the district and would materially bolster the economy of the whole eastern Quebec area. Mont Joli has already been adversely affected by lay-offs of railway workers, and the extension of this line would be especially beneficial to the people in this area.
I feel I must say a word here of the efforts which have been made on behalf of the construction of a Gaspe railway line by the former member for Gaspe, Mr. Leopold Lan-glois and his colleagues from that part of the country.
I have no doubt that the government will bring to this matter the attention it deserves, and because conditions in the peninsula have changed, I trust the government will favourably consider the request, which has again been made to it, for an extension of the line

from Ste. Anne des Monts, to serve the north shore of the Gaspe peninsula.
(Text):


[Stage Direction]
Motion agreed to, bill read the second time and referred to the standing committee on railways, canals and telegraph lines.


[Stage Direction]
Bill No. 27, respecting the Bell Telephone Company of Canada.-Mr. Rea.

Mr. Gordon Chown (Winnipeg South) moved: the second reading of Bill No. 102, respecting Alaska-Yukon Pipelines Ltd.
He said: Mr. Speaker, this bill in its original form was passed by the Senate and the House of Commons during the first session of 1957. If hon. members will look at the bill I can point to the amendment which was recommended by the board of transport commissioners in order to provide the company with the capacity to operate in Alaska as well as in the Yukon. The explanatory note about halfway through the first paragraph in the first bill contains these words:
Provided that the main pipe line or lines for the transmission and transportation of gas and oil shall be located entirely within Canada.
If hon. members will look at the amending paragraph in the body of the bill they will see that the only words that have been added to provide for the operation of this company in Alaska as well as in the Yukon appear early in the paragraph and are "north of the fifty-eighth parallel." When the original bill was first considered by the standing committee on railways, canals and telegraph lines the hon. member for Kootenay West (Mr. Herridge) asked a question with respect to whether or not the people of the Yukon supported the idea of this company and received the reply from Mr. Simmons, the general counsel who appeared on behalf of the company at that time, that the people were very much in favour of the company commencing operations in their area because it meant that they would be provided with cheaper fuel. The matter then proceeded to the board of transport commissioners from the committee in January, 1957, with the result that the board recommended that the amendment I have described to the house should be made before the company was allowed to commence operations. That was the sum and substance of their ruling. In their conclusions I find the following:
We are of the opinion and so find that the proposed line from Haines to Haines Junction is
Private Bills
not two lines but one line, and that it is in reality to be a main line of the applicant although the portion of it in Alaska is proposed to be constructed and owned and possibly also operated by the applicant's wholly-owned Alaskan subsidiary.
The proviso in section 6 of the applicant's special act has already been set forth and for convenience is repeated here as follows:
"Provided that the main pipe line or lines for the transmission and transportation of gas and oil shall be located entirely within Canada."
It may be that the proviso is not appropriate for a company one of whose principal objects is to have a pipe line for transportation of oil products into Canada from the Alaskan seacoast. It may also be that the effect of the proviso is not what the sponsors of the applicant intended. However, we must have regard to the proviso, and give effect to the intention of parliament as disclosed by the language selected for the expression of that intention.
Having regard to the proviso we do not consider that we should grant leave to the applicant to construct the line described in the application when, as we view it, that line is to be a portion of a main line of the applicant from Haines to Haines Junction and the construction of such main line, which is not to be entirely within Canada, is not within the applicant's powers.
I should also like to take the liberty of quoting finally from the second to last paragraph of the findings of the board of transport commissioners as follows:
We are not finding, and it should not be inferred that we are finding, that the existence of the White Pass Railway or the pipe line from Skagway to White Horse will, regardless of their transportation charges, be a bar to the granting of leave to the applicant or any other applicant to construct a pipe line to serve the Yukon, although, of course, the presence of an existing railway or pipe line or other transportation facility may affect the throughput that an additional pipe line may be able to attract. The public interest of the people in the Yukon will be a major consideration, and transportation charges will be a factor that we will consider in determining any application for leave to construct a pipe line to serve the Yukon.
This pipe line, Mr. Speaker, starts at Haines, runs to Haines Junction and of necessity must pass through a portion of Alaska and the Yukon. Although the bill was prepared to conform with the requisitions recommended at the time it was drafted, it was actually after consideration by the standing committee on railways, canals and telegraph lines that it was reviewed by the board of transport commissioners and the recommendation for the amendment I have described to the house was made by them.
If the bill is given second reading today it will, of course, be referred to the same standing committee where questions can be asked of the general counsel who will appear before the committee. There will be a second check as to whether or not the application should be granted at all and perhaps an even more thorough check will be made when the measure is sent on to the board of transport commissioners for consideration. In view of the fact that these checks will be made, that

Private Bills
the bill was already passed once by the Senate and the House of Commons and that the amendment is only to correct a technicality, I believe the bill should be given second reading by the house today.


Mr. G. J. Mcllraith (Ottawa West):: Mr. Speaker, I should like first of all to congratulate the hon. member, who is a new member, upon what I think is his first experience in this house with a private bill. I believe I am right in that. I am in the embarrassing position of having to draw his attention, and the attention of the house, to what I consider to be one or two inadvertences he committed in his statement. I feel they are only inadvertences, but I think they should be corrected for the purpose of the record.
I might say that I am familiar with this bill for the reason that when the company concerned, Alaska-Yukon Pipelines Limited, made their application to the board of transport commissioners for leave to construct a pipe line from Haines to Haines Junction, I appeared as counsel opposing that application. I therefore acquired at least some knowledge of what the application was about. It leaves me also in the position where I was interested in the bill, and for that reason I will refrain from voting in the house or making any motions in the house concerning the bill.
I feel I should draw to the attention of hon. members one or two matters. In moving the bill the hon. member for Winnipeg South (Mr. Chown) I believe referred to Mr. Simmons as general counsel for the applicant company. The Mr. Simmons referred to was the hon. member for Yukon and was one of our colleagues in the house at that time. He was not, so far as I know, at any time ever counsel for the company, and certainly he was not at that time when the bill passed.


Gordon Campbell Chown: I am sorry, I meant Mr. Porteous.


George James McIlraith: Application was made to the board of transport commissioners, not having to do with the bill itself or whether or not the bill should become law, but under the Pipe Line Act for leave to construct a pipe line from Haines to Haines Junction, some 159 miles, part of that distance being in Alaska and part in the Yukon. The board of transport commissioners delivered a quite lengthy judgment containing some 14 pages. Part of that judgment has been referred to here.
I feel that hon. members would do well to read that judgment because the quotation of part of it, as always happens when you quote only part of any document, left an incomplete picture of what the application was about. The proviso in the original act is

not a mere technicality. It is a proviso put in because the parliament of Canada, rightly or wrongly, believed it should be put in. It went to the very root of the power of the company and to its capacity to act outside of the country. It is not correct, by any means, to refer to it as a technicality. It is something that is basic in the act of incorporation. Whether or not that should be changed now is, of course, another matter and is for the judgment of parliament.
In the judgment itself the board of transport commissioners dealt with the merits of the application and after dealing with the part referred to by the hon. member went on to say:
In case we have erred in the foregoing conclusion we will also deal with the application as if the Alaskan portion of the proposed line should not be treated as part of the applicant's main line.
Then follow several paragraphs dealing with the application on its merits and dealing point by point with the usual criteria considered by the board in such cases. I can only suggest, then, Mr. Speaker, that hon. members would do well to acquaint themselves with the judgment of the board of transport commissioners for Canada, and with the evidence given at that hearing, before finally passing on whether or not this application should be granted.


Douglas Mason Fisher: I just wanted to ask the hon. member who introduced the bill whether or not the judgment would be available to us in the committee so we can examine it?


Mr. Speaker:: If this procedure of asking the hon. member who introduced the bill to speak again is followed, he will close the debate. Is that agreeable?


Jean Lesage: When this bill goes to the committee, I would appreciate it, since I am not a member of the committee, if the following question were examined. There is on the order paper, standing in my name, a question of the Minister of Northern Affairs and National Resources (Mr. Hamilton) as to the disposition of the 2-inch, 3-inch and 4-inch pipe lines now existing in the Yukon and which might be affected by this bill. I think that properly this question should be dealt with by officers of the Department of Northern Affairs and National Resources in the committee.


Mr. Speaker:: Perhaps the hon. member would now like to answer the question which was asked as there appears to be no one else who desires to speak.


Gordon Campbell Chown: I shall be happy to see, to the best of my ability, that the evidence for which the hon. gentleman asked is before the

members of the committee to whom this bill will be referred. I am sure that the general counsel of the company will welcome any questions that have been raised as a result of the judgment delivered by the board of transport commissioners, and which have been raised by the other hon. member who spoke.


[Stage Direction]
Motion agreed to, bill read the second time and referred to the standing committee on railways, canals and telegraph lines.
Mr. Speaker:: I note that items 37 to 124 on the order paper are divorce bills, Nos. 103 to 168 inclusive and Nos. 172 to 193 inclusive. Is the house in unanimous agreement that these bills may be read a second time all together?


Stanley Howard Knowles: Under protest.


Some hon. Members:: Agreed.



SECOND READINGS


[Stage Direction]
Bill No. 103, for the relief of Marguerite Downie Malo.-Mr. Rea.
Bill No. 104, for the relief of Irene Patricia Heffernan Brown.-Mr. Rea.
Bill No. 105, for the relief of Catherine Ann Naylor Couture.-Mr. Rea.
Bill	No.	106,	for	the	relief	of	Antonio
Bucci.-Mr. Rea.
Bill	No.	107,	for	the	relief	of	Maurice
Robert.-Mr. Rea.
Bill	No.	108,	for	the	relief	of	Frances
Dorothy Denenberg Bloomfield.-Mr. Rea.
Bill No. 109, for the relief of Theodore Elbert Holtham.-Mr. Rea.
Bill	No.	110,	for	the	relief	of	Claude
Murray Kirk.-Mr. Rea.
Bill No. Ill, for the relief of John Alfred Crease.-Mr. Rea.
Bill No. 112, for the relief of Catherine Rita Marian Laker.-Mr. Rea.
Bill No. 113, for the relief of Jacqueline Marchand Cote.-Mr. Rea.
Bill No. 114, for the relief of Pola Baron Brisebois.-Mr. Rea.
Bill No. 115, for the relief of Graziella Bernier Murray.-Mr. Rea.
Bill No. 116, for the relief of Claus Elstorpff.-Mr. Rea.
Bill No. 117, for the relief of Denis LeBlanc. -Mr. Rea.
Bill No. 118, for the relief of Patricia Mary Gorman Walsh.-Mr. Rea.
Bill No. 119, for the relief of Madeline Audrey Booth Hibbard.-Mr. Rea.
Private Bills
Bill No. 120, for the relief of Lily Sklar Titleman.-Mr. Rea.
Bill No. 121, for the relief of Alice Florence Chaisson Boychuk.-Mr. Rea.
Bill No. 122, for the relief of Cecile Chagnon Tremblay.-Mr. Rea.
Bill No. 123, for the relief of Roger Albert Bersier.-Mr. Rea.
Bill No. 124, for the relief of Herman Rayvals.-Mr. Rea.
Bill No. 125, for the relief of Helen Frances Knight Koomas.-Mr. Rea.
Bill No. 126, for the relief of Marie Cecile Philomene Gilberte Pregent Bouchard. -Mr. Rea.
Bill No. 127, for the relief of Joyce Eugenie Swanburg Millette.-Mr. Rea.
Bill No. 128, for the relief of Evelyn Mahaffy Major.-Mr. Rea.
Bill No. 129, for the relief of Ruth Mary Ledden Wallace.-Mr. Rea.
Bill No. 130, for the relief of Catherine Lammie Graham McLean.-Mr. Rea.
Bill No. 131, for the relief of Irene Tinkoff Goldmann.-Mr. Rea.
Bill No. 132, for the relief of Joseph Fishman.-Mr. Rea.
Bill	No.	133,	for	the	relief of Lucille
Therrien Deguise.-Mr. Rea.
Bill No. 134, for the relief of Doris Rose May Cook Thomas.-Mr. Rea.
Bill No. 135, for the relief of Olive Clara Benson Pitman.-Mr. Rea.
Bill No. 136, for the relief of Mildred Irene Mitchell Gauthier.-Mr. Rea.
Bill No. 137, for the relief of Laurette Racine Pollender.-Mr. Rea.
Bill	No.	138,	for	the	relief of George
Wilkinson Pridmore.-Mr. Rea.
Bill	No.	139,	for	the	relief of Kathleen
Mary Hicks Rainville.-Mr. Rea.
Bill No. 140, for the relief of Violet June Bockus Good.-Mr. Rea.
Bill No. 141, for the relief of Ethel Rap-paport Lomon.-Mr. Rea.
Bill	No.	142,	for	the	relief of William
Newell.-Mr. Rea.
Bill No. 143, for the relief of Sally Ruth Pall Gold.-Mr. Rea.
Bill	No.	144,	for	the	relief of Nicholas
Vlahos.-Mr. Rea.
Bill No. 145, for the relief of Stefan Weber. -Mr. Rea.
Bill No. 146, for the relief of Mary Russell Leclaire.-Mr. Rea.
Bill No. 147, for the relief of Joseph Roland Langevin.-Mr. Rea.
[Stage Direction]
Private Bills
Bill No. 148, for the relief of Eileen Hannah Thomson Scott.-Mr. Rea.
Bill No. 149, for the relief of Miriam Jurist Stern.-Mr. Rea.
Bill No. 150, for the relief of Bernice Edith Knights Blake.-Mr. Rea.
Bill No. 151, for the relief of Michael Francis McTigue.-Mr. Rea.
Bill No. 152, for the relief of Zygmunt Hab-dank Bielinski.-Mr. Rea.
Bill No. 153, for the relief of Daphne Louisa Ruby Burrows Newland.-Mr. Rea.
Bill No. 154, for the relief of Reine Isabel Charles Bisson.-Mr. Rea.
Bill No. 155, for the relief of Elizabeth Cave Collyer DuBoyce.-Mr. Rea.
Bill No. 156, for the relief of Elvi Russak Urb.-Mr. Rea.
Bill No. 157, for the relief of Norma Rose Cohen Freeman.-Mr. Rea.
Bill No. 158, for the relief of Shirley Janet Whitton Ladds.-Mr. Rea.
Bill No. 159, for the relief of Venise Gosselin Hotte.-Mr. Rea.
Bill No. 160, for the relief of Bertha Wexler Azeman.-Mr. Rea.
Bill No. 161, for the relief of Emilia Shutko Suranow.-Mr. Rea.
Bill No. 162, for the relief of Amy Isabel Wonham Saunderson.-Mr. Rea.
Bill No. 163, for the relief of Marie Anna Eliza Labrecque Ladouceur.-Mr. Rea.
Bill No. 164, for the relief of Donald Stewart Walker.-Mr. Rea.
Bill No. 165, for the relief of John Joseph Sebaski.-Mr. Rea.
Bill No. 166, for the relief of Gwen Horne Segal.-Mr. Rea.
Bill No. 167, for the relief of Gwendolyn Alice Wilson Hermann.-Mr. Rea.
Bill No. 168, for the relief of Agnes Traiton Rathburn.-Mr. Rea.
Bill No. 172, for the relief of Loueisa Knutton Roberge.-Mr. Rea.
Bill No. 173, for the relief of Dorothy Miriam Skinner Stuckey.-Mr. Rea.
Bill No. 174, for the relief of Albert Renaud. -Mr. Rea.
Bill No. 175, for the relief of David St. Clair Wilson.-Mr. Rea.
Bill No. 176, for the relief of Omer Arthur Menard.-Mr. Rea.
Bill No. 177, for the relief of Dorothy Nettie Clarke Hay.-Mr. Rea.
Bill No. 178, for the relief of Frederick William Hovermann.-Mr. Rea.
Bill No. 179, for the relief of Bertha Viola Beatrice Good Malcolm.-Mr. Rea.
Bill No. 180, for the relief of Mabel Florence Adams Hadden.-Mr. Rea.
Bill No. 181, for the relief of Ernest Frank Cross.-Mr. Rea.
Bill No. 182, for the relief of Marie Marthe Moreau Roy.-Mr. Rea.
Bill No. 183, for the relief of Pierrette Picard Gagnon.-Mr. Rea.
Bill No. 184, for the relief of Marcelle Richard Deschambault.-Mr. Rea.
Bill No. 185, for the relief of Florence Irene Burness Williams.-Mr. Rea.
Bill No. 186, for the relief of Jean Paul Pelletier.-Mr. Rea.
Bill No. 187, for the relief of Mildred Mabel Desmarais Demers Joly.-Mr. Rea.
Bill No. 188, for the relief of Leonne Liane Andree Belanger Botham.'-Mr. Rea.
Bill No. 189, for the relief of Shirley Alma Lawson Wilson.-Mr. Rea.
Bill No. 190, for the relief of Sarah Yam-polsky Pinsky.-Mr. Rea.
Bill No. 191, for the relief of Karina Mercs Bunte.-Mr. Rea.
Bill No. 192, for the relief of William Garnet Mills.-Mr. Rea.
Bill No. 193, for the relief of Violet Pitman Proulx.-Mr. Rea.

Mr. G. E. Nixon (Algoma West) moved: the second reading of Bill No. 195, respecting St. Mary's River Bridge Company.


Some hon. Members:: Explain.


George Ewart Nixon: Mr. Speaker, the St. Mary's River Bridge Company was incorporated by an act of the parliament of Canada passed on May 4, 1955. The act authorized the company to construct, maintain and operate a bridge or tunnel across or under the St. Mary's river at or near the city of Sault Ste. Marie, Ontario. Section 18 of the act provided that if approval of the governor in council to the bridge or tunnel had not been obtained within three years of the passing of the act, the powers granted for the construction would cease and be null and void. The purpose of the bill now before the house is to amend that section to grant an extension by a further three years to obtain such approval.


Mr. Bell (Carleion):: Before the hon. gentleman sits down, would he tell the house whether legislation has already been passed in the state of Michigan and has been concurred in by the Congress of the United States.


George Ewart Nixon: All I can say, Mr. Speaker, is that they are working on it.


[Stage Direction]
Motion agreed to, bill read the second time and referred to the standing committee on railways, canals and telegraph lines.


Mr. Raoul Poulin (Beauce) moved: the second reading of Bill No. 9, to amend the Financial Administration Act.
He said: Mr. Speaker, I shall only briefly set out the reasons why Bill No. 9 should be introduced for second reading. This bill requires that all cheques and other negotiable instruments issued by the federal government be printed in the two official languages of this country. It will be noted that my proposal is strictly limited to the federal government and such bodies as are dependent upon it, and has nothing to do with provincial governments or private concerns or individuals.
Since this is the third time that I introduce this bill I would ask, with all due respect, that the house be given the time necessary and the opportunity to vote.
I do wish to point out that very few people in Canada at this time would care to deny the French language equal status with the English language. In this house even, there are a large number of English speaking members who find pleasure in expressing themselves in French occasionally,-


Stanley Howard Knowles: Tres bien.


Raoul Poulin: -in a rather halting fashion sometimes, just as I do myself when I speak English.


An hon. Member:: Your English is excellent.


Raoul Poulin: From this we must conclude that there exists a feeling of good will, sympathy and generosity which I prize highly and which deserves, I feel, congratulations and thanks. It is in fact to this spirit of good will that I appeal at this time. I should like a further step to be taken in the right direction, in the direction of understanding, fellowship and unity between the races. I would ask the English speaking majority in this country to realize that in the province of Quebec we act with generosity towards the English speaking element in that province. We go far beyond the limits ascribed by the constitution; in fact we go much beyond its very spirit. Not for a moment would I believe that our English
Financial Administration Act speaking fellow citizens would refuse to grant to 30 per cent of the Canadian people what is so readily granted by French Canadians to 15 per cent or 16 per cent of the people of Quebec.
The Minister of Finance (Mr. Fleming) who is more particularly concerned with this matter will certainly not oppose this measure. How could he? He has shown the greatest sympathy for the French speaking people in Canada and has received in return unmistakable evidence of the esteem in which he is held by the latter. He speaks French very well and has even been honoured with a decoration given by the "Societe du bon parler frangais".
The Prime Minister (Mr. Diefenbaker) is making creditable efforts to broaden his already good knowledge of French, something for which I commend him. He will no doubt be the last in this house to refuse the French element of this country the recognition of one of its rights. Besides, he must realize that he is the political leader of a bilingual country comprising the two racial elements with equal rights. Was it not one of the members of his cabinet, namely the Solicitor General (Mr. Balcer) who, on August 16 last, stated in Edmonton-and I am quoting from the newspaper Le Devoir of August 17, 1957-as follows:
We are not just a minority but, in reality, English speaking and French speaking Canadians are here as partners.
In my opinion, it is reasonable that partners be treated with equality and I have no doubt that the Solicitor General will endeavour to bring all his colleagues from the ten provinces to support my bill.
Need I add that there are precedents justifying the adoption of this bill? There are bilingual currency and postal stamps. I do not think that these two first steps to foster good understanding between the two great races of this country have caused any disturbance in Canada or any wrong to a single Canadian citizen. Why would it be otherwise with the measure I am proposing today?
Mr. Speaker, it was intentionally that in the course of my remarks I left aside any argument of a judicial or authoritative nature in order to confine myself to an appeal to reason. As a matter of fact, I am convinced that if, in principle, the judicial statute of our country guarantees the respect of the rights of each of the two racial groups, in practice it is in consideration of good judgment on the part of people of good will that both these racial groups will permit to all the full enjoyment of those rights.

Financial Administration Act (Translation):
Mr. Speaker, I thought I should make my remarks in English, at this time when the house is considering the bill I have just introduced, so as to show a modicum of sincerity by personally practising what I have been preaching.


Mr. Benoit Chabot (Kamouraska):: Mr. Speaker, having seconded my good friend from Beauce (Mr. Poulin), I am pleased to say a few words in support of this proposed legislation.
This is the third time that the bill on bilingual cheques, introduced by my hon. friend from Beauce has been submitted to the approval of the house. While the adoption of such a measure would prejudice no one in this country, it would be an act of justice towards one third of its people, whose language is French, it would help strengthen national unity, and would favour better understanding between the two great races in Canada.
By reason of our geographic situation, we are forced to absorb, willy-nilly, the American way of life as pictured to us by TV, the radio, newspapers, tourists, and by business carried on in the language of two thirds of the people of Canada.
May I say, Mr. Speaker, that the traditions, the religion and the language of the French-Canadian people of this country constitute obstacles to American assimilation which, by the very nature of things, would otherwise be quite unavoidable.
The adoption of my hon. friend's bill would be a further step towards unity between two great races that make Canada a great and unique country, and, at the same time, it would be a guarantee of survival.
The recognized equality of the two great races would seem to demand the adoption of such a measure, and I hope that all hon. members from both sides of the house will make it a point of honour to see that, from now on, all cheques issued by the government, anywhere in Canada, be printed in the two official languages.


Mr. M. W. Martin (Timmins):: Mr. Speaker, in considering this resolution, two points strike my attention. First, what is its objective and how can it be reached?
The first and main objective, in the minds of the hon. members of the house, is and should be complete national unity. Now I honestly believe that the best way to reach that goal is to follow the dictates of plain common sense.

All racial or religious differences which I have observed in this country, or anywhere in the world, are due to two causes. First, they are often prompted and exploited by unscrupulous politicians, or other scoundrels, for their personal benefit or gain; secondly, they may be the by-products of ignorance, lack of understanding or intolerance.
It is so easy, after all, for people to believe the slanders and calumnies about others whom they do not know. That is why, unfortunately, some people take advantage of that human failing to spread suspicions which, in some cases, have proved ineradicable.
I remember that, as a youth, when I was living in the county of Compton, province of Quebec, just two miles from our English village of Gold, there was a French village by the name of Sainte-Marguerite de Lin-wick. At that time there was no kind of social contact or fraternization between us. The Blains, the Lapointes or the Rousseaus gathered around the wood-stove in the general store of Sainte-Marguerite and talked about the Scotch, while the MacCaskills, the MacKays, or the Morrisons were doing likewise at Gould, about the Frenchies. But let some disaster happen, as when fire destroyed Joseph Blain's barn together with all his crops and livestock, or when a cyclone flattened the house of Murdo McLeod, then everybody, French or English, turned up at the bee and pitched in not only in rebuilding destroyed property but in donating a cow, a pig, a load of hay, or furniture. When the bee was finished,-always climaxed by a dance-not only were the buildings up again but they were well furnished.
How amazing it was to sense that surge of friendship spreading from village to village for a few months, everyone realizing that people he had looked down upon until then were, after all, no worse than himself, nor different!
But, alas, in less than six months, the old situation emerged again, until some new disaster again revived the fellow-feeling.
Was that not in itself a tragedy, this situation where fundamentally kind-hearted and generous people failed to appreciate one another or to get together except when visited by some calamity.
It strikingly shows the magnitude and importance of the task facing us if we really want to promote understanding and mutual respect among all the Canadians scattered throughout our great and wonderful country.
Another example which comes to my mind happened in 1942 when I had the privilege of serving in a French-Canadian regiment, the St. Lawrence Fusiliers. Only six of us in the whole unit could speak English and yet never,

in all my five years in the army, was I made to feel so welcome, nor was I so well treated, as during those three months I passed with French-speaking comrades.
As I said at the outset, it is easy to accept as the truth the gossip we hear about people we do not know, but once we have learned to know one another, we realize that those seeds of discord are sown in the mind of Canadians for the sole purpose of creating disunity, by greedy opportunists who have no other concern but their own advantage and profit.
In fact, Canada is made up not only of two but of many nationalities, each of which contributes to our national culture and heritage. However, Canada recognizes two official languages, those of the two main groups which make up its population. This must be understood if we wish to work together toward national unity, remembering that privileges granted to one group can in no way detract from the prerogatives enjoyed by the others.


Mr. Theogene Ricard (St. Hyacinthe-Bagof):: Mr. Speaker, I am happy to support the hon. member for Beauce (Mr. Poulin) in a matter as serious and significant as that of bilingual cheques in this country. I commend him for the persistence he has shown in the past years when submitting this bill, for without his well-known tenacity, he would certainly have dropped the matter and it would have been automatically shelved.
As a French Canadian, I fully agree with the hon. member for Beauce, and I am happy to ask all hon. representatives to give this matter all the attention it deserves. To my mind, a gesture such as this would be tangible proof of every member's wish to see the highest degree of national unity established in this country, and we should therefore vote in favour of the legislation moved by the hon. member for Beauce.
I take this opportunity to remind the house that the first French bank-note in Canada was printed under a Conservative government-


Mr. Habel:: But is wasn't a bilingual one!


Jean Lesage: No, a unilingual one.


J.-H.-Théogène Ricard: I was not talking about bilingual bank-notes; I said that the first bank-note printed in French had been issued under a Conservative government.


Jean Lesage: Bilingual currency was instituted by the Liberal party.


J.-H.-Théogène Ricard: That may be so, but it does not change the fact that the first French
Financial Administration Act words to appear on Canadian bank-notes did appear under a Conservative government, and I am pleased to recall that fact. Indeed, it would not surprise me at all if the first Canadian government cheques labelled in French and in English were issued under a Conservative government.


Raoul Poulin: You have an excellent opportunity to do it today.


Mr. Neree Arsenault (Bonaventure):: Mr. Speaker, it is a pleasure for me to add a few remarks about this bill. I wish to congratulate my friend, the hon. member for Beauce (Mr. Poulin), for his steadfastness and his patriotism in again submitting this bill.
French-Canadians must always do what is humanly possible to deserve the respect to which they are entitled from English-speaking Canadians. If we obtain bilingual cheques, it will be another step towards the achievement of Canadian unity.
In such a field, I can mention the example of the association of forestry engineers of the province of Quebec which requires that foreign forestry engineers wishing to practise their profession in our province, write a thesis in a language other than their own; the purpose of this is to establish better relations between workers or employees and those who are called upon to direct them.
It is only by struggling for the rights of French or of English, either by insisting on their use in charters or, as in this case, by requesting that cheques issued by the Canadian government be bilingual, that we will succeed in obtaining respect for the two official languages of this country and national unity.


Mr. M. J. A. Lambert (Edmonton West):: Mr. Speaker, in the first place, I wish to congratulate the hon. member for Beauce (Mr. Poulin) on his tenacity in again introducing his bill concerning the issuing in Canada of travellers' cheques, postal money orders, cheques, drafts and other negotiable effects in the two official languages of this country.
Mr. Speaker, since we already have bilingual bank notes, why could our cheques not be bilingual too, as well as our postal notes and all other negotiable effects mentioned by the hon. member for Beauce in his bill?
The other day, on the occasion of my first speech in this house, I spoke of the value of bilingualism to this country. As a French Canadian from the west, this matter is as close to my heart as to that of the members of the province of Quebec.

Financial Administration Act
I might say at this point that it would be well to remember the words spoken by the Solicitor General, as quoted by the member for Beauce. I happened to be present at this banquet of the ACELF at Edmonton, last August. I must say that the words spoken by the Solicitor General were extremely well received.
In any event, I am of the opinion that we should recommend to the house that all negotiable effects concerned in the proposed legislation be printed both in French and in English, as soon as possible.
(Text):
Now, Mr. Speaker, I feel we have not heard much in English about the purport of this bill which has been before the house on a number of occasions and, frankly, I must, as I have done in French a few moments ago, compliment the hon. member for Beauce (Mr. Poulin) on his determination in bringing forward this measure.
I see no objection to it. It is merely an administrative procedure. Representations have been made latterly with respect to it by a number of people from the province of Quebec who have spoken on the subject with great sincerity. A number of speeches have been made here this session by English and French speaking members about the value of the unity of both Canadian cultures, yet though we have our money printed both in English and in French, as issued by the Bank of Canada, it has not yet been possible, apparently, to have our cheques, bills of exchange, postal notes and other documents as referred to in the bill printed in English and in French.
It is quite a simple procedure and certainly it is not against the spirit or the letter of the Bills of Exchange Act. I would say we should give it most serious consideration. However, there is one thing I would like to point out. I have not heard anybody on the other side of the house speak to this bill.


Mr. Dumas:: We want to vote on it.


Jean Lesage: You are killing the bill.


Mr. Cardiff:: You stirred up something
over there.


Marcel Joseph Aimé Lambert: I would like to hear hon. members opposite say something about this bill.


Some hon. Members:: Vote.


Marcel Joseph Aimé Lambert: Perhaps they would like to express themselves the way I have expressed myself.


Jean Lesage: Go ahead and kill it.


George Harris Hees: You did not want to vote in the old days.


Some hon. Members:: Question.


George Harris Hees: You always talked them out. We always wanted to vote in the old days.


Stanley Howard Knowles: Tell us about the Eskimos.


George Harris Hees: You fellows used to kill the bills every time. We always wanted to vote in the old days.


Jean Lesage: We did not kill the bills, you did.


George Harris Hees: We are very democratic; we like to hear everybody speak.


Marcel Joseph Aimé Lambert: Mr. Speaker, I meant my remarks in all sincerity. I would like to hear from some hon. members opposite.


Armand Dumas: Just sit down and you will see how we vote.


Marcel Joseph Aimé Lambert: I would like to hear from an hon. member who has not previously spoken in this house and learn what he thinks about the bill.
(Translation):
Mr. Speaker, I would like to know the opinion held on this matter by the new members of the province of Quebec and the other provinces who sit on the far side of the house.


Some hon. Members:: Sit down and you will be told.
Other hon. Members: Sit down!


Marcel Joseph Aimé Lambert: Mr. Speaker, those few remarks of mine were meant to indicate my support of the principle of this bill.
(Text) :


Mr. Raymond O'Hurley (Lotbiniere):: Mr. Speaker-


Some hon. Members:: Oh, oh.


George Harris Hees: We have a lot of great speakers over here. We all like to talk.


Mr. O'Hurley:: Mr. Speaker, I hear a lot of noise from the other side of the house but I know they are my good friends. As I have already said in this house I do not want any of my remarks to be taken as an injury by any hon. member from Quebec or elsewhere who might not share the same political opinion I hold.
I read with great pleasure the bill presented here by the hon. member for Beauce (Mr. Poulin) asking for bilingual cheques all across Canada. The bill and the remarks he made in presenting it were timely as they

were in the two previous years. If the information that has been given me is correct the hon. gentleman presented a similar resolution during the winter session of 1957 and also in 1956.
In a cosmopolitan country like Canada bilingualism is fully recognized today. On the other hand, there is a certain schooling, if I might use that word, which must be undergone by people throughout the country to ensure that even a 100 per cent English speaking community does not neglect and forget that bilingualism exists in this nation. I take pleasure in announcing in the house that although 1 am of English speaking origin probably 99 per cent of my constituents are of French speaking origin. They have admirably demonstrated to people in Canada the fact that they do not hold against any person the language he speaks and have proven that it is possible in a free country for two great racial groups to live side by side in harmonious co-operation. They are completely bilingual in their thinking.


Armand Dumas: Question.


Raymond Joseph Michael O'Hurley: A bill of this kind could be enacted only with the unanimity of the house.


Jean Lesage: Question.


Stanley Howard Knowles: Carried unanimously.


Raymond Joseph Michael O'Hurley: I know that if all hon.
members were present in the house today there would not be unanimity on this question.


An hon. Member:: Let us vote and find out.


Marcel Joseph Aimé Lambert: Indeed, Mr. Speaker, it might create a greater division than presently exists as we have seen today in the introduction of this measure.


An hon. Member:: Six o'clock.


Raymond Joseph Michael O'Hurley: I think the remarks made by hon. members who have spoken today point up the need for a greater education on the part of our people in appreciating that this is a bilingual country with two official languages and that the question is something which must be studied. It is a matter which we must bring to the attention not only of members of this house but of our constituents in order that they may understand its implications.


Jean Lesage: You did not do it in the last election.


Raymond Joseph Michael O'Hurley: I spoke in both English and French when the occasion presented itself. In my constituency I have three municipalities wherein I have to speak English and I
Hamilton Harbour Commissioners am always proud to do so and in the other I take pride in speaking French.
Mr. Speaker, may I call it six o'clock.


Jean Lesage: It is not.
At six o'clock the house took recess.


[Stage Direction]
AFTER RECESS

The house resumed at eight o'clock. HAMILTON HARBOUR COMMISSIONERS

George Harris Hees: that the house go into committee to consider the following resolution:
That it is expedient to introduce a bill to authorize the Minister of Finance to make loans to the Hamilton harbour commissioners, out of the consolidated revenue fund, not exceeding in the aggregate $4 million for the purpose of constructing additional dockage and other facilities in the harbour.
Motion agreed to and the house went into committee, Mr. Rea in the chair.


George Harris Hees: Mr. Chairman, this resolution seeks to authorize a loan of $4 million to the Hamilton harbour commissioners to permit them to participate in an $8 million harbour development program to be completed in 1960. The trade to Hamilton harbour, both foreign and domestic, has been steadily increasing in recent years. The established industries have definite plans for expansion; other industries are moving to Hamilton and the recent announcement of the Ontario hydro of the construction of a system of a steam generating plant all add materially to the rate of increase of waterborne traffic. The completion of the St. Lawrence seaway will, I am sure, greatly contribute towards this rate of increase.
The Hamilton harbour commissioners propose to construct a new transit shed on the Wellington street terminal, now being extended by the Department of Public Works. They propose to create by 1959 a new terminal slip at Ship street and to construct for 1960 a new slip at Strathearne street. The Wellington street transit shed will cost the commissioners $1 million and the new slips at Ship street and Strathearne street are estimated to cost $3 million each, the commissioners to pay one-half of this cost and the remainder to be borne by the Department of Public Works. In addition, the Department of Public Works would carry out a large dredging program costing $1 million in connection with the Strathearne street slip.

Hamilton Harbour Commissioners
A loan at the rate of 4-J- per cent for a term of 40 years is proposed, and on this basis the annual financing for the Wellington street transit shed would be $50,000 and for the Ship street and Strathearne street terminals $75,000 each, making a total of $200,000 annually. An examination of the harbour commissioners financial position indicates that the expected revenues above expenditures would be well in excess of $200,000 per annum and that under normal circumstances the commissioners would have no difficulty in meeting their commitments.
These projects were examined by the departments of public works and finance and my department on the spot some months ago, and after further discussion in Ottawa it was agreed that this expansion program in Hamilton merits support. I trust that the resolution will commend itself to the house as an important step to facilitate the development of Hamilton harbour and to permit the Hamilton harbour commissioners to keep in step with the demands of waterborne traffic being made upon them. I might say that when the bill is before the house I intend to move that it be referred to the standing committee on railways, canals and telegraph lines.


George Carlyle Marler: Mr. Chairman, as the minister has pointed out, this resolution is a necessary prerequisite to the introduction of a bill which will enable the government to lend to the Hamilton harbour commissioners an amount not exceeding $4 million for the purpose of constructing additional dockage and other facilities in Hamilton harbour. I think that in considering the resolution it must be remembered that the Hamilton harbour commissioners are a separate and autonomous corporate body and that this is not one of the national harbours which falls under the jurisdiction of the national harbours board. Consequently, in considering the terms of the resolution it must be borne in mind that there is a distinction to be made between these autonomous harbour commissions and the national harbours board itself which is an agency of the crown and at the same time a national institution.
Of course, I am fully aware that in the past the federal government has followed the practice of advancing the capital sums required for harbour dredging in the harbours which, having harbour commissioners, still do not fall under the jurisdiction of the national harbours board. But I think that this is the first case which has come to my notice in which the rather extensive program referred to somewhat briefly by the minister is to be carried out as a joint operation by

the public works department of this government and by the local harbour commission itself. Perhaps I might come back to that point in a moment.
I should like to say, considering the matter more in a general way, that it was my experience when I was minister of transport that a decision had been pretty well reached that advances made to autonomous harbour commissioners for harbour improvements from time to time would be made on the basis that the investment would be self-liquidating.
I think that was a sensible policy to follow because naturally when the government came to consider the propriety of making an advance or of the making of an expenditure which it would itself support, all of the pertinent facts would be taken into account so that, so far as it is possible in advance to predict what the future development of a harbour will be, consideration would be given to all the pertinent factors in order that an estimate might be reached of the additions to the revenues of the harbour and at the same time the additions to operating expenses and particularly, when advances of this kind were considered, the addition of the burden of interest and amortization of principal.
I think that such a policy has much to commend it because otherwise harbour commissioners who are inspired by a natural and understandable wish to possess more attractive and perhaps more modern facilities might very easily be tempted to borrow substantial sums from the government in the expectation that by the expenditure of the moneys in question business would be attracted to their harbours and that, in their estimation at least, revenues in sufficient amount would be developed to enable the harbour commission to repay the moneys so borrowed. But clearly if this were done widely and without the element of-I would not like to use the word "supervision"-the economics of the projects being given careful attention, developments of this kind would give rise to a state of affairs which I think in the long run could only be disadvantageous to local harbour commissioners and of course to the government itself if the government were financing such improvements. Consequently, when I was associated with the Department of Transport it was felt it would be desirable to have the fullest economic study made of projects of this kind in order to determine to what extent the proposed capital expenditures were justified.
It seems to me, Mr. Chairman, we have quite an unusual situation here. It is common knowledge, I think, that the Department of Public Works has, for example in the case of the Toronto harbour commission, carried out

extensive dredging projects at the expense of the federal government so as to provide deep water navigation up to the facilities which have been constructed by the Toronto harbour commission itself. I can, however, recall no instance in which the government has used public funds, obviously through the budget of the Department of Public Works, and either alone or jointly with any harbour commission undertaken the construction of facilities which by their very nature are revenue producing.
The facts as given by the minister should, I think, remove any particular disquiet as to the security of the $4 million which is to be advanced by the government, and which it is necessary that the committee should consider when adopting this particular resolution. But I think the government should perhaps consider what will be the effect of the policy which it seems now to be inaugurating in placing under the control of separate and autonomous harbour commissions valuable facilities producing revenue, when the revenues from those facilities will be used exclusively for the purposes of the harbour commission.
Of course, I have no knowledge whatever of the cost of these facilities other than the information which the minister has just given. It is not possible for me, with the rather limited information at my disposal, to know how useful the facilities which the minister has described will be; what are likely to be the revenues which they will produce when fully developed and, let us say, fully used. I do believe the government owes it to the committee to explain the reasons which have led them to depart from past policies in this connection, and to say whether in other places in Canada where additional harbour facilities are going to be required they will follow the precedent which appears now to be established of bearing jointly with the harbour commission the cost of the improvement it may be thought suitable to make to the local harbour. I think there is a very real and obvious distinction to be made between expenditures made in the national harbours and those made in the case of autonomous bodies such as Hamilton, Toronto, New Westminster and a few others. I think the minister should explain what are the reasons which have led the government to depart from the more or less established policies.
Coming back to the national harbours, I would say that it is quite obvious where improvements are made by the national harbours board it is quite proper that they should be financed by the government. If the facilities produce more revenue than is needed, in other words more revenue than 96698-1141
Hamilton Harbour Commissioners is required to repay the interest and amortization of the investment, the excess will accrue to the national harbours board and will find its way into the accounts of the government at the end of each year. But in this particular case the revenue which will accrue from the improvements to which the minister has referred will accrue to the commission itself. I do not reject the idea, I am just questioning the advisability of embarking on a policy in which the cost of revenue producing improvements is borne jointly by the federal government and the commission itself.
At all events the minister will perhaps deal with that question before the resolution is adopted. He has referred, of course, to the question of the traffic in Hamilton harbour. I think it is gratifying to note that there has been, as the minister has said, an increase both in foreign and domestic traffic. As I recall, about a year or so ago when I had occasion to examine the volume of overseas traffic which was then passing through the canal system I observed that of the not very large proportion which originated from or was destined to Canadian ports on the great lakes, the portion going to Hamilton represented a fairly substantial percentage. I do not recall the exact figure but my impression is that more than two-thirds of the total overseas traffic was destined to or originated from the two ports of Toronto and Hamilton.
The minister has referred also to the probable building at Hamilton of a thermal plant by the hydro electric commission of Ontario. Quite obviously, that should provide additional traffic for Hamilton harbour. So far as the St. Lawrence seaway is concerned, I think we all believe there is going to be an expansion in overseas traffic, although while I was minister of transport no one in the department seemed anxious to put down on paper any very positive estimate as to the exact amount of that traffic. In any event, as I understand what the minister has said, it is the belief of his department that the increase in foreign and domestic traffic, the traffic that is likely to be generated by the establishment of a thermal plant at Hamilton, and the additional traffic which may be expected to develop when the seaway is finished will, all in all, justify the new facilities and provide revenues adequate to meet at least the interest and amortization of the $4 million covered by this resolution.
I should like, Mr. Chairman, to hear what the minister has to say with regard to the broader question of these facilities being provided at the joint expense of the local

Hamilton Harbour Commissioners harbour commission and the Department of Public Works. I realize, of course, that is not the principal issue in this resolution. The principal issue in this resolution, on which I think there can be no possible disagreement, is that the resolution is a prerequisite to a bill which will authorize the Minister of Finance to lend $4 million to the Hamilton harbour commissioners for the carrying out of this program. From what the minister has said, and bearing in mind the very well-established reputation of the harbour commission itself, its long record of successful and good administration of the harbour, I do not think any of us would have any qualms about approving the resolution. However, I do hope the minister will tell us something about the subsidiary question of the financing of these harbour facilities jointly by the federal government and by the local commission.


Thomas Speakman Barnett: During the first year in which I was a member of this house I had the pleasure one week-end of visiting Hamilton as a member of a party of members of the house. While I realize that a brief visit does not qualify me to discuss in any detail the merits of this project, certainly during that visit I gathered enough knowledge of the interest in the affairs of the city taken by Hamiltonians to understand the interest of the Hamilton harbour commission in this particular project.
I was interested in listening to the brief statement made to the house by the Minister of Transport and also in listening to the statement made by the former minister of transport. Perhaps I might be permitted to observe that the statement of the former minister of transport was perhaps a little bit more discursive than were some of the statements he used to make when he was sitting across on the other side of the house on occasions similar to this.


George Carlyle Marler: I am not now so hampered by responsibility.


Thomas Speakman Barnett: I feel that the introduction of the resolution raises one or two questions which I certainly should like to have the Minister of Transport answer for us before the resolution passes. If I understood correctly the remarks of the former minister, he suggested to the house that in this resolution there has been some departure from what has been the former policy of the department. I can believe that perhaps the former minister may have more knowledge of some of the details of this project than he has indicated to us in the house. I do not imagine this project has reached the present stage overnight. The question which

occurs to me, of course, is whether this is the first time an advance of this kind is being made to one of the autonomous harbour commissions and how similar this resolution is to any previous arrangement for financing works by the independent harbour commissions as distinct from works under the national harbours board. I think the Minister of Transport should make it clear to the house whether this is a particular project or a particular policy in respect of the Hamilton harbour commission or whether other autonomous harbour commissions, if they had similar needs and were under similar circumstances, would be able to receive similar consideration.
I have some interest in this matter in view of the fact that one of the autonomous harbour commissions lies within the boundaries of my own constituency. While I have no present indication that they may be approaching the government with any proposals for extension of harbour facilities, nevertheless I think it should be clear to us as members of the house from various parts of the country and with interests in various ports of the country just what the government is doing in bringing forward this proposal. I have no reason to doubt that my colleagues on the railways, canals and telegraph lines committee will be able to give full support to the measure as it reaches further stages, but I feel that one or two of these points which have been mentioned by the former minister of transport as well as the question which I have raised should be answered by the minister while we are discussing this measure at the resolution stage.


Thomas James Irwin: I do not intend to occupy too much time of the committee because there is no reason why this motion should be held up. After all, I believe it is expedient that the Hamilton harbour commission should extend its facilities in the light of the fact that the St. Lawrence seaway is certainly going to make upon it demands that at the present moment do not exist and are not likely to
come into being as a result of ordinary traffic. [DOT]
I noticed that the hon. member for St. Antoine-Westmount-maybe I misunderstood him-was trying to bring the city of Hamilton into this question of financing this project. Frankly I do not think that is good business. The city of Hamilton or for that matter any other municipality has plenty on its hands under existing economic conditions without entering into the question of extending harbour facilities, particularly when those extensions arise out of the fact that what is going to occur is not because of anything that Hamilton does but because of something for the general benefit of Canada itself. I believe

that this is a matter solely for the Hamilton harbour commissioners and for the board of harbour commissioners here in Ottawa. I think this is an excellent opportunity for the government to show its willingness to assist municipalities or districts, as far as that is concerned, to a reasonable extent to extend their facilities in order to help out national causes.
I am a little bit worried, of course, because I come from Burnaby and we are faced with the fact that we have harbours on the Fraser river. I hope this will be a step in the direction of the federal government showing its willingness to enter into this question broadly across the country and to help out the harbour commissions on the Fraser river. If I could suggest it to the Minister of Transport, one of the first steps they could take in the matter is to try to correlate the activities of the two harbour commissions at present on the Fraser river.
As to this loan to the Hamilton harbour commission, I notice that our friend the hon. member for Comox-Alberni was a little bit worried that it was going to set a precedent. I am not the least little bit worried about their setting a precedent because, as far as I am concerned, they could not set a better precedent in this world than the one they are setting now, if that is what it is going to be, in helping harbour commissions to help Canada into a better position than that in which it is at the present time.


Daniel (Dan) McIvor: I should like to ask the minister a question. Is not 40 years a long time over which to spread $4 million? A harbour board is not likely to see 1997 and most of us do not expect to see it. Could it not be 20 years at four per cent, leaving out future generations?


George Harris Hees: The answer to that question is that if you try to pay off that loan in 20 years at four per cent, you just do not pay off the loan.


Daniel (Dan) McIvor: Thank you.


George Carlyle Marler: I hope the minister is going to outline the question of policy.


George Harris Hees: Yes. The hon. member for St. Antoine-Westmount asked with regard to our being willing to advance a loan for half of the total cost of the Hamilton harbour commission while the Department of Public Works is making a considerable investment. In reply I might say to him that we believe that is fair and reasonable assistance to an important harbour in Canada which we believe is growing in order to assist it to develop and grow. The hon. member for St. Antoine-Westmount perhaps feels that this is too generous a bill for the Hamilton
Hamilton Harbour Commissioners harbour commission. I do not know whether or not that is his view but this is what we consider to be a fair proposal and we have submitted it in that spirit. We are satisfied with this proposition and feel it is a good and satisfactory way in which to help a growing city help itself. Now I wonder if the hon. member for Comox-Alberni would repeat his question.


Thomas Speakman Barnett: Mr. Chairman, the question I asked of the Minister of Transport was whether this was the first time an arrangement of this kind has been entered into by the federal government with one of the autonomous harbour boards and, if it was not, whether he could give us some indication as to what departures, if any, from previous arrangements were being made in this instance? I may say for the benefit of the member for Burnaby-Richmond that I was not expressing any concern over the setting of a precedent but I would like to know the facts.


George Harris Hees: Well, Mr. Chairman, I am not really an expert on harbour assistance. I do know however that through the Department of Public Works the government is assisting the Toronto harbour commission in respect of considerable dredging operations in helping the harbour to become prepared for the opening of the St. Lawrence seaway. I also know that at the present time this government is considering what help it might give to both the Department of Public Works and the Department of Transport in an examination of possible assistance to the harbour at the lakehead. I believe it is the duty of government, where it can do so, to assist people to help themselves but I do not think there is any hard and fast rule as to exactly what a government should do in any particular set of circumstances. I believe it is the role of government to assist the communities in respect of development projects which will help their own economy and the economy of the country to grow and, with respect to this plan of action, I feel this government is acting correctly in moving towards the helping of people to develop this growing country of ours.


Thomas Speakman Barnett: Well, Mr. Chairman, I think perhaps the minister has not really answered my question. I am quite aware of the fact, of course, that through the Department of Public Works quite a large number of harbour development projects are undertaken and money is spent for that purpose in many parts of the country, but the real point of my question was whether or not there had been previous occasions on which an arrangement such as is described in this

Hamilton Harbour Commissioners resolution had been entered into. That is to say where, out of the consolidated revenue fund of Canada money is advanced to one of the autonomous harbour commissions for the undertaking of their capital works projects. Now if the answer is not at the minister's fingertips-and I understand of course that he has not a long background of experience with the detailed activities of the Department of	Transport-perhaps
arrangements could be made to have the answer given in the committee stage of the bill.


George Harris Hees: Well, Mr. Chairman, I know for instance that in the hon. member's own province the Department of Public Works assists an autonomous harbour commission, namely that in New Westminster, and has assisted them considerably in the past with respect to dredging operations. The government has assisted various harbour commissions in various ways, but I do not feel there is any set pattern in which we say we will or will not carry out any particular set of operations. Whenever something appears to be necessary to be done, as I understand it, my department and the Department of Public Works look into the matter to see if it is justified and to see if there is some way in which the government can help the harbour commission to do the job which it wants to do.
Now it seems strange to me that while members usually urge the government to do more, we find tonight that members are urging the government to do less. The government, I think, is doing a reasonable job of assistance to the Hamilton harbour commission in helping itself and in expanding and it seems to me from the remarks made by members of the opposite side of the house there is a certain criticism implied. There seems to be an idea abroad that we are doing a little too much; that perhaps we should be thinking about this a little bit more carefully; that perhaps we should not lend so much; perhaps we should have the loan paid back in 20 years instead of 40 years and perhaps the Department of Public Works should not be participating in the way it is.
Now, if the hon. members opposite feel that way it is certainly different from what usually takes place when measures of this kind come before the house. I am speaking for the government in this matter and I feel that the government is adopting a good, sensible and progressive policy to help the harbour commissions help themselves. If members on the opposite side of the house now feel we are being too generous-and of course they are entitled to their own view- then I am surprised to hear it. If that is


the feeling, as I say, it is quite different from what usually takes place, but of course now we have a new government which looks at things a little differently and perhaps we are going to get a brand new type of criticism.


Thomas Speakman Barnett: I wonder if perhaps the hon. member for Trinity-Conception who has just risen to his feet would mind if I pursued this a little further because I think the Minister of Transport has, in his last remarks, entirely misrepresented my reason for rising to ask him questions. I cannot see how he could possibly have read into anything I have said any desire to oppose the proposal which has been put forward. Surely if we rise simply for the purpose of obtaining a little more information from the minister than he saw fit to give us at the opening of the discussion we cannot be considered as opposing the proposal which the government is bringing forward.
Now I thought my question was perfectly simple and straightforward; I did not say one word as to whether I was for this measure or against it except that I did say at the start that I understood and appreciated the desire of the Hamilton harbour commission and the people of that city to have their harbour facilities extended and I fully expected that we would be able to go along with this proposal. Now I said that quite definitely. What I wanted to know was simply whether this was the first time the government had chosen to adopt this particular pattern of providing assistance by the mechanism of a loan which I understood is to be repayable under certain terms and conditions to the consolidated revenue fund.
In my initial remarks I did raise a further question as to whether or not we can understand from the minister that, under the same terms and conditions, if other autonomous harbour boards approached the government with a proposal which stood on its merits in the way the minister indicates this one does, they could expect the same kind of arrangement might be worked out. That is all I wanted to know from the minister. I had no desire to create in his mind that I was in any way opposed to his proposal when I asked these questions.


George Harris Hees: Well, Mr. Chairman, this bill, as I mentioned earlier, will go before the standing committee on railways, canals and telegraph lines where full questioning will be possible and at whose meetings the officials of my department will be present to answer all questions that can be put. As I explained earlier, I have held this portfolio for only a limited time and I am not an

expert on the past history of these things. I am doing the job at the present time and trying to look to the future.
Regarding looking to the future, I am glad to be able to assure the hon. member for Comox-Alberni that if other harbour commissioners put forward propositions which appear to be as economically sound as this one does, we will be pleased to receive them and to consider them and to look on< them very favourably. I feel that this is really what the hon. member wants to know.


Mr. Slick:: Mr. Chairman, it seems to me from what the minister is saying that he is initiating a new policy. I am not against that policy and I am certainly not against spending money for harbour commissions or public works. We find it mighty hard to get from the Minister of Public Works what we require to assist our people in improving their living standards.
But we have a harbour in Newfoundland, St. John's. The minister has seen it himself and I think he will realize that it is an important and growing port. I am given to understand that they need improvements down there, and I am hoping-and the minister has partly answered my question when replying to the last speaker-that if the people in St. John's apply to him under the same conditions as Hamilton has done he will grant the same facilities as he is granting Hamilton. The minister has already said he will consider these schemes on their merits. That leaves an escape. But I think that if he grants this to Hamilton he cannot deny it to anyone else who asks for the same concessions under the same conditions, and I should like an assurance that if the harbour commission in St. John's puts the case up to him, and if they need the improvement, they will get the same terms as Hamilton is getting.


George Harris Hees: As I said to the hon. member for Comox-Alberni, I am very glad to assure the hon. member that, if the harbour commission of St. John's brings forward to us a proposition which on examination appears to be as economically sound as this one does and gives an equal good assurance of payment at an economic rate of interest over a reasonable period of time we will be very glad to look at it as favourably as we are looking on this application.


Douglas Mason Fisher: Mr. Chairman, there are a number of innocents in the house who are always seeking educational opportunities, and I think as one of the innocents it is disappointing to find we have had more educational inspiration on this occasion from the former minister than from the present minister.
Hamilton Harbour Commissioners
I think the present minister has missed the point of the queries. He drew into the discussion a mention of the lakehead. As he knows, we have no harbour commission there, but I feel the member for Comox-Alberni and myself both have the same reason for wanting to know more. In the area from which I come we hope to have a harbour commission at the lakehead. We would like to know how this whole arrangement was made and how it was developed; what steps the government took in examining the Hamilton facilities; how the recommendations were made; and whether this whole principle is one which we can look forward to being followed when a good case is made.
I had looked forward to having a more general answer which would have enabled us to approach the question with more background when it is discussed in committee, and I do not think the ingenuous counterplay made by the minister is good enough.


George Harris Hees: I do not know what the hon. member for Port Arthur is complaining about, because as soon as the matter of the harbour facilities at the lakehead was brought to my attention and to the attention of the Minister of Public Works, the officials of our departments went immediately to the lake-head, studied the situation there, and have since been giving it a very great deal of attention. I do not think the hon. member or the people he represents will be disappointed when our plans are finally disclosed.
The hon. member has asked what transpired between the Hamilton harbour commissioners and ourselves. They put forward the proposition that in their estimation certain facilities should now be provided. Officials of my department and officials of the Department of Public Works looked over the situation, examined the records of the past very carefully, decided what in their estimation would be the potential of the harbour as the St. Lawrence seaway developed, what percentage of traffic could be expected in view of what has taken place, and agreed on the basis of that study that the assistance which is being given was justified and that the loan which is being made available is justified. There is nothing very complicated about it. We are perfectly willing for harbour commissioners to come to us and bring forward propositions to examine, and when this is done we are happy to examine the economic potentialities, the potentialities of growth, the cost of what has to be done and so on, and decide what development we believe to be justified.
I hope that answers the hon. member's question. We have tried to deal fairly with

Hamilton Harbour Commissioners the situation at the lakehead. I do not know how we could have worked more quickly or done any better than we have done, and I am sure the lakehead will get a fair deal and I hope I have explained the rather simple procedure we follow.


Douglas Mason Fisher: The minister is perhaps a bit too sensitive. I am not complaining at all about the situation at the lakehead. I just wanted to know more about the situation so that I would know the pressure points when the time came at the lakehead. I hope the minister will answer the question raised by the former minister, which was, as I recall his words, whether this is likely to create a situation in which a harbour commission will spend more than it can afford because it can draw on funds such as these.


Mr. McDonald (Hamilton South):: Mr. Chairman, I will intervene in this discussion very briefly to assure the house that the Hamilton harbour commission is a very competent commission. They have shown the soundness of their judgment as to the future by putting before this government the present proposal, which is a very businesslike proposal with an arrangement for payment of an appropriate interest rate over a certain period of time.
Studies of Hamilton harbour have been made over the past year, and since this is the third largest port in the country and since there are 542 industries in Hamilton, some of these the largest in Canada, I feel it is a very good proposition for the people of Hamilton and one which will greatly help the development of the St. Lawrence seaway. I must congratulate the Minister of Transport on his speedy action in dealing with this loan arrangement, and I must also congratulate the harbour commissioners of Hamilton who have created something of a precedent by making this application. I think it shows that Hamilton wants to help itself. It is not asking for anything for nothing, but it is going ahead and making an effort to ensure its future welfare. I think this is another example of this Conservative government co-operating with the municipalities in this type of endeavour and I would like to give it my full support.


George Carlyle Marler: Mr. Chairman, I would first like to correct the impression the hon. member for Burnaby-Richmond seemed to form from what I said when speaking on this resolution. He seemed to think that the purpose I had in mind in raising the question of this change of policy with regard to the financing of harbour improvements was to throw on to the back of the municipality a responsibility which clearly does not belong

to it. I am sure that if the hon. gentleman will read in Hansard tomorrow what I said earlier he will find that no words of mine should have given him that impression.
The reason I raised the question of what seems to me to be a change of policy is that up to, let us say, the time when the government changed in June it had been the constant practice of the Department of Public Works to do the original dredging that was required in order to enable ships to approach the facilities provided by harbour commissions and to undertake that dredging at the expense of the national budget and not to charge the costs of that original dredging to the harbour commission which benefited from it.
In the case of the Fraser river I know the question was discussed as to whether or not the cost of annual dredging, which as the hon. member for Burnaby-Richmond no doubt knows is somewhat extensive, should continue to be borne by the Department of Public Works. I do not know what decision has been reached by the present government in that connection but I must say that personally, having the interests of the harbour commissioners at heart and having had some responsibility in representing them in the House of Commons, I am quite sympathetic to the view that all dredging both original and annual should be done by the Department of Public Works because it seems to me that was the way in which the needs of navigation were taken care of so far as the movement of vessels is concerned. It never occurred to me that the Department of Public Works had any responsibility to provide the facilities in the harbours where a harbour commission had been established.
We know, of course, that the Department of Public Works provides harbour facilities of a kind all across Canada but we also know that the revenues from those facilities are paid into the national treasury and the federal government, in a word, takes the good with the bad. Broadly speaking I think it is probably doubtful if on a general basis the revenues from harbour facilities provided by the Department of Public Works are selfsupporting. I do not think anybody would quarrel with that fact because we know that those harbours for which improvements are made by the department are small harbours and are not capable of bearing the total cost and producing the revenues which would make the capital expenditures which have been made self-liquidating.
With regard to the Hamilton harbour commission, as I understand the situation there is a program of works to cost $8 million of

which one-hall is to be paid by the Department of Public Works and the other half is to be paid by the Hamilton harbour commission by means of money furnished by the Minister of Finance and repaid over a period of years. As I said earlier, so far as the official opposition is concerned we believe there is no question whatever that this loan should be well within the financial capabilities of the Hamilton harbour commission and I do not think there is any doubt that it will be able to pay interest and amortization on principal in the 40 years which the minister has mentioned.
The point I do want to bring to the attention of the minister is this. There are, of course, other autonomous harbour commissions and I would like to mention two in particular. There is the harbour commission of New Westminster and, as hon. members from British Columbia well know, this commission not very many years ago borrowed from the federal government the moneys that were required to build what I believe is called the new ocean terminal and there was no question in that connection of the federal government paying half the cost of those facilities. But then nearer at hand to Hamilton, and I take it competing with it for business, is the harbour of Toronto and, as the Minister of Transport who is one of the Toronto members well recalls, within the last two or three years, I think, a new terminal was put up at not inconsiderable expense by the Toronto harbour commission. In that particular case it obtained its own funds without government help and the government did nothing towards contributing to the costs of those facilities which were entirely paid for by the commission itself, as I said.
The situation that seems to me to be developing is that Toronto provided facilities at its own expense and, as I see it, must necessarily levy the tolls and tariffs for the use of its facilities that it requires to pay the interest and amortization on the investment which it has made in those facilities, whereas under the proposal which we are now considering Hamilton is to receive $8 million for facilities to which the Department of Public Works is to contribute $4 million so the interest on the expenditure represented by those facilities is only on $4 million and not on $8 million. If Toronto had built them it would have cost them $8 million.
Under the plan we are now discussing Hamilton will have $8 million worth of facilities but a debt of only $4 million. My only reason for raising the question of this change of policy was not, as the minister seemed to think, to urge the government to do less-I am sure he will find nothing in 96698-115
Hamilton Harbour Commissioners what I said earlier that urged him to take any particular course of action with regard to Hamilton-but what I did ask him was to give the committee the benefit of the consideration which he and his department must have given to this proposal because it seems to me that it creates-if you like, let us call it a precedent. There is nothing wrong with creating a precedent but I think there must be some reason for departing from a policy which had been followed uniformly with all of the harbour commissions across Canada.
The hon. member for Hamilton South in his remarks a moment ago spoke about the need of these facilities and the useful purpose they would serve and while I am not suggesting that he went into the matter at all fully the impression which I received from what he said was that the facilities were of such a character that they would provide the revenues needed to pay the interest on the whole cost. Consequently I am just asking the Minister of Transport if he could not give us a more complete explanation of why there is this change of policy and why we seem to be providing in this particular case at a cost to be borne to the extent of 50 per cent by the federal treasury-I may be quite wrong in this assumption-facilities which would seem to be of themselves self-liquidating.
No one is suggesting for a moment that the facilities should not be built. I think the minister has made it quite clear that in the judgment of himself and his officials the facilities are needed but the one point he has not clearly disposed of in my view is why half the cost should be paid by the federal government when the facilities seem to be self-liquidating and self-supporting. Perhaps the minister could give us a fuller explanation on that point.
I should like to reiterate that I have no wish whatever to interfere with or to hinder the development of facilities in Hamilton harbour. I think we probably all agree that they are necessary. While we do not have the more special knowledge the minister would have as to whether $8 million is the exact cost or the details of the facilities themselves, in a broad general way I think he has made out a case for the carrying out of the work. But I would suggest to him that he has not yet made out a case which is very convincing as to why Hamilton is not able itself to service the cost of the facilities which seem to be necessary.


George Harris Hees: I wonder whether the member for St. Antoine-Westmount would tell me this. Were these arrangements and this proposition not discussed quite clearly between
1804	HOUSE OF
Hamilton Harbour Commissioners himself as the former minister and the Hamilton harbour commission? Was there not a discussion with him?


George Carlyle Marler: I can assure the minister that this is the first time I have had any personal knowledge of this particular project.


Robert Matthew Turnbull McDonald: I do not
wish in any way to say anything against the hon. member for St. Antoine-Westmount, but after the election I made a routine check of the facilities of the harbour and in discussion with one of the harbour commissioners appointed by the former Liberal regime he asked me if our government would give consideration to the $4 million proposal about which he had talked to the Department of Transport before the last election. I told him that I would take up the matter with the officials of the Department of Transport when they came to Hamilton and that I was sure that they would extend the co-operation that this government always gives.


Mr. Martini:: Mr. Chairman, I support the resolution and I have some figures here which prove that Hamilton harbour is growing fast. As the hon. member for Hamilton South said, we have industries there that are situated on the harbour. I just want to give these figures. Thirty-five years ago only
60,000	tons of cargo were handled in and out of Hamilton harbour. In 1956 the figure was 7,834,593 tons and I am told that the increase this year so far is over a million and a half tons. The hydro thermal plant to be built in Hamilton will mean the bringing in of about 4 million tons of coal a year, more than Hamilton uses at the present time. Therefore I am in favour of the resolution.


Mr. Lavigne:: Mr. Chairman, I should like to say a few words on the resolution. I want to tell the minister that I am very happy to see it on the order paper and I wish to compliment him on it. I know the problems of the municipalities along the St. Lawrence seaway. Their financial problems have become very serious. They have been experiencing growing pains and are having difficulty in selling their debentures. They have a much graver problem facing them in the need to develop harbours and promote harbour commissions and are having a very difficult time. I am happy to see the resolution on the order paper because I may have a similar one with respect to the Cornwall harbour commission before too long.


George Carlyle Marler: Is the minister not going to deal with the question I asked?


George Harris Hees: I think all I can say to the hon. member is that this is a new government and we are taking a new look at a number of


problems. Perhaps that is the reason we are here today. This proposition appears to us to be a fair and sensible one in order to help harbour commissions and municipalities to help themselves. We have studied the matter. We feel that it is not giving away the government's money. We feel that the government should assist the development of commerce and industry by helping harbour commissions provide the needed facilities. That is the way we as a government look at this proposition.
The former government may condemn it. The former government may consider we are giving away government money. The former government may consider we are doing things that are spendthrift and foolish. We do not. We believe that this is a way to help people to help themselves, to invest in Canada's future. This matter has been considered thoroughly by the government. We have considered every aspect of it. We consider the proposition is fair and sound. All I can say to members on the opposite side is that if they do not feel this is the right way to spend government money then let them be sure to vote against it. We feel that it is. We believe that this is a sound, sensible way to help Canada to help herself.


George Carlyle Marler: Mr. Chairman, I suppose this is probably the fiftieth invitation that the government has extended since the beginning of the session for us to defeat them on some measure or other. I must say I am somewhat surprised that my hon. friend is following the example of some of his colleagues because in my own parliamentary experience, which now extends over some fifteen years, his is the first government I have met so far which has seemed more anxious to have its proposals defeated than accepted.


George Harris Hees: Just tested before parliament and before the people.


George Carlyle Marler: Regardless of what the minister says concerning the desirability of the federal government lending a helping hand to the Hamilton harbour commission, the fact remains that the two members from Hamilton-I am not, of course, including the Secretary of State-the hon. member for Hamilton South and the hon. member for Hamilton East, have both spoken in rather moderate terms, I thought, with regard to the large volume of traffic that Hamilton is already taking care of. The hon. member for Hamilton East, who spoke a moment ago indicated that the already substantial volume of traffic, which, I suppose, is now in the neighbourhood of 8 million tons annually, is going to be increased by another 4 million tons when the hydro thermal plant is built

in Hamilton. I cannot help thinking from what they have said and from what the minister himself has said that the revenues of the Hamilton harbour commission would seem to be more than sufficient to take care of the principal and interest on the whole cost of these facilities.
Therefore what would really seem to be the case is that the government is making a gift of approximately half the cost of these facilities to a body which, I think we should all agree, is probably fully capable of meeting its own responsibilities and standing on its own feet. One fact that perhaps should not escape us is that that really is not the question before the committee at this time. The question before the committee at this time is the resolution which is in these words:
That it is expedient to introduce a bill to authorize the Minister of Finance to make loans to the Hamilton harbour commissioners, out of the consolidated revenue fund, not exceeding in the aggregate $4 million for the purpose of constructing additional dockage and other facilities in the harbour.
I come back to what I said when I first spoke, Mr. Chairman, that we intend to facilitate the passing of the resolution and the bill to be based on the resolution, but I do not want the minister to think from that, when we are asked to consider more specifically the question of providing through the budget of the Department of Public Works an additional $4 million either by a single payment or otherwise, that we will not go into the matter. We reserve the right to go into the matter more fully at that time.
Now, Mr. Chairman, it may well be that this is a rather rosy view that perhaps we have developed during the evening as to the ability of Hamilton to pay the principal and interest on an $8 million program, provided the moneys were lent. During the discussion before the standing committee on railways, canals and telegraph lines it may develop that the commission is not able to pay interest on the whole of the $8 million, either now or ultimately, and that the tariffs that could reasonably be expected to be levied on the traffic passing over these facilities will not be sufficient to take care of and support a debt burden of $8 million. In those circumstances, I would be quite prepared to adopt a different view in the matter. For that reason I think I should reserve the position of the party to which I belong, so that when the question of providing these additional funds comes before us we shall have an opportunity of expressing our opinions in the light of the pertinent facts. As I say, Mr. Chairman, the question at the moment is whether or not we should adopt this resolution, and despite the invitation of my successor that we should 96698-1154
Hamilton Harbour Commissioners defeat the government on this proposal I am not ready to accept that invitation and I think we should pass the resolution.


Frederick George Hahn: Before the resolution carries, I may say I have listened with a good deal of interest to what the minister had to say and what other spokesmen have said in respect thereto. The minister is fully aware that there is a harbour commission, similar to that of the Hamilton harbour commission, in my own area. I am interested in this change in policy. I would ask the minister if this is a new policy, and if so, have harbour commissions been made aware of it so that they can take advantage of it in other areas of Canada?


George Harris Hees: There is no new policy. As I tried to tell the house tonight, we examine each application as it comes before us and try to make a sensible, accurate and fair summation of the application and deal as fairly as we possibly can under the circumstances which are presented to us. There is no new policy, other than perhaps a different look that a new government takes of national affairs. There is no laid down new policy. We believe that the attitude that we have taken in this matter is quite a sensible and fair one. It may not be, but we think it is. It is not a new policy, as I said; it is simply perhaps a willingness to look at each and every problem that is presented to us on its merits, and an attempt to decide what should be done in the light of the presentation that is made.


Frederick George Hahn: I am very appreciative of what the minister has just said because in it I recognize that while he is not prepared to indicate that it is a new policy, at the same time the fact is established that the government is taking a different look, or let us say looking at this matter through different glasses. I am prepared to accept that. I am very happy to ascertain that we have this new look. I would be the last person in this house to oppose this suggested move. I am more particularly interested, however, in establishing whether or not the government is prepared to accept other applications along similar lines by other harbour commissions?


George Harris Hees: As I said earlier, Mr. Chairman, this government is very glad, as the last five and a half months have indicated, to look at any proposition that is put before them, to examine it to the best of our ability. I am not saying, by any manner of means, that we accept each proposition that is put before us. However, we will look at them, examine them, and to the best of our ability decide whether they are good propositions or otherwise.


Frederick George Hahn: I should like-


Some hon. Members:: Oh, oh.
180S

Hamilton Harbour Commissioners


Frederick George Hahn: I am delighted at the reception I am receiving from my Conservative friends.
I am concerned with ascertaining if this is a new policy with respect to harbour development. If so, I think the people in Canada, and particularly those in my own riding, have a right to know whether or not they can expect the same treatment as the Hamilton harbour commission has received. I am satisfied with what the minister says, that each application must stand on its own merits; that seems to be the case. In other words, what we have in effect is a new policy which says that every harbour is going to be considered on the basis of the case the commissioners make for it. The reception of the application may, of course, depend to a large degree on the personnel or other attributes which the commission has in presenting its case. I do not think that would be too satisfactory in some instances.


George Harris Hees: As a last word, I will say that the personnel of the harbour commission in question has nothing to do with the acceptance or otherwise by this government of an application. I think it might be of interest to hon. members to know that I believe most of the members of the Hamilton harbour commission, so far as I know, are not sympathetic to the party which I represent. This had nothing to do with our examination of the case. Our examination of any particular case will have nothing to do with the political affiliation of the members of the board concerned.


Frederick George Hahn: Mr. Chairman-


An hon. Member:: Sit down.


Frederick George Hahn: An hon. member suggests that I sit down, but I do not think it would be fair to the minister if I left the impression that I thought he had made a suggestion about political affiliations. The only thing I am suggesting is that in the event a harbour commission has a particular problem in respect to their harbour I feel they should be entitled to expect the same treatment as the harbour commission of Hamilton received.
Resolution reported and concurred in.
Mr. Hees thereupon moved for leave to introduce Bill No. 197, respecting the Hamilton harbour commissioners.
Motion agreed to and bill read the first time.


Mr. Speaker:: When shall this bill be read a second time?


Some hon. Members:: Now.


Stanley Howard Knowles: By
leave.


George Harris Hees: the second reading of Bill No. 197, respecting the Hamilton harbour commissioners.


George Carlyle Marler: Is the minister going to make a statement on the bill?


George Harris Hees: I do not think there is anything I can add to what I said at the resolution stage.


George Carlyle Marler: The only comment 1 wish to make on the bill is that it seems to be in the form which is usual in cases where the Minister of Finance (Mr. Fleming) is to be authorized to make loans to harbour commissions. I, personally, have no further comments to make on the bill itself.


[Stage Direction]
Motion agreed to, bill read the second time and referred to the standing committee on railways, canals and telegraph lines.


George Harris Hees: the second reading of Bill No. 72, to amend the Canadian Vessel Construction Assistance Act.


Stanley Howard Knowles: Explain.


George Carlyle Marler: Is the minister going to make a statement?


George Harris Hees: Yes, Mr. Speaker. The purpose of this bill is to extend the benefits provided by the Canadian Vessel Construction Assistance Act in order to give further encouragement to the construction and conversion of vessels in Canada.
The bill is a rather technical one involving income tax law. As the house leader has already said, when it has had second reading I propose to move that it be referred to the committee on railways, canals and telegraph lines.
Before going into the provisions of the bill itself I might summarize the existing provisions of the act by stating that the benefits granted are twofold. The first is the provision of a higher rate of depreciation, not exceeding 33J per cent on a straight line basis, as opposed to the normal rate of 15 per cent on the reducing balance allowed under the Income Tax Act. This special rate of depreciation applies only, of course, to vessels built, converted or altered in Canada. The second benefit is the freedom from recapture of depreciation where the proceeds of sale of a ship are used for replacement in Canada.

The amending bill enlarges and extends the conditions under which the benefits of the act can be obtained. These extensions are necessary because of the fact that shipbuilding in Canada is a more expensive undertaking than it is in European or Japanese yards. In comparison with United Kingdom yards, Canadian shipbuilding costs are about 50 per cent higher. This means that the cost of a ship in Canada is one and a half times that of a similar ship built in the United Kingdom. At the same time we must bear in mind that during the war our shipyards made an immense contribution to the allied cause. There was built up during this period a group of skills the dispersal of which must be prevented. For reasons of national security, these skills would be necessary to us and to our allies in the event of another conflict. For reasons of our national economy as a great trading nation it is also necessary for us to maintain the necessary shipbuilding and ship repairing facilities to meet the needs of the many ships of all nations that come to carry away our exports. The Canadian shipbuilding industry is also an important source of employment for Canadian workmen.
Under the act as it now stands a taxpayer for whom a ship was built in Canada can duly obtain the benefits of a higher depreciation rate while he retains the ship on Canadian registry. In order to assist Canadian shipowners to operate their vessels competitively in the international ocean-going trades we have an arrangement with the United Kingdom whereby Canadian-owned ships may be operated on United Kingdom registry, subject to recall to Canadian registry. These ships will be considered as a Canadian contribution to any allied pool in time of war, and by the nature of the arrangements are subject to Canadian requisition in time of war.
The first amendment extends the benefits of the higher rate of depreciation to the Canadian owner of a ship built or converted in Canada and transferred to a commonwealth registry under conditions satisfactory to the Canadian maritime commission.
This involves a transfer under the special arrangements to which I have referred. Accelerated depreciation is, of course, a form of tax relief. Obviously any form of tax relief is valueless unless the taxpayer is earning sufficient taxable income to take advantage of the relief afforded. The owner cannot earn sufficient income under Canadian registry, but he can do so under United Kingdom registry. Indeed it is a recognized fact that the operation of a 10,000 ton dry cargo vessel on Canadian registry costs $100,000 more per year than it does on United Kingdom registry.
Vessel Construction Assistance
The purpose of this amendment therefore, is to encourage owners building for operation under the transfer arrangements, to build their ships in Canada instead of abroad.
Furthermore, as the act now stands, a taxpayer can obtain the benefit of the higher depreciation rate only if the newly constructed ship is built "by or for" him.
The second amendment involves the deletion of these words "by or for". This will allow Canadian shipyards to build ships, barges or vessels, for later sale to a purchaser not yet identified at the commencement of construction. In other words, it will allow speculative building. As a result, yards will be able to keep their employment cycle more level by undertaking such a venture when there is a slack period. To prevent any undue extension of this benefit, it is restricted to vessels in respect of which no depreciation had been previously allowed to any other taxpayer, either under this act or under the Income Tax Act. Consequently, in practice, the benefit will be available only to the taxpayer who has incurred the additional cost of Canadian building, and it will allow a shipyard to do speculative building with the prospect of being able to attract a purchaser.
The third amendment deals with that part of the act which gives freedom from recapture of depreciation under the Income Tax Act when the vessel is sold, provided the proceeds of sale are used for replacement under conditions satisfactory to the Canadian maritime commission. At present this benefit is available only to the ships sold by the crown in the immediate post-war years or those built since 1949 with the benefits of the act. This amendment makes the benefit of freedom from recapture applicable to the proceeds of sale of any ship regardless of whether or not it was allowed special depreciation or capital cost allowances in the past. This is designed to encourage owners of all classes of vessels to dispose of older equipment and to use the proceeds to build replacements in Canada.
The fourth amendment will allow the Canadian maritime commission to certify that it holds on deposit a sum of money or a guarantee at least equal to the tax payable if satisfactory replacement is not effected, thus allowing the benefits of freedom from recapture of depreciation to be realized during the period between disposition of the old vessel and completion of the new one.
Without this amendment the taxpayer, unless the entire undertaking is completed in one taxation year, is compelled to pay the tax in the year of sale and then to seek reimbursement of the tax in the year when

Vessel Construction Assistance the proceeds of disposition are actually spent for replacement. This obviously makes his financing problems more complicated and more onerous.
The fifth amendment modifies certain income tax practices to ensure that the seller of a ship may enjoy the freedom from recapture at the time the sale is made.
The final amendment provides for the conditions under which any deposit or guarantee may be paid out by the Canadian maritime commission.
As with the other bills I have introduced this evening, Mr. Speaker, when second reading is passed I intend to move that this bill be referred to the standing committee on railways, canals and telegraph lines.


George Carlyle Marler: Mr. Speaker, if one were to read this bill I think one would have the impression that it is probably the most complex piece of legislation which the house will be asked to consider at this session. But the language is misleading because it contains many technical terms. In fact, however, the objects which it proposes to carry out are fundamentally simple.
I should like to say to members of the house that this Bill No. 72 is drawn in very much the same terms as those of a bill for the same purposes which was introduced at the last session of parliament earlier this year but which, because of time running out, was not disposed of and did not go beyond first reading. In consequence it will be our intention to support the bill now before the house. However, I hope that if critical comments are expressed, the Minister of Transport will not again ask us to vote against the government or to throw it out of office.
Hon. members who had the opportunity of examining the Canadian Vessel Construction Assistance Act will see from its terms that it was adopted obviously in order to encourage the construction of vessels in Canadian shipyards and likewise the carrying out in Canadian shipyards of the work of conversion and major alterations. As hon. members may have gathered from what the hon. minister said in his explanatory remarks, encouragement was given in the form of depreciation at an unusually high rate and of freedom from recapture of depreciation where the proceeds from the sale of a vessel were used for its replacement under conditions satisfactory to the Canadian maritime commission. The provisions concerning depreciation which cover both the case of construction of a vessel in Canada and the case where a vessel has undergone conversion or major alteration in Canada will be found in subsections
[Mr. Hees.l
(1) and (2) of section 3, and the provisions providing freedom from recapture of depreciation will be found in section 4, from which it will be seen that the recapture provisions of the Income Tax Act do not apply where the proceeds are used or the replacement of the vessel is made, as I said a moment ago, under conditions satisfactory to the Canadian maritime commission.
The bill which is before us in effect makes several changes. The first one is to do away with the requirement that the benefits of the act shall accrue only to a taxpayer while a vessel remains on Canadian registry and it will be readily seen from an examination of the bill that one of its purposes is to do away with this requirement as a condition of being entitled to benefits and thereafter to depreciation after the vessel is replaced.
The second provision which it is proposed to change is that it is no longer to be a condition that the vessel in respect of which benefits are allowed shall be built by or for the taxpayer and, as the minister himself pointed out, this has to be done by extending the benefits of the act to vessels built by a shipyard for sale to any purchaser. There is, however, a restriction which has been added in regard to this benefit which did not appear in the bill which I presented at the earlier session this year, and I would hope that when the bill is considered in the standing committee we might have the opportunity of going into this restriction to see whether or not a useful purpose will be served by leaving it in or whether it might be more advantageous to make some other provision with a somewhat similar object in mind.
Quite obviously the taxpayer should not be entitled to depreciate the same vessel twice, but I am not sure that the proviso to which I am referring does not prevent the taxpayer from obtaining full depreciation at the accelerated rate and I am not perfectly certain with respect to the benefits which would otherwise accrue to a taxpayer owning a vessel of the kind qualifying for these benefits, whether that taxpayer should be precluded from passing on the same advantages to someone to whom he might sell that vessel. However, that is rather a technical question and perhaps not at all appropriate to discuss on the second reading of this bill, when of course we are concerned with its principle.
The third change is to extend the operation of subsection (1) of section 4 in the present act, as the minister said, so as to include any vessel whatsoever, instead of limiting its operation to those vessels in respect of which some form of special depreciation or capital cost allowance had been granted in the past.

In that connection I would like to recall what I think was a fairly simple explanation which I gave to the house when the estimates of the Department of Transport were under consideration on August 10, 1956. I would like to quote from what I said on page 7406 of Hansard as follows:
Further modifications will also be brought about in the realm of capital cost allowances. At present, for income tax purposes, it is compulsory to pool vessels that have an exemption from recapture of depreciation, under section 4 of the Canadian Vessel Construction Assistance Act, with other vessels that do not benefit from this exemption. Consequently, when the owner disposes of some or all of the vessels so pooled, his exemption can readily become dependent upon the order in which they are sold. Broadly speaking, if the qualified ships are sold earlier and the unqualified ships later, the sale of the qualified ships may serve to wipe out the undepreciated value of the class. This situation could be remedied by permitting an owner, if he so elects, to treat as a separate prescribed class any vessel or vessels that qualify under section 4 of the act: that is, a vessel the proceeds of sale of which had been used for replacement under conditions satisfactory to the commission.
Of course, Mr. Speaker, in referring to the commission there I was referring to the Canadian maritime commission. I am sure hon. members will agree that the question of whether or not the benefits of the act should or should not accrue, ought not to be dependent upon the order in which the taxpayer disposes of his vessels, and if this is the law it would seem to be an anomaly which ought to be corrected, and that, of course, is the purpose of the third change to which I referred a moment ago.
The fourth change is to allow the Canadian maritime commission, where the replacement of a vessel has not been undertaken but is foreseen, to certify that it holds on deposit or by way of guarantee an amount at least equal to the tax that is paid. This will allow the benefits of the act to be recovered during an interim period instead of requiring payment of the tax and the subsequent reimbursement of it. I think the minister's explanation on this point was perfectly clear that when an owner disposes of his ship the question arises as to whether or not there is to be recapture of the depreciation which he has set up during the time he has owned and operated the vessel, and I think it is desirable that this question could be disposed of finally at that time and the determination not held over until perhaps some much later date when the funds in question are used for the replacement of the vessel, that is to say at the time of the completion of the operation by which the old vessel is replaced by a modern replacement.
As I said earlier, Mr. Speaker, this is legislation which we in this party might well have dealt with earlier this year had the time
Vessel Construction Assistance available been long enough and I do not think, despite the complexity of the language of the bill, it is controversial. Therefore, so far as we are concerned, it is our intention to support the second reading.


Mr. H. E. Smith (Simcoe North):: Some hon. members may wonder why a member from a central Ontario riding is speaking in support of a bill dealing with the construction of ocean going vessels. In Colling-wood on Georgian bay is one of the finest and most efficient shipyards in all Canada. There are presently employed in those yards between seven and nine hundred highly skilled shipbuilders. That these yards have been able to keep busy with the little governmental aid they have received is indeed a tribute to both the workers and management. In anticipation of the opening of the St. Lawrence seaway, ships are now being built there which will sail both the Atlantic and Pacific coasts of Canada. The passage of this bill means that Canadian shipbuilding will be able to compete with regard to all the shipbuilding needs of Canadian owners wherever ships may be used.
It has not been the policy of the Canadian government to subsidize the building of Canadian merchant shipping, yet in times of need the shipbuilding industry and the shipbuilders are absolutely vital to the security of our country. In Canada we have seen since the end of the second world war many of our great lakes yards virtually disappear. Certainly their work forces are scattered forever. If this bill brings only one ship to the great lakes yards it will be worth while, but I am sure it will mean many new ships for all Canadian shipyards. Without it there is no incentive for Canadian ship owners to build their ships in Canada when the prime cost of ships in foreign yards is as much as 50 per cent less than in Canadian yards.
This act is not a subsidy. It merely permits the owner to write off the cost against earnings at an accelerated rate. As soon as the cost is written off in a minimum of three years the ship will still have many years of earning taxable income for the owners.
This bill ought to commend itself to all hon. members who consider the shipbuilding industry important to our national maturity and to our national security.


Mr. R. J. McCleave (Halifax):: Mr. Speaker, I can take part in this debate not only as a member for a constituency in which there are large shipyards, but also as one who represents a riches to rags story as far as shipbuilding is concerned, for my great,

Vessel Construction Assistance great grandfather built 75 vessels in the balmy days of sailing ships while I could not even patch a canoe.
I think there is no more vulnerable point in our national life than foreign competition in the shipping and allied industries. An outstanding example of this is with us today, namely the problem of Canadian National Steamships. I am happy to see this act come before parliament at this time, for revision. I think it is a hopeful sign that with all the emergency legislation we have to consider before we get out of here at Christmas, New Year's Day or St. Valentine's Day-


Leonard T. Stick: Why not make it Easter while you are at it?


Robert Jardine McCleave: -the government should be able to find time for this measure, and I hope the hon. minister who heads the Department of Transport will continually keep a vigilant eye upon this act to see that it accomplishes what it sets out to do.


Mr. C. W. Carter (Burin-Burgeo):: Coming from a province that is surrounded by water we are naturally interested in anything which is done to encourage shipbuilding in Canada. The very life of our province depends, of course, on what is brought in by sea.
The purpose of this legislation, as stated by the minister, is to retain the pool of skills which we have built up, and which we might need in an emergency. We want, also, to encourage shipbuilding in Canada. I have some doubt whether this bill in its present form is going to be of very much use in that respect as far as the province of Newfoundland is concerned. The bill does not specify to what size ships this legislation will apply, or whether it will apply only to coastal vessels, or whether it will apply equally to fishing vessels. I should like the minister to clear this matter up.
My own opinion is that if we are going to encourage shipbuilding in Canada we have to meet two problems. The first is the exorbitant capital cost of construction. As the minister said, a ship built in Canada costs 50 per cent more than the same ship built in the United Kingdom. I think he could have gone on to say that it would cost twice as much as a similar one built in Japan or in another part of the world.
If we are going to meet that competition and encourage shipbuilding in Canada, the best way of doing that is to increase our bounty system and extend the bounty system we have for fishing ships. I think this legislation would be best applied to operating costs, which are our second problem inasmuch as operating costs are geared to our standard of

living, which makes it impossible for us to compete with ships of foreign registry. I should like to see more attention paid to the bounty system, and this legislation restricted to operating costs. I think we could do something more by way of amending some other legislation under the Canada Shipping Act which would permit us to lower capital costs by bringing in secondhand ships at very reasonable cost for use in our fishing industry and coastal trade.
(Translation) :


Mr. Maurice Bourgel (Levis):: Mr. Speaker, I merely want to add a few words to the remarks of my colleagues.
As the representative of a riding whose chief industry is the building and repair of ships, I am keenly interested in any legislation affecting this particular industry. I had the opportunity to sit in this house during the last war, and I did note how much it cost the government to organize its navy and merchant marine.
I believe legislation such as this should command the approval of every hon. member in this house, because I think it is designed to help an industry which is of primary importance for the country's defence and economy. I hope the minister will continue to assist this industry, in the same manner as it was helped by the former government, as it is essential to our national economy and, more particularly to those ridings depending on it for their existence.
I also hope that before long we will hear the government announce the creation of that famous merchant navy advocated by the Conservatives when they were sitting on the opposition benches.
Again, Mr. Speaker, I want to say that I will support this or any other legislation tending to assist shipbuilding and repair in our country.
(Text) :


[Stage Direction]
Motion agreed to, bill read the second time and referred to the standing committee on railways, canals and telegraph lines.


Donald Methuen Fleming: the second reading of Bill No. 169, to amend the Canadian and British Insurance Companies Act.
He said: Mr. Speaker, although this bill appears to have some formidable provisions in it, its intent is quite simple and it is proposed, if the house is pleased to give the

bill a second reading, to have the measure then referred to the standing committee on banking and commerce where a thorough review can be made of the clauses of the bill and where the superintendent of insurance and any other officials whose presence is desired will be available to discuss the terms in detail.
The policies and practices of Canadian life insurance companies cut deeply across the Canadian economic structure and the welfare of a great multitude of people in Canada. The contracts of life companies are generally made for long terms, involving the future welfare of both policyholders and their dependants. Moreover, most companies have grown enormously during the last decade. Consequently the question of their ownership and control is of serious concern and importance to almost every Canadian.
Life insurance companies are organized either on the mutual basis, without share capital, or on the joint stock basis. Mutual companies are, of course, owned entirely by their policyholders. The great majority of Canadian life companies are joint stock companies but practically all of them issue policies on the participating plan as well as on the non-participating plan. A participating policyholder pays relatively higher premiums but is entitled to participate in the profits of the company from its participating business. As a consequence, the holders of participating policies have a very real interest in the management of the company, an interest going substantially beyond the security of their policies alone. This is recognized in the insurance act by giving participating policyholders the right to attend and vote, either in person or by proxy, at all general meetings of the company and by giving them representation on the board of directors to the extent of at least one-third of the board.
Over the years participating insurance has proved to be the more popular plan in Canada, with the result that most of the life business is transacted on this plan. From this point of view, therefore, it may be said that a well-established life insurance company having a large volume of participating insurance in force, even though organized on the joint stock basis, is to some extent already a mutual company.
The capital stock of a relatively mature life insurance company is usually quite small in comparison with the total funds of the company and its total liabilities. The capital serves a most important purpose in launching a company and in providing protection to the policyholders during the early years. However, as a company grows, the capital
Insurance Companies Act becomes less and less important so far as protection to the policyholders is concerned. This is not to say, of course, that the shareholders are not entitled to the profits resulting from the development of a successful enterprise, or to minimize the value of a proprietary interest in most businesses. In the field of life insurance, both mutual companies and stock companies have their advantages and their disadvantages. Nevertheless, the diminishing role of the capital must be mentioned to point up the fact that the principal strength of a well-established life insurance company lies in the funds accumulated from the premiums paid by its policyholders, especially the participating policyholders, rather than in the capital stock.
From what I have said I think that it can readily be seen that the policyholders' interests in every Canadian life insurance company, whether it be a mutual company or a stock company, are very substantial, and that it may properly be stated that as the companies grow they all tend to become policyholder organizations to an increasing extent.
In recent years a high degree of interest has been displayed in the shares of Canadian stock life insurance companies, and in the case of some companies the price of the shares has risen to levels that scarcely seem justifiable in the light of the dividends being paid and the earnings of the companies. For the most part, our Canadian companies have been built by Canadians with Canadian capital, and the good management and public responsibility shown by the shareholders have been a credit to the industry. Policyholders have been treated fairly and the profits withdrawn by shareholders have not in any case been so large as to suggest that the interests of the policyholders have been affected to their detriment. The companies have at the same time gained an enviable record for reliability. With a new body of shareholders, however, coming into ownership of shares at the very high prices that have been in evidence in recent years it is less certain that past management practices will be continued in every instance.
There has also been great interest manifested in recent years in obtaining control of Canadian life insurance companies, particularly among foreign investors. Prior to 1930, all Canadian life insurance companies were controlled in Canada. About 1930, control of the Montreal Life Insurance Company, head office, Montreal, was acquired by an English insurance company. No other change occurred until 1955 but, since then, control of six Canadian life companies has been acquired

Insurance Companies Act by interests outside of Canada. In 1955 control of the Continental Life Insurance Company, head office, Toronto, was acquired by a Swiss insurance company. In the same year, the Canadian Premier Life Insurance Company, head office, Winnipeg, was incorporated by parliament to take over an existing fraternal benefit society, the Dominion General Benefit Association, and the new company was capitalized entirely by another Swiss insurance company. Early in 1956, control of the Western Life Assurance Company, head office, Hamilton, was acquired by certain United States investors; and later that year, control of the Commercial Life Assurance Company, head office, Toronto, was acquired by Dutch insurance interests. Although most of these companies were quite old, they were relatively small companies.
Early in 1957, control of a much larger company, the Dominion Life Assurance Company, head office, Waterloo, was acquired by a large United States insurance company. More recently still, in June last, control of the Fidelity Life Assurance Company, head office, Regina, was acquired by British insurance interests. I am sure the house is aware of the fact that in at least one other conspicuous case control of the stock of the company nearly passed out of Canadian hands not very long ago.
By reason of the small capital in relation to the aggregate funds of many companies, control of a very large organization may sometimes be obtained through comparatively small outlays in the purchase of shares. These surrounding circumstances, which have been the subject of comments from time to time in the reports of the superintendent of insurance, have led some companies to feel that the best course for their future, including the welfare of their policyholders, would be to purchase their own shares, eventually retiring their entire capital stock and so becoming mutual companies. This course has been followed with outstanding success by some of the largest companies in the United States, notably the Metropolitan Life Insurance Company and the Prudential Insurance Company of America.
Mr. Speaker, if it meets with the approval of the house I think I could finish this statement in two or three minutes.


Some hon. Members:: Agreed.


Donald Methuen Fleming: Whatever the means may be, it seems desirable that control of Canadian life insurance companies should remain in good hands, and preferably Canadian hands. I am sure that this view is shared by all members of the house. After all, the life insurance business in Canada as represented

by the Canadian life insurance companies is peculiarly a Canadian institution.
The rrfein purpose of this bill is to authorize a procedure whereby a stock life insurance company incorporated by parliament may be converted into a mutual company, if the shareholders and participating policyholders of the company wish to follow this course and if the company is in a financial position to do so. The insurance laws of several of the states of the United States of America include provisions of this kind but our own act has not contained such a provision hitherto.
Under the procedure set forth in the bill, mutualization would be effected through the purchase of its own shares by the company and the cancellation of the shares when all of them have been acquired. Appropriate safeguards have been included to ensure that no company will start on this path unless it has the financial resources to carry the plan through to completion within a reasonable period and to ensure that the shareholders will be treated fairly and the interests of the policyholders will be protected.
Some companies may not wish to mutualize but may, nevertheless, wish to retain their Canadian character in so far as they can. In order to assist them to do so the bill would empower the board of directors of a life insurance company incorporated by parliament to refuse to allow the transfer of shares from Canadian hands to non-Canadian hands. This would be a discretionary power resting with the directors to use or not as they might see fit. However, this power would not apply to enable the directors to prohibit transfers from one non-Canadian shareholder to another. In that respect we are taking nothing away from the rights of any existing shareholder residing outside Canada. In some respects this power is similar to the power already conferred upon the directors by the Insurance Act whereby they may refuse to allow the transfer of any shares that are not fully paid.
The bill would also require that the majority of the entire board of directors of every company incorporated by parliament, whether a mutual company or a stock company, and whether a life insurance company or any other kind of insurance company, must at all times be Canadian citizens resident in Canada. The insurance act now requires that a majority of the directors representing shareholders must be Canadian citizens resident in Canada but no provision is made for mutual companies or as respects the entire boards of companies having policyholders' directors as well as shareholders' directors.
The other point dealt with in the bill relates to fraternal benefit societies. At the

present time, a fraternal benefit society insuring the dependent children of members is required to account for this insurance in a completely separate fund. This requirement was established many years ago at a time when societies were smaller than they are now and generally less experienced in insurance matters, particularly in the insurance of children. Under existing circumstances, there is no longer a need for this requirement and societies have been pressing to have the requirement removed so that they may simplify their accounting methods and also reduce their expenses.
Accordingly, the bill would remove the mandatory requirement that juvenile insurance must be accounted for in a separate fund and would enable fraternal societies to merge the juvenile insurance with similar kinds of adult insurance if they wish to do so. However, societies would still be empowered to maintain a separate fund for juvenile insurance if they so desire.
May I remind the house, Mr. Speaker, that if the house is pleased to give the bill second reading it is the intention to propose that it be then referred to the standing committee on banking and commerce.
On motion of Mr. Benidickson the debate was adjourned.



BUSINESS OF THE HOUSE

George Carlyle Marler: What business will we be taking up tomorrow?


Howard Charles Green: Tomorrow we shall commence with interim supply and then go on with the bill to amend the Canadian and British
Business of the House
Insurance Companies Act, debate on which has just been adjourned by the hon. member for Kenora-Rainy River. Then we will take the resolution to introduce a measure to amend the Exports Credits Insurance Act, then the resolution to introduce a measure to amend the National Housing Act. The hon. member for Assiniboia will be glad to hear that we will then take the resolution providing for guaranteed prices for agricultural commodities, then the resolution preceding a bill to provide for a loan to the province of New Brunswick. After that we will take the estimates of the Department of Trade and Commerce.


Stanley Howard Knowles: Could the minister give us a little more information about the remainder of the week? I ask this question particularly in view of the statement made earlier today by the Minister of Finance that he hoped his estimates would be considered before the end of the week. Can the minister say what estimates will be dealt with on Thursday, Friday and Saturday?


Howard Charles Green: I do not want to be held down to the information I give this evening because I am not certain. I think that on Thursday we will take the estimates of the Department of National Defence and on Friday those of the Department of Finance. I am not sure what we will take on Saturday.


George Carlyle Marler: The all-star game.


[Stage Direction]
It being six minutes after ten o'clock the house adjourned, without question put, pursuant to standing order.
1814	HOUSE OF
Questions