1958-06-20

[Stage Direction]
Second report of standing committee on miscellaneous private bills.-Mr. McCleave.

Right Hon. J. G. Diefenbaker (Prime Minister):: Mr. Speaker, some days ago the Leader of the Opposition asked whether I might say a word or two with regard to the meeting that took place last week with the Prime Minister of the United Kingdom. I say to him at once that I undertook to do so the next day, but in the course of the debate that arose I omitted to do so.
The discussions I had with Mr. Macmillan provided an opportunity to renew at first hand the understanding of our respective points of view. As both the late Mr. King and former prime minister Mr. St. Laurent said on more than one occasion, such consultations are a feature of the unique quality of the commonwealth. It is one of the privileges of membership in this commonwealth that prime ministers who share these ties can hold friendly and forthright discussions with each other from time to time about the problems which affect their respective countries, and also in a broader world context.
In the talks we reviewed a number of international problems, ranging from the proposed summit conference to developments in the Middle East and the problems at the moment being faced by the republic of France. We also spent some time in exchanging views on economic developments, particularly those relating to the forthcoming commonwealth trade and economic conference.
As hon. members know, the Canadian government has felt that a summit conference might resolve some of the issues affecting relations of the free world and the communist bloc. But we also believe that before any such conference is called there must be full preparation on the lower levels in order to assure a reasonable degree of success. Many there are who look with anticipation to the holding of a summit conference as though it would resolve all of the problems, 57071-3-93
or many of the problems, that have existed between the free world and the communist countries since 1945. For that reason everything must be done, if a conference is to be called, to assure that it shall not fail in its objectives when it is convened. This would, I think, be worse than not having a conference at all.
As hon. members know, technical discussions will commence at Geneva on July 1 regarding atomic inspection and the detection of nuclear explosions, in which conference the United Kingdom, the United States and the U.S.S.R. will participate, as well as other interested countries. If in consequence of this meeting in Geneva tangible progress is made, I think we might then be more optimistic about a summit conference taking place. Mr. Macmillan and I hope that a summit conference will take place, but both are aware of the fact that the west has not yet had any very encouraging indications from the U.S.S.R. that would lead the free world to believe confidently that the cold war will cease. When I make that statement I do so as well in the light of events that have taken place in the last few days in Hungary, and also the extent to which Mr. Khrushchev has added to the propaganda warfare that has existed for the last year or so, and to an intensified extent in the last few days.
Reference was also made to the political developments in Lebanon, and recently my colleague the Secretary of State for External Affairs reported on the part Canada could take in co-operation with other members of the United Nations in assisting the security council in its efforts to bring about an end to the disorders in that country. It was agreed among us that respect for the ideals of the United Nations in the Middle East, as elsewhere, would be a help to the observers of the United Nations in their task in that area.
Another political development in the Middle East which has disturbed the free world, and particularly us in Canada because of our membership in the commonwealth and in NATO, has been the disorderly situation in Cyprus. I can only say that as a result of the initiative being taken by the United Kingdom government in its latest proposals that were revealed yesterday in the House of Commons there it is to be hoped that a solution of this
1458	HOUSE OF
Discussion with U.K. Prime Minister problem may be worked out within a framework of conciliation and compromise.
Discussions also centred around the situation in France, our close friend and valiant ally, and I think there is reason to be optimistic that the worst of the difficulties in that nation is over and that under General de Gaulle, our loyal and brave friend during the dark days of the last war, Canada will be able to look forward to seeing France resolve its present problems and to a continuation of intimate collaboration with France under General de Gaulle.
As well we discussed the economic outlook on both sides of the Atlantic and its relation to the main problems and issues of policy that the United Kingdom and Canada are now considering. These discussions involved trade and economic development, not only as regards our two countries directly but also in respect of our relations with other countries as well. The main subjects of economic discussion were the policies to be followed at and the preparations being made for the commonwealth trade and economic conference. This included a review of a number of matters that are being studied by officials from all commonwealth countries in London at the present time, to the end that proper foundations will be laid for a successful conference.
Throughout these discussions there was a full realization of the ever-growing Soviet attack on the vulnerable and comparatively weakly defended economic front of the free world. It seems clear that this economic challenge is designed to outflank the political and military defences of the west. I believe that counteraction will be required in this field and can only be taken by co-operative measures to meet this new Soviet offensive. During the next few months the Canadian government jointly with our friends and allies will take steps to meet this new Soviet offensive.
Discussions are already under way with the North Atlantic treaty council, and I believe the result we hope will be achieved at the forthcoming trade and economic conference in September will tend to strengthen the economies of the free world.
That in general represents in summation the matters that we considered and discussed.


Hon. L. B. Pearson (Leader of the Opposition):: May I thank the Prime Minister for his summary of the discussions he had with the United Kingdom Prime Minister, which I am sure have emphasized and strengthened the feeling of friendship and close relationship between our two countries, not only in respect of their bilateral nature but in their working together to reduce


tensions and strengthen the chances of peace.
I am sure Mr. Macmillan's visit was helpful in that regard.
May I ask the Prime Minister one question arising out of his statement. In the discussion of economic matters with the United Kingdom Prime Minister, was advantage taken of the occasion to go into the United Kingdom free trade offer made to Canada last year?


Mr. Hazen Argue (Assiniboia):: If I may, Mr. Speaker, I should like to say a word on the statement that has just been made by the Prime Minister. I think we have all welcomed the statement he has just made. We feel that having meetings from time to time between the Prime Minister of this country and the prime minister of any other commonwealth nation is an excellent thing and should be promoted. I was interested in his statement on the forthcoming commonwealth conference, but I felt the statement was somewhat vague and inexact and that it did not give us any great hope that real accomplishments might come from that conference. I am hoping that recent action taken by this government will not make the work of that conference more difficult.
We realize that throughout the world today there are many areas of great tension, and we hope the free nations of the world will have success in easing this tension and promoting freedom and democracy throughout the world. Along with the Prime Minister we in this group are concerned with recent events in Hungary, and we are afraid these may spell a change of tactics in the Soviet union itself. We hope also that the forthcoming conference in July on the control of atomic explosions and atomic inspection will prove fruitful.
As to the summit conference, we hope without reservation that one will be held, and held soon. I am not one of those who feel we should give undue weight to preparations being made in every single detail as a prerequisite to such a conference being held. We feel the west should seize the initiative now by agreeing readily to such a summit conference and, if it is a failure, allot the blame where it is due. But we could err by insisting there should be too much in the way of detailed advance preparation, thereby laying ourselves open to the accusation that we were making it more difficult for such a conference to be held. We hope such a conference will be held, that it will reduce world tension, and that it will result in the strengthening of freedom and democracy throughout the world.


John George Diefenbaker: I thank both hon. gentlemen for their contributions. I want to say,

in so far as the latter remarks of the hon. member for Assiniboia are concerned, that all of us are desirous of having a summit meeting, but that a meeting called without adequate preparation would inevitably lead to unsuccess. This government has strongly supported the need for action with regard to a summit conference being called, but after all it is of prime importance that everything should be done in anticipation to assure that the issues will be properly placed before that conference, and the necessary preparations made for this purpose, so there will be no excuse for failure.
As far as the question asked by the Leader of the Opposition with regard to trade policy is concerned, we did discuss United Kingdom negotiations with the various European countries in the European free trade area, but there was no discussion of the United Kingdom plan for forming a free trade area with Canada.
Mention was made, I think the other day, with respect to the plans for the commonwealth conference. An agenda is being worked out; consideration is now being given to all the phases of the matters which should and will be discussed. As I said a moment ago, a meeting is now being held in London among the nations affected, to the end that the conference will have beneficial results.



HUNGARY


[Stage Direction]
On the orders of the day:
Lester Bowles Pearson: Mr. Speaker, I should like to ask the Prime Minister whether the government has conveyed to the Hungarian government the detestation which I am sure all Canadians feel at the brutal execution-perhaps murder would be a better word-of the former premier of Hungary and three of his associates in the Hungarian people's revolt for liberty in 1956?
Right Hon. J. G. Diefenbaker (Prime
Minister): Mr. Speaker, the government has not yet sent that message, but I join with the Leader of the Opposition in the words he has used to describe and portray the diabolical action that has taken place in this case. I certainly will follow immediately the suggestion of communicating the feelings of Canadians as a whole at the institution of the unjustifiable terrorist policy that has just borne its latest fruits.



COMMUNIST CHINA


[Stage Direction]
On the orders of the day:
Mr. Frank Howard (Skeena):: Mr. Speaker, I have a question which I should like to direct 57071-3-93i
Ontario Grain-Base Prices to the Prime Minister. I wonder if the Prime Minister has seen an article by Mr. Charles Lynch in the Ottawa Citizen of June 19, which states that the reason the Canadian government will not diplomatically recognize China is that the government is in fear of embarrassing the United States. If so, would he care to indicate whether this article is a true reflection of the policy of the government in this regard?


Some hon. Members:: Order.


John George Diefenbaker: Mr. Speaker, it is not for the government to comment on such articles. The attitude of this government has at all times been a realistic one undominated in any way by any other government, and so it will remain.



ANNOUNCEMENT OF BASE PRICES FOR ONTARIO WHEAT, OATS AND BARLEY

Hon. D. S. Harkness (Minister of Agriculture):: I wish to announce that, in accordance with the requirements of the Agricultural Stabilization Act, the agricultural stabilization board has established base prices, based on the average prices for the last ten years, for wheat, oats and barley.
The Ontario basis is as follows: Ontario wheat, $1.77 per bushel on track for No. 2 C.E. or better quality; Ontario oats, 72 cents per bushel on track for No. 2 C.E. or better quality; Ontario barley, $1.04 per bushel on track for No. 2 C.E. or better quality.
Using the above mentioned base prices the board has established a mandatory 80 per cent support price which will be in effect for the 12-month period starting July 1, 1958, as follows: Ontario wheat, $1.42 per bushel on track for No. 2 C.E. or better quality; Ontario oats, 58 cents per bushel on track for No. 2 C.E. or better quality; Ontario barley, 83 cents per bushel on track for No. 2 C.E. or better quality.
In the case of other provinces, outside the designated Canadian wheat board areas, where any of these grains are grown in commercial quantities, the support prices will be established in appropriate relationship to the above mentioned Ontario prices.


Hon. Paul Marlin (Essex East):: With regard to the mandatory price of $1.42, am I not correct in saying that this is not the figure which has been urged upon the minister by a number of representative groups of Ontario farmers, who have discussed this matter with him within the last few months? Is it not also a fact that they have indicated the great danger in the future of a price at this level

Inquiries of the Ministry being construed as and developing into a ceiling price rather than a floor price?


Douglas Scott Harkness: As I indicated to the hon. gentleman the other day in connection with soybeans, every group of producers naturally asks for a very high support price and the wheat producers through the Ontario wheat board did, of course, ask for a considerably higher price than the mandatory support price provided under the stabilization act.
As far as this price becoming a ceiling is concerned, I do not think that will be the case, and I certainly hope it will not. The Ontario wheat board, in addition to having this support price provided for them, have applied to us under the Agricultural Products Marketing Act for authority to collect an equalization fee, as it might be called, or to make a levy of up to 9 cents per bushel to provide them with working capital to be used for taking care of this crop, paying storage charges and looking after the general handling of it. Their object, and I think this is what has been needed more than anything else as far as the marketing of Ontario wheat is concerned, is to prevent all this wheat from coming on the market in the fall.
The hon. member for Essex East will perhaps remember that shortly after the harvest season last summer this wheat was down to $1.12 per bushel. This present action provides an absolute floor of $1.42 per bushel; and I think the Ontario wheat board, by the use of this 9 cents levy which we have authorized them to collect, will be able to handle the crop, to feed it out gradually during the year and, I hope, to secure a considerably higher price than the $1.42. That, of course, is their objective.


Hazen Robert Argue: I think the statement of the Minister of Agriculture and the question of the hon. member for Essex East clearly demonstrate that floor prices under this legislation do not in any way meet the wishes of the producers themselves, for the very obvious reason that the prices are based on 80 per cent of the average price for the last 10 years, so that the floor price is relatively low.


Douglas Scott Harkness: What is your question?


Hazen Robert Argue: I think, Mr. Speaker, that this is a statement-[DOT]


Mr. Speaker:: In order to clear up exactly where we are, I take it that we have reverted to motions and the Minister of Agriculture made his statement under motions. It would therefore be in order for both opposition parties to comment upon it. I do not think it is in order to ask questions. I believe the practice has been to comment briefly on a statement made by a minister under the


order for motions and to reserve questions until the orders of the day. Otherwise we tend to get into a debate, which is obviously not desirable at this stage of the proceedings.


Hazen Robert Argue: I thank you for your comment, Mr. Speaker. If I made an error it was in failing to rise following the hon. member for Essex East. I was saying that the statement of the Minister of Agriculture indicates that these prices have not met the demands of the producers of eastern Canada. In view of your statement I will reserve my further comment until the orders of the day.



NOVA SCOTIA-REPORTED SHUTDOWN OF MINES

[Stage Direction]
On the orders of the day:
Mr. Robert Muir (Cape Breton North and Victoria):: Mr. Speaker, I should like to
direct a question to the Minister of Mines and Technical Surveys. I understand that the Dominion Steel and Coal Company has announced a five-week shutdown of its coal mines in Cape Breton and on the mainland of Nova Scotia due to lack of markets. In view of the hardship this step will cause to the 8,000 or 9,000 miners involved, can the minister assure the house that he and the dominion coal board will render every assistance toward reaching a solution to this very serious situation?


Hon. Paul Comtois (Minister of Mines and Technical Surveys):: Mr. Speaker, I thank the hon. member for giving me notice of his intention to ask this question. This situation has been under study by the government and the dominion coal board for several weeks and is under continuous study and consultation with the company, but due to many factors we are not too hopeful that we can prevent the idle time which has been planned by the company.


Mr. H. J. Robichaud (Gloucester):: A supplementary question, Mr. Speaker. Could the minister advise the house if any definite action has been taken by the government on the request of the Dominion Steel and Coal Company for financial assistance?


Paul Comtois: I am afraid I cannot give a definite answer to that question today, but I am most hopeful of making a statement in this regard within a short time.



REQUEST FOR PAYMENT OF CASH ADVANCES

[Stage Direction]
On the orders of the day:
Hédard-J. Robichaud: May I
direct a question to the Prime Minister. In view of the critical situation of the coal industry, will the Prime Minister take under

consideration making cash advances on surplus coal similar to the cash advances being made to western farmers?


John George Diefenbaker: Mr. Speaker, the question indicates that my hon. friend does not understand the system of cash advances to western farmers. So far as cash advances to western farmers are concerned, they are made in respect of a commodity, the monopoly privilege of dealing with which is a matter under the control of a government agency.


Hédard-J. Robichaud: The mine workers understand it, though.



CANADIAN NATIONAL STEAMSHIPS


[Stage Direction]
On the orders of the day:
Hon. Lionel Chevrier (Laurier):: Mr. Speaker, I should like to direct a question to the Minister of Transport. I regret that he is not in his seat, but I assume the acting minister will take this as notice. Have representations been received by the Minister of Transport from the Halifax board of trade for a meeting between representatives of the board and the Minister of Transport and the Minister of National Revenue to discuss the proposed sale of Canadian National Steamships vessels with a view to having the matter reconsidered, in view of the economic importance of the steamships service to Halifax and the future potential trade which might arise as a result of the West Indies federation?


Hon. Leon Balcer (Solicitor General):: Mr. Speaker, I will take the question as notice.



POSTAL SERVICE


[Stage Direction]
On the orders of the day:
Mr. Alexis Caron (Hull):: Mr. Speaker, I should like to direct a question to the Postmaster General. I received a complaint this morning from Mistassini and Dolbeau. Would the minister inquire why Le Devoir did not reach subscribers in Mistassini on Wednesday, June 18, and those in Dolbeau on Thursday, June 19? On account of the declarations being made in the newspaper they are very anxious to get it every day.


Hon. W. M. Hamilton (Postmaster General):: I will be very glad to look into this important matter which the hon. member has drawn to the attention of the house.
Inquiries of the Ministry NATIONAL DEFENCE



ARMED FORCES PERSONNEL TRANSFERRED


[Stage Direction]
On the orders of the day:
Mr. H. W. Herridge (Kootenay West):: Mr. Speaker, in view of the repeatedly expressed interest of the Minister of National Defence in economies in his department, to the advantage of the public purse and the pocket-books of the armed forces personnel, I address a question to the minister. In view of the fact that many members of the Canadian armed forces, when transferred from one province to another, are required to register and obtain new motor vehicle licences, and in view of the fact that United States servicemen are allowed to use the registration and licence of their home state in any part of the United States, would the minister consider seeking the co-operation of the provincial governments for the purpose of making arrangements that would save members of the armed forces this extra and unnecessary expense?


Hon. G. R. Pearkes (Minister of National Defence):: Mr. Speaker, I am aware of this problem. I should like to take this opportunity of thanking the hon. member for his interest in the welfare of the armed services. Of course the problem is associated with the compulsory transfer of servicemen from one province to another. We have already taken up this matter with the provinces and several concessions have been made, for which I should like to express my appreciation to the provinces concerned. The problem is not merely restricted to servicemen, and it is possible that even some hon. members may be suffering from the same hardship.



PURCHASE OF U. S. BUSES BY TORONTO TRANSPORTATION COMMISSION

[Stage Direction]
On the orders of the day:
Mr. Hubert Badanai (Fort William):: Mr. Speaker, in the absence of the Minister of Labour I wish to direct a question to the acting minister. Has the acting minister received a communication from the united automobile workers, local 1075, of the Canadian Car plant at Fort William and the Fort William city council, protesting the purchase of United States buses by the Toronto transportation commission? If so, in view of the still serious unemployment situation at the lakehead will the acting minister inform the house if she intends to suggest to the T.T.C. that they should consider placing the order with the Canadian Car company, which
1462	HOUSE OF
Inquiries of the Ministry is the only company, incidentally, manufacturing buses in Canada? I might add-


Mr. Speaker:: Order. I think the hon.
member has explained his question sufficiently. 1 am doubtful whether it is a proper question because, as I understand it, it asks about the purchase of buses by the T.T.C.


Hubert Badanai: The Toronto transportation
commission.


Mr. Speaker:: That is not an organization
under the direction of the Minister of Labour, and I doubt if the question can properly be asked of the Minister of Labour.


Hubert Badanai: My question is whether the
minister intends to use the influence of her office to suggest to the transportation company that the buses be purchased from the Fort William plant of the Canadian Car company. It will accomplish two things-


Mr. Speaker:: Order. I am doubtful
whether the question, as finally expressed, is a proper one, but I do not object to the minister saying what she proposes to do with her influence.


Hon. Ellen L. Fairclough (Acting Minister of Labour):: Mr. Speaker, I shall answer the
first part of the question, which inquired whether or not I had received these representations. They may be in the department but they have not yet reached my desk. I think, Mr. Speaker, you answered the second part of the question.


Mr. D. M. Fisher (Port Arthur):: I should
like to address a supplementary question on this matter to the Minister of Trade and Commerce. Is there any possibility of the minister's department taking action through some form of embargo in the case of this particular order so the Canadian manufacturer will have the opportunity of filling the contract?


Hon. Gordon Churchill (Minister of Trade and Commerce):: Unlikely.


Hubert Badanai: I wish to direct a question
to the Minister of Trade and Commerce. Is the minister aware that buses now manufactured in Fort William are equipped with diesel motors manufactured in Britain? That being so, would the minister not consider that it would be a good thing, in view of the policy of the government to divert purchases to Britain-


Some hon. Members:: Order.


Hubert Badanai: -to promote the sale of
buses manufactured in Fort William, thus increasing-


Mr. Speaker:: Order. I suggest that the
hon. member take advantage of the budget debate, upon which we are going to enter this day.
.	PIPE LINES



QUEBEC-INQUIRY AS TO PURCHASE OF GAS CORPORATION SHARES

[Stage Direction]
On the orders of the day:
Hazen Robert Argue: I should like to direct a question to the Prime Minister. Will the Prime Minister consider having an inquiry made into the grave charges by he Devoir that consequent upon the purchase of a provincially owned gas pipe-line company by the Quebec Natural Gas Corporation, shares in this company were purchased by the legal firm of which the present lieutenant governor of Quebec is a partner?


Mr. Speaker:: I am sure the hon. member is departing from the field of jurisdiction of the ministry in asking a question of that kind. I am willing to hear on what basis he proposes to ask the question.


Hazen Robert Argue: On the point of order, Mr. Speaker, as I read the rules of the house one cannot refer to Her Majesty or the Governor General but I did not realize-I may be in error-that this extended to the office of lieutenant governor. Since the lieutenant governor is appointed and paid by the federal government I feel this is a very proper question, inasmuch as no one would want action that would reflect on that office. I think we would all agree that the conduct of anyone occupying the important position of lieutenant governor of any province should be beyond reproach.


Mr. Speaker:: I am afraid I cannot accept that question. It seems to me that if any mention or reference to the conduct of a representative of Her Majesty is to be made in the house it should be by a substantive motion. That is the only proper way to bring such a matter before the house. It could be done that way, but I feel it should not be done by an inferential question.



HOSPITAL INSURANCE ACT


[Stage Direction]
On the order:
Third reading of Bill No. C-30, an act to amend the Hospital Insurance and Diagnostic Services Act.- The Minister of National Health and Welfare.
Mr. Speaker:: I understand that by unanimous consent the house is prepared to consider this order, third reading of Bill No.

C-30, notwithstanding the fact that this day has been set aside for the budget debate. Is that correct?


Some hon. Members:: Agreed.


Hon. J. W. Monleilh (Minister of National Health and Welfare) moved: the third reading of Bill No. C-30, to amend the Hospital Insurance and Diagnostic Services Act.
Motion agreed to and bill read the third time and passed.



THE BUDGET


[Stage Direction]
The house resumed, from Tuesday, June 17, consideration of the motion of Hon. Donald M. Fleming (Minister of Finance) that Mr. Speaker do now leave the chair for the house to go into committee of ways and means.
Mr. W. M. Benidickson (Kenora-Rainy River):: Mr. Speaker, on Tuesday night the Minister of Finance paid tribute to the blue news in the budget. I think I should like to pay a suitable tribute to the recordbreaking overtones of red that were in the annual financial accounts.
Now, Mr. Speaker, as I approach this task I want to say I noted, as probably did the minister, the correspondent Adelphi's comment in the Financial Post last week when he was referring to the Prime Minister of Great Britain in complimentary form. He said this:
-Only a fool likes criticism, only a fool resents it.
I, of course, have received in the past a fair amount of criticism from the minister when he was sitting on this side of the house. Before too much criticism, may I say that there are naturally some features in the minister's proposals that I think will receive fairly general endorsation, although not too many in this particular budget. I can think of his proposal with respect to a gift to a spouse of real property up to a limit of $10,000. I think of certain additions to the list of sales tax exemptions to municipalities. I commend the minister for his references to the amendment to the Emergency Gold Mining Assistance Act. I appreciate that, coming from a mining area as I do. However, I would point out that the assistance still would be at least $5 million short of the maximum assistance provided in one of the years of the previous administration. I think perhaps I should commend him for taking the tax off cut flowers; probably it helped me to some extent this morning.
But on the whole I do not think anyone could better the present Minister of Finance,
The Budget-Mr. Benidickson good orator that he is, in driving home small talk with a sledgehammer. I think of his peroration and I think also of his remarks last December 6, when he was speaking to the estimates of his department. At that time, as recorded on page 2009 of Hansard for that date, he said:
-We trust that the committee will however recognize the boldness of the government's program and the extent to which it will contribute to confidence and prosperity.
He was referring to tax reductions, Mr. Speaker, from that date to the end of the fiscal year, some five months, amounting to only $26 million. Again on Tuesday night in his speech to this house he referred to his "bold" budget. I refer to page 1250 of Hansard. The Minister of Finance said:
We have sought to face our difficulties squarely and to prescribe bold courses to meet them.
The tax reductions total only $8 million for the fiscal year. Mr. Speaker, I want to assert that in my view people are fast becoming disenchanted with rhetoric and thespian appeal only, and this dodge of too much government by bluff and by bragging.
I should like to refer to the deficit. This has received a considerable amount of attention in the press. I said on Tuesday night in my few remarks that I should like to say more about the prominent figure of $640 million produced by the minister after I had an opportunity to examine the complicated figures in Hansard. Out of office the Conservatives professed themselves in favour of less spending and balanced budgets. One can certainly argue for spending and deficits if they are not aimless but rather are planned, comprehensive and vigorous enough proposals to provide incentive, to provide lift, to perk up the economy. But I suggest, Mr. Speaker, that an analysis of this budget will show that the deficit is more attributable to political commitments than to economic theory or for the relief of unemployment.


Mr. McDonald (Hamilton South):: How about
the old folks?


William Moore Benidickson: There was nothing in this budget with respect to the old folks. It results from piecemeal and unrelated measures. A deficit we can understand, but a deficit plus record unemployment shocks the country. The minister's financial leadership, now for almost a year, I suggest has solved neither deficit nor unemployment. He has added to both.
In so far as the gross national product is concerned, while the minister used a lot of words in his budget the other day he referred to it in a very passing way, and with what I felt was an inadequate build-up of
1464	HOUSE OF
The Budget-Mr. Benidickson the base to give confidence that the figure he finally produced is one upon which we can rely. It is quite possible to juggle accounts with respect to expenditures, as we saw the other night, but you cannot juggle accounts of revenues. "What will be", as the song goes, "will be."
The minister forecast revenues in 1958-59 of $4,660 million, down $387 million. Now, if this is to be realized the minister must be reasonably good as a prophet with respect to his estimate of gross national product, which he suggested on page 1235 of Hansard would be $32 billion.
I want to raise the question before the members of the house, is he a good prophet? First of all, has he made out any real case for his estimate? I want to compare his presentation, before tossing out this figure, with a similar presentation prior to a prediction of the gross national product made by his predecessor on March 14 of last year. I refer to Hansard pages 2216 and 2217 of March 14, 1957.
Before suggesting in any way what the gross national product might be the finance minister at that time referred to some of the components in the gross national product. He made reference to capital investment, and to the fact that the Minister of Trade and Commerce, by his white paper, showed that capital investment was likely to increase by 7 per cent. Another component, namely commodity exports, according to Mr. Harris "should continue to increase through 1957." They did increase in 1957. Another component was consumer expenditures, and Mr. Harris said "these should continue to grow in 1957." He referred to the fact that a considerable increase in wage rates was built in through wage agreements recently made. Another component was farm income, and the minister of finance of that day said this should be maintained unless the grain crops in the west were disappointing. He referred to the labour force, and said he did not believe he "could count on as large an increase as in the previous year."
What in this budget have we had to establish the minister's estimate as a base for the gross national product? As reported at page 1235 of Hansard, blandly he said this:
-there are hopeful signs that we have reached the end of the recent decline.
With respect to investment intentions-I see nothing to justify a prediction of a rise in the gross national product-the minister said this:
Present investment intentions of business for capital outlays in 1958 are about 11 per cent below the 1957 level.


He went on to say that housing and governmental expenditures would be up perhaps 14 per cent, but I draw attention to the relative volume of investment in both accounts. Here we have, then, little to build up confidence that the gross national product estimate is something that we can rely upon. As reported at page 1235 of Hansard of last Tuesday the minister starts off by saying this:
Assuming-
And it is a big assumption.
-normal crops, stable prices and no untoward external events, I am basing my revenue forecasts on a gross national product of $32 billion, which is about 2 per cent above the level achieved in 1957.
As I say, he does that without giving us an explanation of the components of that very important figure. He says "assuming normal crops". We all hope that normal crops will prove to be the result in 1958, but already we are getting not too optimistic reports as to moisture conditions in the western provinces.
With respect to capital investment, we normally get from the minister of trade and commerce at this time a revised estimate of the white paper that we had to smoke out of the present Minister of Trade and Commerce in March, but which in its first page made clear that the calculations were based on information obtained at the end of 1957, in December of that year.
I wonder whether we are to expect in this debate the usual revised estimate of capital investment from the Minister of Trade and Commerce. I know that last week before a congressional committee in the United States a new figure was produced, and it by no means held up to the expectations produced at the beginning of this year respecting business capital investment plans.
In addition, I think some doubt is cast on the probability of the minister's forecast when we look at his own forecast of revenues for the coming year. I refer to page 1241 of Hansard of last Tuesday. He referred to personal income tax. He suggested that this tax would be down $129 million in the coming year. He referred to corporate income tax. He suggested that this tax would be down $215 million. He referred to sales tax. Sales tax, of course, would be related to consumer expenditures, a component of the gross national product. He suggested that this tax would rise, despite a population increase, by only 2 per cent for the coming year.
Another component of the gross national product, or having a very important effect upon it, would be exports. As the house knows, in the period January to April of this year exports are down $21 million. So

where out of any of these figures does one get comfort in thinking there will be a rise in the gross national product of 2 per cent, unless it comes-something which the minister discounted-from an increase in prices?
I suggest that the minister seems to have taken probably the most optimistic of all advice in calculating the gross national product. That leaves some doubt in the first instance, when we consider this matter of deficit, as to whether the revenue estimate of $4,660 million is attainable. But on the expenditure side we had this striking sentence in the minister's speech:
-we propose to eliminate the balance remaining in the national defence equipment account.
That amount was $165 million. That is an item to which a considerable portion of the press did not give very much prominence. This fund was set up by the predecessors of the minister in order to help NATO. I suggest that this is an item that is being raided at the present time in a bookkeeping manner to help the Conservative party. In looking at this budget in ensuing days I suggest that we confine ourselves to current operations. This particular kind of calculation is just about the equivalent of the minister saying, "Well, in days past my predecessors Mr. Harris and Mr. Abbott had surpluses; we will use them". That is just about what the result is when you take advantage of this $165 million in this particular account.


Mr, Fleming (Eglinton):: But they drew on this account.


William Moore Benidickson: In addition there is a very interesting thing that I think could be said. I thought the minister was very casual in his arithmetic the other night. On careful reading we find that he produced a figure which established that in the main estimates we had $5,179 million; in the supplementaries, $58 million; in the hospital insurance act provision, $70 million; and for old age security deficit, $190 million. These add up to $5,497 million. He made reference to the possibility of a deficit on the Canadian National Railways, but he did not put it in his accounts. We already have the budget proposed for this year by the Canadian National Railways. The railroad itself suggests that its deficit in the coming year will be $55 million. Why leave it out? Adding this amount to the $5,497 million we come to $5,552 million, versus revenue of $4,660 million.
To me that provides a deficit of $892 million. Even if one takes the $5,497 million and even assuming there was any justification for the minister utilizing this $165 million as a transfer item and relating that to his
The Budget-Mr. Benidickson proposed revenue of $4,660 million, I suggest that he was rather casual indeed in ending up with the round figure of $5,300 million, because there is a difference of $32 million in that arithmetic, as I see it. But the minister may say "What's $32 million?"


Mr. Fleming (Eglinton):: No, no; he does not.


William Moore Benidickson: He had some other items without any price tags. He said that we must expect some payments under the Agricultural Stabilization Act. That remains with a question mark. In addition he said there would be further "statutory requirements," whatever that means. Again there is no price tag. He said as well that the house can expect the usual final supplementary estimates. I think this will be in the minds of hon. members when they consider the deficit figure that was presented to the house and the country.
This presents, I admit, quite a guessing game to any person who is now examining these accounts. As I pointed out the other night, there is nothing here to suggest that the friend of the government, Mr. Frost, can expect his $78 million which, if he were to obtain, it would mean that an additional $150 million would have to go to the other provinces on the basis of equalization.
Another interesting point is that no mention whatsoever was made in the budget with respect to civil servants' salaries. They are negotiating with the government, I understand, for a 12 per cent increase, but supposing the figure were 8 per cent the cost of that increase would be $100 million. There is nothing here about the oft-discussed pensions for superannuated civil servants. Even the new item, produced with a considerable flourish the other night-the additional subsidy of $2 2 million for gold mines-does not seem to have been provided for.
The other night the minister made much of the appropriateness of the timing of proposals presented by him as financial leader of the country within the last year. I suggest that, on the contrary, the failure to realize what was happening, months after he took office, has resulted in the failure to act. As far back as last November the Trades and Labour Congress of this country called for action; they predicted that during the winter 500,000 persons would be unemployed. The Prime Minister brushed off this estimate, suggesting that these people were alarmists. That prediction, as everybody knows, proved to be conservative. I say the minister was so busy charging other people with thinking us into a depression that he did not do all

The Budget

Mr. Benidickson he should have done, in conjunction with his budget advisers, to think us out of the depression.
There is no bold new program provided by this government. I think it is most evident that the thinking which has taken place in past months has been preoccupied with elections, past and forthcoming, and not with matters of economics. The minister would say the bad signs were not there, and we have heard some suggestion that the previous administration was unduly optimistic; but allow me to point out that in the papers presented to us the other day the minister himself confesses that he, fairly early, had information upon which I consider he should have, acted promptly. At page 1232 of Hansard for June 17, 1958, the minister said:
Some slow-down in economic activity was to be expected after the excessive pace of 1955 and 1956, a pace which was straining our resources of men and materials despite very large borrowing abroad.
What was there in the budget of 1957 which would have given good counsel to the minister? At page 2217 of Hansard for March 14 of that year Mr. Harris, who was then minister of finance, said:
All in all, I believe, there is a good possibility that the inflationary pressures which have been present throughout the past year may begin to moderate during the coming year.
He went on to say in a cautionary way that the increases in exports might not be as great as they had been, and again in that same speech he said:
1 do not believe we can count on obtaining as large an increase in the labour force.
At page 2217 again, in the 1957 budget report, Mr. Harris also said:
Corporate profit margins show signs of narrowing.
We have found that that was indeed a pretty good prophecy. The minister, however, boasted the other night of good timing. I suggest that during last fall and winter we in this country had very little except soothing words from the new ministers, particularly from those most identified with the recession, namely the Minister of Finance, the Minister of Labour, and indeed the Prime Minister himself. The Minister of Finance said on November 23, 1957, that there was no national emergency in unemployment. "The number of people employed in mid-October is the highest in Canada's history." He said if this was a national emergency all he could say was that practically every country in the world would like to have a national emergency like it.
I contrast that with what the minister said the other day in his budget papers, and I refer once more to page 1232 of Hansard for


June 17. In reporting upon the affairs of the country under his administration he said:
By mid-1957 the value of large capital projects being started began to run behind the value of projects being completed.
On the same page he said:
-during 1956 capital expenditure was rising at a rapid rate while in 1957 investment outlays as a whole first levelled out and then declined slightly. The slow-down in the rate of capital investment was accentuated by the inventory liquidation which developed toward the end of the year.
That is to say, toward the end of 1957. Again, with respect to unemployment, was the minister not aware of these things? At page 26 of the white paper provided to this house the day before the budget speech we find the following words:
There were more persons with jobs in each month of 1957 than in the corresponding period of 1956, but in the fourth quarter of the year the gains became progressively smaller as employment began to show the effects of the levelling out in production.
And at page 27 of the white paper we find the following words:
The low in unemployment occurred in June, 1957, when 162,000 persons were jobless, compared with 117,000 during the same period in 1956. From the third quarter to the end of 1957 unemployment just about doubled and there were 386,000 jobless persons in December compared with 186,000 a year earlier.
What was the Minister of Finance really saying to the country? This surely is indicative of his thinking at that time. On December 8, when speaking to the Dominion Commercial Travellers Association meeting, he is quoted as saying that "a decline in the volume of our imports is too fractional to be a cause of concern." On December 6 last, in presenting the estimates of his department to this house, he said he was still prepared to accept the estimates of revenue of his predecessor. The Minister of Labour, as late as March 8 last at a press conference in Vancouver, said, "We are over the peak."
With what did these words meet within a matter of a few days? The figure for unemployment produced by the dominion bureau of statistics showed there were 35,000 more unemployed people in the month of March than there were in February. Once again we hear soothing words from the Minister of Finance. The other night he said that hopeful signs are here, that "we have reached the end of the decline." There is no one in this house who does not hope the minister is correct; but the ministers I have quoted, the Minister of Labour, the Minister of Finance and indeed the Queen's first minister, have misread the economic signs so often in the past that there is some doubt cast upon the assertions now being made. I do not want to be a Jeremiah continually today, but we have to be realistic.

Another item which I think should get more attention than simply the absolute reduction in the number of unemployed is the rate of reduction. I find that registration at the unemployment commission's offices in the worst previous year of our post-war depression, which was 1955, went down between mid-March and mid-April from 633,000 to 556,000, which is a drop of 12 per cent. But this year at mid-April the figure was 884,000, down 30,000, it is true, but the rate of drop instead of being 12 per cent was 3 per cent.
I should like to say a few words now about trade, although during the forthcoming debate many others in this party will have something to say on this all-important subject. I referred to it briefly on Tuesday night. I spoke then of what I regarded as the seeming ham-handedness and the casting of a preconference chill over such things as the forthcoming commonwealth conference, particularly with respect to the proposed tariffs affecting British wool imports. I said that the same thing had been done, in my opinion rather ineptly, just prior to the Mont Trem-blant conference last year. It does not seem to me that actions of this kind are likely to be very encouraging to the delegates to this assembly. We also remember very recently how vigorously we all cheered-and none of us more than the government members of this house-the speech of the Prime Minister of Great Britain. If anything I think his visit to North America, stripped of economic jargon, was basically intended to suggest ways of making the capitalist system work in the cold war. He wanted to persuade us all that we needed some new economic thinking on the part of the west. This, I think, has bread and butter implications for Canada.
I think, again in relation to the budget the other night, of the forthcoming visit, not far off, of President Eisenhower. But despite this approaching visit, which is of great importance, the Minister of Finance unnecessarily, I think, took time out in the usual hot-headed way he has with respect to the United States to introduce this subject which was so much discussed during the recent political activities. To me this business of stirring up anti-United States sentiment played up as an election issue is not desirable. I refer to the remarks of the Minister of Finance as reported at page 1237 of Hansard.
What is the basis of all this? Can it be that it is largely personal pique? Time magazine of April 26, 1958, referred after the election to what it called the flying visit to Washington of the minister for external affairs and the Minister of Trade and Commerce, and then the article said:
Since they were in town, the two ministers decided also to drop in on their two U.S. counterparts. Commerce Secretary Sinclair Weeks turned
The Budget-Mr. Benidickson out to be too busy to see Churchill in his office, but that evening the two managed to link arms at a cocktail party.
I have no critical reference to make to the latter part, but I wonder if it is pique that is responsible for continued affronts to a country which continues to be Canada's best customer. I think there is still rankling in the mind of the government this phrase, after their last attempt to do something constructive and important in this field, when so much emphasis was given to the phrase "we fixed 'em".
I suggest, Mr. Speaker, that if you were a businessman with one big customer and a number of smaller ones and you wanted to enlarge your business, you would try to be nice to all your customers; you would not tell your big customer, "I want to do business with more people, so I want to do less with you". That would be very unwise and I suggest not likely. The Gordon commission suggested in its report that in times of recession-and we have such times now-it would be found that our exports to the United States would hold up better than our exports overseas. This happened in 1957 and it is happening today. In 1957 our exports to the United Kingdom fell by $75 million, while our exports to the United States rose by $51 million.
I have no doubt we will have a further opportunity to consider what the government has in mind by its reference in the budget speech to dumping. We will have a statute and be able to examine the language of that statute and debate it in due course, so I do not propose to go into this subject to any great extent. The announcement of the change in the dumping laws will have to be examined in the light of the legislation when it is brought down, but on its face it appears to be another "back to Bennett" item repeating his very special kind of dumping laws which consumers in this country will remember. From what the minister has already said it appears that there is great danger that these dumping laws will be used as a weapon to harass producers in other countries rather than as a legitimate instrument of government economic policy.
One of our most serious and justified complaints against the Americans-and this was referred to in the minister's speech the other night-is that they use regulations of various kinds to keep out our exports. The minister's remarks with regard to this appear on page 1237 of Hansard. Today it looks as if, with this new weapon which the minister is adopting, we are in danger of doing exactly what so angers us when the United States do it; and we are doing it just prior to this

The Budget-Mr. Benidickson very important visit by the President of the United States and Mr. Dulles.
This is typical of some of the ineptness which has preceded conferences of the greatest importance to this country. We are not fooling anybody by this, particularly our best customers. The other day in Washington the United States ambassador to Canada, Mr. Merchant, appearing before the Senate foreign relations committee had this to say:
Mr. Diefenbaker can be expected to continue to protest eloquently and with vigour what he considers protectionist action by the United States, while at the same time yielding to protectionist pressure groups in Canada by imposing restrictions on certain categories of imports.
How is trade to be enlarged by this kind of procedure?
Now I should like to make reference to a subject which has been discussed several times this session, namely the public works program of this government. I said when speaking on the first interim supply bill that one can of course argue for spending and deficits in a recession. The government would like the people of Canada to believe that the new high expenditures and large deficit are due to deliberate planning and an unusually large public works program. With the present government's Madison Avenue technique to which we have become accustomed, I think they have been somewhat successful in attaining this objective. Articles in the press have certainly tended to foster this idea. A big play was made by the Prime Minister with the word "launch" when he spoke of the launching of a vast program of public works. Of course he linked with it a big program to combat unemployment.
Careful examination of the figures, as I have pointed out previously this session in the house, quickly reveals that the figures presented are largely normal spending by a government, expenditures that would be presented by any government. They are not new; they would be provided in good times or bad. In confirmation of that statement I wish to make reference to table 3 in a press statement presumably put out by the Minister of Finance on May 13, when he was releasing the main estimates in this house for the coming year. This table has been broken down into four headings:	"Administration
and operation", "Building, works and equipment", "Grants, subsidies and other items" and "Recoverable items". The total allotment for "Buildings, works and equipment" for the period 1958-59 is $927.3 million as compared with $923.5 million for the 1957-58 period provided by the previous administration in a time of economic inflation and with very little thought when under preparation


of the more difficult winter ahead in 1957-58. This indicates that on May 13, 1958, there was nothing very planned or striking in the public works proposals of the present government.
In addition I remind the minister that when he spoke on his estimates on December 6, 1957, he said very clearly that where there are expenditures that involve construction which means employment, items would not be reduced. I draw his attention to the fact that not long afterward he was called upon to approve a warrant to be presented to the Governor General for expenditures for the balance of the year. The warrant is dated February 15, 1958, and it discloses reductions in construction votes totalling almost $20 million. There is a reduction in construction votes of $11,501,636. From that must be deducted some increases in construction votes but they amount to only $66,576, leaving a net reduction of $11,435,060 in the ordinary accounts, plus reductions for construction in the loan accounts of $8,501,490 making a total of $19,936,550.
There is altogether too much rhetoric and not enough reality in some of the actions of this government, and as I have said the public will soon realize this. Too much of what we hear proves to be pretty empty, almost phony when it receives careful examination. I want to bring the house right up to date. If there is anything the government has done about which we have heard much in recent weeks it has been the steps it took with regard to the housing program. Reference to housing has predominated from the time of the speech from the throne on, and we have heard a great deal about the housing program of this government in terms of it being a work-creating measure.
After the speech from the throne was announced nothing received more attention from the press than the government's $350 million housing program. Indeed with typical flair and a typical sense of publicity value the throne speech debate itself was interrupted to permit the house to deal with amendments to the National Housing Act. It was said to be an emergency measure, and it was most important that the amendments be passed involving the expenditure of $350 million for housing which would make available work for the unemployed. Within a matter of a week or perhaps two weeks after this splashy and very well-huckstered window dressing we found that this proposal was just as empty as are so many other proposals that are well advertised; as empty as a bird's nest in December.
After the bill was passed by this house the subject of the government's housing

program could only command from the press and from the public the usual yawning. But the truth comes out. I want to read what the president of Central Mortgage and Housing Corporation had to say with respect to this additional $350 million, when he appeared before the standing committee on finance of the other house on Thursday, June 5, 1958 as recorded at page 29 of the minutes of proceedings of that committee. Mr. Bates said:
-we are standing merely on residual loans ... It is my opinion . . . that by the end of the year, if we got into it again in September-
He was referring to direct lending.
-we might have spent $30 million or something of that kind-
-by the end of the year. What a contrast between rhetoric and deeds, promises and performance.
If there is anything in the new budget that probably had a chance of making an appeal to the average member of the public I think it was the reference to deducting for income tax purposes certain prescription drugs. Actually this again is a window dressing item, because in the budget brought in by Mr. Harris last year a standard deduction of $100 was provided to all taxpayers, and at that time on advice of the officials of the department the minister said that about 75 per cent of the taxpayers of the country had not put in claims of this kind and therefore it was a clear, new deduction.
I think the Minister of Finance has been found out on this, too. Just yesterday the Financial Post, a very authoritative and highly respected financial publication in this country, commented on the new budget in these words:
There is flashy political appeal in some of Finance Minister Fleming's tax changes, but when citizens get them digested and when they figure out what the changes could actually mean to them, there will be widespread disappointment.
Making drugs and medicines, eyeglasses and artificial eyes, ambulances and laboratory services exempt from income tax, will catch popular fancy.
But the 3 per cent of income limit on such income tax deductions, which Mr. Fleming retains, still means that very few people will be sick enough to get any benefit whatever from the change. If the Tories wanted to do anything significant on reducing this human burden, they should have lowered the 3 per cent figure so long recommended by tax experts and then the sick would have had an honest benefit.
The same thing applies to some of the other income tax changes announced. These gestures will look and sound good in the constituencies, but they will mean very little or nothing to all but a very few people-and very, very little of them.
I will have additional opportunities in the further stages provided in the budget debate to comment on some of the other items of the budget, but I want to repeat what I said on Tuesday evening; that contrary to what
The Budget-Mr. Argue the minister said then there is nothing in this budget which suggests bold courses. We have a deficit not by design but by default. There is nothing new in the budget either for jobs or for business. I therefore move the following amendment, seconded by my deskmate, the hon. member for Bonavista-Twillingate (Mr. Pickersgill):
That all the words after the word "that" be struck out and the following substituted therefor:
"this house regrets that the government, in its budget proposals, has failed to cope satisfactorily with the problems of the recession in spite of the largest peacetime deficit in Canadian history and that it is moving towards greater trade restrictions at a time when other countries in the western world are moving in the opposite direction."


Hazen Robert Argue: Mr. Speaker, I think the wording of the amendment should recommend it to the house and to the country. Certainly our group is quite happy to support the amendment as it has been moved. I believe that by the time I draw to the conclusion of my remarks my colleagues, who are very good draftsmen, will be able to hand me a subamendment which will also commend itself to the country.
I congratulate the Minister of Finance on his facility in both languages and I say to him quite sincerely that I envy him in this regard. I was most interested in his budget speech. I can only say that I wish he had presented such a comprehensive budget statement in the last parliament a few months ago.
I also want to commend the hon. member for Kenora-Rainy River (Mr. Benidickson) on his effort as financial critic for the official opposition. I enjoyed his remarks. In fact when there was a lot of punch in them I enjoyed them exceedingly. I congratulate him on the effort he made.
I think this budget will be taken by the people of Canada as something of a shock. One hears of shock treatment being used at times by the medical profession. I think the budget is shock treatment for the people of the country. It demonstrates that we on this side of the house were right when we said in the last parliament that the government owed it to the country to present a comprehensive budget that would hide nothing and would show the true financial picture of the nation. That was not done. There was no budget in the last parliament. There was no comprehensive statement as to what would happen in the ensuing fiscal year.
What did we have last session? When the government was criticized about economic conditions the main thing we had was the waving before the house of a so-called secret document that had been presented to the former government and not divulged by them. We had a motion in the house the other day
1470	HOUSE OF
The Budget-Mr. Argue asking that the up to date version oi the same secret document be now divulged, and the government would have nothing to do with it.
I think the document that should have been divulged before the election is the budget speech of the Minister of Finance. If that document, which was kept secret until after the election, had been available to the people of the country I have no doubt that the results of the election would have been a great deal different; because the government, by refusing to disclose the economic facts facing the nation, was able to camouflage the true position of the country and to benefit in a political sense. This is an ice water budget which I think will awaken the people of Canada to the fact that on March 31 they were cheated, as has been proven by the government's lack of action since that date.
I sat on this side of the house for many years with members of the present government, and I was just as energetic in criticism of the former government as I am now. I had expected until a very few weeks ago, as a matter of fact, that the government would continue for some time on the road it took last session, a road of progressive legislation, a road to improve the economic lot of the ordinary people of the country. But I have been fooled. They have now halted that forward progress. The Conservative party which goes by a hyphenated name-


Donald Methuen Fleming: It is not hyphenated. There is no hyphen in it.


Hazen Robert Argue: A double name, two separate names.


Lester Bowles Pearson: Double-barreled mediocrity.


Hazen Robert Argue: Last session we saw the progressive face of the Progressive Conservative party but now we see the conservative face, the Tory face with the mask oft. This is a Tory budget, this is a depression budget, this is a recession budget. The best the Minister of Finance can forecast in the budget is that things are going to stay as bad as they now are throughout this year.


Donald Methuen Fleming: Oh, no.


Hazen Robert Argue: He forecast a 2 per cent increase in the gross national product. The increase in the population of the country is ordinarily about that figure, so we are going to remain just where we are with widespread unemployment, with the agricultural industry in a state of depression and in many parts in almost total collapse, without any policy, without any action by the government to improve the economic position of the people of the country.


The Minister of Finance is a great master of words. He has shown us that he can champion either side of a cause with equal ease and facility.


Mr. Pickersgill:: And equal volume.


Hazen Robert Argue: He has contradicted himself so often in the budget that it is a double-barreled budget with the barrels pointing in opposite directions. What did he say before he had completed one full page of his address as it appears in Hansard? As found on page 1231 of Hansard of June 17 he said:
Foremost among the factors which we must keep in mind in reviewing the year 1957 is the record population increase of 552,000, an increase which brought our population at year-end to 16.9 million. About half of this growth was the result of natural increase and about half was due to the exceptionally high level of immigration.
Some idea of the economic importance of this great increase can be gained from the fact that there are only three Canadian cities with a population in excess of half a million people.
Then he went on:
Population growth of itself does not ensure progress, but in a country such as ours it has a special significance. It provides a greater market for our agricultural produce and for the products of our factories and reduces our vulnerability to changes in external demand. It brings us a greater diversity of talent and the means of employing it to better advantage. It reduces the per capita cost of supplying essential services in this great land.
Here we have outlined all the advantages of an increase in population, half of which was brought about by natural increase and the other half from immigration, yet the government chokes off immigration as one of its first actions on taking office. They choked off immigration which, according to the words of the Minister of Finance, had done so much for the economic welfare of this country. We have double talk from the Minister of Finance.
During the last session we heard a great deal about the improvement that was to be made in the old age pension, the improvement in the position of people obtaining social security benefits. We welcomed the improvement. What were we told? We were told that the improvement for the old age pensioner was not the end but was only the beginning. The Prime Minister said he was having an inquiry made into the social security system in the United States, and he was in a hurry to have this inquiry made. He appointed Professor Gordon Huson and set out a tight timetable of three or four months for the work. The professor said it was not long enough, so he was promptly dropped and another man, Dr. Robert Clark of the University of British Columbia, was appointed. The aim was to get a report within

three or four months so that Canada would have the advantage of an improved social security system.
Well, the report has not yet been made, though it is more than four months since Professor Clark was appointed. More important, when I asked the Prime Minister on May 30 when a report would be received, and whether when it was received action would be taken this session to improve the old age pension, what did he say? He said, as reported at page 677 of Hansard for that date:
As to whether or not action will be taken at this session of parliament, I must say that having regard to the tremendous amount of work yet to be done as set out in the speech from the throne, I would not expect it would be possible to give consideration to the report, even if received now, to enable any legislation to be brought in at this session.
The people of Canada have been fooled and hoodwinked in this regard, because they expected an early report. They expected early action. Why should parliament not sit for another three or four days this session- let us assume it would be a long debate-to discuss and pass legislation providing for an improved system of social security? The reason there is no hurry now is not that there is so much legislation before the house, the reason is that the election is over. The urgency is over, and there is plenty of time to consider the matter during another session of parliament at some time in the future. I ask the Minister of Finance if he has anything to say as to when such action will be taken.
How much did we hear from the government before the election about the need to increase commonwealth trade? This was the big pitch of the Conservative party. They were going to increase commonwealth trade, and they were going to call a conference. They did call a conference, and they received an offer which they have not yet answered. It made them dizzy when they heard it, and they have not yet recovered sufficient equilibrium to provide a reply. We thought we were going to hear something about the government's plans for freer trade, but we did not hear anything in the budget last year. We thought there might be something in the budget this year. However, the budget contains the same old Tory policy all the way through of higher and higher tariffs, more and more obstruction to international trade. This policy is not going to help industries or the people who work in industries. I suggest it is directed toward helping some of the management; it may help a few of the owners. The report of the tariff board on the woollen industry says this policy will not save the industry.
If the government wanted to take action, instead of putting up the tariff why did
The Budget-Mr. Argue they not remove the excise tax on clothing? This would have increased the home market for woollens and other goods. Why not provide full employment, with the resultant tremendous increase in demand for textiles that would follow such a program? There has been no planning on trade. There is nothing in the budget except a reversion to the old Tory policy of higher and higher tariffs.
I thought last session that perhaps the new look of the Conservative party might stay. I thought perhaps the Prime Minister would use his influence, and would have sufficient influence in the cabinet, to break down trade barriers and to overcome the Tory members of the cabinet. He lost out if he did try, and I do not know whether or not he did. This provision in the budget for higher and higher tariffs has all the earmarks of being made on Bay street, or having been written in the board room of the Toronto stock exchange. Certainly the budget contains nothing for the ordinary people of this country.
I know the Minister of Finance took a long time to outline the various reductions in excise taxes, the increased exemption for medical expenses, the little here and the little there. However, there is not very much in total, only $8 million over a year as compared to the $26 million in the legislation brought in last year. I have a statement here, the source of which I shall give a little later on. It was made about similar reductions in a budget not so long ago. The statement is as follows:
It is an illusory budget. It proposes changes, large in number but small in individual extent in every case, and seeks to create the impression of importance by their mere multiplicity. The banquet table is long. It is well dressed. The best silver and china are used. The lackeys are well-trained. But the fare is thin. The guests have left unsatisfied.
This was a statement by the present Minister of Finance in this house on March 21, 1957, as recorded at page 2553 of Hansard. I believe that is a far more appropriate and more accurate description of this budget than I am able to give. This government, with its double talk, with its progressive face of last year and its Tory face of this year, is just as inconsistent in all its actions.
We heard a great deal about the government wanting to help education in this country by providing further grants to assist young people in obtaining an adequate education.
There is really nothing in this budget except to coax the corporations to do some of the things that the government itself could be doing by way of grants for education. The Minister of Finance had this to say as far
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The Budget-Mr. Argue as the application of income tax law is concerned, as reported at page 1244 of Hansard:
It is important that income tax law should receive constant attention to ensure the greatest degree of equity in its operation.
Yet the dividends from investments in corporations are still, to a very substantial extent, not taxable. We find that a married person can earn $11,350 without paying any income tax whatsoever with the exception of $60 old age security tax. Is there any equity amongst Canadian taxpayers with this provision still remaining in the budget? Have any steps been taken to tax into the federal treasury some of the enormous speculative profits that are being made in the gas pipe-line corporations of this country? How roundly the Conservatives criticized the Liberal government for their actions in connection with gas pipe lines. If we pick up almost any paper in recent days we find that Conservatives all over this country, whether they be high-placed Conservatives in Ontario or high-placed Conservatives with another name in the province of Quebec, have all got their elbows or their arms into this very lucrative deal, or as somebody says, their nose in the trough. They are still exempt. There is no capital gains tax. Yet the minister talks about equity in taxation.
Here is another instance where we find the government talking both ways. Before the election they said they were going to call another conference or reconvene the federal-provincial conference. That categorical statement was made by the Prime Minister and by the Minister of Finance. But there is not a word about it in the budget, not a sound or a breath. Before the election the calling of a conference was announced. After the election no interest is shown in the conference.
The agricultural producers of this country expected fair treatment by this government. They put great stock in the Agricultural Stabilization Act passed in this house last year, and in the clause which said that floor prices would be established in relation to the cost of production taking into consideration the farmer's investment and a fair labour income. The farm organizations came down here a few weeks ago after the election and said to the government, "What are the cost of production figures?" The government said, "We do not have any; there are no statistics available". The legislation says the farmer is to have the cost of production, but the government are not trying to find out what the cost of production is.
As I said earlier in the session, the western producers expected that deficiency payments on grain would be made. To show their confidence that something would be done, after


the election was over they came to Ottawa and asked for deficiency payments of something in excess of $220 million in total on two crops of grain. But in the budget there is not a word about that, not a breath.
In calculating this huge deficit, no account has been taken of the possibility of deficiency payments on western grain for the last two crops. I say that at this moment this government has turned thumbs down on the farmers' request for deficiency payments. I say that the government has failed to fulfil that promise, and at this moment has no intention of fulfilling that promise; because if they had, the deficit forecast would have been much greater. The only hope for western producers at this time is to join their farm organizations in greater numbers and put a great deal more pressure on this government by way of submissions and by way of interviews.


Mr. McFarlane:: Nonsense.


Hazen Robert Argue: Yes; and by way of mass delegations.


Murray Lincoln McFarlane: Nonsense.


Hazen Robert Argue: It is absolutely apparent that this government has no intention of meeting that commitment. Why would they? Apparently they lost their interest in keeping their promises on March 31.


Some hon. Members:: Oh, oh.


Hazen Robert Argue: Of the 48 prairie members, they have 47, so there is no interest in it any longer. They have all the seats now but one.


An hon. Member:: Talk for your own party.


Hazen Robert Argue: I am going to speak on behalf of the producers of western Canada, who unanimously want deficiency payments at this time. The government talks one way in that regard before the election and the other way afterward. They blamed the former government for widespread unemployment. They said they had a public works program that would put people back to work.


An hon. Member:: We have.


Hazen Robert Argue: They said they had a public works program to relieve the unemployment problem. The Minister of Finance, by his forecast of the gross national product in the present budget, says he does not expect there will be an improvement in employment and a reduction in the general unemployment picture or in the numbers of unemployed this year. If the Minister of Finance had expected unemployment to be reduced, if he had expected the unemployment situation to be solved, of necessity he would have been

obliged to forecast a 5 per cent increase in the gross national product in order to have everyone working.


Mr. Deputy Speaker:: It is with regret that I must interrupt the eloquent speech of the hon. member but, it being one o'clock, I now leave the chair.
At one o'clock the house took recess.


[Stage Direction]
AFTER RECESS

The house resumed at 2.30 p.m.


Mr. Speaker:: By leave of the house, has the Prime Minister leave to revert to motions to make an announcement?


Some hon. Members:: Agreed.


John George Diefenbaker: Mr. Speaker, in reverting to motions at this time I would like to make an announcement concerning a matter of immediate importance respecting the projected talks on the technical methods of verifying compliance with an agreement on the suspension of nuclear tests.
Exchanges on this question have taken place in recent weeks between the United States and the Soviet union, the latest of which was in the form of a letter dated June 13 last from the Soviet union, to which the United States has delivered its reply as of today's date.
Hon. members will understand that it is not for me to make public the text of this communication, which will be released in accordance with procedures agreed upon between the United States and the Soviet union. It is, however, appropriate for me to announce that Canada was invited to nominate a scientist to participate as one of the experts on the western side. It is therefore a pleasure for me to announce the appointment of Dr. O. M. Solandt, who for many years was chairman of the defence research board and is one of Canada's great scientists. Dr. Solandt is now vice chairman of the Canadian National Railways in charge of research, and has agreed to make himself available for this important and exacting assignment. Dr. Solandt's name has therefore been included in the list of western scientists contained in today's communication from the United States to the U.S.S.R.
I felt that this announcement should be made in the House of Commons simultaneously
20, 1958	1473
Conference on Nuclear Tests Suspension with the announcement in Washington, and that hon. members should learn of the appointment in this way rather than through the medium of the newspapers.


Lester Bowles Pearson: Mr. Speaker, I think all members of the house will have heard with great satisfaction the announcement which the Prime Minister has been good enough to make to us. It seems to me entirely proper that a Canadian scientist should take part in these discussions because of the advances which have been made in this country in the field of atomic science. I for one am very glad that the Canadian claim has been recognized, and I can imagine no one better qualified for this assignment than Dr. Solandt.


Herbert Wilfred Herridge: Mr. Speaker, on behalf of this group may I say we are very pleased to hear the announcement by the Prime Minister, and to know that Canada is going to take such an active and direct part in assisting to solve this most complex and difficult problem. We are furthermore very glad that such an experienced and well-known Canadian citizen has been -chosen for this purpose.



THE BUDGET


[Stage Direction]
The house resumed consideration of the motion of Hon. Donald M. Fleming (Minister of Finance) that Mr. Speaker do now leave the chair for the house to go into committee of ways and means, and the amendment thereto of Mr. Benidickson.
Hazen Robert Argue: At one o'clock, Mr. Speaker,
I was pointing out that the Conservative party was a much different party from the Conservative party before the election as evidenced by the budget. One of the great problems remaining unsolved is the very widespread unemployment in our country. The budget is bare of any policy designed to put the unemployed back to work, and I think it is a shame and a disgrace to a nation such as our own that so much technical know-how and such a vast amount of plant and men should be idle at a time when many of our people are in great need.
The Minister of Finance brushed aside this aspect very quickly and lightly in his speech the other night, but he did not always brush the unemployment problem under the carpet in this way. In years gone by he was

The Budget-Mr. Argue very concerned about the question of Canadian unemployment, and on March 22 of 1955 he had this to say, as reported on page 2261 of Hansard:
When we entered this debate several weeks ago I am sure that all hon. members expected that the government would avail itself of this opportunity to make an announcement of whatever policy it proposed in order to grapple with a situation which is assuming emergent proportions.
He went on to say:
This session opened two and a half months ago with a statement by the government contained in the speech from the throne as follows:
"Some unemployment of a regional and seasonal nature is being experienced."
He said that the statement in the speech from the throne was a palpable and grotesque absurdity of understatement. That is what he said about the unemployment situation in March, 1955, at a time when there were 327,000 persons without jobs and seeking employment. However, in his budget speech, when he described the present unemployment situation as a fairly mild recession, there were no less than 556,000 persons at that time without jobs and seeking work. The minister, when he was a private member in 1955 and when unemployment was a great deal less, said something should have been done, but certainly this budget is bare with respect to action to alleviate the unemployment situation.
There are many things which should have been done in this budget; one thing certainly was to increase the income tax exemptions. The present exemptions of $1,000 for a single person and $2,000 for a married couple are completely inadequate. Because we feel there should be an increase in income tax exemptions, I wish to move a motion seconded by the hon. member for Kootenay West (Mr. Herridge) as follows:
That the amendment be further amended by adding thereto the following words:
"This house further regrets that the government contemplates no action at this session to recognize the loss of purchasing power to the majority of Canadian citizens because of the lowered value of the dollar as related to consumer goods and prices, by amending the Income Tax Act so as to raise the amount of permissible income to single and married persons without taxation.


An hon. Member:: How much?


Hazen Robert Argue: We have left it as a general principle rather than putting in an exact figure.


Some hon. Members:: Oh, oh.


Hazen Robert Argue: I do not mind answering questions; as a matter of fact I agree with the statement made by a very prominent member of this house-the present Minister of Finance -on January 24, 1956, wherein he said that

if the minister of finance was not prepared to go as far as Conservative policy advocated in this respect, namely $1,500 for single persons and $3,000 for married persons without dependants, then at least he hoped that he would take a generous step in that direction.


Some hon. Members:: Hear, hear.


Donald Methuen Fleming: What did we do last December?


Hazen Robert Argue: That is precisely how far we would like to see the government go. I feel the words of the Minister of Finance back in 1956 were well chosen-when he said that if the government would not go that far they should at least take a generous step forward. In the hope that there might be a single Progressive Conservative of this house who will support the motion, we have made it in general terms, trusting that it would command the greatest amount of support. However, as a direct reply to a direct question, I think the Minister of Finance was right in those days when he said the exemption should be raised to $1,500 for a single person and to $3,000 for married persons.


Mr. Chown:: Would the hon. gentleman permit a question? Has he figured out what such an exemption would add to the present budget deficit?


Hazen Robert Argue: I have looked into this very carefully in the light of the considered statement by the Minister of Finance back in 1956, and I feel that the statement he made at that time was correct. The statement the Minister of Finance made in the past was that this government would not hesitate to finance by means of a deficit. We are quite prepared to see the deficit go to any extent necessary to put people back to work, and we are prepared to increase exemptions to this amount. We would go one step further. We would start taxing some of the millionaires and some of the multi-millionaires who in recent years have made millions of dollars profit, without tax, under the policy of the former Liberal government, and who are doing the same today under the policy of the Conservative government.


Some hon. Members:: Oh, oh.


Mr. Speaker:: Order. The hon. member for Assiniboia has the floor.


Hazen Robert Argue: The official opposition was tried as the government of this country for 22 years and was found wanting, and was very rightly turned out of office on June 10 last, but the new government that has taken office since is no different. They took a short step forward when they were only a minority in this house, but they are now back to the

economic policies which resulted in their predecessors being turned out of office. We say to the people of this country at this time that there is only one movement that should be supported by people who are progressively minded, or liberally minded and that is the C.C.F. movement, and we look forward to the day when the people of this country will accept our policies. We are quite pleased with the results of the elections in the province of Manitoba which showed that the C.C.F. party is the only party in that province which is growing at this time. We ask this house to support the proposition that income tax exemptions should be increased.


Mr. Browne (Vancouver-Kingsway):: Would the hon. member permit a question? He said he looked forward to a day when the people will accept his policy, but in the tirade we have just heard I did not hear much about policy. I heard a good deal of criticism but no constructive suggestions.


Hazen Robert Argue: Is that your maiden speech?


Mr. Speaker:: Before putting the amendment to the amendment, may I say a word about the amendment itself, which reads, in substance:
That this house regrets that the government in its budget proposals has failed to cope satisfactorily with the problems of the recession in spite of the largest peacetime deficit in Canadian history-
I accept the amendment to that point, but I raise for consideration the latter part of the amendment which seems to me to duplicate an amendment moved on the address in reply to the speech from the throne. The latter part reads as follows:
an<i that it is moving towards greater trade restrictions at a time when other countries in the western world are moving in the opposite direction.
Now the amendment moved by the official opposition on the address in reply to the speech from the throne read:
We respectfully represent to Your Excellency that a high level of employment and prosperity in Canada requires a high and expanding level of international trade, and that this will be promoted more effectively by vigorous measures for the expansion of trade with all countries than by efforts to divert from one country to another.
It seems to me that the second half of each amendment is essentially on the same subject, and I wonder whether the Leader of the Opposition (Mr. Pearson) would agree, in the absence of the hon. member for Kenora-Rainy River (Mr. Benidickson), to the deletion of the second half of the amendment.


Lester Bowles Pearson: Mr. Speaker, with great respect I should like to call to your attention the fact that our earlier amendment dealt with the question of the expansion of trade as
The Budget-Amendment
opposed to the diversion of trade. This amendment deals not with one form of trade restriction, which might be diversion, but with trade restrictions generally, and puts those trade restrictions in the context of the general policies of other countries leading in the opposite direction. In other words, the amendment seeks to draw a contrast between the trade policy embodied in this budget and the policies which are being followed by other countries in the world, and I should have thought with great respect, Mr. Speaker, that this distinguishes it from the amendment we raised to the address in reply to the speech from the throne. I call this to your attention in case you may wish to give the matter further consideration.


Donald Methuen Fleming: Mr. Speaker,
perhaps you would wish something to be said from this side of the house on the question that has been raised. As I understand the rules of the house, it is that there may not be duplication of debate in the sense that when there has been a debate on a subject, that debate may not be revived during the session by the introduction of what is in substance the same question. It is not necessary that the second motion or amendment be in precisely identical terms; it is a question whether debate on the subject is, in essence, revived by the second measure, motion, amendment, or whatever it may be, which it is sought to introduce.
The Leader of the Opposition (Mr. Pearson) has sought to distinguish the motion he introduced on May 13 from the second part of the amendment introduced this morning by the hon. member for Kenora-Rainy River (Mr. Benidickson) by saying that they both relate to trade but that the earlier motion relates rather to the diversion of trade, thus seeking to contrast diversion of trade with expansion of trade, whereas the second half of this morning's amendment purports to condemn the government because it is said that there has been a movement toward greater trade restriction.
Looking at the matter, not in terms simply of the words but in terms of the substance, it is perhaps clear that there will be some duplication of debate. At the same time, I believe that it will be the desire of all hon. members that there should be the fullest opportunity for the discussion of trade policy during this debate. In response to previous requests I reviewed the position and policy of the government in relation to trade, with particular reference to our trade relations with the United States and the efforts we are
147S

The Budget-Mr. R. A. Bell making to expand trade within the commonwealth, and while it may well be that the amendment could be more happily worded to allow the fullest discussion on those points, I for one would not wish to see any undue limitation of the discussion of the trade questions and policies that are directly presented to the house by the budget. I may have my own opinion about how far this particular amendment strays away from those policies that were put before the house in the budget speech or which are raised directly or by implication in any of the budget resolutions. But, Mr. Speaker, I do think in this debate, as long as there is no trespass on the matters that were included in the earlier debate, it would be the wish of the house to have a full opportunity to discuss those questions of trade that were raised by the budget.


Mr. Speaker:: I am prepared to accept the view as expressed by the Leader of the Opposition (Mr. Pearson) with the reservation that he claims there is a distinction and perhaps I may try to find a distinction in the course of the debate. No one wants to proscribe a free-ranging debate of the kind of the budget debate and I accept the second part of this amendment as relating to the fiscal policy of the government related to trade and therefore opening the door for this kind of discussion.
May I now put the motion moved by way of amendment to the amendment. It is moved by the hon. member for Assiniboia (Mr. Argue) and seconded by the hon. member for Kootenay West (Mr. Herridge):
That the amendment be further amended by adding thereto the following words:
This house further regrets that the government contemplates no action at this session to recognize the loss of purchasing power to the majority of Canadian citizens because of the lowered value of the dollar as related to consumer goods and prices, by amending the Income Tax Act so as to raise the amount of permissible income to single and married persons without taxation.


Mr. Richard A. Bell (Carleion):: Mr. Speaker, the house has heard two vigorous speeches from hon. gentlemen who take their roles as critics rather literally. As I listened to their rhetoric-indeed to their declamations-I was reminded of Disraeli's remark, "How much easier it is to be critical than to be correct". Such congratulations as I may extend to the hon. member for Kenora-Rainy River (Mr. Benidickson) I must reserve first to congratulations upon the confidence his party has demonstrated in him, and properly so, in designating him for the important and onerous role of financial critic, and second upon the pleasant manner of his speaking in this house.
From the gallery of this chamber it has been my privilege to hear every financial

critic since the year 1927: Guthrie, Bennett, Ralston, Lawson, Hanson, Harris, and more recently the hon. member for Dufferin-Simcoe (Mr. Rowe) and the hon. member for Greenwood (Mr. Macdonnell), the latter I suppose being the veteran budget critic of all time. The hon. member for Kenora-Rainy River in taking this role has joined distinguished company and I extend my wishes to him in the words once used by the late Ernest Lapointe, "I wish him luck, but not too much".
I spoke of the onerous role of financial critic that now falls to the lot of the hon. member for Kenora-Rainy River. Onerous and arduous that role will be for the hon. gentleman as long as the hon. member for Eglinton (Mr. Fleming) occupies the treasury benches as Minister of Finance. But what disappointed me in the speech of the new financial critic-and I must confess it immediately-was that he fell into the same error as his immediate predecessor, the former member for Coast-Capilano, in attempting to substitute angry scattered jibes and epithets for reasoned consecutive argument. May I say with respect that his was a speech conceived in angry frustration and delivered with a sense of bitter repression and electoral disappointment for these are the qualities which regrettably have characterized hon. gentlemen opposite since June 10 last.
Not yet have they reconciled themselves to the facts of political life. Not yet have they recovered from the complex they have of their divine right to rule. Perhaps it is because of that that in his speech and in the amendment which he moved the hon. member for Kenora-Rainy River has succeeded in getting on both sides of every issue, has succeeded in begging any question and has succeeded in blowing hot and cold on every problem. When he was speaking I set out to refresh my memory of the words of Samuel Butler, and these are they:
He was In logic a great critic
Profoundly skilled in analytic
He could distinguish and divide
A hair 'twixt south and southwest side.
On either which he would dispute,
Confute, change hand and still confute.
The speech of my friend the hon. member for Assiniboia (Mr. Argue) was merely a political stump speech, a warmed-over election hustings version. What serious contribution did the hon. gentleman make to this debate?


Some hon. Members:: None.


Richard Albert Bell: In the midst of his tirade of abuse-and that is all it was-he

did make one suggestion. He suggested removal of the excise tax on clothing made in Canada. He was apparently oblivious to the fact that under GATT we must not discriminate and the tax would have to be removed from all goods whether Canadian or imported. How would that help? That is but a sample of the confused economic thinking of hon. gentlemen opposite. I could multiply it many times but I will not take time this afternoon to do so.


An hon. Member:: It isn't so much confused economic thinking as ignorance.


Richard Albert Bell: I said that the hon. member for Kenora-Rainy River blew hot and cold. It seems to me that the Liberal critic was in favour of balanced budgets, certainly he was opposed to the deficit in this budget but equally he was in favour of larger deficits under existing circumstances. On Tuesday night he waxed indignant and sarcastic about the present deficit yet did he not then and does he not today advocate policies which would result in a much larger deficit? He appeared to be in favour of what he called quick economic stimulus by way of tax cuts, yet at other times he appeared to be in favour of tax maintenance. I thought I detected today that he was in favour of reduced expenditures but he was equally in favour of and called for higher payments. He was in favour of protection for Canadian industry and against all means of protecting Canadian industry. He was in favour of the expansion of trade within the commonwealth and against all means of achieving such expansion.
He was in favour of additional assistance to the provinces and to the municipalities yet rigidly adhered to the policies of the former government, rejected and discarded by the electorate, which prevented additional assistance to the provinces and the municipalities of this country. He was against dumping but in favour of the legislation which permits it. Never in such a short period of time did I ever hear one speaker gore himself on the horns of so many dilem-nas and I reflected, "Oh, Consistency, thou art a jewel!"
As I listened in incredulous fascination to the hon. gentleman I realized that the Liberal party continues as a house divided against itself. I realized how delicately and indecisively the hon. gentleman had to walk the tight rope in order to satisfy at the same time the Winnipeg Free Press and the party's eastern moguls.
The amendment moved by the Liberal party which apparently is to have the support of the C.C.F. consists of what? It is nothing but sophistry, hollow equivocation, and
The Budget-Mr. R. A. Bell nothing could better demonstrate the political bankruptcy of the Liberal party. The C.C.F. sub-amendment certainly does not improve upon it.


Mr. Deschaielets:: What about unemployment?


Richard Albert Bell: What about unemployment? I will tell you plenty about it and I will make it clear who is responsible for the present situation in unemployment before I am done if that is the issue the hon. gentleman wants to raise.
The hon. member for Kenora-Rainy River laboured long and hard this morning to have this house and the country believe that the conditions of recession and unemployment have been a direct result of the economic and fiscal policies of this government. In fact, he would have us believe that it was contributed to by the failure of the government to present its budget earlier, perhaps last autumn, and by other alleged deficiencies which the hon. member for Kenora-Rainy River described in terms rather more vivid than accurate. Let us examine these allegations. Let us put the situation in perspective. I suggest the best way to do this is to ask ourselves this question: What would have been the situation in Canada today if on June 10 last, by peradventure or misadventure, my hon. .friend's party had been re-elected?
I can tell you exactly what the situation would be. First, there would have been no budget or financial accounting of any kind at least until late this spring. This government did give a financial outline on December 6 last. Hon. members opposite have screamed for an autumn budget knowing full well that there would have been none if they had been in power. Actually all they were doing was administering another kick to the already well-bruised Walter Harris.
Second, there would have been no tax reduction as occurred last December. The Canadian people would have been deprived of the benefit of substantial tax cuts in personal income, corporation and excise taxes amounting to $178 million. These present advocates of tax reductions, of a tax holiday indeed, though that was not mentioned today, would have pursued the unrealistic policies laid down in the last Harris budget. I say, that that budget was as complete a miscalculation of the then existing economic position of this country as it was of the mood of the Canadian people.	[DOT]
Third, there would have been no increases in old age pensions beyond the Walter Harris-William Benidickson figure of $6 a month. There would have been no increases in disability pensions, in blind pensions, in war veterans allowances, no change in the Pension
1478	HOUSE OF
The Budget-Mr. R. A. Bell Act, no change in the Unemployment Insurance Act. Hospital insurance could not conceivably have become effective anywhere before January 1, 1959, and probably not then. The advantages of these additional large sums in alleviating a Liberally inspired and created recession would not have been available.
Fourth, there would have been no additional money for housing. Housing starts had almost ceased when my hon. friends opposite went out of power. Under their policy recession would have become full-out depression. This morning the hon. member for Kenora-Rainy River called the $400 million for housing, "splashy and well-huckstered window dressing." The people who are now and will be living in these homes will long remember that outrageous comment from the hon. gentleman.
Fifth, I say that the tight money condition, the unwise credit restrictions, the discouragement of capital works and investment, basic causes of the recession, would have continued and plunged us ever deeper into an economic decline. We would have continued with the highest interest rates in our history and a general scarcity of credit.
Sixth, there would have been no additional moneys made available for stepping up the program of public works and for national development.


John Whitney Pickersgill: Where are they?


Richard Albert Bell: The impact of these additional amounts upon the national economy would have been lost with disastrous results to the people.
Seventh, there would have been no additional assistance to the provinces. The old take it or leave it attitude would have persisted.


Mr. Habel:: By telegram.


Richard Albert Bell: By telegram. That is exactly what my hon. friend understands. He understands nothing else but that type of operation.


Joseph-Alphonse-Anaclet Habel: Take it or leave it, by telegram.


Richard Albert Bell: I have observed my hon. friend in the house for a long time and I say he ought to have lived in the days of the sailing ships because he generates enough wind to blow a ship across the Atlantic.
Eighth, I say that the Atlantic adjustment grants would not have been provided. Those sections of our economy most in need of help would have been deprived of $100 million.
Ninth, there would have been no program of stabilization of agricultural prices and recession would have struck the farmers of Canada in a much more vividly pronounced fashion.


Tenth, the wheat surplus would have continued to pile up. Sales of wheat would have continued to decline and the amount in storage would have increased. There would also have been no trade or economic conference. The old policy of drift, the old policy of wait and see in relation to trade with the United Kingdom would have continued.


John Whitney Pickersgill: No tariffs against the British.


Richard Albert Bell: The old policy of diverting trade from the United Kingdom to the United States would have continued. Finally, I say that without the benefit of the new policies adopted by the present government unemployment would have mounted to figures at least double those which actually occurred.


Some hon. Members:: Oh, oh.


Richard Albert Bell: As I have said, under the Liberal policies of credit restriction recession would have become depression. These are but a few of the consequences which might have occurred without a change in the direction of the fiscal, monetary and commercial policies of the nation. It was a change of government, a change from the principles of the last Harris budget, with which the hon. member for Kenora-Rainy River was so intimately connected, which saved this country from a major economic disaster. It was and is the realistic policies set forth in the speech from the throne and in the budget of last Tuesday night which will direct the paths of the Canadian people to greater and more ehallanging development, more challenging accomplishments and goals.
On Tuesday night the hon. member for Kenora-Rainy River said, in an attempt to catch the headlines, that the budget was a sick budget. Did anybody in the house fail to realize on Tuesday night that all the sick faces were on the opposite side? More properly the hon. gentlemen ought to have called it a physician's budget, a budget designed to heal the many ills to which this government fell heir from its predecessor. He claimed that it was a wait and see budget, a slow motion budget. What nonsense! Never in the whole history of our country has there been a government which has attempted so much in such a short time. Yes, never has a government moved so rapidly its objectives to accomplish.
Then the hon. member for Kenora-Rainy River used harsh words about the government respecting the projected deficit. He said this morning, 1 believe, that it was directly attributable to political commitments rather than to economic policy. What are

these commitments? Which of these commitments would he like us to abandon? What things has the government done involving financial outlays that he would seek to have undone? I think he should have told us that. I think hon. gentlemen opposite who speak later in the debate should tell us.
But, if I interpret my hon. friend correctly, and I think I do, if his policies were followed, certainly if his leader's policies had been followed, there could be no doubt that the deficit projected would have been at least $500 million more than what it is. How can he have it both ways? How can he manage, Janus-like, to face in both directions at the same time? Actually my hon. friend, I venture to suggest, resembles John Bunyan's great grandfather, "but a waterman, looking one way and rowing another".
No one denies that $648 million is an exceedingly sizeable surplus.


Some hon. Members:: Surplus?


Richard Albert Bell: Deficit, I am sorry. But it should cause dismay to no one. It represents 12.2 per cent of our total expenditure this year. There have been many times in our history, both under Liberal and Conservative governments, when the deficit has represented a very much higher percentage of expenditure.
To go back to 1909, if you will, to the great Liberal finance minister, W. S. Fielding, he had no concern over a deficit which represented 35 per cent of the total expenditure of that day. Nor had Mr. Dunning when his last budget before the 1930 election showed a deficit of 19 per cent of expenditure or when his first budget after the 1935 election showed a deficit of 14.6 per cent. Related to the gross national product, there have been many occasions when we have had larger deficits than that now projected. Nor are we alone in this country at this time with this particular problem. In the United States the best recent forecast indicated a deficit of between $11 billion and $13 billion, figures substantially higher on a per capita basis than that forecast in this budget.
But the hon. member for Kenora-Rainy River reserved his harshest strictures for the calculation of the amount of the deficit. In effect he alleged a type of juggling of accounts to achieve a bookkeeping deficit smaller than the actual one. He bases this upon the winding up or liquidation of the defence equipment replacement account. On Tuesday night he went overboard in alleging incorrectly that provision had not been made in the deficit figure for $190 million for the old age security fund or $70 million for the hospital insurance scheme, but that
The Budget-Mr. R. A. Bell
he corrected today. He did try, however, to bring in the C.N.R. deficit and other nonbudgetary items although I am sure he is well aware from his experience that these have not been included in budgetary deficits on previous occasions.
But what of his strictures regarding the defence equipment replacement account? This account was nothing more than a bookkeeping kitty that the former government tucked away for convenient purposes to avoid parliamentary control of certain defence expenditures. At one time it was as high as $310 million. It is now $165 million. If the hon. gentleman suggests that the liquidation of the final balance of $165 million in this account distorts the budgetary position, then what does he say about the distortion when the former government reduced it by over $100 million? His argument, if it is logical and it is not, applies equally to the former government and he condemns his own colleagues by his ill-considered blasts in this respect.
I suggest to the house that there is no doubt that this account should have been eliminated several years ago. Indeed, at one time a former minister of finance ordered that it be liquidated within a period of three years. If his orders had been obeyed, what would my hon. friend have said? Would he then have charged the minister of finance with distortion, his own minister of finance with whom he served in such close relationship? Would he have charged him with distortion of the position? This government considered, in accordance with what is its universal policy, that parliamentary control of defence expenditures ought to be restored and that this bookkeeping device for circumventing parliament ought to be abandoned. It was, therefore, an honourable, honest course and was stated clearly, specifically and openly in the budget speech.
No one in the press gallery misunderstood, although my hon. friend may have done so. There was no concealment. The minister came right out in the open so that he who runs may read. I suggest this course was in refreshing contrast to the way in which previous ministers of finance were accustomed to tucking away $310 million in this account for the purpose of distorting the budgetary picture. What I want to emphasize is that this account has been a non-budgetary account used, however, by previous governments for budgetary purposes. This will be ended, and it will be liquidated as a nonbudgetary cash requirement. The cash position of the government is not changed, but the position of parliament and parliamentary control over the expenditure is greatly changed.
1480	HOUSE OF
The Budget-Mr. R. A. Bell
My hon. friend spoke at some length about giving a quick, economic stimulus to our economy. How much additional deficit would he think would be required to meet his objective? Certainly, the election objective of his leader was tax cuts, both permanent tax cuts and tax holidays. This objective could be achieved in only two ways, either by substantially increasing the amount of the deficit or substantially reducing the amount of other expenditures. My hon. friend makes no suggestion today that would eliminate any of the major expenditures of the government. He has not told us, but I assume he would not want to go back to the $46 per month old age pension for which he and his minister of finance were responsible. I assume that there are no public works he would want to eliminate. I assume, therefore, that the only way my hon. friend would go about achieving the election objectives of his party would be by substantially increasing the deficit.
Would he tell us what would be a proper amount of deficit, under existing circumstances? Suppose my hon. friend were minister of finance today, what would his deficit be? What would he have done? Perhaps he could have some of his friends who sit around him tell us. In the recent election campaign the Leader of the Opposition (Mr. Pearson) definitely achieved an all-time record for election promises and commitments. It is strange that during the six weeks of this session he has not repeated a single one of those election promises, those election panaceas. The hon. gentleman repeated not one of them today, either.


Lester Bowles Pearson: That does not happen to be true, but that is all right.


Mr. Bell (Carlefon):: I will establish that in just a moment. What did he promise? First, he promised a tax cut of $400 million. Then when that did not seem to be catching on, he raised the ante to $500 million.


Lester Bowles Pearson: That is not true, either.


Richard Albert Bell: I have the press clippings here if my hon. friend would like me to take the time to read them.


John Whitney Pickersgill: Go ahead.


Richard Albert Bell: The hon. gentleman has not denied either of these proposals. I have the press clippings here if the hon. gentleman wishes me to refer to them. He raised the ante to $500 million.


John Whitney Pickersgill: Produce the evidence.


Richard Albert Bell: It is on the record plenty of times. Here it is:
Liberal Leader Pearson has boosted the ante on his party's tax cut proposals to "perhaps $500 million from the original $400 million".


This article is dated March 13, 1958.


Lester Bowles Pearson: Who said that?


Richard Albert Bell: This is Liberal Leader Pearson speaking, at least, I assume it is.


Lester Bowles Pearson: From what are you reading?


Richard Albert Bell: This particular clipping I have here is by a most responsible press gallery reporter, Clark Davey, and the dateline of the article is Port Hawkesbury, Nova Scotia. I believe this quotation has been used thousands of times, and the hon. gentleman has not denied it once.


Lester Bowles Pearson: I have.


Richard Albert Bell: When even the $500 million additional fell flat, what did he do? In a last desperate strategem, he promised an additional plan, a tax holiday. This tax holiday was to be for at least six weeks. Did the hon. gentleman not say that? Would he like me to read that to him, too?


Lester Bowles Pearson: Yes.


Richard Albert Bell: I will be glad to read that to him, but I am not going to be diverted from this speech. Personal income tax collections during the past fiscal year were about a billion and a half. A tax holiday of six weeks would represent, as a minimum, about $175 million. There would be possibly a total additional deficit, with what the hon. gentleman suggested himself during the election campaign, of at least $675 million, and I think I am putting it at a very modest figure.
What have we heard of this tax holiday? Have we heard it mentioned in this house since the session opened? Did we hear about it today? Has it been confined to limbo? What have we heard about the doubling of the marriage exemption allowance? The Leader of the Opposition promised the marriage allowance would be increased from $2,000 to $4,000 for the first three years of married bliss. I thought that was a sheer stroke of political genius. Would anyone in this house doubt that was the beloved brain child of the hon. member for Bonavista-Twillingate (Mr. Pickersgill)? I am sure the hon. gentleman will not deny the paternity of that. I said in the election campaign that the voice was the voice of Pearson, but the hand was the hand of Pickersgill.
At first I thought that this was an insult to the young women of Canada, that such an additional incentive to marriage should have been required. Then I was told that it applied equally to the first marriage or to the number of joys which apparently Tommy Manville has achieved. What would be the mundane life of a member of parliament with these anticipated tax exemptions as promised

by the Leader of the Opposition? For this great boon to the newlyweds, both new and renewed, apparently the hon. gentleman who leads the opposition ascribed a figure of $25 million. The experts with whom I have consulted disagree with him. They ascribe to this delectable proposal a cost of $100 million to $125 million, but I am unable to discover whether they are bachelors or whether they are widowers beyond redemption. I confess that my mind is so taken up with just the contemplation of the delights of these proposals that I cannot pay much attention to the beliefs of experts on this subject. After all, they probably would seek to controvert the well-known fact that two can live as cheaply as one.
The temptation to tarry on such a subject is great, but I must hurry on to what my hon. friend said on the subject of trade. Since this government was formed 364 days ago it has been subjected to a barrage from the heavy artillery opposite on its trade policies. No other subject seems to have so delighted the hon. member for Essex East (Mr. Martin) and the hon. member for Bonavista-Twil-lingate as the subject of trade. Whatever steps the government has taken, these hon. gentlemen have attacked the government. On no other subject have they ventured into so many inconsistencies; indeed, on trade the opposition in this parliament has been consistent only in its inconsistencies, and it has been given delightful leadership in that respect by the hon. member for Essex East.


Paul Joseph James Martin: I ask my hon. friend this question. What does he think about the British proposal?


Richard Albert Bell: I will tell my hon. friend before I am finished.


Paul Joseph James Martin: Tell me now.


Richard Albert Bell: I will tell my hon.
friend what I think of his reaction.


Paul Joseph James Martin: Tell me what
yours is.


Richard Albert Bell: I will tell you what I think of his reaction. In what he said he reminded me of the statement of Henri Bourassa that the only policy of liberalism is to have no policy and the only principle of liberalism is to have no principles.


Paul Joseph James Martin: What is yours?


Richard Albert Bell: Over the years hon. gentlemen opposite on many occasions have voted against the holding of a commonwealth trade and economic conference.


Some hon. Members:: Rubbish.


Paul Joseph James Martin: When?
The Budget-Mr. R. A. Bell


Richard Albert Bell: I will produce the
evidence on another occasion.


John Whitney Pickersgill: Produce it now.


Richard Albert Bell: Year after year hon. gentlemen opposite voted against-


John Whitney Pickersgill: Produce the evidence.


Richard Albert Bell: I will produce the
evidence on another occasion.


John Whitney Pickersgill: You will not produce it because there is none.


Richard Albert Bell: No one knows better than does the hon. member for Bonavista-Twillingate that the evidence is there. This party succeeded in having a commonwealth trade and economic conference called through the inspiration of the Prime Minister (Mr. Diefenbaker) and because of the Prime Minister's faith and the faith of this party in the commonwealth and its future as a political and economic force in today's world. Since that conference was arranged hon. gentlemen opposite have sought to play it down, to minimize it as much as possible. Did anybody ever see such glum faces as there were a week ago this day when the Prime Minister of the United Kingdom in this chamber spoke of the forthcoming commonwealth conference as working "a great advance in commonwealth co-operation in trade and commerce." Their faces were even glummer when Mr. Macmillan spoke of the remarkable results of the trade mission to Britain. By every means, direct and indirect, they have sought to minimize and destroy the effect of that mission. I quite agree that nothing has been more calculated to set the hon. member for Bonavista-Twillingate agiggling.


Lionel Chevrier: Why can we not get the
report?


John Whitney Pickersgill: What has it accomplished?


Richard Albert Bell: No one should be
surprised at these inconsistencies. 1 had hoped to take a little time to speak about some of the past record of hon. gentlemen opposite of the fact that they piled up the greatest trade deficit in Canadian history, how they piled up the greatest trade deficit with the United States and allowed it to rise to the astronomical figure of $1,280 million. Yes, Mr. Speaker, these were the men who were responsible for the shifting of our trade from the United Kingdom to the United States. They were responsible for the loss of our markets in the United Kingdom for our agricultural products. These were the men who sold the textile industry down the river, who sacrificed it on the altar of expediency and jeopardized the jobs of tens of thousands

The Budget-Mr. R. A. Bell of Canadian workers. That is the record that can be produced at any time.
I want to speak of the refreshing contrast to that record there is in what this government has done in under a year and, may I say, a year spent in an atmosphere which was almost entirely one of crisis and emergency. Our trade deficit with the United States has been reduced by one-fifth. Again this year imports have fallen off much more sharply than have exports. Our pattern of trade with the United Kingdom is moving quietly but effectively toward its former tradition. The convening of the commonwealth trade and economic conference, the trade mission to Britain, the reduction of the huge wheat surpluses are constructive, dynamic forward steps, the full import of which will make themselves felt in the coming fiscal periods.
Attempts have been made-and they are made in the Liberal amendment-to paint the present budget as moving towards greater trade restrictions. That is what the amendment states.


John Whitney Pickersgill: That is what the budget
says.


Richard Albert Bell: By some it has been suggested that this marks a turning of our backs upon the principle of multilateral trade envisaged by GATT. In my opinion nothing could be further from the truth. The hon. member for Kenora-Rainy River says that the budget proposals went back to Bennett. I am one member who is not ashamed of Right Hon. R. B. Bennett, the man who saved this country from economic ruin. Some day I will take the time of this house to set the records straight. No hon. gentleman knows that better than does the Leader of the Opposition because he was an integral part of the policies which were propounded by the Bennett government. Yes, the hon. gentleman knows very well that that is true for he occupied a senior-


Lester Bowles Pearson: May I ask the hon. member what he means by saying that I was part of the integral policies of the Bennett administration?


Richard Albert Bell: I want to say this to the hon. gentleman. No member of the civil service of Canada played a larger part than did the hon. gentleman who now leads the opposition in setting policy or formulating and outlining policies for the then Bennett government. Everyone knows that to be so. It ill behooves him to deny it.


Lester Bowles Pearson: May I ask the hon. gentleman whether he thinks that civil servants are responsible for the policies of the Canadian government?


Richard Albert Bell: I want to say to my
hon. friend that, so far as he is concerned, he was given a special status in the Stevens commission. He was given a status in various matters where his opinion was made known profoundly on the policies. As I say it ill behooves him to deny what I have now stated.


Mr. Marlin (Essex Easl):: Stevens left
Bennett.


Richard Albert Bell: Oh, yes. I can tell the hon. gentleman something in respect to that.


Mr. Denis:: Talk about Sir John A.
Macdonald.


Richard Albert Bell: I do not know that there is much that I could talk about that the hon. member for St. Denis would understand.


John Whitney Pickersgill: You can include the rest of us too.


Richard Albert Bell: In a full year of office this government has taken no steps to give tariff or valuation protection to any industry except agriculture. Does my friend the hon. member for Assiniboia (Mr. Argue) object to that fact? With the exception of a group of miscellaneous tariff items in this budget, some of which involve small increases, but more of which involve duty reductions, and none of which have any major economic significance, all the tariff changes which have been made in this budget have been made on the recommendation of the tariff board. These tariff board reports, with one exception, were made at the request of the previous government.
When supporters of that former government say to us, as they have said today, that these tariff changes are restrictions on trade- and that is what the amendment says-what do they really mean? Are they saying that they would have declined to implement the reports of the tariff board on references which they themselves made? Are they admitting that these references were intended by them as purely dilatory tactics to get them over the embarrassment of dealing with these matters until after an election or what in fact does my friend the hon. member for Kenora-Rainy River really mean?
The changes which have been made are changes negotiated in accordance with GATT and in full conformity with GATT. Wool fabrics are in a class by themselves. The desperate condition of the textile industry after years of Liberal neglect compelled some action, the full nature and import of which was clearly set forth in the budget address. My hon. friend would weep crocodile tears for the British exporters. To what extent will they suffer from the increase that has been put on in this budget? My hon. friend

said that it would cast a chill on the conference. I have greater faith in the British people and greater faith in the commonwealth than to believe, as he does, that this would cast a chill on what I believe may be the greatest movement forward in trade that we have had in many a year.
I want to say a word in respect to the prospective amendments to section 35 of the Custom Act. My personal view is that Canada made a grave mistake in 1948 when she amended the then provisions of that key valuation section of the Customs Act. Bit by bit, under pressure from many parts of Canada-and nobody knows this better than does the hon. member for Kenora-Rainy River -the former government tried to restore some of the teeth in the former section. They did not succeed.
Mr. Speaker, I have no sympathy for any Canadian industry which cannot face reasonable and proper competition from imported goods. There is no use in having an industry in this country which has to be pampered and petted by excessively protective measures and which cannot face foreign competition on reasonable terms. But what this amendment is designed to do-as the Minister of Finance has outlined-is to eliminate foreign dumping. Surely there is no member of this house who wants Canadian industry, Canadian workmen, yes and Canadian agriculture, to be compelled to compete with foreign goods sold at less than their cost of production plus a reasonable amount for selling costs and profit. Yet, that is what my hon. friend the member for Kenora-Rainy River appeared to say this morning.
If preventing goods from entering Canada at less than their cost of production, thereby destroying the jobs of Canadian working men, is protection, then as far as I am concerned I am for that type of protection. As long as I have a vote in this house I will not vote to compel Canadian working men to compete with foreign dumped goods.
I have taken a substantial length of time on trade and tariff matters, but for that I do not apologize because the next few months will be critical and crucial ones for this nation's trading future. I believe it is the hope of all hon. members, wherever they sit in this house, that those who will assemble in Montreal on September 15 next for the great commonwealth trade and economic conference may have the wisdom and guidance to enable them to bring about a successful conclusion to that conference, one which will be advantageous to all nations.
57071-3-94J
The Budget-Mr. Dupuis (Translation):


Mr. Yvon Dupuis (St. Jean-Iberville-Napierville):: Mr. Speaker, I have the honour of representing in this house the great riding of St. Jean-Iberville-Napierville. Therefore I would like to stop a minute or two at the very beginning of my remarks, to recall to hon. members the memory of the Hon. Alcide Cote who for many years was member for that riding before being appointed postmaster general on February 13, 1952. Unfortunately, the Lord deprived us too soon of his many loyal services not only to the riding he represented, but to the country as a whole.
Mr. Speaker, before tackling the budget introduced by the Minister of Finance (Mr. Fleming), I would like to stress a particular fact which is of interest to the riding I represent in this house.
You are aware that the Liberal party which guided this country's destinies until June 1957, had endowed St. Johns with a development that we had earnestly wished and that we highly appreciate; I refer to the Royal Military College of St. Johns. However, Mr. Speaker, I would be remiss in my duty if I did not seek redress on behalf of the cadets now attending that college. Mr. Speaker, we have three military colleges in Canada and you know that at Kingston a cadet who begins his studies there is allowed to finish them at that college. Now, it is different in the province of Quebec where we are facing a situation that should end at once; that of having French-speaking Canadians start their course at St. Johns and then having to expatriate themselves to Kingston to finish their studies and obtain their diploma. It is a flagrant injustice and that is why I rise today to claim justice on behalf of our French-speaking fellow citizens.
Very often, French Canadians who have been getting high marks in their final mm; at St. Johns are seriously handicapped when transferred to Kingston to finish their studies, frequently because of their inadequate knowledge of English. I am pointing out this injustice and I know that the Minister of National Defence (Mr. Pearkes), who was in St. Johns recently, will look into the matter in so far as his responsibilities warrant. Mr. Speaker, I want to make it clear that if justice is not done, I will rise in this house as often as necessary to claim equal treatment at Kingston for the young French Canadian graduates of the College militaire royal de Saint-Jean.

The Budget-Mr. Dupuis
Mr. Speaker, I would now like to congratulate the hon. member for Kenora-Rainy River (Mr. Benidickson) on his scathing and forceful rebuttal this morning, to the first budget speech of the Minister of Finance. The other evening, all eyes in this country were turned on the Minister of Finance. It was the first Conservative budget since 1935 and, as you will see in a moment, Mr. Speaker, it does indeed deserve the name "conservative", for it stuck to some old practices of previous Tory governments.
Mr. Speaker, the Minister of Finance was one of those who, until 1957, were financial critics of the opposition. I would not like to go over all the statements made by the Minister of Finance when he sat on the opposition side. He was often vehement, sometimes sarcastic and seldom clear. I will limit myself to one extract of a statement from the Minister of Finance, who, speaking in the name of the opposition in March 1957, and addressing himself to the Liberal government, said:
He has debased and humiliated parliament which has become the pawn of the government and its friends. He has crushed under a heavy taxation burden the population of Canada which this year will have to pay an unprecedented amount of taxes.
Well, Mr. Speaker, those words of the Minister of Finance when he was in the opposition would apply very well today to the present government. You will remember, Mr. Speaker, that the then financial critic of the opposition blamed the federal government for taking what he called the lion's share in the tax field. And you will remember that some premiers of the provinces united their efforts with our present Minister of Finance to claim their fair share of the tax fields in this country. You have heard the premier of Ontario, and the premier of Quebec complaining loudly of injustice, misunderstanding and inadequate funds to administer their provinces.
I still remember the voice of the premier of Quebec when I was a member of the provincial legislature. Every day he used to say to the Liberals in the opposition: "Tell your friends in Ottawa to stop talcing 73 cents out of every tax dollar, leaving us only 27 cents to administer the provinces and the municipalities!"


An hon. Member:: There's a real punch!


An hon. Member:: There's a fine speech, for you!


An hon. Member:: A very, very telling point!


Yvon Dupuis: Well, Mr. Speaker, today I ask those who wish to interrupt me that they kindly ask their friends to return to the provinces what is rightly theirs and is being refused to them under this budget.
The sacred Frost-Duplessis-Diefenbaker union has given a show which today has but pitiful results. And now we have heard the Minister of Finance who, for years, flailed the Liberal regime, came out for balanced budgeting and every year, in the budget debate, indulged in such solemn promises as: "bring us to power and we will settle that ourselves".
Well, the people of Canada have returned the Conservatives to power. It has been said in this house and elsewhere that the present government was put into power because of the vision of a great man. So, the people of Canada expected a great change, a great deal of good from the promises made by our friends opposite, and it is finding out today, not only that the Prime Minister had visions, but that the people itself also had visions in believing that the government would do it justice.
Mr. Speaker, we have-


An hon. Member:: The hon. member has obsessions-


Yvon Dupuis: Does anyone wish to ask me a question?


Mr. Parizeau:: I said the hon. member has obsessions.


Yvon Dupuis: Mr. Speaker, I would beg my hon. friend to allow me to finish my speech. Should he wish to have his own obsessions, he may take time out to have them. I wish he would let me finish my speech.


Mr.   Speaker-Mr. Deputy Speaker@: Order. I would ask hon. members to allow the hon. member for Ste. Marie to finish his speech.


Yvon Dupuis: On a point of order, Mr. Speaker. I represent the constituency of St. Jean-


Mr. Deputy Speaker:: I beg your pardon. The hon. member for St. Jean-Iberville-Napierville has the floor.


Yvon Dupuis: Mr. Speaker, I am glad you have mentioned the constituency of Ste. Marie; I am not ashamed of it; it is one of the finest in the province.


Mr. English:: You could not manage to get re-elected there.


Yvon Dupuis: Frankly, I was not resorting to the electoral methods of the Union Nationale. Since you indulged in petty politics as deputy minister of colonization in the Quebec government, you should be the last one to raise your voice here-


Roland Léo English: Mr. Speaker, I never was deputy minister of colonization. The hon. member should brush up on his history; he would then learn that I was, at the time, deputy minister of game and fisheries.


Mr. Deputy Speaker:: Once again, I would beg hon. members to kindly let the hon. member for St. Jean-Iberville-Napierville go on with his speech.


Yvon Dupuis: Mr. Speaker, when we probe this budget and think of all the election promises made during the last campaign-


An hon. Member:: By the Liberals.


Yvon Dupuis: -we notice quite a difference. We had been promised substantial tax cuts-


An hon. Member:: They were cut.


An hon. Member:: Mr. Pearson had promised them too!


Yvon Dupuis: But then he would have done so.
They had promised to take care of such problems as those of the small wage earner, unemployment and federal-provincial relations.
Now, what sort of budget have we got? Mr. Speaker, while there is need in this country, we are presented with a budget which I would call funeral budget, i.e. a lower tax on cut flowers, a permissible deduction of ambulance costs, and a tax rebate on rat poison. That is what the Minister of Finance is submitting to us in a period of emergency.


Mr. Ricard:: Remember bubble gum?


Yvon Dupuis: This budget also shows up what I would call an inflated and pointless love for England.
Mr. Speaker, I would like to remind the Minister of Finance that, in his past speeches, which, as a matter of fact, I have studied very carefully believe me, he often referred to French history. Now, you remember, Mr. Speaker, and the Minister of Finance too will remember, as he knows French history so well-that Marie Antoinette when she was told that the people of Paris were pressing round the palace gates, replied: "What are they growling about? Let them eat cake!"
The Budget-Mr. Dupuis
Well, Mr. Speaker, we are living these times over again. We have, at the gates of parliament hill, unemployed people, farmers, provinces, asking for a fair deal. And the Minister of Finance replies:	"What are
they growling about? I've just reduced the sales tax on rat poison." Mr. Speaker, some people think problems can be solved in that way.
In 1957-


An hon. Member:: Now, that was pretty good!


Yvon Dupuis: Good enough to be member for St. Jean-Iberville-Napierville for much longer than my hon. friends would like.
In 1957-of course I again revert to the last Liberal budget-when my hon. friend-


An hon. Member:: Look out for bubble gum!


Yvon Dupuis: -when my hon. friend was financial critic-
At least, bubble gum is of some use to some people, whereas I do not know that rat poison is.


An hon. Member:: The Liberals can use it.


Yvon Dupuis: Mr. Speaker, the Minister of Finance, then financial critic for the opposition, stated in 1957 that the Liberal surpluses were shocking. He estimated at $382 million the surplus that the Liberal government had actually accumulated for that year and said: "Why not divide up the $152 million surplus forecast by the government among the provinces?" That was easy for him to say, Mr. Speaker, speaking as a Conservative financial critic at the time of the Liberal government. It was no hard task to ask for the surpluses to be divided up among the provinces because, under a Liberal administration, there were surpluses. At that time, Mr. Speaker, Conservative leaders, Tory leaders, Union Nationale leaders, call them what you will, in the various provinces aligned themselves with the present Minister of Finance, in the hope of obtaining their fair share of federal government surpluses. However, at this time, much to their discomfiture, they understand and will find that they will necessarily be forced-to use a redundant phrase-necessarily forced-


Some hon. Members:: Oh, oh.


Yvon Dupuis: Some hon. members find this a laughing matter. But Mr. Duplessis generally speaks that way in Quebec. The provincial governments will necessarily be obliged to share not a surplus, but a deficit which is well on the way to reaching one billion dollars.

The Budget-Mr. Dupuis
Mr. Speaker, the great man has had a vision, a vision based on the promises made by the present government when it was sitting in opposition. We are back to the dark days of Conservative regimes and I am very sorry for my hon. friends opposite. This is hurting them, as I well realize. I would not like to be in their shoes. However, when Conservatives are in power we have depression: For instance, under the Borden administration, we had the depression, unemployment and difficulties, and the same under the Bennett regime. On the other hand, under Liberal administrations we had unprecedented surpluses, unprecedented prosperity. And now, we have just had the first Conservative budget since 1935 and we are on the way to a deficit of one billion dollars.
Why were so many promises made? Why so much criticism? Why were they professing to be the champions of all classes when at present the government is protecting no particular class of society. No solution is found to the problem of unemployment or to the problem of trade relations with the United States. No solution is found to the urgent problem of agriculture, to the problem of small wage earners.
Mr. Speaker, we have before us a budget that is absolutely worthless at this time. We, Liberals, were the only ones to give this country social legislation; I said at the beginning of this session and I now repeat that the Liberals have been dismissed from power no doubt through a natural need of every human being for a change but, as soon as the change was made, all the citizens of this country were disillusioned and, at this time, I would rather represent the people of the constituency of St. Jean-Iberville-Napierville from this side of the house because I am sure that, after four years of a Tory-Conservative government, the people will bring us back to power for 25 years, to restore the economy of our country.
Mr. Speaker, the old age pension, the pensions for the disabled and the invalids, as well as the family allowances, are social measures which were enacted by the Liberal party. The Unemployment Insurance Act, which now saves the life of our friends opposite, was also enacted by the Liberal party. When, Mr. Speaker, I see these people boast about a $9 increase of the old age pension, under an act which they consistently opposed in the past, I cannot help laughing.
But, in fact, what are they doing now? In the province of Quebec they promised to raise family allowances. They have not and

will not do so. It was a Liberal government which upheld in this house the cause of large families and it was a Liberal government which enacted the Family Allowances Act while the Conservative leader of that time, Colonel George Drew, said that they were a "baby bonus" for the province of Quebec.
Mr. Speaker, this budget does not settle any problem. In fact, it makes the situation worse. I would therefore echo the words of the former financial critic of the opposition who, in 1957, said that the government had neglected basic necessities in favour of other goods which were not necessary. As stated in the Holy Scripture, Mr. Speaker: "The tree is known by his fruit".
A moment ago the hon. member for Carle-ton (Mr. Bell) said: "Never has a government done so much in such a short time." True enough, Mr. Speaker, never has a government managed to build up such a deficit in so short a time. I will grant them that.
Urgent measures are required to solve unemployment in my area. There was talk this week of turning the Richelieu river into a seaway, an undertaking which would help solve the unemployment situation, which, at this time, is showing no improvement whatever.
From the agricultural point of view, many farmers in our area are complaining that our market is being flooded with American potatoes. I ask the present government to raise the customs duties on American potatoes, at least from July to September of each year, so that our Canadian producers may market their product before having to face competition from American producers, which is not as serious in the other months of the year, because of the milder climate in the country to the south. I therefore ask on behalf of our farmers the immediate raising of the customs duties on American potatoes so that never again shall we have to see warehouses where, each year, a tremendous quantity of potatoes are left to rot. I will now conclude my remarks-


Some hon. Members:: Hear! Hear!


An hon. Member:: That hurts.


Yvon Dupuis: When I begin speaking, they are jittery; and when I finish speaking they are more jittery still. They might as well get used to it, because I will be on my feet pretty often to deal with the problems facing the Canadian people in general and the needs of my area in particular.

Mr. Speaker, before concluding, I would ask the hon. members opposite-or more exactly those gentlemen who sit to my left, those who were elected under the Conservative ticket-I will not say under the Union Nationale ticket, because that is embarrassing to them-but to those who were elected as Conservatives in Quebec during the last federal elections, to remember that in all their speeches, in every corner of the province, they were most emphatic in claiming justice for provincial governments. However, since they have been sitting here, in this house, we have not heard any request on their part of fair treatment for provincial governments. Indeed, we no longer hear them talk of this problem which, in the last election, they pointed out as being of paramount importance. They keep silent on this problem, which they raised themselves, but they keep shouting to prevent a member of this house from speaking the truth, and it hurts them when the finger is put on this sore.


J.-H.-Théogène Ricard: But we have had $19 million.


Yvon Dupuis: They said everywhere and particularly in the province of Quebec that the federal government was not doing justice to the provinces. Well, let them now ask the Prime Minister to convene a federal provincial conference, as he promised he would, and let them make the claims they made in the past; let them claim justice for the provincial governments here in this house. Let the hon. member for St. Hyacinthe-Bagot (Mr. Ricard), who just resumed his seat, show some spunk and forget for a minute his ties with the Union Nationale, and defend the interests of the people of the province of Quebec and of the people of Canada as a whole.
(Text):


Mr. G. M. Stearns (Compton-Fronlenac):: Mr. Speaker, following so closely upon the brilliant speech of my colleague, the hon. member for Carleton (Mr. Bell) and the equally dynamic speech of the hon. member for St. Jean-Iberville-Napierville (Mr. Dupuis) which dealt with cut flowers, rat poison and the province of Quebec I am afraid the poor words which I will speak in the next few minutes are going to sound like a cap pistol being discharged following the sounding of a 21-gun salute. Nevertheless my words will be sincere.
As this is the first occasion I have had the honour to rise to speak in this house I would like to congratulate Mr. Speaker upon his re-election to the high post which he fills. To a new member of parliament it has been
The Budget-Mr. Stearns and is extremely comforting and encouraging to watch him perform his daily duties so wisely and in such a pleasant manner.
To you, Mr. Deputy Speaker, and to the hon. member for Spadina (Mr. Rea) I wish to say I am both pleased and proud of the manner in which you maintain and preserve good order in the house.
As an English-speaking member from the province of Quebec I wish also to say how pleased I am at the recent appointment to ministerial rank of my two good friends, the hon. member for Lotbiniere (Mr. O'Hurley) and the hon. member for Labelle (Mr. Courtemanche).
(Translation):
Mr. Speaker, it is an honour for an Englishspeaking Canadian to have been chosen candidate in a constituency whose people are 75 per cent French-speaking. I can assure you that I was not chosen because I speak French well. You can readily realize that I speak this language with great difficulty. Therefore, I was not chosen on the strength of my ability as a speaker, I never was one, neither in French nor in English. I was chosen by the whole people of Compton-Frontenac which is a constituency of the eastern townships.
I appreciate French-speaking Canadians as much as I do English-speaking Canadians. I take advantage of this opportunity to thank all the electors who put their trust in me. We English-speaking Canadians of the province of Quebec are able to live in full harmony with our French-speaking fellow-citizens.
(Text):
About a week ago, I read an article in one of the Ottawa papers in which the writer referred to the quality of the speeches made during the debate on the address in reply to the speech from the throne. The writer apparently took a dim view of those speeches. I think it is a pity that he did not wait until today because he would have had a better foundation for what he said than he had then. I enjoyed what I heard during that debate. The writer went on to say that he did not think newly elected members to parliament should confine their remarks to subjects concerning their own constituencies but that once they had come to Ottawa they should try to speak on subjects of interest to the whole country. I do not agree with that view because the only way this country can continue to be fairly governed is to have the problems and ideas of each of the 265 members presented to the house. The government can then sort them out, adopt those that are ready for adoption, discard those which are of no use and put the balance in a little pile on the

The Budget-Mr. Stearns shelf. As time overtakes these projects our friends of the C.C.F. group will see their ideas fulfilled.
I should like to say a few words about matters concerning my own constituency. I want to thank the government for the measures it passed during the short session of the last parliament which were of great benefit to the people of my constituency as well as to people all over Canada. I want to thank the government for extending the period of seasonal unemployment insurance benefits because I know for a fact that it did a tremendous amount of good in a small town in my constituency where the only industry had closed its doors forever.
I wish to thank the government for having started work on the Sherbrooke airport. I understand that the government intends to spend $4 million there during the next two years. This will provide a great number of jobs and in the future will result in interest on the part of a large number of industries in building factories close to the airport. Hon. members may ask why I am interested in the Sherbrooke airport. The reason is that all the land comprising the airport is in the county of Compton. My constituency is composed of the counties of Compton and Frontenac and it is significant that the two great races of our country live there side by side. The origin of the name "Compton" is lost in antiquity but it is believed to have been the name of a famous Englishman. As to the name "Frontenac", it is easily remembered as being the name of one of the great governors of New France.
The constituency consists for the greater part of small farms and some woodworking industries. The farmers cannot grow enough crops in the summer months to make a living so they turn to the woods in the winter time. When there is not sufficient work in the province of Quebec they go across the line to the states of Maine, New Hampshire or Vermont. If they work in Vermont all winter they are entitled upon their return home in the spring to draw unemployment insurance benefits in the province of Quebec because Vermont has a reciprocal agreement with Canada. Up to the present time neither the state of Maine nor the state of New Hampshire has been willing to enter into any such agreement. I suggest that the government keep on trying to convince the governors and legislative bodies of these two states to enter into reciprocal agreements so that our people working over there may be treated just as fairly as any United States citizen who happens to be working in the same camp.
Still on the subject of our farmers, I should very much like to see pulpwood brought


under the Agricultural Stabilization Act. In the first place, it might keep more of our farmers at home in the winter time if they had a winter crop which they knew they would be able to sell at a predetermined price. But most important is the improvement which would result in the quality of the pulpwood produced by the farmers if they had to follow standards and specifications laid down by the government in order to be protected by the floor price. The paper mills would certainly be prepared to pay a little more for the pulpwood if they could be sure that it was going to be usable when it got to the mill. At the present time almost anything is delivered to the paper mills of which there are three in the eastern townships. The wood is all mixed up and the companies buy it but they do not like it.
In the eastern townships we have 63 4-H clubs. Our 4-H clubs in the province of Quebec differ greatly from those in other parts of Canada and the United States where the emphasis is on dairy farming and crops. We cannot do that so well in the province of Quebec so our 4-H clubs are formed and maintained to teach the children forest conservation and to plant trees. We hope that as they grow up they will establish tree farms so that they will have a crop that they can sell in nearby markets during the winter. But it costs money in order to plant trees and protect them from disease and fire. Up to the present the farmers have not been able to afford to do very much about it. Some of the small forest industry companies give them trees and help them to get started. I know of one small company in the county of Frontenac that has been responsible for the planting already of over six million trees.
Having spoken about local problems, I should like to say a few words on the budget which has been brought down. I want to congratulate the Minister of Finance (Mr. Fleming) for his courage in presenting a budget which is so realistic and in keeping with the difficult period from which we are just emerging. It is human nature to want to please as many people as possible and a giveaway program would have been much more agreeable to present. However, I have never felt that the Canadian people really expected to obtain any more than they did in the present budget. I say this because up to March 31 the Liberals were offering the people a very nice immediate tax cut of $400 million. If the voters had wanted it that way, they would have voted for the Liberals. The Liberals would have been re-elected and the present estimated deficit of $648 million would have reached over $1,000 million.

One of the great difficulties in connection with manufacturing goods today is the rapidity with which they are produced. If industry could only be geared to operate efficiently at about 80 per cent of its capacity, inventories would not tend to pile up so fast when there is a lull in demand. I am hoping that one lesson we will learn from this recession is to explore the possibility of providing full employment for the labour force we have now. I hope also that management and labour may work closer together so that we may never see the frightening day when our Canadian goods will be priced out of the markets of the world.
I do not believe that the small increase in the tariff on textiles will drive our friends away from our markets. I sincerely hope that the anti-dumping clause will put new life into this industry which has been depressed for so long. So far as lumber is concerned, I am happy that the recent difficulties of definition of planed lumber have been resolved. I am hoping to live to see the day when all tariffs and duties will have been removed from lumber which passes between the United States and this country. The right given to corporations to increase their donations for charitable purposes up to 10 per cent is a step in the right direction. It ought to help our hospitals and universities a great deal, but it might not be enough. If this proves to be the case, I hope our government will increase the allowance to 15 per cent of income or more. I hope the day never comes when our universities become state institutions because of a lack of support from corporations and private individuals.
In conclusion, Mr. Speaker, I wish this parliament, so well endowed with youth, and I include Conservatives, Liberals and the eight youthful looking members of the C.C.F. who are not present at the moment, a most fruitful session to the benefit of Canada.


Alexis Pierre Caron: Mr. Speaker, may I be permitted to express my views on the budget which was presented last Tuesday by paraphrasing a bit of a poem. "Something new, something blue", and I would add, "God, what a stew." As a matter of fact, it was something new. This was the first budget to be presented in two sessions of this parliament. The session last year was called to deal with matters generally, and at that time the minister did not dare bring down a budget. Oh, he brought in some changes, some cuts in taxes. I really believe he made a mistake because if he had introduced a budget last year with tax reductions amounting to $178 million and the increased pensions, it would have been presented to the people on the eve of the election in a very favourable light.
The Budget-Mr. Caron
However, the minister preferred not to present a budget. He introduced one this year which is really very blue. There is nothing in it to help the situation in which we find ourselves. Really, I would say it is a gloomy budget. I said that it was some kind of stew because the minister spoke a lot of words for over two hours, but nothing emerged to help the Canadian situation.
(Translation):
Mr. Speaker, during this budget debate, we are called upon of course to criticize the Minister of Finance (Mr. Fleming) for his presentation. Yet, knowing that there is nothing which is essentially good or essentially bad in this world, I take the liberty, at the outset of my remarks, to offer him my congratulations. I congratulate him for having been kind enough, for the first time in the history of Canada, when he presented his budget, to add a few sentences in French so as to show clearly that he recognized the bilingual character of Canada. It reminded me that I read the other night in the Sentinel an article entitled:	"Says bilingualism unrealistic,"
published by Rev. John Douglas, of Paisley Memorial United Church, and I quote:
(Text):
Like most of what is said in support of bilingualism in Canada it shows, to my mind, lack of logic and realism. No real argument is presented.
(Translation):
He terminates the article as follows: (Text):
Let us ask ourselves why we should be bilingual, and what real benefits there are and we shall see that only in special cases is it worthwhile.
(Translation):
That is why I should like to congratulate the hon. minister for clearly demonstrating that he recognizes the bilingual character of our country. His French is very good and we accept it with pleasure. I would like to congratulate also-but it will be in his absence-the Minister of Justice (Mr. Fulton) who, on two occasions

in Hull some time ago and in Montreal last Sunday-gave in good French some explanations about his opinion on obscene literature in Canada. Those two hon. ministers showed that articles such as the one to which I have just referred and which was printed in the Sentinel, are written by a minority of narrow-minded people who do not seem to have a true understanding of our country's problem. I think that this is a bad thing.
While I was a member of a delegation of the Canadian parliament to NATO, I found that among the fifteen countries represented there, most Europeans spoke perfectly in at

The Budget-Mr. Caron least two languages. The Belgians spoke from two to four languages; those from Great Britain spoke French and English to perfection. Unfortunately, English Canadians and Americans alone were unilingual, speaking only English. If, in the past, we had better understood the advantages of a twofold culture, there is no doubt that our representation abroad would have been in a more favourable position. Again I commend both hon. ministers.
(Text):
The other day I was reading Hansard for 1955, and I found these words spoken by the Minister of Finance (Mr. Fleming), and they appear in volume III, page 3392:
After the closest examination of the budget and of the minister's comments upon it, one can only conclude that this budget is the product of muddled thinking, confusion, indecision and fear on the part of the government to admit the existence of problems with which the taxpayers and the people of this country are all too familiar. It was therefore highly proper that The Economist in its issue of April 19, iri a letter from its Ottawa correspondent, should make this observation upon the budget:
"On the assumption that Canada needs some stimulus to get back to its proper rate of expansion after last year's modest setback, this financing of tax cuts out of deficit is easily defensible. The budget speech in fact made it perfectly clear that this was the intention. But the government refuses to say so explicitly. It has never admitted that anything was wrong with the Canadian economy that required artificial stimulus, and it will not do so now. It would rather do good by stealth. The result is to leave it without any logical defence of the plunge into deficit financing."
Could you find anything more realistic at the present time? I think we could have taken the whole speech of the present Minister of Finance (Mr. Fleming) criticizing the budget of the Liberal party and it would be a speech that would be up to date after the budget we heard presented by the minister last Tuesday. As reported at page 3392 of Hansard he went on to say this:
It is true that in the house, constituted as this one is at present, the government wins the vote. But it is equally true that in relation to the kind of budget we are discussing here today the opposition wins the debate. But what of the people? The Canadian people from this budget will glean but little benefit but they will glean something of benefit from the debate in which the proposals of the government are examined.
It is perfectly true that the people of Canada will not get very much out of this budget. But after the discussion is over they will certainly have a clearer knowledge of the situation in which Canada is at the present time. One of the problems that the present government did not want to recognize and which it refused to admit last year was the problem of unemployment. When in October 1957 the Liberal party and the rest of the opposition were telling the ministers that it was dangerous to go on in the way we were

going, that unemployment was increasing every day and that they were not doing anything about it, the Prime Minister said at the time that the Liberals including our leader- and he especially mentioned our leader-were grossly exaggerating the situation, and this statement appeared in the Citizen of that day. It is true that unemployment has been recognized since that time but the government waited so long to recognize it that unemployment was given a chance to increase to a figure which the Canadian people had not been accustomed to since the crisis of 1930.
In the budget the minister admits-he admitted it the other night-that there was a slackening in the economy. I believe those are his words. In a speech made outside the house the Prime Minister said that in order to avoid recession and to create work he would not stop at any financial obstacle. But at the present time we have unemployment and it is still going on, and nothing is really being done to help the situation or to create a new economy so that everybody in this part of the year, the summer of 1958, will enjoy a share of work in this country. Instead of admitting the fact that unemployment exists; instead of admitting it clearly, as he stated in 1955 when he was blaming the Liberal party, the minister said the other night that there are more men at work in these months than there have been in any previous years. Nobody will refuse to admit that fact.
Certainly there are more men at work because the population has increased but the problem is that there are thousands and thousands of people not receiving anything from the unemployment department because their stamps are through, because they are not eligible for one reason or another. But those people are starving at the present time and the government is not doing anything to help them. I think of a doctor who is taking care of a sick person going into a hospital and for whom the only remedy he can find is to tell him that there are millions of millions of people on the street who are healthy and that he is one of the few in the hospital. Would such a remedy cure that person? That is what the Minister of Finance was doing in his budget last Tuesday. I come back to the opinions expressed in 1955 by the present Minister of Finance in criticizing the Liberal government. They are to be found in volume 3, page 3396 of Hansard. The minister said this:
The second problem which has been ignored by the government is the problem of unemployment.
That is what he said then.
This problem has been discussed at length in this session, or I would seek to go into it at greater length today. But let me content myself, in this limited time, with making this limited observation

on the subject, that the government throughout this session has observed a conspiracy of silence in regard to unemployment;-
This can be said for today.
-and it has carried that conspiracy of silence into the budget.
That can be said for today.
It is still running away from the problem of unemployment.
This can be said for the budget of today.
This budget does not meet, in fact it cannot even make the pretence of meeting or even assisting to meet, the problem of unemployment. The government is still running away from that problem; they hope to ignore it.
That is what we can say today; we can say what he said at the time when he was criticizing the Liberal government. If I may go a little further, on page 3396 in the same volume we find him reading a quotation of what Mr. St. Laurent had said outside the house. The quotation is as follows:
We have a country where there should be work for everybody and if we are not smart enough to organize the economy of the nation to provide work for everybody we are incompetent.
The present Minister of Finance said at the time:
And we say to the Prime Minister, "Out of thine own mouth hast thou condemned thyself, and not only thyself, but condemned thy colleagues as well".
If there is anything true it is this. If we transport those phrases pronounced by the Minister of Finance when he was on this side of the house in 1955, that is exactly the situation today. I think he was trying to prophesy then what would come about today if he were in power. He said this:
This is a problem that is national in scope. It is beyond local responsibility. What we want on the part of this government, and what we still look for, are employment measures, some constructive and some effective approach to meeting the deterioration m the economic condition and the unemployment situation in Canada today.
Is there really anything being done with respect to public works in order to help anybody? The Montreal Gazette of February 19, 1958, reported that the Prime Minister (Mr. Diefenbaker) announced on February 18 expenditures by government departments and agencies on works projects totalling $280 million during the first quarter of 1958 and $1,185 million for the full calendar year.
The other day we studied the estimates of the Department of Public Works, but what did we have in those estimates? They were pretty nearly all concerning things started by the Liberal government, in fact all the big things were commenced by that government. Where is this expenditure of $1,185 million? The government seems to think it
57071-3-95i
The Budget-Mr. Caron is doing a lot to help unemployment, but we cannot find any evidence of this.
We find instead a deficit which would be quite understandable if anything was being done to alleviate unemployment, but a deficit when nothing is being done along these lines is, in my opinion, due to maladministration of the affairs of the country.
I said in this house a few weeks ago that in the city of Hull 51 per cent of the unemployed were not receiving any unemployment benefits at all and the city itself has to accept responsibility in order to keep such people from starving. But, as the present minister said in 1955, this is not a problem for the local government, it is a problem for the federal government. Local authorities have no powers of taxation whereby they can obtain the money to help the unemployed. At the present time such people are being given a few dollars a week in order that they may have something to eat but they are not able to pay their rent and as a result may be thrown out on to the streets.


Mr. Nasserden:: Would the hon. member state what tax he proposes might be used to take care of the situation?


Alexis Pierre Caron: I am merely proposing that the government should stand by the promises made during the last election, when they said they would help the unemployed.


Some hon. Members:: Hear, hear.


Alexis Pierre Caron: This they are not doing at the present time.


Edward Nasserden: But what tax does the hon. member propose should take care of expenditures of this kind?


Alexis Pierre Caron: That is the problem of the government. When we are in trouble we do not mind a deficit provided such people are assisted, but when nothing is being done to help them that is a different matter. Our cities are in a very bad position; they cannot obtain the money to help them carry that burden. In the city of Hull, for example, expenses in respect of public assistance totalled $180,000 in 1953-54; in 1957-58, $480,000; and it is not fair for a city to have to spend such a sum. There is no sense in this situation-such expenditures are much too high for the municipalities and the government which promised it would help the municipalities has not yet done anything. Furthermore, they do not seem willing to do anything; they do not even try to do anything. All we can find in the budget are a few small reductions in the sales tax which will amount, as the minister said, to a total of $5 million.


Donald Methuen Fleming: The figure was $6 million for a full year.

The Budget-Mr. Caron Mr. Caron: Not for the municipalities. The minister said $5 million for the municipalities.


Donald Methuen Fleming: Oh yes, that is right.


Alexis Pierre Caron: When we divide that $5 million among all the municipalities of the country each one will get a peanut.


Donald Methuen Fleming: It will be $5 million more than they would have had if there had not been a change of government last June.


Lionel Chevrier: They cannot take it.


Alexis Pierre Caron: The municipalities have a heavy load to carry. We thought the Prime Minister would live up to his promises. The Montreal Gazette of February 8, 1958 reported that the Prime Minister on February 7, 1958 said he planned to call an informal federal-municipal conference in 1958 to discuss the financial plight of Canadian municipalities.
On February 26 the Montreal Star reported the Prime Minister as follows:
He also indicated prompt action on holding an "informal" meeting between the federal government and municipal representatives-he said it would occur after the election-to hear municipal views on their financial problems.
Such a meeting, he said, would allow the federal government to draw up proposals to present to the next federal-provincial conference for easing "excessive" municipal real estate taxes.
These are not my promises; they are the promises of the Prime Minister and his government. In the Ottawa Journal of February 26 the Prime Minister is reported as saying:
Mr. Diefenbaker announced that he proposed to call a federal-provincial-municipal conference In the near future. He recognized that the municipalities come under the jurisdiction of the provinces, but saw advantages of having them represented at an informal conference which would give them opportunity to put forward their own proposals and to explain their needs. Out of such a conference, he said, might come some plan to ease the "excessive" municipal tax burden on real estate.
Then there is a further translation I would like to quote from he Droit of February 26, 1958, as follows:
Mr. Diefenbaker stated that the government understands the difficult financial position of the municipalities of the country. "We shall see to granting them a reasonable share of taxes", he said, "so that they will be able to meet the new needs arising from their rapid growth."
According to the Prime Minister the question of division should be studied by the governments concerned, but his government is said to be ready with a plan for municipal aid in the light of such a study and the recommendations of the provincial governments. Those are the promises and the government is still making promises; but what do we get today? We get the same old promises. Nothing is being done for the 
municipalities who are asking for aid from the government. We need a source of employment and the government is able to provide that source right away. The municipalities have all kinds of projects ready and the only thing they lack is money. They are unable to get money on the market today at a fair price, and one thing this government could do is to lend the municipalities the money they need for their projects at an interest rate comparable to the one paid by the federal government on today's market. This would ease the difficulties of the municipalities.


An hon. Member:: Who brought in the tight money policy and cut off the availability of money?


Alexis Pierre Caron: I would refer the hon. member to the governor of the Bank of Canada. He might be able to give you a good answer to that question.


An hon. Member:: It would be better than yours.


Alexis Pierre Caron: The hon. member seems to believe what was said by the Minister of Finance, but let me tell him this: the Minister of Finance is often off the beam, and I showed that when I was showing what he said in 1955. He was speaking of tax reductions. Tax reductions last year amounted to $178 millions; this year in every department tax reductions amount to $26 million. And he seems to be happy with that, and the hon. member on my left seems to be happy with it too.
But let us look at what is being said all over the world. Governor Harriman speaking in New York with regard to the United States recession said there should be an emergency tax cut. He further said, and I quote his words:
In my opinion it would be reckless to do little, and sensible and safer to take strong measures in this period.
I point out that Governor Harriman is a man considered to be an expert in finance; much better than some of the hon. members I see on my left. Tax reform in the United States to encourage individual incentive and promote the nation's economic growth has also been proposed by the Rockefeller brothers fund. The recommendation was made by a panel of 17 leading economists, and they urged an immediate tax cut to help expand employment and overcome the current recession. The panel emphasized, too, that the anti-recession tax cuts should be consistent with the more important long-term goals of tax reform.
This is from the United States, but we can find something in Canada. I have here

the report of the general manager of the Canadian Manufacturers' Association, and I should like to place on record the following recommendation made by that association: With total taxation-federal, provincial and municipal-now 29.8 per cent of net national income as compared with 22.3 per cent in 1939, and with federal taxes representing almost three-quarters of total taxes, the association has urged that every effort should be made to reduce federal taxation, submitting, among other things, that if more money is left in the hands of individuals and corporations it will have a stimulating effect on business generally, and in particular, will make increased Canadian capital available for the much needed investment in our primary and secondary industries.
These are not men in politics; they are men in business, and they are looking after their businesses, and that is why they are pressing the present government to set up a tax system which will ensure that the money will flow to the people. With better purchasing power in the hands of the people, the factories will be able to start again and more of our people will be able to find employment.
How many people will benefit as a result of the government's tax concessions? Not many, I venture to think. With regard to the proposed assistance for education we must wait until the bill is presented before we see whether this is what we want it to be. However, we have the cut flower tax reduction, and this may prove an economy to the Conservative party when its members celebrate their anniversaries. But I am afraid this will be of limited benefit, because the carnations which are created so beautifully by nature have never been blue, they are always, red, pink or white.


Mr. Palleft:: What about that pansy you are wearing? There is a lot of blue in that.


Alexis Pierre Caron: My pansy has a lot of yellow in it, and I am sure some hon. members would be very proud to wear it on July 12.
The Minister of Finance spoke the other day about ways of getting money, about loans to cover part of the expenditure. He spoke about the sale of bonds in Canada and expressed the hope that everyone would participate in the buying of such bonds. There is one thing which every hon. member has received by mail, namely the plan which has been submitted since 1941 by Mr. Laflamme for what he calls premium bonds. This is a way to get people to buy these bonds, with low interest but with a possibility of a prize to make them attractive. Some people will say that this is a mere gamble. I do not know, but let us suppose it is. Who is not a gambler at heart? We have been born gamblers. Who among us has given the order to be born here or there? It is an accident to be born; it is a gamble we have to take. One man is
The Budget-Mr. Caron born in English-speaking Canada; another is born to be a French-speaking Canadian-


Edward Nasserden: Is that Liberal fiscal policy?


Alexis Pierre Caron: It may not be that, but I will answer the hon. member a little further. Every time in life we have to make a choice, that choice is a gamble. I think the Minister of Finance should study this question of premium bonds very carefully, because such bonds would sell in great quantities in Canada and people would be glad to take a chance on winning $10,000 or $25,000 or $50,000 a month.
The government-the Conservative party- are keen to imitate everything that comes from Britain. They should recognize that this system has been accepted in Britain. I have here a copy of the London Times giving the numbers and the amounts which have been won by the drawings last month. There is a long list of them. And those bonds which are being sold in England are also being sold at the present time under this administration in Canada, and if it is legal to sell them in England and in Canada I think it should be legal for the government to sell them. Anything which would help the government of Canada to find the money to get out of the difficulties in which we now find ourselves should be accepted and tried. All I am asking the government to do at the present time is to study the question.
Experts on trade promotion have been telling the government that they have not been doing very much to help trade in Canada, and speaking of taxes the government is happy to say that on account of the recession they had a deficit of $648 million which will amount to over $1 billion before the year is over.


An hon. Member:: How do you know that?


Alexis Pierre Caron: But after the last war we had to change the economy of the country because industry had to change from war purposes to peace purposes. In the 42 months from 1945 to 1949 the Liberal government made reductions in taxes amounting to $1,292 million; in 1945, $300 million; in 1946, $266 million; in 1947, $265 million; in 1948, $92 million and in 1949, $369 million. This is the reason that right after the war we were not subjected to a period of recession such as we experienced last year and this year and during that period of 42 months the debt of the country was reduced by $1,625 million.


Mr. Nesbitt:: Overtaxation. Why didn't you cut taxes then?


Alexis Pierre Caron: The Conservative government should not be proud of its record. During this period of hardship what we need in Canada-

The Budget-Mr. Baldwin a country with a small population of approximately 17 million that produces foodstuffs to support a population of over 40 million-is a firm policy that will develop markets for our products. What is the government doing to win markets for Canada? Nothing at all. The government criticizes the policies of the government of the United States and indulges in criticism of this and that, but is it really making an effort to sell Canadian products? Not at all. I admit the government held a conference at Mont Tremblant with the British government which brought in suggestions concerning free trade between the two countries. After this happened the government hastily closed the conference and sent the British delegates back home.


An hon. Member:: Are you for free trade or against it?


Alexis Pierre Caron: The government should institute a public relations policy that will win markets for Canadian goods in other countries. With regard to the import restrictions in other countries Mr. J. C. Whitelaw, Q.C., in the report of the general manager of the Canadian Manufacturers' Association stated:
Import quotas and exchange restrictions in commonwealth as well as other countries are limiting the export of Canadian manufactured goods. Some further relaxation in the United Kingdom import licensing arrangements were made in August 1957, while the token import scheme continues in effect in 1958 with very little change. The British West Indies liberalization plan for 1958 is unchanged. Certain commonwealth countries found it necessary in 1958 to further restrict their imports of manufactured goods, due to deficiencies in their balance of payments.
The Aciing Speaker (Mr. Rea): Order. I am sorry to interrupt the hon. member but his time has expired.


Alexis Pierre Caron: I am sorry myself.


Mr. G. W. Baldwin (Peace River):: Mr. Speaker, I would like to belatedly extend my congratulations to the Speaker on his election to that high office and commend him for the tact and skill which he has displayed in guiding the deliberations of this house. I extend the same complimentary words to yourself and to the Deputy Speaker. May I express the hope that the patient attitude you have demonstrated with respect to new members will continue and that the sands of your good nature will not run out at least until I have completed what I have to say.
I would also like to extend congratulations to the Minister of Finance (Mr. Fleming) in respect of his first budget and to say that in presenting it he has in an honest and competent way faced realities and has been able to come to grips with the fiscal facts of life and at the same time has been able to maintain benefits which have been derived from tax deductions introduced at an earlier date,


to add something to them and also has been able to provide for the extensive public undertakings of this government. It has been a Herculean task and he should be given full credit for it. I would like in particular to comment on the proposal with regard to succession duties. This suggestion is most welcome and together with the companion measure permitting a tax-free gift up to $10,000 of a home or farm will remove inequities and injustices which have been apparent in the past.
I described the task of the Minister of Finance as a Herculean one and in so doing I had in mind that this government had to acquire some of the characteristics of Hercules in cleaning up after the previous administration by altering their unfortunate financial policies and doing what had to be done to remove the effects of such policies. I was thinking particularly of the task which was assigned to Hercules in cleaning out the Aegean stables for the first time in 100 years and I am sure the present Minister of Finance is thankful that he had only 23 years' accumulation to deal with.
I would now like to relate what was said in the conclusion of the budget presentation about the great destiny of this nation to observations I wish to make regarding a problem which affects the country generally and my constituency in particular, namely the question of the proposed construction of a railway to be built to the south shore of Great Slave lake.
The constituency which I represent is one of a tier of ridings lying at the northernmost extremity of the western provinces and occupying over one-third of the province of Alberta with an area of 80,000 square miles and containing a population of nearly 70,000 people. The people who live in the district constitute a reasonable cross section of Canada in the ethnic sense as here the two main streams of our population have joined and into the river which has resulted have been poured the smaller tributaries comprising the sturdy and fine people of every racial extraction who make up this country, all of us proud to be and to be called Canadians.
(Translation):
I am happy to know that the district which counts several thousand French-speaking voters supported me during the last election by awarding me 80 per cent of their votes. I hope that when I shall again ask for their support on another occasion, I shall be able to express myself in French, and I beg my hon. friends to pardon the errors I might commit when speaking in this language for the first time.

(Text):


Mr. Speaker:: It being five o'clock the house will now proceed to the consideration of
private and public bills, the former having precedence, pursuant to standing order 15 (3).



PRIVATE BILLS


Mr. Speaker:: As there are a number of divorce bills standing for second reading, is it the pleasure of the house to have the bills taken in one motion?


Some hon. Members:: Agreed.


Mr. Speaker:: By unanimous consent Mr. McCleave, seconded by Mr. Mandziuk, moves that Bills Nos. SD-28 to SD-55 inclusive and Bills Nos. SD-57 to SD-78 inclusive, being divorce bills appearing on today's order paper as orders Nos. 30 to 79 inclusive, be now read a second time. Is it the pleasure of the house to adopt the motion?


Some hon. Members:: On division.
Bill No. SD-28, for the relief of Therese Beaudoin Girard.-Mr. McCleave.
Bill No. SD-29, for the relief of Dorothy Elizabeth Nairn Anderson Bloodsworth.-Mr. McCleave.
Bill No. SD-30, for the relief of Anne Marie Mathilde Vautelet Gagnier.-Mr. McCleave.
Bill No. SD-31, for the relief of William Leonard Mugford.-Mr. McCleave.
Bill No. SD-32, for the relief of James Clancy.-Mr. McCleave.
Bill No. SD-33, for the relief of Marjorie June Gabrielson Trainor.-Mr. McCleave.
Bill No. SD-34, for the relief of Kathleen Mitchell Cabana.-Mr. McCleave.
Bill No. SD-35, for the relief of Fernande Leduc Clarke.-Mr. McCleave.
Bill No. SD-36, for the relief of Ann West-water Murphy.-Mr. McCleave.
Bill No. SD-37, for the relief of Gaynor Jenkins Douglas.-Mr. McCleave.
Bill No. SD-38, for the relief of Roland Paquin.-Mr. McCleave.
Bill No. SD-39, for the relief of Jone Vanda Skakauskaite Kaniewski.-Mr. McCleave.
Bill No. SD-40, for the relief of Ivy Elizabeth Shaw Labbee.-Mr. McCleave.
Bill No. SD-41, for the relief of Constance Jean Backhouse Brayton Lapierre.-Mr. McCleave.
Bill No. SD-42, for the relief of Lisbet Schlosser Wisternitz.-Mr. McCleave.
Bill No. SD-43, for the relief of Virginia Marshall Staniforth.-Mr. McCleave.
Bill No. SD-44, for the relief of Elie Kouri. -Mr. McCleave.
Private Bills-Divorce
Bill No. SD-45, for the relief of Margaret Stirling Izett Brown.-Mr. McCleave.
Bill No. SD-46, for the relief of Norman Weisman.-Mr. McCleave.
Bill No. SD-47, for the relief of Dawn Yvonne Tonkin Kadas.-Mr. McCleave.
Bill No. SD-48, for the relief of Betty Taylor Sharpe.-Mr. McCleave.
Bill No. SD-49, for the relief of Doris Williams Timmins.-Mr. McCleave.
Bill No. SD-50, for the relief of Marjorie Mary Ellen Bowes Jupp.-Mr. McCleave.
Bill No. SD-51, for the relief of Earl Bruce Carswell.-Mr. McCleave.
Bill No. SD-52, for the relief of Beverly Joan Smithson Rook.-Mr. McCleave.
Bill No. SD-53, for the relief of Joseph Francois Gabriel Rene Denis.-Mr. McCleave.
Bill No. SD-54, for the relief of Solomon Seymour Yetman.-Mr. McCleave.
Bill No. SD-55, for the relief of Margaret St. Aubin Brennan.-Mr. McCleave.
Bill No. SD-57, for the relief of Lidija Plesums Koppel.-Mr. McCleave.
Bill No. SD-58, for the relief of Vera Hamburg Colson.-Mr. McCleave.
Bill No. SD-59, for the relief of Margaret Griffin Clarke.-Mr. McCleave.
Bill No. SD-60, for the relief of Katie Miller Fisch.-Mr. McCleave.
Bill No. SD-61, for the relief of Greta Clair Van Valkenburg Stenstadvold.-Mr. McCleave.
Bill No. SD-62, for the relief of Beatrice Madeleine Schmid Layton.-Mr. McCleave.
Bill No. SD-63, for the relief of Anne Gold Zidile.-Mr. McCleave.
Bill No. SD-64, for the relief of Thomas Mastropaolo.-Mr. McCleave.
Bill No. SD-65, for the relief of Charles Coorsh.-Mr. McCleave.
Bill No. SD-66, for the relief of Claire Aubin Daunais.-Mr. McCleave.
Bill No. SD-67, for the relief of Maurice Gardner Swaine.-Mr. McCleave.
Bill No. SD-68, for the relief of William Arthur Terry.-Mr. McCleave.
Bill No. SD-69, for the relief of Frances Eileen Fisher Baker.-Mr. McCleave.
Bill No. SD-70, for the relief of Marie Aurore Cecile Gauthier	Thomson.-Mr. McCleave.
Bill No. SD-71, for the relief of James Dunn Drummond.-Mr. McCleave.
Bill No. SD-72, for the relief of Marie Eva Desorcy Valiquette.-Mr. McCleave.
Bill No. SD-73, for the relief of Norman Silver.-Mr. McCleave.
1496	HOUSE OF
Company Directors' Qualifications
Bill No. SD-74, for the relief of Herbert Everett Follette.-Mr. McCleave.
Bill No. SD-75, for the relief of Abie Cubitz. -Mr. McCleave.
Bill No. SD-76, for the relief of Eva Shtull Hager.-Mr. McCleave.
Bill No. SD-77, for the relief of Georges Etienne Brais.-Mr. McCleave.
Bill No. SD-78, for the relief of Barbara Eisenstein Packer.-Mr. McCleave.



COMPANY DIRECTORS


Mr. E. J. Broome (Vancouver South) moved: the second reading of Bill No. C-16,
respecting company directors (directors' qualifications).
He said: Mr. Speaker, the purpose of this bill is to require that all companies created by the parliament of Canada be managed by a majority of resident Canadian directors. The exception is where such a requirement already exists as in the Canadian and British Insurance Companies Act and in part III of the Companies Act. As I say, there is an exception in the case of these acts because they already have this provision. There is also, I believe, a provision in the Bank Act passed at the last session of parliament whereby insurance companies by mutualization can retain their Canadian identity. Therefore at the present time companies having to do with financial affairs such as banks and insurance companies are able to retain their Canadian identity under an act of parliament.
For an understanding of the purpose and intent of the bill I should like to go back and establish the groundwork with regard to the present status of foreign investment in Canada and some of the conclusions which can be drawn from the amount of foreign investment. In doing so I wish to refer particularly to the Gordon report and to the report on Canada-United States economic relations by Messrs. Brecher and Reisman. In the late nineteenth century most foreign investments in Canada came from the United Kingdom and were mainly concentrated in railways, government bonds and the construction of basic utilities. In this regard foreign investment in Canada followed the pattern as it existed in the United States, a pattern which existed up to about the year 1914. However, in recent years foreign investment has mainly been in the form of equities, that is, in the form of investments participating in the growth of the country through investment in the petroleum industry, manufacturing industry and so on.


The extent of that investment is rather extraordinary. According to the report on Canada-United States economic relations, between 1900 and 1955 foreign, long-term capital invested rose from $1.2 billion to $13J billion. Actually that is a little bit out of date because the latest bureau of statistic figures as reported in the Toronto Telegram of June 16 indicate that the foreign stake in Canada's economic future has climbed to more than $17 billion, an increase of several billion dollars over the figure given in this report.
At present nearly four-fifths of all this foreign capital invested in Canada is held in the United States which is in strong contrast with the position at the end of world war I when the majority of foreign capital was held in the United Kingdom. At the beginning of 1955 non-residents controlled 54 per cent of the investment in Canadian manufacturing and 59 per cent of the total in mining, smelting and petroleum exploration and development. In fact, the holding in the petroleum industry alone would approach the 90 per cent mark. In a large number of very important Canadian industries, including oil, gas, nickle, aluminum, asbestos, iron ore, automobiles, electrical, rubber and chemicals, a relatively few enterprises owned and controlled mainly in the United States account for a very large share of the business enjoyed in those industries.
This is not to say that foreign investmenl in itself is not something that we are intensely anxious to have. In fact, our standard of living and the development of our country evolve around an adequate supply of capital from all countries throughout the world. But there are many questions which do come up and which should be considered in considering the problem and the longterm effects of this rather large foreign investment in our productive industries and our natural resources. It has been said that it is just a question of the economic immaturity of Canada and that in the course of time this condition will rectify itself in the same way it did in the United States. Actually this will not happen because, as I have pointed out, the bulk of the investment in the United States was in the form of underwriting government bonds whereas the investment in Canada is in the forms of equity stock.
Government bonds mature periodically and there is a chance then to repatriate them. Equity stock is something different. There is very little chance of repatriation of such stock unless a whole company is bought out in a company merger and the usual thing is that the smaller companies merge with large companies rather than vice versa. Therefore a very large proportion of foreign investment

in Canada involves direct ownership and control of productive enterprises.
In the past, with the growing maturity of the Canadian economy, a number of foreign corporations appear to have broadened the range of Canadian participation in their operations in a variety of ways because they found that the question as to how far foreign owned and controlled business enterprises should become integrated in the Canadian community was something which they should consider for self-interest reasons alone. As I say, many of these companies have moved in that direction and, to all intents and purposes, have become strictly Canadian enterprises. However, this report on Canada-United States economic relations goes on to point out the following:
With the increasing Canadian concern over the extent of foreign ownership and control, it is perhaps safe to predict that some acceleration of this process-
That is, greater Canadian participation.
-is likely to occur. On the other hand, there is no reason to believe that close integration will automatically become the universal pattern. While in many instances enlightened self-interest may stimulate further integration, in others the financial and operating advantages flowing from their present position may well continue to be the dominant consideration for non-resident enterprises.
This is a condition we must live with and it should be a cause of real concern. The extent of non-resident control has increased with the growth of Canadian industry and never in the economic history of any other nation as highly industrialized as Canada has there ever been such a large proportion of industry controlled by non-resident concerns.
That is roughly the situation as it stands today. It has been said that Canadian investment is an offsetting factor and that as other people invest in Canada so we in turn make investments in other countries. According to the report of the dominion bureau of statistics, as printed on June 16, Canada's investment abroad rose in the 1949-56 period to roughly $4.5 billion from $3.5 billion. However, as the bureau points out, a great deal of this so-called Canadian investment was really investment by Canadian companies which were really foreign-owned and which were returning money to parent corporations so that the parent corporation could make further investments in other areas of the world.
How did this situation come about? It is not the result merely of the fact that Canada has more than welcomed the investment of foreign capital here. This would not have been sufficient to attract the inflow of capital to this country of the magnitude we have had, nor would the availability of rich and plentiful resources and opportunities for growth
20, 1958
Company Directors' Qualifications have done so. I quote from page 385 of the Gordon commission report:
But the mere fact that Canada has been willing to borrow abroad and has always welcomed the investment of foreign capital here would not by itself have been enough to attract an inflow of capital to this country. Nor would the availability of rich and plentiful resources and opportunities for growth. Fortunately in addition the "investment climate" in Canada has been favourable. Canada has had a long tradition of freedom for the flow of capital and income across its borders. Canada has also had a long history of orderly and responsible government. Moreover, a hard-working people with a strong desire for material advancement, a skilled labour force, a well developed educational system, adequate transportation and other social-capital facilities, reasonably stable economic and social conditions and positive encouragement by all levels of government have all helped to make this country an attractive outlet for private foreign capital.
There are other and much more positive factors than those which have encouraged the people of the United States as well as Europeans to invest their capital in Canada. For instance, the United States economy has developed to the point where it is generating large amounts of savings. There are many people in the United States, including those responsible for managing large United States corporations, who are looking outside the borders of the United States for a suitable place to invest capital. Secondly, another motive for the investment of capital in Canada is to secure resources, that is resources which may be needed for future development of the company concerned, resources which may be falling off in the native country of that corporation.
Then the motive for direct investment by non-residents in Canadian secondary manufacturing industries has been to expand the parent companies' operations into the Canadian market in the most desirable way. There is the wish to take advantage of commonwealth preferences which such a company could secure through Canadian operation. In addition, there are taxation considerations, particularly in the United States where income tax concessions are designed to encourage people of the United States to explore for gas and oil, not only in the United States but other countries of the world as well. These concessions have given many United States citizens a natural incentive to come to Canada and explore here for oil and gas. The advantages of such investment to Canadians are equally clear. The profits from direct investments by foreign concerns have a direct influence on the rate of economic growth and industrial development and on the Canadian standard of living for Canadians.
The point about access to markets bears constant repetition and continued emphasis. Most of the output of many of Canada's basic
1498	HOUSE OF
Company Directors' Qualifications industries cannot be consumed at home and must be exported. In such circumstances the assured market which foreign parent companies can often provide to their Canadian subsidiaries may be imperative to offset the heavy risks which otherwise would be inherent in the large-scale capital investment which would otherwise be required to develop these industries. These benefits are very real and tangible. It is much more difficult to set down in precise terms what the dangers are. No nation has ever gone through the period of development through which we are going. No other nation has ever been in the same condition as we are in Canada in regard to the control of our resources and our manufacturing potential being largely outside of the country. It may be that much that has been said about foreign control has little, if any, validity and is simply an outgrowth of a rather youthful nationalism.
But on the other hand, there are many cases, many of which I know myself, where such control has not been entirely in the best interests of Canada. This concern has arisen because of the concentration of foreign ownership in certain industries, because of the fact that most of it is centred in one country, the United States, and because most of it is in the form of equities which, in the ordinary course of events, are never likely to be repatriated.
Now, Mr. Speaker, what would be the solution? I am not claiming that this bill is the solution. Before I conclude, I should like to quote the recommendations of the Gordon commission. Their recommendations were as follows:
(1)	wherever possible, such concerns should employ Canadians in senior management and technical positions, should retain Canadian engineering and other professional and service personnel, and should do their purchasing of supplies, material and equipment in this country;
(2)	they should publish their financial statements and make full disclosure of the results of their Canadian operations;
(3)	they should include on their boards of directors a number of independent Canadians and they should sell an appreciable interest in their equity stock to Canadians.
In so far as this bill is concerned, it states that the majority of the directors shall be resident Canadians. I checked with a very large firm which had business outside of Canada and they advised me that in their operations in Brazil the requirement they have to meet is that the majority of the directors shall be residents of that country. It may well be that the purpose of this bill could be equally well served if it said that these directors should be resident in the country rather than that the majority of directors should be Canadians. This is one of the reasons why I say I do not consider this


bill is the final and complete answer. However, the debate which the bill will provoke will help to resolve, in a slight way, some of the problems that we have in this regard by the contribution that it will make. By the contributions which are now being made by Senate committees which are at present studying United States-Canadian relations, by special committees such as those mentioned by the Prime Minister (Mr. Diefenbaker) which are being set up or have been set up to discuss United States-Canadian relations and by the work which is being done in that regard by the companies which are more conscious of the problems in our relationship. I say that is the way in which this condition, which I have been trying to point out can be to the detriment of Canada, can be resolved in a way that is mutually profitable for both countries. It is a question of education and it is a quesion of fair treatment to all concerned.
I should like to point out two or three conditions under which we are at present suffering. For instance, I have here a report from the Toronto Globe and Mail of April 15, 1958. The heading on this report or this news item is as follows:
Subsidiaries Hiring U.S. Engineers, Report Canadians Squeezed Out.
This is an interview with Lieutenant-Colonel T. M. Medland, executive director of the Association of Professional Engineers in Ontario who said as follows:
"We have been raising the devil over the installing of these natural gas pipelines. But we don't object to U.S. specialists being brought in provided they add Canadians to their staffs for training purposes."
He added: "But some companies with subsidiaries in Canada are attempting to hold their engineering staffs in the United States together by replacing Canadians in this country.
"The bigger companies are O.K. They are beginning to see the light and are interested in their senior staffs here being Canadians. We are more afraid of the smaller companies."
Actually the point that he is driving at is what happens in connection with a great many United States subsidiaries; and when I say "United States" I should use the word "foreign" because it applies to all foreign-controlled subsidiaries; but as I have pointed out previously, the bulk of our manufacturing, our engineering and our resource industries are under the control of the United States and therefore they are the people who bulk largest in this problem. But the problem does apply to all foreign countries. The difficulty has been that the Canadian operation has in many ways been considered as a branch plant extension of the parent company and as such is operated as a branch plant extension with all policy decision being made at the head office of the parent company.

The operating personnel in Canada are just that, namely operating personnel, and they have very little to do with such matters as export markets, the degree of Canadian content and other matters which would be of interest if it was not a wholly-owned subsidiary or even a partially-owned subsidiary which was for all purposes controlled in a foreign country.
You may think that that matter is not too important. But the fact has been that-and when I say "has been" I am not referring to all companies-in certain areas and with certain companies, for instance, purchasing policy has a definite United States bias with regard to the supply of material, machinery and equipment. The question of markets in many cases has been controlled from a parent company in the over-all interest of the company but sometimes not in the best interests of the Canadian company. There are examples of Canadian companies which have been precluded from participating in foreign markets which they could reach, in which they could sell and in which they have sold in previous years. By a policy decision made outside of this country they have been told that they are no longer free to ship into that export market.
Perhaps the problem which bears most heavily on our shoulders is that of senior personnel. Many subsidiaries' staffs-their managerial staff, their professional staff-are brought in from the United States and Canadian engineers and Canadian managers are not given a chance at promotion within that company. This is a much more general condition than hon. members of this house imagine it to be. I have here a letter from a young engineer who is a friend of mine. I will just quote one paragraph from it. He is referring to the fact that in the petroleum industry there is a general disinclination to hire Canadian engineers and there is an inclination to demand that key engineering work either be done in the United States or that personnel be brought over from the United States to do this work in Canada. He says as follows:
The state of affairs I speak about I realize is probably most noticeable on project work connected with the oil and gas industry but I suspect that the same thing holds for other parts of the economy as well. I am disturbed constantly by the number of surveys and investigations done by "a firm of American consultants". I was more disturbed recently while on a job hunting tour in Alberta to hear in the office of one American engineering firm in Calgary that Canadians couldn't be hired for work in Canada under present conditions when the company had plenty of Americans on its payroll trying to keep busy.
For those people who are from Calgary I might say that this firm said they had to make sure that their people in Denver were
Company Directors' Qualifications taken care of first. That is not an isolated case. I know of at least half a dozen. I am referring to highly specialized, highly trained technical personnel, graduate engineers, who could do the job but who will not be allowed to do so. This is along the same line of thought as that expressed in this newspaper comment that I read out a few minutes ago.
I was interested in putting a question on the order paper with regard to the value of automatic transmission assemblies and parts imported from the United States by the automobile industry. I found out that the Department of Trade and Commerce just could not give me that information. Then I asked for the duty rate and the answer is as follows:
Complete automatic transmissions for use in the assembly of motor cars are ruled to be of a class or kind not made in Canada and are admissible under tariff item 438n free of duty when imported from the United States.
Then I asked with regard to parts for automatic transmissions and I was told that since they were not made in Canada they came in duty free also.
I also recall many years in the automobile industry when the empire content clause reacted in favour of increasing the Canadian content in automobiles manufactured in Canada so that the automobile companies could participate in markets which were closed to them if they exported from the United States and which they could only enter from Canada. Their export markets reached from Canada are not so important to them now. Branch plants have been set up in Australia, Malaya and so on. So the Canadian content part is not too important, but there is another point I would like to raise and that is that approximately $10 million to $15 million worth of automatic transmissions are brought into this country. These products alone would, if made in Canada, provide employment for at least 300 men, and I would suspect the figure might run as high as 500.
The tooling problems are not great, and neither is the problem of capital investment. However, it is to the advantage of the automobile company to concentrate the production of automatic transmissions; in fact, in one company of which I know production is confined to one plant in the United States. These components are shipped into Canada and we will never institute an increasing Canadian content in the automobile industry unless the industry has some incentive to build up that content. If they were given such an incentive I suspect that there would be many more jobs opening up in Windsor and Oshawa. It is certainly not in the Canadian interest that this condition should be allowed to continue. I can assure hon. members that such items as automatic transmissions can be

Company Directors' Qualifications manufactured in Canada as cheaply as in the United States. In fact, as much automobile manufacturing is done in terms of labour hours and less time is used-if you ignore tooling costs-than is the case in the United States. I have also known of cases where United States engineers come up to study Canadian production methods, for example, in the Fisher body corporation, because those methods were more advanced than the ones practised in the United States.
I see my time is drawing to a close, but I would not wish to leave the impression that it is only United States firms who are not hiring Canadian personnel, because I notice in the Gazette that the Boyal Bank in Place Ville Marie has employed the services of architects and planners from the United States. In fact, if you read down the list, the first half dozen categories of architects, mechanical and structural engineers, indicate that most of this work is being done by New York organizations.
I believe, furthermore, that the Queen Elizabeth hotel was pretty nearly completely designed in New York. We are a nation which is apparently continually saying, "We do not have the know-how, the savvy, we lack the trained engineers and technical personnel." This is not so. We can tackle any job, and it is only in very few specialized fields that we do need outside help. My contention is that if somehow, through education, through bills such as this, or through modifications to such bills, we could create the general atmosphere in this country which would allow enterprises to make the greatest capital gain they can and to obtain the greatest share of the markets they can, generally to operate as a part of the Canadian community and industrial life, and indeed to pay their proper share of charitable contributions, this would be a great step in the right direction. I raise the last point because I understand that it is not possible for many of the operating heads of companies in this country to make a contribution to welfare or whatever the cause may be without first obtaining permission from their United States head office.
The whole intention of this bill is to create a condition, if not on the operative level, at least on the policy-making level between the operating heads of the Canadian and the parent companies, so that as the years go by the Canadian company will gradually increase its proportion of Canadian engineers, Canadian salesmen and indeed achieve a completely Canadian personnel, all working to the best of their abilities to make the Canadian operation a profitable one. These investments have come into our country and

have helped to develop Canada and the Canadian operation should try to produce as much as it can and to sell in as many markets of the world as it can in free and open competition, if necessary with its own parent company, and in competition with foreign companies.
The purpose of this bill is not to try to dictate to anyone or to drive away capital but, on the contrary, to set up a suitable atmosphere of a continuing nature which will be of benefit not only to the Canadian people but to the organizations who have invested -it is true for the sake of profit-in our country. We hope to provide a general climate in economic and industrial operations in Canada which will be of benefit to everyone.


Douglas Mason Fisher: I would like to assure the hon. member who has just taken his seat that our party supports his bill on second reading, which is the stage where principle is involved. We hope that the bill will be thereafter sent to a committee where it may be examined much more closely because, as the hon. member himself pointed out, there are many factors which should receive further consideration. We trust there will be an opportunity for a vote on this bill before six o'clock, although the hon. member for Calgary South (Mr. Smith) probably has other intentions.
I wonder whether in introducing the bill the hon. member for Vancouver South (Mr. Broome) considered the fact that so many companies in Canada, especially those in the resources field, are not set up under the Companies Act or under letters patent from this parliament but come solely within provincial jurisdiction. As a matter of fact, I understand one of their main reasons for organizing on a national basis is because the federal service is better than that offered by some of the provinces. The fact remains that this bill could drive companies to let go their organization under a federal basis and concentrate on an exclusively provincial operation. I raise this point because I know that many of the pulp and paper companies in my own area operate entirely within the province of Ontario. This is a consideration which I think should be taken into account.
I wish the hon. member had made some further investigation of the files in the office of the Secretary of State (Mr. Courtemanche) with respect to the situation as to subsidiaries and as to whether there is any indication from the addresses of the directors of certain companies of how many such directors do live in Canada at the present time.
The intent behind the bill seems to me to be identified with the party of the hon. member. One usually thinks of a bill brought

in by a private member as being something which is particularly his own interest, but in this case, bearing in mind speeches during the last two election campaigns, there seems to be an absorbing fear on the part of the hon. member's party with respect to United States domination of the Canadian economy.
I can only say that I wish a few more of the private members on the government side had been similarly inclined because we would especially welcome a bill which would require the subsidiaries of United States corporations to publish an annual report showing the relationship of the Canadian subsidiary to the total operation of the concern. We believe this aspect of the matter is perhaps even more important than the requirement so far as the directors are concerned.
Another point that perhaps we could welcome in relation to this bill is the whole question of giving Canadians the chance to share in the equity possibilities of Canadian subsidiaries without having to go into the parent company for stock purchases, and we would certainly welcome it if the hon. member who introduced the bill could develop the tone even a little more, perhaps in the party caucus, and perhaps a few of the younger members could assist him in taking the initiative with regard to these matters which are so closely related.
One of the difficulties, it seems to me, in principle about this question of directorships is the corporate structure. I think it has been very noticeable. Any of you who have been reading texts in the development of corporate structure will realize that more and more control is going out of the grasp of the shareholders, or directors elected by shareholders, and entering the grasp of management itself. Furthermore, we have had a tremendous development in the last decade of two other factors which make the position of a director much less important and so gives the purpose of this bill perhaps more meaning. I am thinking of a giant holding company which needs to purchase perhaps only a minority part of the stock of a company before it can control it and set up its own dummies. That is another question which could be considered in the committee, whether these directors would be any more than dummies. I know in particular of a mining operation in the area from which I come where there are a number of Canadian directors but where the effective control, as everyone realizes, is not in the head office in Canada but down in the United States.
I am reminded of another story-I hope it is apocryphal-in connection with one of the companies laying the trans-Canada pipe
Company Directors' Qualifications line. Apparently they were having difficulty in getting past the Department of Citizenship and Immigration in getting some Americans in to work, so they took these chaps who were waiting down south of the border and who they felt were needed badly, and they created them vice-presidents of the company. I understand these men are working, one as a truck driver and one in charge of a parts store, and at the same time they are vice-presidents of this construction company, and that is an example of how a dummies set-up can come in, no matter how well intentioned the legislation.
One of the other tremendous developments I referred to earlier and that I have not touched on in detail yet, is the development of these investment portfolios by such organizations as Investors Mutual and Investors Syndicate. More and more, so much of the equity control seems to be superficially getting into the hands of these big portfolio groups and companies that they are in a position to nominate directors and in many ways almost control the policies of the corporation. I was just wondering, and it seems a very good question, how is this development-and it seems to be going on every year; in the Financial Post in their annual review you can see how these portfolios are getting larger and larger, and so the question comes to mind-eventually going to be applied. Are these portfolio-holding mutual companies to continue to keep hands off appointing directors and actually taking an interest in management, or is there finally going to come a switch and will they begin to operate more like a holding company. This question affects the question of selecting Canadian directors and the general problem, of course, seems to me that we have been told often enough by supporters of free enterprise in this house that capital is international and knows no bounds, and we cannot consider very seriously whether Canadian directors of United States owned subsidiaries can do an effective job.
This sounds very much like a general criticism of the bill, but it is only intended to be some suggestions to lead us on after second reading to a study of the bill in committee. We think that would be extremely worth while.
I do not want to close without saying some good things about some of the United States subsidiaries we have in Canada. I realize, for example, from my own particular training of librarianship that we would be nowhere in Canada but for funds supplied by a United States corporation, the Carnegie Foundation, and I think also of the work that has been

Company Directors' Qualifications done by other large United States corporations. We have got to temper our criticism to a certain extent with regard to the way they operate.
We have in our area two United States subsidiaries, the Marathon Corporation and Kimberley Clark, that in many ways have set the pace and the whole standard not only for the communities they have developed but also for the advanced forestry outlook they have. And when I consider what they do compared with, for example, a Canadian corporation such as Abitibi which has largely Canadian directors, I begin to see that there has been a certain guided benevolence on the part of some United States corporations, and that this bill might cause such organizations difficulty.
Then again, Marathon Corporation only recently became in the United States a subsidiary of a much bigger organization, the American Can, and I do know that the community of Marathon and those engaged in the home operations there stewed and worried for a few months because they knew that control was vested in the United States but they had come to recognize that the control was benevolent and very often in their best interests. Now it has been removed by another of these gigantic shuffles in the corporation market, and perhaps if we had a requirement such as the hon. member suggested in this bill we would not have this kind of worry.
I certainly think the point the hon. member made with regard to corporate contributions by United States subsidiaries to our Canadian educational institutions is a very important one and it would not be right to single out any particular United States subsidiary that is giving a great deal or others that have given nothing, but this is an important point. It seems clear that if one had Canadian directors with a Canadian background and education they would be much more likely to call to the attention of the management of the corporation the need for helping Canadian institutions.
That completes the remarks I want to make. I would just like to close by congratulating the hon. member again on his initiative.


Mr. A. R. Smith (Calgary South):: Before the hon. member for Port Arthur (Mr. Fisher) spoke I had some misgivings about this bill. I have considerably more now, and in view of the well known and long standing love of private enterprise by that particular group my suspicions are naturally aroused by the sentiments he has expressed and by the congratulations he has extended to the hon. member for Vancouver South (Mr. Broome).

I should just like to say to him that the principles or objectives or intentions that he has in mind are indeed good if taken in proper doses but, as he says on his own admission, in effect the establishment of a majority of directors would not in itself cure the problem about which he spoke for some 40 minutes. It therefore seems unnecessary to make any comment on the bill as such because of its apparent weaknesses; first, that the aim he wishes to achieve could be completely defeated by provincial corporations or by establishing dummy directors, which makes it unnecessary to comment on the bill any further.
But he did raise one or two other interesting points with which I wish to deal, not in defence of foreign investment or United States citizens or United States companies but purely to set the record straight. In his remarks the hon. member made repeated reference to Canada's No. 1 industry, the petroleum and natural gas industry.
In dealing with the points raised by the hon. member the first comment I would make is this. We recognize perhaps as much as anyone the need for capital investment. We know that the capital requirements of Canada involving an investment of some $8 billion exceeds our ability in savings by a considerable degree. We also appreciate that we have vast areas of undeveloped sections of Canada and in western Canada in particular we have vast areas of undeveloped resources. It therefore becomes essential that if we are to enjoy the prosperity we have experienced these past years we must continue to develop these resources-yes, in the interests of Canadians first-and we can only do this, I suggest, with the aid of foreign capital.
The hon. member who introduced the bill said it was not designed to discourage foreign capital. I submit that the moment this bill was placed on the order paper it did exactly that.


Douglas Mason Fisher: Nonsense.


Arthur Smith: You cannot say to anyone whether he be American, Belgian or Chinese that you are inviting capital from his country to Canada with strings attached to the invitation. It is tantamount to saying, "It is all right to send your money but do not come yourself." The hon. member for Port Arthur suggested that there are several ways of being absolutely certain that the rights of Canadians are protected and he itemized them. They are also contained in the report of the Gordon commission and have been enunciated by the Minister of Finance (Mr. Fleming) on several occasions. They were also set out in the brief presented to the Gordon commission by the Canadian

Manufacturers' Association. As they have already been dealt with I shall only say this in referring to them. Protection of the rights of Canadians in participating in the equity of these companies can be safeguarded by ensuring that Canadians have the right to participate in their management, by ensuring that these companies will carry out the development of research in the industries concerned, by ensuring that these companies will contribute to various philanthropic societies and also by ensuring that these companies will in themselves be good companies. I believe that to a substantial degree the United States parent and subsidiary companies operating in Canada have followed this pattern although of course there are exceptions.
With a recession today in the United States it is quite likely that a number of citizens of that country will enter Canada to establish themselves in Canadian industry. I have no facts or figures in this respect but it is something that conceivably could happen. We in the petroleum industry recognize that and the industry itself-not government-are taking every precaution by informing these companies that if they hope to retain their position here under the same favourable circumstances they have enjoyed in past years it is good common sense to be absolutely certain that they are first of all good Canadian citizens operating as good citizens should.
I wish to make one point clear with respect to the development of resources-and petroleum and natural gas are perhaps as good an example as any-and it is that large expenditures will be necessary to ensure continued development. It is estimated we are going to require to expend about $25 billion in order to develop the petroleum and natural gas industry in the next 20 years. It is obvious that we have two choices in this regard. The first is to call upon our own savings which I have suggested are not great enough to meet the demand and the second is that we merely delay the day when these resources are going to be utilized. Let us keep in mind that in developing the resources of our country we will be providing literally thousands of jobs for Canadians and millions of dollars in consumer goods in putting these products into competitive markets for the use, first of all, of Canadians.
I suggest it is not necessary to become emotional in judging the advantages of foreign investment. I point out that this bill will do nothing to encourage the free flow of the
Company Directors' Qualifications required capital to our country. For some years we had no opportunity and little hope of obtaining capital from eastern sections of Canada with which to develop the resources of western Canada. It was many years before Bay street was prepared to invest capital in the development of natural resources in Alberta and consequently the province accepted foreign capital from the United States in substantial volume.
I wish to raise one other point before concluding because I notice it is almost six o'clock. I wish to stress the necessity of maintaining proper provincial legislation to ensure adequate control by Canadians of our resources. This legislation is already in effect in the provinces which illustrates that foreign investment does not mean control of Canadian industry itself. We have all the provisions we require to protect the rights of our citizens. I am quite certain that the law makers in Canada, both provincial and federal, will conscientiously endeavour to ensure that Canadian rights are adequately protected.
I suggest that the intention of this bill is good in that the hon. member was motivated by a desire to ensure the protection of the rights of Canadians through the application of the five or six safeguards listed in the report of the Gordon commission but I point out that the bill will do little else but discourage the foreign capital which we certainly require at this stage in the history of the development of Canada's natural resources.
Mr. Speaker, may I call it six o'clock?



BUSINESS OF THE HOUSE

Lionel Chevrier: Mr. Speaker, I presume we will proceed with the debate on the budget on Monday and continue it throughout the week, as was announced last night?


Mr. Green:: That is the intention, Mr. Speaker. It has been agreed among the parties that private members' day which normally falls on Monday will be postponed.


Mr. Speaker:: Does the house give unanimous consent that the business on Monday will be a continuation of the budget debate notwithstanding the provisions of standing order 15 (3) which would otherwise make it private members' day?


Some hon. Members:: Agreed.


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

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

Mr. Mcllraith: 1.	Is delivery of mall for boxholders served by route 501, Ottawa, made by department personnel or by contract?
2.	If by contract, what is the name of the contractor?
3.	Were tenders called for this contract?
4.	If not, for what reason?
5.	What is the price paid for this service?
Answer by: Hon. W. M. Hamilton (Postmaster
General):
1 and 2. Service performed under temporary arrangement with Rod Service (Ottawa) Limited.
3.	No.
4.	Due to the probability of considerable changes in the number of patrons to be served, it was not considered advisable to invite tenders for a regular contract until the situation has become more stabilized.
5.	$2.50 per hour for truck and driver.


SPECIAL DELIVERY POSTAL SERVICE, OTTAWA
Mr. Mcllraith: 1.	Are special delivery letters in Ottawa delivered by a contractor or by post office personnel?
2.	If by contract, (a) who is the contractor; (b) what is the price paid for this service?
3.	Were tenders called? If not, for what reason?
Answer by: Hon. W. M. Hamilton (Postmaster
General):
1.	Special delivery letters are delivered in Ottawa by a contractor operating on a temporary basis, except for a limited number of items which can be delivered more expeditiously by letter carriers.
2.	(a) Rod Service (Ottawa) Ltd.; (b) 20 cents per item, plus $45 per month for each of three vehicles. Payment at pro rata is made for any additional vehicles required.
3.	No. It is not the practice to advertise special delivery services. Experience has proved that more efficient and economical arrangements can be made by utilizing the services of regular contractors holding mail contracts in the same areas.

Monday, June 23, 1958