1958-06-26

PRIVILEGE


Mr. M. A. Hardie (Mackenzie River):: Mr. Speaker, I rise on a question of privilege. Yesterday I asked the Minister of Agriculture the following question, as reported at page 1609 of Hansard of that date:
In view of the extremely low market price of 6 cents per pound paid to British Columbia raspberry producers, will the minister consider bringing raspberries under the price stabilization act to enable these producers to take off their present crop?
In his reply the minister commented that I had been back in the northern fastness too long because this matter, he claimed, had been dealt with previously.


Mr. Hodgson:: He was wrong; you have been here too long.


Mervyn Arthur Hardie: I am going to be here a lot longer, too.


An hon. Member:: That's what you think.


Mervyn Arthur Hardie: I suggest that the minister himself has been wandering around some place other than his office, because-


Mr. Speaker:: Order. Would the hon. member state his question of privilege?


Mervyn Arthur Hardie: Well, Mr. Speaker, before I asked the question yesterday I checked with the officials concerned and found that no decision had been taken on the question of placing a price support under raspberries. The minister's answer, then, in my opinion was both arrogant and completely false.


Mr. Speaker:: Order. I am sure the hon. member would not like to leave that statement standing on the record.


Mervyn Arthur Hardie: I think after I get through you will see why I leave it on the record.


Mr. Speaker:: I am asking the hon. member to withdraw it.


Mervyn Arthur Hardie: If I have to withdraw it, I will have to withdraw it.


Mr. Fraser:: That is no way to do it.


Mr. Speaker:: May I say that while the hon. member may not agree with what the minister said, and even if one assumes that
the minister was mistaken, that does not to my mind raise a question of privilege.


Mr. Pickersgill:: Surely it is a question of privilege if he misled the house.


Mervyn Arthur Hardie: My question of privilege is this, Mr. Speaker. Yesterday the Minister of Agriculture deliberately misled the house in reply to my question.


Gordon Knapman Fraser: Withdraw that.


Hon. D. S. Harkness (Minister of Agriculture):: Mr. Speaker, first of all I think the hon. member should withdraw his statement that I deliberately misled the house, because I state unequivocally that his comment is completely incorrect. I did not mislead the house yesterday.


Mr. Speaker:: The hon. member has heard what the minister has said, and he knows the practice of the house-that it is quite outside of our accepted standards of conduct here to impute to another hon. member the deliberate statement of falsehood or untruth. The words which the hon. member has used do just that, and I must ask him if he will withdraw them.


Mervyn Arthur Hardie: I will withdraw that statement, Mr. Speaker, but I will not withdraw the implication I made that the minister was not informed as to what took place in his own department.


Mr. Speaker:: I think the hon. member has sufficiently made his point that he disagrees with what the minister said yesterday; and as he has withdrawn the statement, unless there is a question of privilege I do not think he should proceed further.


Mervyn Arthur Hardie: The minister claimed yesterday in reply to my question that the matter had been dealt with the week before. I find this morning that a recommendation had been signed by him this morning and up until noon today a quorum of four of the cabinet ministers had not approved this recommendation and the order in council had not been passed, at least up until noon today.


Mr. Speaker:: Perhaps the hon. member would raise the matter as a question at the appropriate time. As I have said before, it does not seem to me to be a question of privilege.
1640	HOUSE OF
Inquiries of the Ministry


Douglas Scott Harkness: Mr. Speaker, this has been raised as a question of privilege, and I would like to reply to it on a question of privilege. The statement I made yesterday was absolutely correct. The stabilization board sent a wire under my instructions, and after having received the approval of cabinet, to the processors of raspberries in British Columbia. The wire was sent on Thursday night last, making a proposition or an offer to them. As far as the support of raspberries was concerned, it provided that they had to pay a minimum of 9 cents a pound to the growers. They had a meeting on Friday morning and wired back accepting this offer, and I immediately gave instructions to wire back to them to put this 9-cent price into effect immediately. That is the exact situation.

On the orders of the day:


Mr. G. J. Mcllraiih (Ottawa West):: I should like to ask the Minister of Agriculture if he would table the telegrams referred to by him in his reply earlier today to the hon. member for Mackenzie River, and if he would also at the same time table the order in council referred to?


Douglas Scott Harkness: I would be quite happy to table the telegrams and also the order in council, but of course the order in council appears in the normal form of the Canada Gazette.


Douglas Scott Harkness: Mr. Speaker, in order to avoid any further misunderstanding or mistakes on the part of the official opposition in connection with the question of raspberries in British Columbia perhaps I should say an additional word or two on the subject.
The matter first came up something like ten days to two weeks ago. A considerable number of telegrams were received here from raspberry growers stating that they were threatened with a very low price and asking for some form of support. The matter was particularly brought to my attention by the hon. members for Fraser Valley and New Westminster. We canvassed the situation and had a senior official of the department in British Columbia investigate the matter. At about the time the investigation concluded as to what the probable situation would be, the first of the raspberries began to come on the market and the processors of these raspberries who put them into S02 or freeze them were offering 6 cents a pound for this fruit.
As a result I took up the matter and obtained cabinet approval, as 1 indicated before,


to make an offer to the processors which would ensure that the growers received a minimum of 9 cents a pound. I then dispatched the telegram I mentioned a short time ago.
That is the whole situation. The order in council which provides the specific terms under which the processors will be paid in the event they cannot dispose of the raspberries put into S02 and held in frozen form was signed today. It went through today but the actual action, as I indicated, was taken last Thursday and Friday, and the growers were thus put in a position to sell their raspberries at a minimum of 9 cents last week, as I stated in the house yesterday.


George James McIlraith: Mr. Speaker, the statement made by the Minister of Agriculture raises quite an important question of privilege. I believe the house will be very glad of the statement he just made clarifying this matter, but I feel I must fulfil my obligation of pointing out to you, Mr. Speaker, that the minister in answer to the question yesterday, as recorded at page 1609 of Hansard, said:
I think perhaps he-
That is the hon. member for Mackenzie River.
-has been back in the northern fastness too long, because this matter was dealt with last week.
Note these remarks, Mr. Speaker:
Assistance was provided under the stabilization act for the raspberry growers in British Columbia which will ensure that they will be paid a minimum of 9 cents per pound for the poorest type of raspberry which is produced there.
You will note, Mr. Speaker, the statement that assistance was provided.


Douglas Scott Harkness: It was.


John Whitney Pickersgill: They pay no attention to such things as orders in council.


George James McIlraith: The act provides that these things are done by order in council, and hon. members are entitled to know that the law of this country is being observed. At this stage of the proceedings today the minister has told us that the order in council was passed this day, but yesterday he said that the assistance was provided under the act last week.


Douglas Scott Harkness: 
John Whitney Pickersgill: And the minister used to talk about C. D. Howe.


Mr. Speaker:: I did not know so much heat could be generated over a raspberry. I think the hon. member for Ottawa West is within his rights, of course, in raising a question of privilege if he feels that the information given to the house by the hon. minister was incorrect, but I must say that having heard everything that was said today the problem seems to be one of interpretation of what the minister said yesterday and of what it meant. Everyone is entitled to put his own construction on it. I think the matter has been sufficiently aired.
I see that the hon. member for Kootenay West is on his feet. Is this on the point of privilege?


Mr. H. W. Herridge (Kootenay West):: No,
Mr. Speaker. In order to avoid any further misunderstanding in connection with the application of this most important legislation, would the minister make an announcement to the house when the application of the British Columbia tree fruit growers for support prices for the 1957 crop is granted?


An hon. Member:: 1957?
(Translation):



MISCELLANEOUS PRIVATE BILLS

[Stage Direction]
Third report of standing committee on miscellaneous private bills.-Mr. McCleave.
(Text):

[Stage Direction]
On the order:
The Prime Minister-The following proposed motion:-That this house do approve the installation of a simultaneous translation system in this chamber and that Mr. Speaker be authorized to make arrangements necessary to instal and operate it.
Right Hon. J. G. Diefenbaker (Prime Minister):: Mr. Speaker, I would ask that this be transferred to government orders.


Mr. Speaker:: Transferred to government orders, under section 2 of standing order 21.



ATOMIC ENERGY


[Stage Direction]
On the orders of the day:
Hon. L. B. Pearson (Leader of the Opposition):: Mr. Speaker, would the Secretary of State for External Affairs care to comment on the report that the Soviet government has now refused to attend the Geneva meeting, called for next Monday, to consider ways and means of supervising a ban on nuclear tests?
57071-3-104
Inquiries of the Ministry


Hon. Sidney E. Smith (Secretary of Stale for External Affairs):: Mr. Speaker, notwithstanding the negative and polemical statement made over radio Moscow yesterday afternoon, I feel confident that I can assure the house they have not as yet closed the door, and we therefore advised Dr. Solandt to proceed with his plans to the end that he will be in Geneva next Tuesday, July 1. I express a profound hope that scientists who have been designated by the U.S.S.R. will also be present on that date for that meeting.


EXTERNAL AFFAIRS
[Stage Direction]
On the orders of the day:
Hon. Paul Marlin (Essex East):: Mr. Speaker, can the Secretary of State for External Affairs tell the house whether or not the report is true that the government has offered to pay the Soviet embassy for any damages incurred as a result of incidents in this city last Sunday?


Sidney Earle Smith: Yes, Mr. Speaker; according to international practice, we have informed the Soviet ambassador to Canada that if there are any damages in respect of that regrettable incident the Canadian government will pay them. As yet we have not received any claim in that regard.



ROYAL CANADIAN MOUNTED POLICE


[Stage Direction]
On the orders of the day:
Herbert Wilfred Herridge: Mr. Speaker, I should like to address a question to the Minister of Justice, with some restrained indignation. In view of the very disturbing tale in the Printed Word, a periodical published by the public relations firm of Johnston, Everson and Charlesworth Limited, to this effect:
When President Truman visited Ottawa at the end of the war, his guards searched, without warrant, every house along the line of march, including clothes closets, attics and cellars-
-would the Minister of Justice (1) make inquiries as to the veracity of this report and later inform the house as to the result; (2) assure the house that such procedure will not be countenanced in Canada, at any time, for any purpose, and that the basic rights and freedoms of Canadians will be recognized and respected on all such occasions?
1642	HOUSE OF
Inquiries of the Ministry


Hon. E. D. Fulton (Minister of Justice):: Mr. Speaker, I rather doubt whether an allegation about a matter that took place some 10 or 11 years ago, as the visit of President Truman did, is one of sufficient or immediate urgency to justify an inquiry on the orders of the day. However, I have had some inquiry made-


Mr. Speaker:: Order. If the minister is
raising that as a point of order I would agree with him that the first part of the question might be dealt with differently, but the second part of the question remains.


Edmund Davie Fulton: Yes, Mr. Speaker. I can assure the hon. gentleman, as a result of inquiries I have made and discussions I have had with those connected with such matters that there is no likelihood of any such event taking place in connection with any future visit by any head of state who visits Canada. I am also able to say, since the matter has been raised, that the inquiries I have made indicate, so far as my present information goes, that the report of the incidents in connection with the previous visit to which the hon. gentleman has referred is greatly exaggerated, certainly in so far as any allegation of the searching of every private house along the route is concerned.


Herbert Wilfred Herridge: Would the minister inform the house if he considers that on such occasions the Royal Canadian Mounted Police are quite competent to provide all the security required?


Edmund Davie Fulton: Of course, Mr. Speaker, I consider the Royal Canadian Mounted Police sufficiently and absolutely competent to provide all the security precautions that are necessary. However, the hon. gentleman will realize that certain protocols and forms are observed in connection with the visits of heads of state of other countries.



DROWNING OF FIVE MEMBERS OF FORCE


[Stage Direction]
On the orders of the day:
Mr. G. R. McWilliam (Norihumberland-Miramichi):: Mr. Speaker, I wish to direct a question to the Minister of Justice. In view of the minister's statement on June 12 in respect of the tragic drowning of five members of the R.C.M.P. that the total weight carried on that fatal night was within the manufacturer's rate of load for the boat, would the minister care to comment on the finding of the coroner's jury that the five men met their death because the boat was "overcrowded and overloaded"?


Edmund Davie Fulton: Mr. Speaker, I received the text of the verdict of the coroner's jury only this morning, and I am awaiting a full report from counsel who was appointed agent of the Minister of Justice to attend the inquest on our behalf. I am, therefore, not in a position to make a statement on the matter today, but I expect to be in a position to make a full statement tomorrow or by Monday at the latest.


Mr. Lucien Cardin (Richelieu-Vercheres):: I should like to direct a supplementary question to the Minister of Transport on this matter. In view of the finding of the coroner's jury that the Department of Transport standard life jackets and approved life cushions were unsatisfactory in cases of emergency, does the minister intend to change the departmental standard for such equipment?


Hon. George H. Hees (Minister of Transport):: Mr. Speaker, we have not yet received the report of the coroner's inquest. When we do we will examine it thoroughly, and if there are any matters that require action by my department that action will be taken.



NATIONAL DEFENCE


[Stage Direction]
On the orders of the day:
Lester Bowles Pearson: Mr. Speaker, I should like to ask a question arising out of a statement made in the house on June 10, at page 1030 of Hansard, by the Minister of National Defence, when he said:
*-no squadrons have yet been definitely and specifically allocated to NORAD, nor would it seem likely that any such squadrons of the Royal Canadian Air Force would be allocated in that way.
Can the minister reconcile this statement with one he made before a committee in another place yesterday to the effect that as soon as the resolutions of approval of NORAD are passed there will be formal allocation by the government of air defence commands to NORAD, which would of course include nine squadrons of the R.C.A.F.?
Hon. G. R. Pearkes (Minister of National
Defence): Those statements are correct. I do not think they are conflicting in any way.



INQUIRY AS TO CHANGES IN ARMY UNIFORMS

[Stage Direction]
On the orders of the day:
Mr. J. R. Taylor (Vancouver-Burrard):: Mr
Speaker, I wonder whether I might be permitted to direct a question to the Minister of National Defence. Would the minister inform the house whether or not any changes

are contemplated in the present uniforms issued to members of the Canadian army?


Hon. G. R. Pearkes (Minister of National Defence):: Mr. Speaker, certain uniforms
which might be adopted have been under development for some time. They are being issued for user trials during the present summer but no decision has yet been reached as to the adoption of any of these uniforms.



INDUSTRY


[Stage Direction]
On the orders of the day:
Mr. Harold E. Winch (Vancouver East):: Mr. Speaker, may I ask the Prime Minister if he is yet in a position to answer the question I addressed to him on Tuesday, June 17, as reported at page 1205 of Hansard, as follows:
Is the Prime Minister in a position to comment on the press report that William Mahoney, national director of the national steelworkers of America, has asked for a meeting with the government to discuss steel prices and policies in Canada, with special reference to the charge that prices are administered or arranged in such a way that they are geared to United States prices?
The Prime Minister said at that time that he did not know of the press report or of the letter, but I am told the letter was mailed to him on June 12 last.


John George Diefenbaker: In so far as the allegation is concerned as to the date of mailing of this communication, that of course I am unable to controvert. The letter was received from Mr. Mahoney in the stated terms subsequent to the occasion on which my hon. friend asked the question in the house.


Harold Edward Winch: May I ask as a supplementary question if the Prime Minister is now able to give us any information with respect to the disposition of this matter?


John George Diefenbaker: No decision has been reached as yet as to what course shall be followed in this regard, although I am expecting that an opportunity will be given to Mr. Mahoney to make the representations he apparently has in mind. I feel that the representatives of the steel corporations should have the same opportunity at the same time.



CANADIAN PACIFIC RAILWAY


[Stage Direction]
On the orders of the day:
George Harris Hees: Mr. Speaker, on Monday the hon.
57071-3-104J
Inquiries of the Ministry member for Kootenay West (Mr. Herridge) inquired as to the transporting of patients suffering from communicable diseases by railway in the Kettle valley area. In putting his question the hon. member stated that a certain hospital in Kootenay West had been informed by the legal officers of the Canadian Pacific Railway that persons suffering from communicable diseases may ride in the baggage section of the present Budd cars on the Kettle valley line.
If the hospital referred to by my hon. friend is the same hospital which made representations direct to the board of transport commissioners on this point, I think there must be some misunderstanding of the reply made to those representations by the Canadian Pacific Railway Company.
I am advised that Mr. E. M. Stiles, chairman of the board of the Kootenay Lake general hospital society, Nelson, wrote to the board of transport commissioners under date of April 28. The railway company was asked for its submissions, and the legal department of the railway pointed out in reply that rail diesel cars do not provide separate or private accommodation of any kind but that it is permissible to carry stretchers with sick persons in the baggage portion of the rail diesel car provided they are accompanied by another person.
The letter went on to state, however, that this permission has been restricted to persons who are suffering from non-communicable diseases. The letter added that general order No. 804 of the board of transport commissioners requires that if there is no other enclosed accommodation on a train, a person suffering from a communicable disease can be handled in the baggage car; but as the baggage section is part of the rail diesel car and is occupied by the train baggageman and the news agent, it is not considered that such cases should be handled.
I am advised that a copy of the reply from the Canadian Pacific Railway Company was sent to Mr. Stiles.



FISHERIES


[Stage Direction]
On the orders of the day:
Mr. H. J. Robichaud (Gloucester):: Mr. Speaker, may I ask the Minister of Fisheries if any representations have been made by Gloucester county fishermen asking for an extension of the gaspereau fishing season in that county from June 30? If so, has any decision been reached?

Inquiries of the Ministry


Hon. J. A. MacLean (Minister of Fisheries):: Mr. Speaker, representations have been received from two individuals suggesting that the gaspereau fishing season be extended in Gloucester county beyond June 30. Although the run of gaspereaux in that area this year commenced late, it has now reached a point where from a conservation point of view it is considered essential that the season should not be extended beyond June 30 next.


George Roy McWilliam: I have a supplementary question. Have any representations been received with regard to the extension of the gaspereau fishing season in the Miramichi area?


John Angus MacLean: I have no knowledge offhand that any have been received, but I will take the hon. member's question as notice.



CANADIAN PACIFIC STEAMSHIPS


[Stage Direction]
On the orders of the day:
Mr. Frank Howard (Skeena):: On Wednesday, June 4, I directed to the Prime Minister a question which appears in Hansard of that day, inquiring whether he had received a suggestion from the Victoria chamber of commerce for compulsory arbitration in the present strike against the C.P.R. on the west coast. His answer was that he had no recollection of having received such a letter but that he would look into the matter and endeavour to give his answer the next day. I wonder whether he could now indicate an answer to that question.


John George Diefenbaker: Mr. Speaker, I am not sure as to the identity of the organization which communicated with me, but I know that several organizations have brought this question to the attention of the government in letters and communications directed to me or to other ministers.


Frank Howard: I have a supplementary question, Mr. Speaker. The one I referred to suggested that the government should impose compulsory arbitration to settle the strike. It was in that regard that I was inquiring whether it is the intention of the government to follow that suggestion and impose compulsory arbitration to solve the problem.


John George Diefenbaker: Mr. Speaker, this is the second time the hon. gentleman has apparently indicated his support of that procedure. There has been no decision in that regard. However, I will assure the hon.


gentleman that his representations in that connection will receive such attention as they deserve.


Frank Howard: Mr. Speaker, I rise on a point of order and a question of privilege. The Prime Minister has deliberately twisted and distorted a statement I made.


Some hon. Members:: Order.


John George Diefenbaker: Mr. Speaker, I am not one of those with an eggshell sensibility. However, I think the hon. gentleman should withdraw that statement. He must have had a purpose in asking that question and suggesting a course of action. If he did not have one, then I wonder why he worded his question in the way he did.


Harold Edward Winch: Because he wants to know where you stand.


Frank Howard: Mr. Speaker, if the Prime Minister wants any comment-


Mr. Speaker:: Order. The Prime Minister has taken exception to what the hon. member has said. I would ask the hon. member to consider what he has said in that light and advise me what he thinks it is proper to do.


Harold Edward Winch: Mr. Speaker, the hon. member has already taken objection to what was said by the Prime Minister. May I ask you to take that matter into consideration also.


Some hon. Members:: Withdraw.


Mr. Speaker:: I am awaiting the reply of the hon. member for Skeena.


Some hon. Members:: Withdraw.


Frank Howard: Mr. Speaker, I just do not believe that the comments I had to make about deliberate distortion of the implication behind my remarks need withdrawing.


Some hon. Members:: Oh, oh.


Frank Howard: However, Mr. Speaker, if you insist, I will withdraw them. Out of deference to you I will do so.


Mr. Speaker:: I have not insisted on any particular course of action. I simply put it to the hon. member that his words were taken as offensive, and asked whether he would wish to modify them in any way.


Frank Howard: Not particularly, Mr. Speaker.


Some hon. Members:: Withdraw.


Paul Joseph James Martin: Mr. Speaker, I wonder-


Mr. Speaker:: Order. I would ask the hon. member to give me time to deal with this matter before we proceed to the next one. I understood the Prime Minister to suggest

that those words were unparliamentary and that they ought to be withdrawn. I am afraid that I cannot agree that the expression used goes beyond the limits allowed. Deliberate distortion is perhaps something in which all members of parliament engage. To my mind the situation here is different from an implication of deliberate misstatement or falsehood. I would not wish to force the hon. member to change the expression if he himself does not see fit to do so.



DOMINION-PROVINCIAL CONFERENCE INQUIRY AS TO DATE OF NEXT MEETING

[Stage Direction]
On the orders of the day:
Paul Joseph James Martin: Mr. Speaker, I should like to ask the Minister of Finance if he would take the house into his confidence regarding the decision at which the government has seemingly arrived as to when a dominion-provincial conference is to be held, particularly in the light of a statement made yesterday to the association of mayors and reeves by the premier of Ontario, who said he had been promised that in the month of September there will be a conference among the provinces, the municipalities and the federal government.


Hon. Donald M. Fleming (Minister of Finance):: I have seen no such statement as the hon. gentleman has attributed to the premier of Ontario, but I am sure if the premier of Ontario is as anxious as I am to take the hon. gentleman into his confidence on this or any other subject, the hon. gentleman will have no trouble in obtaining all the information he desires.


Mr. Marlin (Essex Easl):: A supplementary question. I ask the hon. minister if he has not read this morning's Globe and Mail in which the premier of Ontario is reported to have said that the federal-provincial-municipal conference which the Prime Minister has promised for September would deal with the kernel of the problem, and that this has to do with a realistic division of revenue and taxation sources. May I inquire, if the premier of Ontario can give this information to the people of Ontario, is it asking too much for the Minister of Finance to give this information to the House of Commons?


Donald Methuen Fleming: The answer to the first question, Mr. Speaker, is no, sir. The answer to the second question was I think given by myself in reply to the earlier question asked by the hon. member.
Inquiries of the Ministry COMBINES INVESTIGATION ACT



REQUEST BY GARAGE OPERATORS ASSOCIATION FOR INVESTIGATION

[Stage Direction]
On the orders of the day:
Mr. D. M. Fisher (Pori Arthur):: Mr. Speaker, I wish to direct the following question to the Minister of Justice. Has the minister received a request for action by any branch of his department from Mr. Elliott, of Peterborough, an official of the Ontario garage operators association, with regard to the relationships between oil companies and retail outlets in this country? If so, has the minister any comments to make on the case made by Mr. Elliott?


Edmund Davie Fulton: thank the hon. gentleman for the notice he gave me of this question. I have received a request from the general manager of the garage operators association of Ontario for an investigation into certain activities of the oil companies. The general manager and other officials of the association, including Mr. Elliott, are to meet with the director under the Combines Investigation Act on July 2 next to elaborate their complaints. These complaints, as in all cases, will be fully studied. Until this meeting has taken place, and until any inquiries which may then be indicated as appropriate to be made have been pursued to a point where it would be proper for me to do so, I would be unable to make any further comment.



POTATOES


[Stage Direction]
On the orders of the day:
Hédard-J. Robichaud: Mr. Speaker, I wish to direct a question to the Minister of Agriculture. What action, if any, is being taken by the agricultural stabilization board to alleviate the condition of potato growers in Prince Edward Island, who at this late date have over 800 carloads of potatoes on hand, with little prospect of disposing of the same?


Douglas Scott Harkness: Mr. Speaker, assistance has been offered by the stabilization board to the Prince Edward Island potato growers and/or the provincial government for diversion of the surplus potatoes as stock food or otherwise on the same basis of payment as applied to New Brunswick potato growers for their surplus potatoes which go into starch diversion.

Inquiries of the Ministry TRADE



INQUIRY AS TO RENEWAL OF AGREEMENT

[Stage Direction]
On the orders of the day:
Mr. W. V. Yacula (Springfield):: Mr. Speaker, I wish to direct the following question to the Minister of Trade and Commerce: (a) When will the general agreement on tariffs and trade, GATT, be up for renewal? (b) Will representations be made at that time to the effect that Canada's position be recognized in a special category? (c) In view of the fact that there is a demand in the United States for tariff protection, is there any likelihood that this agreement will not be renewed by the congress of the United States?


Hon. Gordon Churchill (Minisier of Trade and Commerce):: I will have to accept that question as notice.



TRANSFER OF CF-100 AIRCRAFT TO BELGIUM

[Stage Direction]
On the orders of the day:
George James McIlraith: Mr. Speaker, I should like to ask the Minister of Trade and Commerce if he is in a position to answer the question I asked yesterday regarding the transfer of CF-100 jet aircraft to Belgium?


Gordon Minto Churchill: Mr. Speaker, I regret that due to an unexpected absence yesterday I was unable to be here to give answers to questions which were asked of me. The question was with regard to the transfer of CF-100 jet aircraft to Belgium, and I was asked whether I would give the house the cost to Canada of that transfer.
The answer is as follows. This was a joint mutual aid program between the United States and Canada to provide CF-100 jet aircraft to Belgium. The cost to Canada will amount to approximately $10,276,000. Some $3,625,000 was included in the export figures for the month of May.



AUTOMOBILES


[Stage Direction]
On the orders of the day:
Paul Joseph James Martin: Mr. Speaker, is the Minister of Trade and Commerce in a position to answer the question which in his absence yesterday was put to the Secretary of State for External Affairs, who undertook to accept it as notice and bring it to the minister's attention?


Gordon Minto Churchill: Yes, Mr. Speaker. The hon. member for Essex East was inquiring with regard to an answer I gave the day before, in which I had said some preliminary conversations had been held, and this had to
[Mr. Harkness.l
do with the regulations of the United States which appeared to interfere with trade on the part of subsidiaries in Canada.
Well, my hon. friend, from his long experience on this side of the house, knows that these preliminary discussions are quite the normal discussions on what is called the official level. Some officials of my department have conversed with officials of the United States embassy just to have an exchange of views.


Murdo William Martin: Are we to understand, Mr. Speaker, that the conversations were carried on only in Ottawa, and that they have not gone beyond this?


Gordon Minto Churchill: We have followed the practice followed by my hon. friend in past years.


Murdo William Martin: My question was, do I understand that the conversations held were merely with officials in Ottawa and have not gone beyond that? If they have not, is it proposed to make representations, as my hon. friend said the day before yesterday he would consider, from government to government?


Gordon Minto Churchill: Well, Mr. Speaker, I have said the conversations were between officials of my department here, the Department of Trade and Commerce, and officials of the United States embassy in Ottawa, which answers the first part of the question. We are quite prepared to take such steps as may be necessary to pursue this matter further, and in due course the house will be informed.


Murdo William Martin: May I ask another supplementary question. My hon. friend will appreciate, I am sure, that this is a matter of some urgency. It involves, as the minister is aware, the sale of automobiles to another country and a situation which if corrected might afford some relief to the unemployment which exists in the automobile industry in Canada.


Mr, Churchill:: The hon. member mentions urgency. This matter first came to the attention of the former administration of which my hon. friend was a member, and he is only now discovering the urgency. At least we are being informed and propose to take such steps as may be necessary.


Murdo William Martin: Is the minister not aware that in Arnprior during the election campaign the Prime Minister promised to make an investigation into this?


Some hon. Members:: Order.


Mr. Speaker:: It seems to me this exchange is getting into the category of a debate. The last supplementary question which the hon. member asked was simply a statement of

Inquiries of the Ministry IMMIGRATION
information, and if he is proceeding along the same line I would ask him to drop it there.



LEAD AND ZINC


[Stage Direction]
On the orders of the day:
Herbert Wilfred Herridge: should like to ask the Minister of Trade and Commerce a perfectly proper question. Has the minister had an opportunity to pursue and meditate upon the question I asked yesterday with respect to the United States global plan for the regulation of the marketing of lead and zinc?


Gordon Minto Churchill: The answer to my hon. friend's global question is that I am not aware that the state department of the United States has yet lent its support to any proposal for regulating the flow of lead and zinc to world markets. The government is always prepared to examine and give consideration to any proposals which would appear to be in the interest of the Canadian lead and zinc producers.



LABOUR CONDITIONS


[Stage Direction]
On the orders of the day:
Hon. Ellen L. Fairclough (Acting Minister of Labour):: Mr. Speaker, on Tuesday the hon. member for Essex East questioned a report I gave to the house with reference to unemployment in regard to the release date, and I promised at that time I would look into the matter.
I have checked into this, and find that there was no unusual delay in making this survey in May. As the hon. member may recall, in my answer given on June 11, as recorded at pages 1038 and 1039 of Hansard, I stated that this labour force survey is made by the dominion bureau of statistics normally during the week following the middle of each month or, more precisely, during the second last full week of each month, the main exception to this being December, when the survey is taken earlier in the month due to the Christmas holidays.
The end of the survey week has varied over recent years, with the exception of December, from the 15th of the month to the 24th of the month. May 1958, August 1957 and March 1956 were all months when the survey week happened to end on the 24th of the month.



HUNGARIAN REFUGEES


[Stage Direction]
On the orders of the day:
Ellen Louks Fairclough: Mr. Speaker, I should like to take this opportunity to answer the question which was asked by the hon. member for Bonavista-Twillingate yesterday with regard to a report I made about an agreement respecting the care of Hungarian refugees. I find that March 13 is the date of the letter from the director of the trade and industry branch of the department of planning and development in Ontario in which he indicated they would accept the agreement.


John Whitney Pickersgill: I wonder if I could ask the hon. lady a supplementary question. Has she been able to ascertain whether this agreement is in any respect more favourable to Ontario than the agreement made with the province of Saskatchewan at the very beginning of the Hungarian movement?


Ellen Louks Fairclough: I would think the answer to that is obvious. The answer is no.


John Whitney Pickersgill: Would the hon. lady mind ascertaining from her department whether in fact the answer is obvious, because Ontario asked for a great deal more.


Ellen Louks Fairclough: I would be glad to inquire and inform the hon. member.



BUSINESS OF THE HOUSE


[Stage Direction]
On the orders of the day:
Douglas Mason Fisher: Mr. Speaker, I wish to direct a question to the Prime Minister relating to the activities of the House of Commons on Dominion day. This question stems from a statement made by the leader of the opposition two years ago in which he objected to the house sitting on Dominion day because of that day's general significance. I wonder if the Prime Minister has any comment to make with regard to the sittings of the house on Dominion day in the light of that statement made by Mr. Drew.


John George Diefenbaker: Mr. Speaker, in the circumstances, when we intend to observe the ceremonies on Dominion day to acquaint Canadians as a whole with the history of their country, or at least bring to their attention the fact that July 1 is the national birthday, it is felt-and I intend to have a motion placed before the house accordingly-that while hon. members as a whole may not desire to remain entirely inactive that day, the house should not begin
1648	HOUSE OF COMMONS
Inquiries of the Ministry its session until 4.30 in the afternoon. I intend to have a motion placed on the order paper to that effect.



DOMINION-PROVINCIAL RELATIONS MANITOBA    REQUEST FOR TABLING OF CORRESPONDENCE RESPECTING TAX RENTAL AGREEMENTS

[Stage Direction]
On the orders of the day:
Mr. W. M. Benidickson (Kenora-Rainy River):: Mr. Speaker, I wonder if the Prime Minister would be able to indicate when the correspondence with the government of Manitoba with respect to the tax rental agreements could be tabled.


John George Diefenbaker: Mr. Speaker, I shall try to have that done at once. The last time my hon. friend asked this question he said he wanted to have tabled the correspondence with the premier of Manitoba, but there has been some change in that regard.


John Whitney Pickersgill: Not yet.



THE ROYAL ASSENT

Mr. Speaker:: I have the honour to inform the house that I have received the following communication:
Ottawa, June 26, 1958
Sir:
I have the honour to inform you that the Honourable John R. Cartwright, judge of the Supreme Court of Canada, acting as Deputy of His Excellency the Governor General, will proceed to the Senate chamber today, the 26th June, at 5.45 p.m., for the purpose of giving the royal assent to certain bills.
I have the honour to be, sir,
Your obedient servant,
J. F. Delaute,
Secretary to the Governor General (Administrative)



INQUIRY FOR RETURN


[Stage Direction]
On the orders of the day:
John Whitney Pickersgill: Mr. Speaker, I wonder if I could ask the Prime Minister whether he expects soon to be able to table the correspondence with the premier of Newfoundland, about which a motion was passed on June 18.


John George Diefenbaker: Yes, I shall do that, Mr. Speaker.



INTERNATIONAL TRADE FAIR


[Stage Direction]
On the orders of the day:
Mr. Maurice Bourgei (Levis):: Mr. Speaker, I wonder if the Minister of Trade and Commerce is now in a position to answer the question I asked in his absence yesterday.


Gordon Minto Churchill: Yes, Mr. Speaker. Yesterday as reported at page 1609 of Hansard the hon. member for Levis referred to a story carried in the Toronto Star of June 24 with regard to the Canadian pavilion at the world's trade fair at Brussels. His question was as follows:
-has the minister, as alleged in the newspaper story, curtly accepted the resignation of Madame Valmore Bienvenue, chaperone of the university students who are acting as guides at the Canadian pavilion, and would the minister comment on the whole situation?
I have seen the story in the Toronto Star. I did not curtly but, rather, courteously accepted the resignation of Madame Bienvenue, which I judged was put before me in good faith, and I apprized her of our appreciation of her services. I had no knowledge that there was anything more to it than that.
The story in the Star talks about low morale. My information is that the morale among the students over there is very high. Visitors who have been attending the exhibition have reported largely that the Canadian pavilion is a credit to Canada. Some have said otherwise, but most of the reports I have received recently say that it is a credit to Canada; that the European visitors are impressed with the exhibit, and that the student guides are good representatives of our country. They are enjoying a remarkably fine experience in being chosen to spend about six months in Europe, the type of experience that almost any university student would like to have, and I think they are a credit to Canada. I know of no low morale on the part of any members of the staff whatsoever. Some difficulties may arise from time to time which I think are insignificant.
May I say this with regard to the exhibit over there. The Toronto Star story says something about lack of funds. That exhibit has cost about $3 million. Other countries exhibiting at the world's fair are spending $18 million or over $20 million on their exhibits and, of course, we do not expect to compete in a circle of that size. But if you compare the Canadian exhibit with that

of countries of similar size and wealth I think you will find that it is quite satisfactory to Canada.


Maurice Bourget: Mr. Speaker, I understand that the guides have written a letter to the Minister of Trade and Commerce, a copy of which has been sent also to the Prime Minister. Would the minister be kind enough to table that letter and also the three reports that were sent to him or probably to the Minister of Justice by the mounted police, who are also in attendance at the fair; and also the letter of resignation of Madame Bienvenue?


Gordon Minto Churchill: Mr. Speaker, I do not know of some of those letters to which the hon. member refers. I see no reason why some of those others which he mentioned might not be tabled. I will look into the matter and let him know.


Edmund Davie Fulton: So
far as the Minister of Justice is concerned, since the hon. member mentioned my name, I have no knowledge of any reports having been submitted. I will make inquiries in the department to ascertain whether they have or not. If they are in the nature of routine reports from the constables on duty there to their superior officers in Canada, under such circumstances I doubt whether it would be proper to table them. I will have inquiries made to see whether there is anything that could or should be tabled.



THE BUDGET


[Stage Direction]
The house resumed, from Wednesday, June 25, 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, and the amendment to the amendment of Mr. Argue.
(Translation):
Mr. Paul Marlineau (Ponliac-Timiskam-ing):: Mr. Speaker, at the end of yesterday's sitting I was saying that my constituency is extremely rich in mineral resources, and I am now happy to announce to the house that uranium deposits have been discovered quite recently in northern Timiskaming in the Kippewa and Hunter's Point area, and that these deposits, according to experts, bid fair to be among the richest in the land.
I was particularly happy to learn, while listening to the budget speech delivered by the Minister of Finance (Mr. Fleming), that the government intends to take steps to continue and increase the assistance to gold 57071-3-105
The Budget-Mr. Martineau mines. I was all the happier to learn this because in my constituency there is one extremely rich gold mine, the Belleterre mine, which has been in production for close to 20 years. I submit that the government should look after the problems which beset gold producers, not only by continuing to grant subsidies, but by increasing them. That is, of course no permanent solution but to my mind, every time the occasion offers, representations should be made to the American government for an increase in the price of gold. In this connection, I fully agree with my colleague the hon. member for Chapleau (Mr. Martel) who requested the Canadian government to take such steps as are necessary so that the price of that product may be increased. I do not believe it is an exaggeration to state that, at this time, the price of gold should be set at $75 an ounce.
Mr. Speaker, among the budget resolutions, that which refers to public works is particularly noteworthy. To my mind we should not be content with a single huge operation in a single, possibly unexplored, area, but money should be voted towards public works in the populated areas of this country, where there could be unemployment. Such works would be of benefit to localities which need the suggested improvements and would also help to relieve local unemployment. (Text):
I have reviewed some of the problems pertaining to the northern section of my riding, the county of Timiskaming, and I should like to speak briefly now about some of the problems that beset the southern section of the riding, the county of Pontiac. The population of the county of Pontiac is made up principally of farmers, workers in the forest and lumbering industries, and miners. I have dealt with farmers throughout Pontiac county for quite a number of years, and I remember how in the last years of the Liberal regime farmers would come up to me and say, "Well, we are just hanging on. We do not know how long we can still hang on, because the situation is bad and is getting worse."
The present government has been in power for approximately one year but the farmers I see today, who are engaged in dairy farming and mixed farming, tell me they are well satisfied with the measures adopted so far by the government. They say these measures have contributed in a real sense to the betterment of their condition, and they tell me that all we have to do is to continue

The Budget-Mr. Martineau in that vein and the farming section of our population will certainly always be grateful to the government.
Speaking about improvement in the lot of the farmers, I think of the many "gloom doomers" on the other side of the house-


Some hon. Members:: Oh, oh.


Paul Raymond Martineau: -who have been talking about a slump, about a recession, and about the so-called horrible calamities that have beset the country since, due to unfortunate circumstances, they are no longer the leaders of the country. I really think their zeal is most touching but it is certainly not convincing, especially if one analyses their statements in the light of the plight of the farmers, particularly small farmers such as we have in my riding, who as a class were really completely neglected under the former administration.
In the county of Pontiac we have some very good fairs which are organized each year by the farmers. I believe the outstanding one among them is the Shawville fair, an event which has taken place every year for over 100 years. The farmers of the Shawville area and Pontiac county generally are indeed very pleased to know that the Minister of Agriculture will be able to open the fair in September. Tomorrow another agricultural fair is opening at Quyon, and it will last a couple of days. I take this occasion to invite any of my colleagues who have a bit of time on their hands or who would like a restful change to drive the 30-odd scenic miles up to Pontiac county and visit that fair. I am quite sure they will find it most enjoyable. A little later the Chapeau fair will be held, also one of the outstanding agricultural events of our county.
I am pleased to say that some of the exhibits at these fairs have won wide acclaim and first prizes at some of our national fairs, such as the Royal winter fair. The government has given generous grants to some of these fairs, but I suggest that wherever possible the grants should be increased. It is money that is certainly well spent, and it goes far to promote interest in agricultural events.
As in the county of Timiskaming so in the county of Pontiac there is a crying need for a public investment program. This need is all the more crying in that the county was neglected for a great number of years. There are urgent public works projects that should be initiated and soon. Some of them, such as the construction of the new Bryson bridge, are long overdue. There is a very dangerous situation for the users of that bridge, and I suggest that all measures that may be taken


should now be taken without delay to see that this much needed bridge is constructed, as the present structure has proved completely inadequate to carry the traffic which has to go over it.
Other bridges are also needed in the county. I shall mention only two. A bridge is needed from Quyon to Fitzroy Harbour and a new bridge is needed at Chapeau, Quebec. So far as the Quyon bridge is concerned, I believe that such a project could be incorporated into the national capital plan. It was with great gratification that I learned that the government had decided to acquire the green belt on the outskirts of Ottawa. While on that subject, I think Gatineau park, some of which lies within my constituency, should be enlarged. The Quyon bridge could probably then be incorporated in the larger national capital area.
The development of the national capital is perhaps not something for the immediate future, but I believe that in the course of the next decade the city of Ottawa is slated to become one of the great capitals of the world.
I remember coming to Ottawa as a student in the pre-war years, perhaps 20 years ago, and at that time Ottawa was still a kind of village. It may have been a big village but it was still a village, and I am just amazed at the progress which has taken place here during the last 10 years. Ottawa is truly becoming one of the great cities of this country and if we consider the development which has taken place in just one decade-having in mind that 10 years is a very small period of time in the life of a city and still less in the life of a country-we can surely envisage in the not too distant future a city of surpassing beauty on the banks of the Ottawa river.
It therefore behooves the government to look toward those days. I know steps have been taken, but I think the field of activity and progress should be widened so that Ottawa will acquire a green belt and there will be set aside large areas as national park lands in order to complete the national capital program.
It is in this larger area which I have in mind that I believe my own constituency of Pontiac-Timiskaming can play its part because, judging from the opinions of the many tourists who visit us each year, my constituency is one of the beauty spots of Canada. Yet at the present time it lacks tourist accommodation, and I think some consideration should be given by the government with respect to aid to the operators of tourist resorts. The government has already announced that it will bring forward legislation to help small businessmen. I believe

the tourist resort operators should be included in that group, and that their needs should be considered since they do bring considerable sums of money into Canada. In this way my county will have an opportunity to become outstanding, because from the point of view of natural beauty it has all that it takes to become a great tourist attraction.
I have examined the criticisms of the budget in the speeches of hon. members, most of which I actually heard delivered in the house. All I can see in these criticisms is a lot of contradictions, whining and groaning. The critics have singled out the huge deficit, as they call it, and have also talked about unemployment. I do not see why hon. members of the opposition should be particularly alarmed about deficit financing; as a matter of fact practically every minister of finance during the long Liberal regime spoke about cyclical budgetting. They stated that in times of prosperity one had to accumulate a surplus, and that when there was a pause one should not hesitate to have a deficit as a sort of pump primer to the economic wheel. Why should they now deny what they previously accepted as a sacred economic principle? They say there is now a pause, they say there is a recession, and they apply all their energies to exaggerating that condition.
There is, as the Minister of Finance has said, a slackening in the expansion of our economic activity, but there is no desperate crisis such as the members of the opposition would have us believe. In that connection I can truthfully say that in the county of Pontiac there is this year more employment than for a long time, and from reports in the newspapers during the last few days it would seem to me that the members of the opposition have lost 150,000 reasons for their whining and groaning.
I say this because, as everyone knows, unemployment has dropped in one month by 150,000, and that is the greatest drop ever known in a single month. Therefore the reasons for opposition criticisms of the budget are fast disappearing and when unemployment no longer presents a formidable problem I just wonder what the opposition will have to talk about.
In conclusion I would like to renew my congratulations to the Minister of Finance. He understands the economic problems of our country and has taken steps to resolve them. I am sure the methods he has used, some of which are already in effect and have brought results, will solve our economic difficulties, and they do present a logical answer to those difficulties. For these reasons I submit that the subamendment 57071-3-1051
The Budget-Mr. Meunier and the amendment should be defeated, and that the resolution of the minister should be supported by this house.
(Translation):


Mr. Adrien Meunier (Papineau):: Mr. Speaker, it is customary for the Minister of Finance, when making his budget speech, to deal with all matters relating to the welfare and progress of our country.
The hon. member for Kenora-Rainy River (Mr. Benidickson) called the budget a sick budget. Personally I think it is a lame budget because the Minister of Finance (Mr. Fleming) forgot to deal with an important matter concerning all provinces and more particularly the central provinces. I refer to federal provincial tax arrangements which have been talked about for a long time and to which no final solution has yet been found. Yet, it is a matter of record that when the Minister of Finance sat in the opposition he kept promising that he would find a solution to the problem. In his budget speech, the minister merely referred to it in the following words, as found on page 1234 of Hansard: Additional financial assistance being given to the provinces will enable them to proceed with needed capital improvements in the provincial and municipal fields.
Mr. Speaker, it seems to me that this vital question should have received more attention on the part of the Minister of Finance; he should have spoken at greater length on this subject. This matter was raised in the house about two weeks ago and it was not dealt with in a satisfactory way that would have told us what to expect, because the Minister of Finance and the Prime Minister (Mr. Diefenbaker) have not yet told us that they will soon call a federal provincial conference nor if they have something better to propose or to substitute for the agreements now in force, that is to say the equalization and stabilization payments.
As far as we, in the province of Quebec are concerned, a province in which this matter has been under public consideration for nearly 15 years, it would be important that we know if the government will maintain the present agreements or if it will return to the province of Quebec its field of direct taxation as requested by the premier of that province.
We have not had the pleasure of hearing ministers representing Quebec constituencies speak on this matter in this house but, in the last election campaign, we heard them say that the province of Quebec had been despoiled and done out of its rights, and that a Conservative government would restore what had been taken away from the province.

The Budget-Mr. Meunier
However, on June 3 we heard the hon. member for Bellechasse (Mr. Dorion) make a fine legal statement to the house but, unfortunately, since he had used up all his time, we could not find out whether he approved or not of the equalization payments now in force or if he proposed something better and more progressive. I hope that before long the hon. member for Bellechasse, an eminent jurist and lawyer, will speak on behalf of the province of Quebec on this matter and inform us of his conclusions so that we may know what to expect and what is the stand of members from Quebec on this matter. I feel sure that the hon. member will speak for the province of Quebec and will say what he thinks of the tax agreements now in force, and whether he is for or against their maintenance, whether he feels that the province of Quebec should be handed back its powers of direct taxation.
Mr. Speaker, I have no intention of detailing the history of the tax agreements arrived at between the central government and the provinces, nor to repeat that the provinces were forced to accept these agreements, and even to sign them under duress, as has been held by some.
May I simply say that the provinces were by no means obliged to accept the proposed agreements, whose object and aim was to apportion between the provinces the income accruing from direct taxation provided by income tax, corporation taxes and succession duties. It seems that if certain provinces were not satisfied, all they had to do was to levy taxes inside their own borders on the three bases which I have just mentioned and to reject the suggested agreements.
These agreements were arrived at in order to prevent double taxation and to bring relief to the Canadian taxpayer.
It is recognized, under our constitution, that the federal government and the provinces have a concurrent right to direct taxation and the hon. premier of Quebec has at last acknowledged that principle, which he was the only one to reject, since, in 1954, in enacting his own provincial income tax law he had inserted in the bill a preamble stating that provinces had priority over the federal government in the field of direct taxation. Later on, however, he withdrew from that stand by deleting those words about priority.
This principle being acknowledged, Mr. Speaker, what was the aim of the federal government in seeking to reach an agreement with the provinces about direct taxation, and how did the federal government happen to get involved in that problem?
This very complex question is a result of the 1930 depression when the prairie provinces, unable to face their obligations and

bending under the load of unemployment relief decided to ask for the assistance of the federal government.
At that time, all provinces were anxious to stop unemployment but, unable and unwilling to do anything, they stated one after the other that unemployment was a national problem, which came under the federal government. This was the time when groups of unemployed marched on Ottawa to force the government to action.
In times of depression and trouble, Mr. Speaker, all problems are referred to the central administration, but in times of prosperity and abundance everyone claims more than his own share. Following that economic depression, the Liberal government, which was back in power in 1935, instituted unemployment insurance and, as everyone knows, millions of dollars are spent each year for the administration of that social security legislation. The provinces did not help the central government at all in the administration of that legislation; however, the federal government must have the revenues required to make it work.
After the 1930's, the Liberal government instituted old age pensions and the provinces gave their approval. Later on, the central government advocated the establishment of arts and trades schools and subscribed a large part of their cost of construction without any protest on the part of the provinces. Later came subsidies for the construction of hospitals, subsidies for public health, pensions for the disabled and the blind and also family allowances. There, again, there was no protest from the provinces, as far as I know, against such steps. For these reasons, I have said and I repeat, Mr. Speaker, that if the obligations of the federal government have no limits, its powers must also be limitless.
Everything is being laid at the door of the central government but, on the other hand, everyone wants a large share of its revenues without wondering whether the central government will be able to meet its undertakings. Let me recall some facts which give a good illustration of this.
A few years ago, when cattle suffering from tuberculosis had to be slaughtered as a measure of protection for human beings, and to keep our livestock healthy, by which government was the job done, and who paid a compensation to our farmers for their losses? It was the central government, and no province protested.
When, a few years ago, an epidemic of foot and mouth disease broke out in the west, in Saskatchewan, what government sent men to destroy the affected cattle, and who paid

an indemnity to the owners? It was the federal government who was involved, with no help whatever from the provinces.
If, for instance, an epidemic broke out tomorrow among cattle in this country, and cattle had to be destroyed and an indemnity paid, who would be called upon to pay the shot? Again the federal government, and the provinces would claim that it is a matter of national concern and not their responsibility.
I feel, Mr. Speaker, that I have demonstrated to a certain extent what are the central government's obligations to the people of Canada, which this government has to fulfil lest it be charged with neglecting its duty. However, to fulfil these obligations the federal government must count on certain revenue.
I claim moreover that the Liberal governments which administered this country for 22 years have always worked with the very best intentions and made serious and sincere efforts to solve any difficult problem. I would hope that the present government will continue along the same lines.
In 1955, the Liberal government proposed equalization and stabilization payments which constitute an equitable distribution of wealth and revenues throughout this country in order to help the poorer, less fortunate provinces. This is a problem which occurs in any federal system, and the government must act in a way that will safeguard national unity and allow every citizen to share equally in the common wealth.
It has been only in the last few years that the two richest and most highly industrialized provinces began to show a desire to break their ties with the central government, without renouncing their rights or privileges. They wanted to avail themselves of their abundant revenues, taking no account of the rest of the country.
Have they forgotten that if they are prosperous and if their industries are thriving, it is because they sell their products in the other provinces? For instance, how many billion dollars worth of agricultural equipment have they sold to the prairie provinces, when we know that certain highly mechanized farms use $20,000 to $25,000 worth of agricultural machinery? How many billion dollars worth of furniture, electrical appliances, cars, radio and television sets, etc., etc., have the central provinces sold to the prairie provinces? It is the sale of these goods manufactured in the central provinces, that keeps their manpower at work and brings them very substantial revenue.
The Budget-Mr. Meunier
Equalization payments were instituted by the Liberal government in order to correct the situation and allow the citizens of less favoured provinces to attain a level of prosperity and wealth equal to that of other provinces.
We do not know the final policy of the government on this matter. However, the Prime Minister stated in Winnipeg during the last election campaign that his party, while in opposition, had criticized not the principle of sharing the federal treasury with the provinces, but the extent of that sharing, as regards payment of funds to provincial governments. The Minister of Finance (Mr. Fleming), taking the floor on this question on June 2 last, emphasized the needs of the provinces rather than equalization payments.
However, the promise was made during the last election campaign that a conference would be held between the federal government and the provinces to settle this problem once and for all.
When will this conference be held? We do not know yet but, as representatives of the people, we should like to know.
We know the attitude of the premier of Ontario, Mr. Frost. He stated that he was not satisfied with the agreements developed in 1955 and proposed smother formula which would bring his province 100 million dollars annually, an amount, he said, the province needs. He took part in the election campaigns of 1957 and 1958 and stated that he would get what he wanted.
I said at the outset that this question has been discussed in the province of Quebec for the past 15 years and that the premier of Quebec, the great champion of the rights of his province, always stated, outside the conferences in which he took part, that he would obtain for his province what had been taken away from it. Of course, he was never clear and precise on this matter and never made concrete suggestions that would lead to a solution of this problem. I just said that the premier of Quebec stated outside of the conferences that he would obtain for his province what had been taken away from it. However, when he comes to Ottawa, he does not speak that way and merely repeats what he said in some previous conference.
Indeed, if we refer to the proceedings of the 1957 conference, we see that the premier of Quebec repeated the same vague and indefinite proposals he had submitted at the 1955 conference. The conclusions of the brief submitted by the province of Quebec are summarized as follows:

The Budget-Mr. Meunier
(a)	qualification and delimitation of the powers of taxation of both the federal and provincial authorities, in accordance with the letter and spirit of the Canadian constitution, that is to say having regard to the past, the present and the future;
(b)	simplification of public taxation in such a way as to reduce its cost and facilitate its collection;
(c)	moderation in the domain of taxation to be arrived at by the collaboration of all public powers, in such a way as to ease the burden of the taxpayer so far as possible.
As we can see, Mr. Speaker, the position of the premier of Quebec was always vague, confused, indefinite. And I might add that his motivation was very simple: those proposals were made by a Liberal government and the premier of our province wanted to play petty politics instead of working for the progress of our country.
Now that the Conservatives are in power and that the sworn enemies of the prime minister of Quebec are in the opposition, he might modify his attitude and show himself in a more conciliatory mood; in fact, for the last year we have not heard those sarcastic statements on autonomy, on the protection and retrocession of our rights.
Moreover, since the Conservative members from Quebec who were elected to this house have fully agreed with Mr. Duplessis on the question of tax arrangements, would they be so kind as to tell us if they approve equalization and stabilization payments that were introduced by the Liberals but maintained by their own party until now, and approved in principle by their chief, the hon. Prime Minister (Mr. Diefenbaker) ?
Could they suggest any better and more concrete way of restoring to Quebec all it was deprived and despoiled of, as the leader of that province used to say?
They did however promise, through the ministers representing constituencies of the province of Quebec, namely the Solicitor General (Mr. Balcer) and the Minister of Mines and Technical Surveys (Mr. Comtois), that everything the Liberal government had taken away by way of taxes and rights would be returned to the province of Quebec.
If there was a gross injustice, I ask that the situation be settled at once and I urge the Minister of Finance to call a federal-provincial conference immediately to that end.
Besides the Conservative members from the province of Quebec who advocated that doctrine during the election campaign-I talked about it a moment ago-during that

same period, the Minister of Finance himself stated in the province of Quebec that the provinces could expect justice in the field of taxation. The Minister of Finance came to my riding, in Montreal, on the 18th or 25th of March 1958, and said that the problem would be solved to everyone's satisfaction. I must say, Mr. Speaker, that at the time a wave of conservatism was sweeping over my constituency. After the visit of that hon. minister, where he stated that everyone could expect justice and that the difficult question of taxation as well as that of tax agreements would be settled, I began to gain ground and I was re-elected with the rather comfortable majority of 4,000 votes. I therefore thank the Minister of Finance for his help and I am grateful to him for it. The hon. minister had insisted on that question but he does not seem very anxious now to call a conference with the provinces. In fact, his delay in fulfilling a promise made during the last election, his silence on this subject in his budget speech and the humility for which he is well known lead us to believe that he is satisfied with the way in which the tax problem has been settled in 1955 and that he feels unable to bungle that lasting Liberal piece of work.
(Text):


Mr. J. W. Kucherepa (High Park):: Mr. Speaker, rising to take part in this debate I should like at the very outset to add my congratulations to those which have already been extended to the Minister of Finance (Mr. Fleming) for having brought down this realistic budget, his first budget, and the first Conservative budget for over 20 years. I should like to congratulate him on the courageous attitude he has taken and the measures adopted to combat and overcome the many problems which face our economy at the present time. I should not wish to miss the opportunity of saying that for the most part these are problems which were inherited from the previous administration as a result of certain policies set out by that administration during its last days in office. I refer specifically, of course, to the tight money policy. Let me quote from the budget address of the former minister of finance as reported on page 2216 of Hansard, March 14, 1957. Mr. Harris said on that occasion, and I quote:
The same excess of demand for goods and services was also reflected in a "tight'* credit situation. The monetary policy of the Bank of Canada has been one of restraint, and the fiscal policy of the government has worked in the same direction.

This was the policy of the former Liberal government the members of which party are today speaking diametrically opposite to that policy. So that there may be no confusion in this matter, let me point out that Mr. Harris in his speech that day went on to say:
It is true that the Bank of Canada could have further increased the supply of money and credit.
But, Mr. Speaker, they did not do this although the former minister and his colleagues were well aware of the repercussions of their actions as exemplified by a still further statement on the part of Mr. Harris as reported at page 2216 of Hansard of that day when he said:
Higher rates of interest have given encouragement to saving, have moderated a certain amount of spending and have caused some capital programs to be postponed.
Let us consider the effect of this policy on municipal governments in Canada as an example of the problems which resulted from such a policy in all spheres of the Canadian economy. In discussing this problem I will use as an example the municipality of metropolitan Toronto with whose problems I am more closely acquainted. This municipal government is operating at the present time on a ten-year plan of capital expansion to cost about $1 billion or approximately $100 million a year. It is proposed to finance about $90 million worth of capital works every year. Despite the high credit rating which this municipal government enjoys both in Canada and in the United States there has been an increase of 2 per cent in the cost of its capital financing and it becomes obvious that a 2 per cent increase in the interest rate on $90 million of projects over a period of 20 years will cost the people of this city $18 million over and above what this financing would have cost if the tight money policy of the previous Liberal administration had not been in effect. Besides this $90 million of capital works program which is debentured over 20 years, as a rule, the people of the metropolitan area of Toronto are taxed in addition with a special two mill capital levy which is collected out of current taxation and which amounts to over $6 million a year and is in effect a device being used by this particular municipal government to overcome to some degree the effects of the tight money policy.
It is not to be wondered that the government of metropolitan Toronto has requested special aid from this government to assist in the building of the proposed east-west subway in the city of Toronto, a project which
The Budget-Mr. Kucherepa is estimated to cost about $200 million. The effect of the tight money policy on this project alone, over and above the ordinary debenture charges, will be to add $40 million of cost to this undertaking calculated at the rate of 2 per cent per annum as I have outlined. As a result of this kind of difficulty many public works have been postponed as was predicted by Mr. Harris in March of 1957, and as a result of this postponement the number of unemployed has increased.
The latest results of this tight money policy, I submit, are manifested by the greatly reduced numbers of supporters of that former government sitting in this house today. At this time I should like to make a suggestion to the government with regard to the financing problems facing all our municipalities. There is a statute known as the Municipal Improvements Assistance Act, Revised Statutes of Canada, chapter 183 which provides for loans to municipalities by the federal government to enable a municipality to pay the whole or any part of the cost of constructing or making extensions or improvements to or renewals of a municipal waterworks system, a municipal gas plant, a municipal electric light system, or other municipal project, if the project to be constructed or the extensions or improvements or renewals to be made will be a self-liquidating project, and if the project is urgently needed and will assist in the relief of unemployment for the municipality. Any application by a municipality under this act requires approval by the lieutenant-governor in council for the province and requires a municipality to obtain an undertaking from the province that the province will guarantee to the government of Canada the payment of interest and principal of the loan.
Under this act the interest on such a loan is at the rate of 2 per cent per annum, payable semi-annually, and the loan is to be amortized by semi-annual payments sufficient to pay off the loan during a period fixed by the federal government and such period is not to be longer than the estimated life of the project. This act to my knowledge has never been implemented. I should like to suggest that the government investigate the possibilities of this act having in mind that it was passed in 1938 and therefore might be in need of revision in so far as the aggregate principal amount of loans made under its authority is concerned as well as other items which may be desirable to change at this time.
I should like to take this opportunity of commending the government for the speedy action it took in again amending the housing act, early in this session. I believe this will

The Budget-Mr. Kucherepa help not only to solve some of our housing problems but will also help to relieve some of the unemployment, the roots of which this government inherited from the previous Liberal administration, whose unrealistic tight money policy did so much to create this unfortunate situation.
In September 1957 the new Conservative government made $150 million available for loans on mortgages to stimulate construction of houses, under the National Housing Act, in the fall and winter months. Subsequently, another $150 million was made available, making a total of $300 million in 1957. When the Conservatives took office in June 1957 the Central Mortgage and Housing Corporation had no funds left for new commitments. The new national housing bill which the Conservative government introduced, while not changing the old one in principle went a good deal further to meet the needs of certain people, needs which had not been met in the past.
The effect of this new legislation has been, as was intended, to induce others to lend money under the act and to stimulate construction of low cost housing across Canada. The former Liberal government up to the time of the 1957 election, had not proposed any such amendment; on the contrary, their "tight money" policy ruled out any such possibility. Today they are critical of what the Conservatives did, and did at once on taking office and are continuing to do, as evidenced by the amendment brought in early in this session in this very important field of housing.
Much has been said by members of the Liberal party, regarding the lack of a budget during the last session. I wonder if my hon. friends in the Liberal party are aware that the last Liberal budget was for the fiscal year 1957-58 which did not end until March 31 last. So when hon. members of that party reiterate the question of why there was no budget brought down in the last session, they are in effect arguing that the last Liberal budget should have been scrapped or amended because of its shortcomings.
For the purpose of the record I should like to point out that the Liberals themselves did not feel obligated to present a budget when they called parliament into session on March 19, 1945, and dissolved it on April 16, 1945, with no sign of a new budget to succeed the last previous one of June 26, 1944. Nor was there one until October 12, 1945. The Liberal government in 1944-45 went 16 months without a budget whereas the present government has been in office less than 12 months and has brought in a budget and this in

addition to a financial accounting given by the Minister of Finance during the last short session of parliament.
Much has been said by opposition members regarding the lack of tax cuts in the budget before us. They seem to have lost sight of the fact that in this budget the following tax cuts are included which were not present in the 1957-58 budget. The excise tax on automobiles has been cut by 25 per cent, from 10 per cent to 7i per cent, at an estimated cost of the treasury of $20 million for the full fiscal year 1958-59. In the field of personal income tax, reduction exemptions for -children were raised $100. One effect of this will be to free completely from income tax some
100,000	taxpayers. It will also give relief to about one and three-quarter million others. In a full year, the cost to the treasury will be about $60 million.
There has also been a reduction in the tax on income in the first two brackets of the income tax structure, which will benefit every taxpayer in Canada, particularly those whose taxable income is not more than $2,000 and that constitutes about 70 per cent of the taxpayers in this country.
A change was made in the corporation tax rate structure which will be of particular benefit to small corporations, although all corporations will receive a measure of relief. The lower rate of taxation, 20 per cent of profits, which used to apply only to profits of $20,000 or less, has been extended to apply to profits of between $20,000 and $25,000. Some 2,000 corporations which fall into this category will have a tax on profits within this range reduced from 47 per cent to 20 per cent. The cost to the treasury in the full fiscal year will be about $21 million.
The government's plan of spending many more millions on pubic works is obviously a very sound approach to the problem of unemployment. While the government has already cut taxes from the former high Liberal level, the government's public works program does not anticipate the effect that higher spending may have on industrial production but goes to the core of the problem at once. Besides, tax cuts bring immediate relief only to those paying taxes and it is the unemployed, not the taxpayer, whose need is most urgent today.
The Conservative government's tax reductions, higher pensions and abolition of artificial credit restrictions have been helpful, but their full effect has not yet been felt. In the same way, the full effect of the Liberal government's economic mistakes took some time to become evident, and even now in some degree these effects are still with us.

The acceleration of useful public works is, indeed, one of the recognized methods of inoculating and boosting the economy with the resultant increase in employment, trade and prosperity. People of the Toronto area are happy indeed that a substantial works program will be carried out soon in this locality. This program will provide essential public buildings, airport extensions and harbour improvements. More than $15 million will be spent in the metropolitan area and this should help not only to keep employment at a high peak but also to provide for the necessary improvements required to keep pace with the rapid development of this vital area of Canada.
The improvements to Malton and Toronto island airport at a cost of $4,335,000 are long overdue and have been a matter of great concern to the council and people of this area. The expenditure of $4,440,000 will bring about those necessary improvements and repairs to the Toronto harbour, which will provide the important facilities, so essential to accommodate the increased industry and commerce which will result from the opening of the St. Lawrence seaway.
The $5.3 billion budget which is being proposed-the largest in the history of this country in peacetime-will go a long way in stimulating our economy and helping to overcome the problem of unemployment. This sum does not include such items as the government's liabilities under its guarantee of insured loans under the National Housing Act and the variety of other disbursements which altogether are also working toward further stimulation of the economy of this country by this form of public investment. In the past year this amounted to $447 million, which moneys are available from the repayment of loans, insurance and pension accounts receipts and other non-budgetary sources, as shown in the white paper. This year this requirement will reach $755 million. This infusion into the economy should also be a stimulating factor in promoting a higher level of prosperity.
This should certainly satisfy some, if not all, of those critics in the opposition groups who have been asking what this government intends to do for the solution to the problem of unemployment, which I again reiterate was inherited from the previous Liberal administration which refused to recognize the warning signals and which took a course directly opposite-


Mr. Peters:: Mr. Speaker, it appears that the hon. member is reading his speech rather than making it orally and this is contrary to citation 144 of Beauchesne.


John William Kucherepa: I am referring to notes because of the technical nature of the subject
The Budget

Mr. Kucherepa which I am now discussing. As I was saying, Mr. Speaker, the previous Liberal administration refused to recognize the warning signals and as a result of this took a course directly opposite to that which they were advised to take and as a result of that we find ourselves in the present economic dilemma which faces this country.
The members of the opposition made much of the present unemployment situation in Canada and yet in March 1955 when there were more than 400,000 people out of work the same Liberal party did not consider this to be a major problem. To summarize the situation, I should like to refer to page 3556 of Hansard of January 21, 1958, and the remarks of Mr. Solon Low, who was then leader of the Social Credit party in this house and a veteran of many parliaments, who had a full opportunity to observe events in this house for many years. He said:
Mr. Speaker, my colleagues and I have conducted ourselves all through this session as if we believed what I have just said. Now the Leader of the Opposition is asking the government to resign and give over the reins of government to the Liberal party without an election. As I think about that I remember how indifferent the Liberals were on several occasions to high unemployment during wintertime. They claimed it was seasonal and regional and temporary.
Those terms-seasonal, regional and temporary- have been so burned into my conscience that I shall never forget them. When I bear in mind the fact that it was either policies instituted by that party or things they left undone which started this country into stagnation and carried it before last June 10 quite a way down that road; when I think of the tragic decline in farm cash income during the past six years; and when I add to these things the fact that the Liberal party got as far out of touch with the people of Canada as they did, I And it difficult to see for Canadians any advantage whatsoever in a change of government at this time from Conservative to Liberal.
These were the words of the leader of the Social Credit party who sat in this house during the last parliament and indeed they well summarize the situation as to where the roots of this unemployment problem might be traced.
Some hon. members imply that one of the main causes of unemployment in Canada is the suggestion to divert some 15 per cent of our purchases from the United States to the United Kingdom. Mr. Speaker, these hon. members claim that the Americans have reacted by cutting their imports from us. Similarly, perhaps they would have us believe that United States factories have closed down, leaving millions of workers idle because of this suggestion of increasing our trade with our oldest and perhaps one of our best customers in years gone by.
All this talk about United States reprisals is nonsense. The United States buys from

The Budget-Mr. Kucherepa Canada only what they have to buy. Fifteen per cent of our sales from the United States are made up of five main items. Most of the rest that Canada sells to the United States is made up of raw materials needed to keep United States factories going. Obviously, any reduction of these imports would mean idle workers in the United States, and conversely an industrial slow-down in the United States is bound to reduce demands for those Canadian products. This government has nothing but the friendliest feelings for the United States. Our efforts to expand trade with the United Kingdom were never directed against the United States but were aimed at serving the best interests of Canada. It would be in the interest of Canada to expand our trade with the United Kingdom because this would allow Britain to buy goods from Canada with those dollars.
Mr. Speaker, I submit the Liberals had every opportunity to foresee the current trade recession with its resultant unemployment. What did they do? They did nothing. If anything, through their fiscal policy they contributed to it. The fiscal policy outlined in Mr. Harris' budget speech in 1957 confirms this statement.
Some Liberal members criticize the government for policies that they think are harmful to our relations with the United States and at the same time they suggest that Canada should use as a bargaining device our cooperation with the United States in questions of hemispheric defence. I cannot help but quote the Leader of the Opposition (Mr. Pearson) and the remarks he made on May 13, 1958, as reported at page 25 of Hansard, and which are as follows:
We must naturally protect our interests when they are prejudiced by United States policy. We must, for instance, make it quite clear that the United States cannot expect full and complete co-operation in continental defence, which is desirable, if she treats us unfairly in her tariff and trade policies.
I submit that this kind of Liberal policy as enunciated by the leader of that party is not worthy of one who has had such vast experience in the field of international affairs and who should realize the serious implications of such a move. It is certainly not a matter for bargaining or bartering for special economic considerations which, I am sure, can be achieved through friendly negotiations between the governments of the United States and Canada.
I should like to refer now to the Liberal amendment which was in these words:
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.
The Liberal amendment before us is most incongruous. On the one hand, it criticizes the government for failing to take steps in fighting the recession. I presume what is meant by that is increased spending as suggested by the Liberal party during the recent election campaign. Their propaganda, as manifested by the crash program of $400 million of further tax reductions plus a six weeks tax holiday, seems to indicate to me that this is their thinking on this matter. Yet in the same breath the amendment implies criticism of the government for spending too much when it refers to the largest peacetime deficit in Canadian history. It appears to me that whoever masterminded this amendment does not believe in the maxim, "you can't have your cake and eat it too".
The second part of the amendment is also ambiguous and without too much meaning when read in conjunction with the statement of the Leader of the Opposition made on May 13 last to which I referred a few moments ago. If I may refresh the memories of hon. members, this is the way it went:
We must naturally protect our interests when they are prejudiced by United States policy. We must, for instance, make it quite clear that the United States cannot expect full and complete co-operation in continental defence, which is desirable, if she treats us unfairly in her tariff trade policies.
This statement implies that the United States is unfair to us in her tariff and trade policies. This, of course, is contrary to what the amendment contains when it says, "that it"-meaning the government-"is moving towards greater trade restrictions at a time when other countries in the western world are moving in the opposite direction." So, Mr. Speaker, the amendment does not seem to have very much in the way of substance when it is so incohesive.
The C.C.F. amendment, of course, can best be understood in the light of the sum total of the remarks made by members of that group, especially in the light of the remarks made by the hon. member for Burnaby-Coquitlam (Mr. Regier), who on the one hand referred to the Prime Minister (Mr. Diefen-baker) in the most derogatory terms and on the other hand alluded to the kindness of the Soviet ambassador in Ottawa in affording him a free plane trip to British Columbia. In the light of this kind of thinking, there is not much point in discussing their amendment.
This debate affords me an opportunity to discuss another matter of international importance. We in Canada are of necessity spending many millions of dollars on defence each year while the international situation

remains tense and strained, no worse and no better than it has been for some years.


William Arnold Peters: Mr. Speaker, I have listened very carefully and 1 do not feel that this speech is so technical as to warrant reading. I would ask Your Honour to so direct the hon. member.


An hon. Member:: You have not been in the house to know.


John William Kucherepa: I am merely referring to my notes from time to time. I am sure the hon. member who has objected has read more speeches in this house than any of the members now present.


William Arnold Peters: Mr. Speaker, I have not read my speeches and I am asking that the hon. member not be allowed to do so.


Mr. Deputy Speaker:: Once again I must ask hon. members not to refer to notes too extensively and to deliver their speeches rather than read them.


John William Kucherepa: As I was saying, Mr. Speaker, the western world has developed powerful military alliances which today are the greatest deterrent to war and aggression and which will continue to be essential for some time to come in maintaining the liberty and freedom which we in the western world still have with us today.
It is true that world peace now rests on power so threatening that neither side dares to use it. That being so, what we need now more than anything else is to return to that kind of rational thinking through which, by sincere inquiry and debate, we can distinguish the true and the false, the right and the wrong.
We must not take a defensive position on these international matters but we should bolster our now strong military alliances by furthering economic co-operation with our allies and other free countries to a similar degree so as to counteract the new challenge in the field of trade. Apparently the Soviet government believes this to be our vulnerable position. Therefore we should not hesitate to take steps to ensure a strong economic front among the free countries of the world at the earliest possible opportunity.
At the same time we must demonstrate that our values and ideas, shared by millions of others, represent a positive way of life based on great traditions of truth and justice which have been recognized as the unwritten international law throughout the centuries. This should be the basis of our thinking. I cannot help but reflect upon the inspiring words that the Prime Minister of the United Kingdom uttered in this house on June 13 last, and I quote from page 1151 of Hansard:
The Budget-Mr. Kucherepa
You may ask how will it all end. X do not believe that we need fear the future if we hold firm to our faith and our ideals. In time even the monolithic dictatorships crumble and change, for although the free world by its very diversity often seems weak, in its variety and above all in its freedom it is fundamentally strong. I do not believe that a purely materialistic concept of life will forever satisfy men and women; nor do I fear a continuing struggle of ideas. This I think should be our chosen battleground.
If we can measure up to this conception in international affairs, then I believe that we will be able to solve the problems that confront us in the world today. Without this kind of foundation, neither meetings at the summit nor conferences in the capitals of the world can bring us enduring peace or security.
What we need today is to respect those international institutions such as the United Nations where debate can take place and where truth must eventually come to the fore. We must not be too eager to exchange the role of the United Nations for that of summit conferences. When we did that in the thirties, when we abandoned the League of Nations and pinned our hopes on a kind of summit meeting, the results were disastrous. The proper place and the best place for our deliberations on these vital matters is the United Nations, in full view of all the nations of the world. Summit conferences should be complementary to the United Nations but should not become a substitute for the United Nations.
In a way, time is on our side. It will not be the number of guided missiles or any other armament which will determine our future. It will be our spirit and our devotion to the principles of democracy and Christianity, upon which our traditions are based and from which our progress has stemmed. True, we must maintain our defences for some time to come and we must also expand our economic alliances and meet the challenge of assisting the hungry free nations of the world.
Recent events in Hungary only underline the situation as it exists in eastern and central Europe today. There, many races, enslaved by communist tyranny, look to us in the west with hope that justice will be done and that liberty will once more assert itself in their midst. We must never become complacent, self-satisfied or apathetic if we are to maintain our liberties and also be of service to those less fortunate than ourselves who are today the victims of brutal communist subjugation.
Then, in the battle of ideologies, ours will triumph because it has stood the test of time whereas the communist philosophy, being what it is, will disintegrate, disappear and

The Budget-Mr. Forgie go the way of all dictatorships. When this happens, our various efforts within the commonwealth, in NATO, in the United Nations and in other similar undertakings will be crowned with success and will help to achieve freedom and enduring peace, not only for ourselves but for those many nations now enslaved by international communism.


Mr. J. M. Forgie (Renfrew Norih):: Mr. Speaker, I would like to read from the eighth paragraph in the speech from the throne as follows:
You will be asked to approve a number of measures and appropriations to continue and extend the program of my government in sustaining employment by the acceleration of useful public works and by encouraging the development and processing of our natural resources.
I have listened to most of the debates which have taken place in this house since the presentation of the budget but I have yet to find a clue as to what policy the present administration intends to follow with respect to unemployment. The administration now in power must cure the unemployment situation; the responsibility for this matter is squarely on the shoulders of this administration and it must now prove its worth.
Unemployment was not an issue in 1957 when the Liberal administration was in office. In this connection I would like to refer to the statement of the present Minister of Finance (Mr. Fleming) made when he was a member of the opposition party during the year 1955. This statement bears repeating, and the minister said at that time-
When we entered this debate several weeks ago l 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.
Then he went on to say:
This session opened 2i months ago with a statement by the government contained in the speech from the throne as follows: "Some employment of a regional and seasonal nature is being experienced".
As has been said, the Minister of Finance has described the present unemployment situation as a fairly mild recession. He must accept full responsibility for that statement, made at a time when there were over 500,000 people out of work. This budget brought down by the Minister of Finance is a political expedient but the administration has been unable since 1957 to find a solution to the problem of unemployment. If this were not so we would not have had a march on the parliament buildings such as we experienced yesterday. Those unemployed people returned to their homes frustrated and disconsolate.
This is a serious matter but the present administration is seemingly living from day to day and it might be said that their motto

is: seize the day and trust as little as possible to tomorrow. The public expects the administration to solve the problem and while public works will be of assistance such relief would only be temporary and the unemployed need permanent jobs. Such permanency can only be attained by a reduction in personal and corporation taxes with a consequent expansion in trade. Such tax reductions must take place now when industrial profits are dropping and our unemployment is the highest in history. The cushioning effects of extended benefits are now disappearing, thus increasing the hardships of the unemployed.
We find on the order paper a resolution to increase the capital of the Canadian farm loan board. That is apparently as far as the resolution goes and the government seems to be awaiting a debate on this resolution in order to formulate a farm policy. In the speech from the throne we read of amendments to certain acts but up to now there is not one inkling of any realistic approach to a practical farm policy.
So that the farmers of our nation will not conclude that the Liberal party has nothing constructive to say on this question I wish to present in brief form, as my time is limited, the salient features of our policy in this frightfully important matter. We shall be interested to hear from the Minister of Agriculture (Mr. Harkness) with respect to the farm policy of the government. At page 1892 of Hansard of March 5, 1957 he is reported to have said:
I think there is no question that one of the most serious features of our whole agricultural economy and set-up at the present time is that the great majority of farmers now are getting in the older age brackets. The number of young farmers is comparatively small, and the reason for that essential!: is the extremely high cost of buying and equipping a farm at the present time. It is impossible for a young man with a very small amount of capital to go into farming as it was possible, and as thousands and hundreds of thousands did, 50 or 60 years ago.
If our agricultural economy is to continue on a sound basis it is essential that we get more young men into agriculture, and that can only be done if funds are made available to young men, who are interested in the agricultural life to purchase and equip those farms. I know the present act is not adequate to do that to anything like the extent that is necessary.
From the findings of the Gordon report and the submission to the government by the interprovincial farm council it is apparent that our farm population is steadily declining. In 1840, 70 per cent of the population of Canada was engaged in agriculture; in 1940 the percentage was 33 per cent, and in 1956 it was 13 per cent. To most of us these are startling figures. I do not think we can ignore the fact that the notable prosperity arising from the rapid development of our country during the past 20 years has

by-passed the farms. There are different phases of agriculture in Canada-the mari-times with their emphasis on products other than grains; Ontario and Quebec with their mixed farming; the prairies with their overwhelming stake in wheat; and British Columbia of course, with its emphasis on fruits.
The export markets have not treated our farmers too kindly. What of the future? On page 159 of the Gordon report we find this statement:
We have already expressed the opinion that, in time, price and other changes in U.S. agriculture may bring supply and demand sufficiently into balance so that agricultural surpluses will cease to be chronic.
That may be overly sanguine but it would stretch even the limits of our optimism to believe that over the next 25 years the U.S. farmers will be so powerless, the inducements offered them so slight, and the remedies applied to overproduction so drastic as to leave much room in the U.S. market for increased imports of Canadian foodstuffs. At the present time, however, it would appear that our farmer will enjoy a good export market in the United States for beef cattle for the next four or five years unless hit by a tariff. Livestock and livestock products are by far the largest source of income to Canadian farmers. They yielded $854 million in 1955. The estimated cattle population in 1957 was 10,293,000, and the hog population 5,160,000.
To improve farm conditions and to enable the farmer to obtain a greater share of our prosperity, the Liberal party enunciated a farm policy in January of this year which was reiterated and enlarged upon by the Leader of the Opposition (Mr. Pearson) at Cudworth, Saskatchewan on February 27. The government must come to grips with and solve this serious problem that is facing the farmers of both western and eastern Canada. These problems are not identical, however, for the western and eastern sections of our country. They are not even identical in the three western provinces of Manitoba, Saskatchewan and Alberta. I should like to read a paragraph from the Gordon report at page 175, as follows:
Adjustment of farm organization and farm production to changing economic circumstances, including changing technology, will also, in our opinion, call in some instances for rather more generous credit arrangements than are now available. Too easy credit can aggravate farm problems by inducing an expansion in output that would lead to lower prices. Scarcity of credit, on the other hand, can prevent a desirable rise in agricultural productivity by perpetuating antiquated types of farm organization. As the mechanization of Canadian farms continues, some farmers in all parts of the country will need more medium-term capital to enable them to buy machinery and equipment, and more long-term capital to enable them to enlarge their holdings.
The Budget-Mr. Forgie while the rise in demand for meat will mean that more capital will also be needed for the purchase of livestock. As the result of these cumulative developments, the capital value of farm businesses will be rising on the average; and there will be difficulty in transferring them from one owner to another-in many cases it will be from father to son-unless somewhat more generous credit arrangements are available. So long as farm incomes are relatively low and irregular, it is important that fixed annual payments on mortgages and other forms of indebtedness be no larger than is necessary. Appropriate rates of interest will vary from time to time, but annual payments can be reduced by extending the number of years over which the principal will be repaid. Since the long-range prospects for farm income and for the ability of farmers to service loans would seem to be favourable, we think that farm credit agencies might appropriately extend the period of repayment up to 40 years for long-term loans and up to five or six years for medium-term loans. Extension of credit on somewhat easier terms is one way by which the adjustment of Canadian farming to changing economic conditions can be facilitated. Another way is by altering the emphasis of research programs. In view of the heavy demand that is anticipated for beef and other livestock products, it would seem sensible for research programs to stress the improvement of beef cattle, feeding for beef production, of forage crops, and the carrying capacity of grasslands.
As I see the requirements of western Canada they are as follows:	First, there is
increased population by immigration. In 1957, 282,000 immigrants entered Canada, a greater number than in any other year since 1913 and brought the post-war total up to 1,700,000. Had it not been for this powerful addition to our manpower, Canada would not have progressed and expanded in the way in which it has since the war. In the next quarter century Canada will need all the morally, mentally and physically healthy people who will wish to come to our shores. It will be interesting to see what will happen this year. If the British immigration figures for 1958 mean anything, we shall surely scrape the bottom this year.
The second requirement is mixed farming that will result when immigration is stepped up, particularly in western Canada. That should reduce wheat productions. The third requirement is the establishment of industries and the fourth is the development of a leguminous rotation cash crop as, for instance, soybeans, particularly in Saskatchewan.
The government must provide funds to accelerate research in order to provide, particularly in Saskatchewan, a profitable leguminous cash crop such as the one I mentioned, namely the soybean. For this crop particular types of soil are required. Such a crop would be the answer to the wheat surplus problem provided that research will develop a seed that will ripen before the arrival of the early frost that sometimes hits Saskatchewan in August. Much research has already been done in this line. I have

The Budget-Mr. Forgie been advised by the authorities that a grant of $20,000 a year would be sufficient for this purpose.
A study of the European market requirements will reveal that there is a market in Great Britain and in Europe today for over 100 million bushels of soybeans. The last shipment of soybeans exported from Ontario to Germany was sold at $2.55 a bushel. The highest yield in Ontario, as far as I know, has been 69J bushels to the acre obtained on Pelee island in lake Erie. Practically all the soybeans now grown in Canada come from western and southwestern Ontario. In 1936 about 1,000 acres of soybeans were grown in that section of the country. Last year the acreage was 264,000. An additional 4,000 acres were grown near Morden, Manitoba but the difficulty has been that the oil content has been somewhat low and the average yield has been only 12 bushels to the acre in comparison with 24 bushels to the acre in the province of Ontario last year. However, research is being carried on at the University of Manitoba and has been going on for some time in an effort to secure a better type of bean for that section of the country. Also I am advised that soybeans have been grown near Saskatoon and Indian Head.
The oil development which played such an important part in adding to Alberta's prosperity pinched out in Manitoba, so that diversification of the economy in Manitoba had to be sought by other means to give it a broader base. Agriculture still is the underpinning of Manitoba's economy, with better than 49,000 farms being worked and with production worth $248 million last year. But there is considerable diversification here, with substantial production of crops other than grain, and with livestock accounting for close to half of recent annual returns. Farm income has not increased substantially, but farming has become a dependable business rather than a hazardous occupation.
The big bonanza for Manitoba has been growth of manufacturing. In the past seven years expansion in this area of the economy has been of the order of 40 per cent, with industrial production exceeding $700 million in value last year. Some 1,650 plants give employment to more than 50,000 people of a provincial population of 850,000.
Significant as to what happened is the increase in the production of metal and mineral products, which had a value of $77 million in 1951 and last year was worth $145 million. Wood products, chemicals, electrical apparatus and building materials also have shown spectacular growth. The people of Manitoba have good reason to be

proud of the achievements of the post-war period and the consolidation of it in the last few years.


Mr. Stinson:: Particularly in the past few weeks.


James Moffat Forgie: The dynamic factors in the agricultural picture of the future will likely be technological improvements, growth of the domestic market and conservation. Scientific farming, with proper care of the soil and careful choice of the crops, will play a leading part in increasing and maintaining output.
Farm problems of east and west are similar in the matter of financial assistance that should be given by federal and provincial governments. I do not suggest that all assistance to farmers should come from the federal government, Mr. Speaker. I think the provinces will have to co-operate as the provinces of Quebec and Ontario are doing at the present time.
To assist the farmers throughout the country, we in the opposition feel that certain steps must be taken that will not only yield a higher financial return to the farmers but will strengthen the family farm and conserve and improve the fertility of farm lands. Acting on this belief we passed, a resolution in January of this year to provide all possible help to farmers to improve their economic position by expansion and extension of existing farm credit facilities at present provided by the Canadian farm loan board, the Canadian Farm Loan Act, the Farm Improvement Loan Act and the Veterans Land Act into a complete program of short-term, intermediate and long-term credit.
Such a program would make readily available, at low interest rates, adequate long term capital for farm improvement, the maintenance of the family farm as a healthy economic unit, the purchase of farms by qualified young farmers with small cash payments, and the consolidation of farms. In the estimation of many this program would revolutionize farming in Canada. And, as I said, great emphasis should be placed on agricultural research to find methods of improving and diversifying farm products and introducing new species and new techniques and lowering costs.
To carry out this program for credit assistance we would establish a farm development bank. This bank would control and coordinate all government activities in this field and supervise the loans except those under the Veterans Land Act. That would involve removing the farm loan board from the Department of Finance and placing it and certain

other credit functions under a farm development bank directly responsible to the government.
This farm development bank, combined with improved research and proper land use, expresses our basic policy for the long term improvement of the position of all sections of the agricultural community.
We would also like to make it easier to improve farm homes. We think the time has come when more should be done for rural housing than has been possible in the past. We think that because of the rapid growth of our towns and cities there has been, perhaps inevitably, in recent years too much concentration on government assistance for urban housing. That certainly was a vitally important problem at the time and in some parts of Canada it still is, but surely there is an urgent need to improve housing in the rural areas and small towns.
In reading speeches made by members of the house in 1956 on the Canadian Farm Loan Act, as well as the discussions that took place before the banking and commerce committee, I would think it is fairly well agreed: first, that the loans should be increased to 75 per cent of the appraised value of the land and the maximum amount of the loan increased to $20,000. Second, that regional advisory boards of not more than three members should be set up by the farm development bank to hear applications and question applicants for a loan. Authority to set up one board in each province is contained in the 1935 amendment to the Canadian Farm Loan Act, but one board for each province is inadequate. Third, that the appraisal staff should be increased, and, in this connection, I think all those in the agriculture committee, and the majority of the members who spoke in 1956 and 1957, are of the opinion that V.L.A. appraisers should and could be used by the farm bank.
In the administration of the V.L.A., supervisors call on the veterans in their district from time to time and assist young farmers by way of advice and suggestions. They are well trained men with good judgment. Good public relations such as exist under the V.L.A. are most desirable in dealing with farmers. As I said, V.L.A. appraisers could be used to assist appraisers appointed by the farm bank.
Small farms form part of our sound social structure and should be encouraged, and the operators should receive adequate government assistance, both federal and provincial. The government must do all in its power to prevent a further decline in farm population. If we desire to keep our young people on the
The Budget-Mr. Forgie farms, we must give them some encouragement, especially in the form of adequate financial assistance.
The splendid state of affairs under the Veterans Land Act is in large measure attributable to the field men or supervisors of the V.L.A. The Minister of Veterans Affairs (Mr. Brooks) in his address at Edmonton in May said:
Undoubtedly a good deal of the credit for this fine record belongs to the V.L.A. field supervisors, who have become experts in advising the settlers on how to use their resources to the best advantage in order to neutralize, to some extent, at least, any unfavourable prices for farm products.
V.L.A. officials are presently engaged in a survey to determine what is needed to improve the incomes of our full time farmers. So far they have analysed reports on the farm business of over 3,000 settlers and have found that the key to the problem for most of them is more capital. The survey is continuing, and we are studying the possibility of making more supervised capital available to these farmers.
Full time farmers under the V.L.A. are being well served. Loans under the Veterans Land Act are showing a decline, and before long these appraisers and supervisors could be absorbed by the farm development bank that we have previously advocated. Last year 2,400 full time farming loans under the V.L.A. were paid off and there were only 435 new applications. So, Mr. Speaker, the work of the V.L.A. appraisers is on the decline.
The lapse of time is too great from the date of the application to the completion of processing the loan. That delay is caused mainly through the scarcity of qualified appraisers. As for the processing of the loan, there are delays beyond the control of the board. These delays have all been set out in the banking and commerce and the agriculture committees. There is no need to repeat them. Long term loans and low rate of interest on capital invested in farming is the hard core of the problem of financing agriculture, particularly young farmers starting to farm.
The amount of capital a farmer needs to reach reasonable efficiency varies from $10,000 or $15,000 and in many cases more. Agriculture represents immense long term capital investment. Recent estimates put the value of Canadian farms and buildings, implements and machinery and livestock at $10,000 million. Land is normally a nondepreciating asset, except, of course, when the farmer neglects his soil by failure to fertilize or properly rotate his crops. Livestock represents a semi-permanent investment since it may be renewed by reproduction. Farm machinery is subject to depreciation and obsolescence and, consequently, loans should be for a short term only. Lower rates

The Budget-Mr. Forgie of interest and longer periods of repayment are essential to start a young man on the farm.
It has been pointed out by the chairman of the Canadian farm loan board that 25 per cent of the loans have been made for the consolidation of debts and it may be that there has been a significant increase in loans for this purpose. If so, this is a condition that must be seriously considered. Many of these farmers really cannot make a go of it because their acreage is too meagre or the amount of livestock inadequate to operate economically.
Today, banks and mortgage and insurance companies can find more lucrative and less risky loans than farm loans, and hence a farm development bank would soon become the only practical source of credit for our farmers, and especially of long term credit with low interest rates. And I may say, judging from the comments of farmers for whom I have acted in connection with Canadian farm loan board loans, that they are satisfied with a ceiling of $15,000 to $20,000. In an effort to have loans processed in the early spring farmers should be urged to have their applications in a month or so before the snow comes, and all appraisals should be completed before that time. This is not insurmountable.
In my riding many farmers work out after harvesting at carpentering and other jobs. Their take-home pay is substantial but, as the chairman of the Canadian farm loan board said, there is no objection to that so long as the operations of his farm do not suffer. In fact, in the Canadian Farm Loan Act a "farmer" is described as one whose principal occupation is farming.
In conclusion, Mr. Speaker, while all those recommendations are worth while, we in the opposition stand firm in our conviction that until there is a consolidation of the different legislative enactments aimed at improving the lot of the Canadian farmer through the establishment of a farm development bank and supervised loans no effective and satisfactory economical results can be attained for the farmers of our country. The small size farm is so necessary in Canada. Few of us would like to see small farms replaced by corporate farming. When a farm development act is established and operating we shall witness a lasting improvement in farm conditions and farm economy and a general upsurge in business throughout the nation which will result in restoring employment to a vast number of unemployed, and thus fulfil a two-fold purpose.


Mr. Charlton:: Mr. Speaker, would the hon. member permit a question? Is he aware that the amendments he is now suggesting for the Canadian Farm Loan Act were suggested when we were sitting on those very benches and our proposal was turned down by the party which then formed the government and of which he is a member?


Mr. Pallell:: Well, you are aware of it now.


James Moffat Forgie: No, I am not aware of that.


Mr. Habel:: Are you doing anything about it now?
(Translation):


Mr. Aristide Rompre (Portneuf):: Mr. Speaker, like other members who preceded me in this budget debate, and even before that, I wish to express to the chairman of the house, to the deputy chairman and to yourself, their assistant, my congratulations. I could not omit congratulating the two new ministers.
As mayor of a municipality, together with those in this house who fill the same post in the province of Quebec, may I say to the hon. member for Lotbiniere (Mr. O'Hurley) how much the union of county councils of the province of Quebec, of which he is the president, feels honoured for the confidence shown him in his appointment as Minister of Defence Production.
Mr. Speaker, I must say that it is to me a great honour, one shared by my family, to be sitting in this House of Commons as member for the constituency of Portneuf. I therefore sincerely thank the electors of that constituency for this mark of confidence and assure them of my whole-hearted devotion to their interests for the duration of my mandate. The last time that this constituency was represented by a Conservative member was in 1882, but there is no doubt that, in future, with the progressive and reassuring policies of the present government, under the talented and wise leadership of its valiant leader, the Conservative party is assured of the confidence of the people there for many elections to come.
My congratulations go out also to the Minister of Finance (Mr. Fleming) for bringing down a budget in keeping with present economic conditions. The budget provides large expenditures for public works designed to increase employment and to remedy that deplorable condition of unemployment due to the lack of foresight and to the inertia of the former administration.

Because of my experience in the municipal field, I feel it was a generous move to exempt municipal corporations from the sales tax on materials used in the setting up of a fire-fighting system and other systems under municipal control.
Mr. Speaker, as was noted by several newspapers, it has been very rare that any part of a budget speech has been given in French, as was done by the Minister of Finance. That, to me, is a source of great satisfaction.
I would now like to give a few facts concerning the constituency I represent. Geographically it is only a few miles southwest of the old historic city of Quebec, which is now celebrating the 350th anniversary of its founding. The constituency is bound on one side by the north shore of the majestic St. Lawrence, over a distance of about 40 miles, between Grondines and St. Augustin. On the opposite side is the Laurentian mountain range covered with a great and rich variety of timber which contributes to the operations of several sawmills and pulp and paper mills of the area.
The population of this constituency is evenly divided between farmers and industrial workers. From the agricultural point of view, large scale farming is the main activity. Dairy products are processed there for marketing purposes, either into butter or into powdered milk.
I take this opportunity, Mr. Speaker, to express to the government all my satisfaction and that of the agricultural organizations which forwarded me some resolutions about the Agricultural Stabilization Act enacted by the last parliament. Particularly in so far as my constituency is concerned, I am very proud to extend my congratulations to the government, about the very satisfactory level where the guaranteed price of butter has been set for the next year.
I wish to point out that some communities of my riding specialize in the production of potatoes, that the maple syrup industry means a rather important supplement to the revenue of many farmers and that the setting of a support price for each of these two products would be desirable and would contribute to a more stable revenue to which the farmer is entitled since he must set his budget for the whole year, not to mention that it would remove his uncertainty about future markets. I also express the wish that a serious study will be made with a view to setting a support price for pulpwood derived from family wood-lots, a product which is also an essential factor in the revenue of many of our farmers.
The Budget-Mr. Rompre
A few years ago, the federal government was helping the maple syrup producer by paying him a subsidy representing one third of the purchase price of aluminum pails. That subsidy is still paid in the same amount by the provincial government and there again, Mr. Speaker, I express the wish,-it is also the wish of many maple syrup producers,- that this subsidy will again be granted. The restoration of that policy would substantially help that class of farmers and would at the same time contribute to the production of a better quality product, that would fetch better prices.
There are in my constituency a few communities where farms are not favoured with a loamy and very productive soil. Although I am no expert in this field, I nevertheless wish to refer to some suggestions made to me by several owners of such farms, to the effect that a grant for the claying of their land would be of great help since it would contribute to increase productivity and help them derive a better income from this land.
There is in Portneuf a provincial forestry school where, each year, sons of farmers follow seasonal classes. I feel that it would be wise to encourage by grants the reforestation of some parts of the unproductive farms, as this would create a substantial asset for the coming generation.
With regard to industry, I must point out that the working people in my constituency are mostly employed in pulp and paper mills as well as in a number of sawmills. The lumber industry which feeds these other operations constitutes a rather important source of employment.
There is also, at St. Basile, a cement plant that turns out a good quality product. That industry is only a few years old and is very prosperous.
The quarries of Riviere-a-Pierre provide a granite of incomparable quality, and similar products at St. Marc des Carrieres are another source of employment for our workers. As was done by my good friend, the hon. member for Stanstead (Mr. Letourneau), I draw the attention of the Minister of Public Works (Mr. Green) on that fact and I express the hope that these localities specializing in the production of cut stone will be called upon to provide at least part of the raw material needed for the construction of the public buildings mentioned in the estimates for this year.
I draw the attention of the government to the importation of American cut stone from

The Budget-Mr. Rompre the Indiana Lime Stone quarries. It would be desirable that steps be taken to avoid such competition which is harmful to an industry which is of vital importance to the communities I have just mentioned.
The other main industrial centres are Donnacona, noted for its paper and wall-board industry, a very fine product widely used in the interior finishing of houses and public buildings, and St. Raymond whose industry is largely dependent on forest products, as are the industries of Pont Rouge and Portneuf where similar plants are found.
The largest streams flowing through the constituency are the Jacques Cartier, St. Anne and Batiscan rivers, much used by the industries and the municipalities I just mentioned either for floating pulpwood or feeding power plants.
I am convinced that the $450 million put at the disposal of the Central Housing and Mortgage Corporation at the beginning of this session by this government will greatly contribute to a revival of activity in those industries whose products are used in housing.
As regards the other communities along the St. Lawrence river, some of them are agricultural but others, for instance Des-chambault and Grondines, have been characterized for many generations as the birthplaces of marine officers such as pilots, captains and others.
May I now mention another great natural resource of the area. I refer to the innumerable rivers and lakes teeming with plenty of fish and situated in a vast forest district where game is plentiful. That makes the area very attractive to tourists.
My constituency comprises an area whose subsoil is rich in minerals and for years has been giving to one category of local labour the advantage of honestly earning its living.
I unfortunately have to regret the suspension of operations of the two mining companies which produced zinc and lead at Montauban-les-Mines. I refer to the Anacon Lead Mines Limited and the United Mon-tauban which closed down in 1955, laying off 300 of their employees.
This mining centre has become a ghost town, which gives a striking idea of the previous Liberal government's improvident and stand-pat policy which I mentioned at the ouset of my remarks. That is also an example of the heritage left to this government.
[Mr. Rompre.l
To remedy this urgent situation, I would suggest public works. I think it would be important to build a retaining wall along the north shore of the St. Lawrence river to prevent the erosion caused by the tides and by the waves in the wake of the big ships going up or down the channel. This erosion causes considerable damage to property along the shore where houses of great value have been built. This work is absolutely necessary in several parishes of my constituency situated along the St. Lawrence river. May I point out to the house that the extension of the wall already existing along the St. Anne river to protect shore properties from the considerable damage caused by floods such as the one of December last would be a great help to the people of St. Raymond.
In the field of social security, while not unmindful of the generosity of the present government during the last session, I will, Mr. Speaker, put before the house several resolutions that were forwarded to me by various executive councils of parochial associations in my constituency requesting the government to pay family allowances up to 18 years of age in respect of children who continue their studies. Needless to say, I share those views. I believe, Mr. Speaker, that steps such as this would be of financial assistance to parents and would advance the cause of education. Another important social security measure would be the payment of a pension to widows and single women at age sixty. These people have a great deal of difficulty in finding employment, and special attention should be paid to their needs.
These remarks that I have just submitted to the house, in the course of which I have advanced a few suggestions with regard to the solution of problems which are of particular interest to my constituents, were offered in the hope of making a modest contribution to the work of this house, in order to attain that object which we all pursue in common, that is to say in order to ensure the greatest possible degree of wealth, prosperity and security for all our fellow citizens. I am convinced, Mr. Speaker, that with the sincere and conscientious co-operation of all members of this house we will, in fact, reach that goal.
(Text):


Harold Edward Winch: Mr. Speaker, I sometimes wonder who has the most difficult task in a parliament, the Prime Minister (Mr. Diefenbaker), the Leader of the

Opposition (Mr. Pearson) or the Minister of Finance (Mr. Fleming). Quite bluntly, I think I have to come to the conclusion that the man who has the most difficult task in a parliament is the Minister of Finance. He is damned if he does, and he is damned if he does not. As far as the present budget is concerned, he is going to have to be damned because he does not.
I think all of us have either read or listened with a great deal of interest to the statements of cabinet ministers at various times. We listened to and read the speech from the throne, and I have listened to, read and reread the budget speech. My own feeling on the matter is that I find it difficult to understand just what is government policy. I am inclined to the belief that cabinet ministers are trying to ride two horses at the same time. I have oft-times seen this done by acrobats at circuses but I do not think it has any place in politics or in parliament.
Over the weeks, if not over the months, the Prime Minister has been trying to impress upon the Canadian people the need to spend, to spend and to spend, and I can understand- we can all understand-his thinking in that regard. Undoubtedly he is motivated by the thought that if the people of Canada will just spend and spend the money will go for capital purchases in part but consumer goods in the main and heavy expenditure by the people on capital purchases and consumer goods will so lower inventories that the factories can commence to roll at full speed again and consequently our basic resource industries also. As I said, that can be understood with that motivation if we do not tie it in with the budget of the Minister of Finance. The Minister of Finance, in contradistinction to the economic policy of the Prime Minister, has announced a deficit on current expenditure in the next twelve months of some $641 million. In addition, he quite honestly tells the house that in the next twelve months the government will have to go to the people for loans amounting to close to $3J billion. I think I am correct in saying that in a speech recently the Minister of Finance said that in all probability borrowing approaches will be made perhaps once a month.


Donald Methuen Fleming: No, I never said that.


Harold Edward Winch: The minister may not have
said that but I think he said that he hoped a great deal of it could be financed in Canada. I presume I am correct in that statement.


Donald Methuen Fleming: I hope that all
government borrowings will be financed in Canada.
The Budget-Mr. Winch


Harold Edward Winch: That is the situation then,
$3i billion in the next twelve months.


Donald Methuen Fleming: That includes what was raised six weeks ago in the $950 million issue at that time.


Harold Edward Winch: That is right but it is still $3J billion in twelve months. As has been stated by the Minister of Finance, he hopes that all government borrowings can be raised in Canada. This money must come either out of potential investment capital or out of the savings of the people. It cannot come from any other source because there are no other sources except savings or reserve capital.


Donald Methuen Fleming: I do not wish to interrupt my hon. friend, but I am sure he realizes that in that figure of $3.4 billion which was mentioned there is approximately $2 billion of maturing securities which in the ordinary course we would expect the holders of those maturities to reinvest.


Harold Edward Winch: That is a nice way of getting out of it, but because you cannot meet your maturing bonds you have got to borrow in order to cover them. It still amounts to the fact that the government is going to the people of Canada for this amount of money which has to come from two sources. You cannot lend money to the government and at the same time spend it on consumer goods. The two are diametrically opposed. As far as I am concerned, I admit that I am completely confused by what appears to be a confusing and contradictory government policy.
I also find myself hoping that the optimism of the Minister of Finance is well founded but I wonder whether he can back up his optimism with the opinions of Canadian economists and the pronouncements of government departments. I think the Minister of Finance must have an entirely different crystal ball from that of the majority of economists in Canada. The minister was kind enough to inform us that the $641 million anticipated deficit in the current budget was forecast on the basis of a two per cent increase in the value of the gross national product. We sincerely hope he is correct but I think we are not being unkind by drawing to his attention that if he is wrong Canada may find itself in a most difficult financial situation.
The daily bulletin of the dominion bureau of statistics for Monday, June 23, contains information relative to the gross national product for the first quarter of this year and indicates that there has been a decline of almost two per cent. Although we have not seen any indication of the required policies yet, I know the minister will realize we are very sincere when we say we hope that during this session the government will be

The Budget-Mr. Winch able to announce policies which in the remaining three quarters of the year will be able to overcome the two per cent deficit in the gross national product in the first quarter and achieve the two per cent increase the minister referred to in introducing the budget the other day.
There is something else a number of us would like to have clarified, the position of the government with regard to trade. I know that I am not the only one in the house or in Canada who is still very confused as to what is the government's trade policy. If we listen to government spokesmen outside the house I am certain we all get the impression that the government believes in freer trade and also gives some indication of tending toward free trade. But inside the house the budget appears to indicate the maintenance of the proverbial Conservative protectionist policies. I am not going to speak at length on this matter at the present time. I sincerely hope that when the necessary resolutions and bills are before the house we will be able to have a clear exposition of the principles underlying the trade policies of the present government.
At this point, and because it comes to mind, may I discuss something which disturbs me greatly as I am certain it does the Minister of Finance also. I tried to get some indication of the minister's feelings the other day through questioning but I am afraid that perhaps it was not the right place for me to raise the matter. I refer to the fact of the government introducing tax reductions and some people then taking advantage of them and not passing them on to the ultimate consumer to whom I am certain the minister wants them to go. I am sure that is definitely what the minister has in mind when he introduces tax reductions. I also think that the majority of people in Canada carry them out but unfortunately a great many do not. Of necessity I had to make a hurried trip to my home city of Vancouver last week end. While there I met friends of mine in the retail trade and what did I find? The minister brought down his budget on a Tuesday. In his budget he removed the sales tax on cut flowers.
The next day right in the city of Vancouver, the growers-not all of them it is true but some of them-increased their prices by the amount of the sales tax they had taken off. I do not imagine there is any kind of law which this parliament could pass which would take care of a situation like that but I would certainly like to have a very, very strong statement from the minister as to what in his opinion might be done to stop people from doing this kind of thing. If they persist in what is tantamount to absolute

dishonesty, then perhaps we could work out a method by which we could publicize their names so that the consumers would no longer buy their products and maybe that could bring them to task.
I feel certain that a great many people in this country were disappointed in the budget as recently introduced, disappointed because neither the budget changes nor the allocation of the estimates conformed, by a long shot, with what the people of our country had been given to understand they could expect from the Conservative party when its first budget was introduced in this House of Commons.
Firstly there is nothing in the budget in the way of estimates which gives any indication of increases in allowances for the veterans of Canada. I have not forgotten that changes have been made in the past two or three years but I also remember the statements of certain Conservative members that the increases were not half enough and that the veterans were entitled to a better deal.


Donald Methuen Fleming: We introduced
legislation in that respect last session.


Harold Edward Winch: Do you call that a new deal for the veterans? That is very interesting- the legislation we had last session was the new Conservative deal for the veterans. In that case many thousands of veterans in this country must have been very disappointed for I am certain they all had a very different impression of what they might expect. They got a raw deal instead of a new deal. The fact that there is nothing in the estimates over and above the legislation to which I have just referred is, in my opinion, not only a dereliction of duty and responsibility but is a major disappointment to the Canadian veterans.
These remarks apply also to the plight of the senior citizens of Canada. There is nothing to indicate any further assistance to this group and presumably the legislation introduced last session was the new deal of the Conservative party for the old age pensioners. There is nothing in the estimates to indicate any improvement. Given all the commendation that is due for the increases and changes made during last session we still say that this parliament is unfair to the senior citizens of our country in allowing them to continue living on a semi-starvation basis. There is nothing so far as I can see which is proposed to bring the purchasing power of the dollar in line with the pensions of this group of people. There is a responsibility on the shoulders of the government, with its huge majority, to see that our senior citizens are cared for. Even though the government will not go as far as spending more money

to help the older people surely it could bring in additional legislation, over and above that introduced last session, to allow old age pensioners to draw their pensions outside of Canada beyond a period of six months.
I find it difficult to understand why we have laws in this country, and a government which permits such laws, under which a former official of this house who cannot return to Canada without facing a criminal charge can draw his pension in the United States for the rest of his life and yet an old age pensioner cannot do likewise. Surely if one has served his country so that he is entitled to a pension he should be able to spend his days anywhere in the world with his loved ones, and still receive his Canadian pension. Other pensioners can do so, so why cannot an old age pensioner? Such a measure would cost this government only an infinitesimal amount with respect to administration costs in order to give that right to the people who need it so much. It is not, after all, asking for very much but I defy any member on the government side to give one logical reason why it should not be done and we hope it will be done at this session.
I do not like going back over the years but we must remember the position of our civil servants in respect to superannuation and how it was said by Conservative members that the previous government was unfair to them, that something ought to be done for them and that something would be done for them. We were told how they would get a new deal from the Conservatives but as yet we have no indication, as a result of legislation or in the estimates, that anything is going to be done this year to bring our retired civil servants-our servants-to the position where they would benefit from some form of equalization in respect of their pensions and the purchasing power of their dollars-something else which was left out.



THE ROYAL ASSENT

[Stage Direction]
A message was delivered by Major C. R. Lamoureux, Gentleman Usher of the Black Rod, as follows:
Mr. Speaker, the Honourable the Deputy Governor General desires the immediate attendance of this honourable house in the chamber of the honourable the Senate.
Accordingly, Mr. Speaker with the house went up to the Senate chamber.
And being returned:
Mr. Speaker informed the house that the Deputy Governor General had been pleased
The Royal Assent
to give, in Her Majesty's name, the royal assent to the following bills:
An act for the relief of Valija Zvirgzds Kazaks.
An act for the relief of Joyce Florence Taylor Larman.
An act for the relief of Kathleen Margaret Coffin Barre.
An act for the relief of Freda Bernadette Godin Headland.
An act for the relief of Bruno Bedard.
An act for the relief of Stefania Sobol Wojtowicz.
An act for the relief of Elizabeth Antonie Hartmann Elstermann, otherwise known as Elizabeth Antonie Hartmann Von Elstermann.
An act for the relief of Buth Ellen McMullin Gosnell.
An act for the relief of Beatrice Bellamy Drys-dale Scott.
An act for the relief of John Ronald MacCuaig.
An act for the relief of Edith Ann Van Horne Beattie, otherwise known as Beverley Ann Van Horne Beattie.
An act for the relief of Constance Lilias Crawford Booth.
An act for the relief of Henry Krupa.
An act for the relief of Ferenc Tamas Kalman Laczko.
An Act for the relief of Olive-Jane Frances Piper Sinclair.
An Act for the relief of Bhoda Carin Burack.
An act for the relief of Evelyn Grace Blakely Mullins.
An act for the relief of Julia Switnicki Kobel.
An act for the relief of Eric Dunstan Martin.
An act for the relief of Hazel Margaret White Jackson.
An act for the relief of Mary Stepko Berryman.
An act for the relief of Jewel Evelyn Bockus Yeo.
An act for the relief of Clarence Leonard Sproule.
An act for the relief of Geraldine Avonne Dixon McNaughton.
An act for the relief of Jean-Louis Ducharme.
An act for the relief of Emery George Nemeth.
An act for the relief of Alfreda Rose Celina Gigot Kynazis.	6
An act respecting The Protective Association of Canada.
An act respecting The Mercantile and General Reinsurance Company of Canada Limited.
notti^ServicrAct.11" H°SPltal Insurance and DiaS' StandaCrds°AacTend "" Canada A2ricultura>
Products At six o clock the house took recess.

AFTER RECESS

The house resumed at eight o'clock.


[Stage Direction]
The house resumed consideration of the motion of Hon. Donald M. Fleming (Minister
[Stage Direction]
The Budget-Mr. Winch 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, and the amendment to the amendment of Mr. Argue.
Harold Edward Winch: Mr. Speaker, in continuing my remarks on the budget I should like to join with hon. members who have spoken previously who expressed their disappointment that there is nothing in the budget to indicate that the government has any intention of increasing the family allowance.
I believe it is a great disappointment to all people that the government has not recognized that there is a responsibility on its shoulders to so raise this allowance as to combat the loss in the purchasing power of the dollar. I do not intend to repeat arguments that have already been voiced but I do want to draw the attention of the government to a discrimination which we feel strongly should be removed as speedily as possible. I refer to the fact that for some strange reason the law with regard to the family allowance was so drawn that the families of our personnel in the armed forces do not receive the allowance if their families join them overseas. I raised this matter before in committee and was informed that this action was not the responsibility of the Department of National Defence that the situation exists because of a specific section to that effect in the Family Allowances Act. We have been told by officials of the Department of National Defence, however, that perhaps one reason people in this position are denied the family allowance is because of the additional help the families receive when they are sent overseas to join the head of the family. We maintain that this point of view cannot be substantiated in fact.
I am not referring to the 700-odd members of the armed forces who are now overseas attached to embassies, attaches or NATO headquarters because they are well taken care of through financial assistance which in the case of a person who holds the rank of lieutenant-colonel is as much as $190 a month. I am referring to the 11,000-odd armed service personnel overseas who do not fall into the categories I have mentioned. I have been informed by the Department of National Defence that a great many of this number are married and their families are overseas.
I was surprised to learn on what basis they receive an additional allowance. I was advised by the department this afternoon that the increased allowance for families of our armed service personnel overseas is based on the figure established by the dominion bureau of statistics relating to the cost of living wherever the family is stationed as related to the cost of living in the city of Ottawa.


It works out this way, just to put it rather briefly. If the personnel is stationed in the United Kingdom and living in what is known as married quarters the bonus is nil. If they live outside married quarters the amount is $10 a month for each family. If they are stationed in Germany and are in married quarters the bonus is $15 a month and if they are outside married quarters it is $30. If they are stationed in married quarters in France and have the rank of lieutenant-colonel they receive $48 a month. In the case of a private the amount is $32. A lieutenant-colonel living outside married quarters receives $100 and a private receives $64. I want to emphasize the fact that according to the information given to me only this afternoon these amounts are all based on the dominion bureau of statistics calculation of the variation in the cost of living in the various centres I have outlined as compared with the cost of living here in Ottawa. On that basis, therefore, we can see no reason for the discrimination against the families of our armed service personnel overseas who are no longer entitled to draw the family allowance when they leave the shores of Canada.
Armed service personnel overseas are required to pay income tax under the provisions of that act which is only fair and just but they should likewise be entitled to receive the family allowance. I sincerely hope the government will recognize the injustice of the situation as it exists at this time and will take action at this session to remedy the condition I have drawn to its attention.
There are many other matters which I know are a disappointment to the people of this country in that they have not been included in the policy pronouncements of the Minister of Finance in his budget speech. It is to be sincerely regretted that apparently no action is to be taken to establish a plan and policy under which financial assistance could be given to the municipalities at low interest rates. The government is to be commended, of course, for the action it has taken in the removal of sales tax from certain equipment when purchased by municipalities and which will result in a saving to them this year of approximately $5 million but the municipalities are in a desperate situation and require a great deal of money with which to carry on the services they provide. It would have been of great assistance had the government indicated that action was being contemplated at this session in this regard.
As I have already indicated there are a number of matters which I have not yet discussed but I feel it is sufficient for one to

speak for 25 or 30 minutes and the other matters I have in mind can be discussed when the estimates are before us and so I will conclude with this statement. In all probability this house will be sitting for another two or three months and so there is still plenty of time for the Minister of Finance to redeem himself in the eyes of the public. I think all the people of Canada-and I know all hon. members of the opposition-are so broad in their outlook and generous in their hearts that they will overlook the minister's sins of omission if he will now come forward with the estimates and proposals that will not only meet the expectations of the Canadian people but will also represent the fulfilment of Conservative promises.


Mr. D. V. Pugh (Okanagan Boundary):: Mr. Speaker, I should like my first words in this house to be words of congratulation to you on your election to the high office you hold, and may I extend the same compliment and my good wishes to the Deputy Speaker and the hon. member for Spadina (Mr. Rea). I wish also to congratulate the Minister of Finance (Mr. Fleming) on his budget. It was a delight to me not only to have been present at its delivery but to have felt that in some small measure I was a part of it. I say a part of it because the budget sets out judiciously and exactly those things which I, as a Conservative member, support.
In the budget speech there were two statements which struck me forcibly, the statement on distress selling and that on fair value for duty. In these two clear, concise statements of broad principle may be found the hope for a solution of a long-standing problem in my constituency, that is the plight of our fruit and vegetable growers.
Before dealing specifically with these two budget statements I would like to sum up a few points which apply to my riding. To me, Okanagan Boundary is a lovely part of the world with fertile valleys, forests, lakes and rivers, all set in the heart of the mountains in the interior of British Columbia. I like to call it home. As other members speaking of their constituencies like to call their own places home, so also do I.
As for industries, we have mining, lumbering, ranching and fruit and vegetable growing. We also have a well-established tourist industry. In one respect at least, the province of British Columbia has taken a back seat to no place on this continent and that is in providing campsites and picnic grounds. These are readily available along the highways and beauty spots of the province. They are well laid out camps, with all the facilities provided. Here I would like
The Budget-Mr. Pugh to commend the federal government for the financial assistance they have given to the provinces aiding construction of such camps.
In Okanagan Boundary there is one further aid to our tourist business which I hope the government will take into consideration. We have a great need for the building of small boat harbourage and launching sites. Not only will this be of benefit to people locally but in general to the many visitors throughout British Columbia, the rest of Canada and from the United States. Visitors bring all types of craft and boats to our lakes. To understand this need it is necessary to know that Okanagan lake provides no safe anchorage in the form of natural bays. In each case the construction of a breakwater is necessary as a protection against strong winds. The building of breakwaters is a federal responsibility but it might well be worked out with provincial or local authorities. Here I would like to say a word of thanks for the recent action of the government in extending and modifying the present breakwater at Penticton.
While commenting on tourism, I would like to draw the attention of the government to the development of highway No. 97 which starts in California and runs up through my riding of Okanagan Boundary and the ridings of Okanagan-Revelstoke, Kamloops and Cariboo and farther on up north. Of great importance to the future is the fact that this highway, if developed further, will provide a logical link to the north. It is the shortest route with the best gradients available and apart from the tourist business, has tremendous trade and military value.
Let me say a few words on flood control. The government has, in conjunction with the province of British Columbia, done extensive work to control flood conditions on the Okanagan river. The worth of this project is shown by the additional acreage made available. Previously the river had snaked its way through the valley and now many miles have been cut off its course. Flooding of a large acreage has been cut to a minimum. However, there is need of a further study in the Similkameen valley and on both forks of the Kettle river. In the mountains fertile land is at a premium and each year erosion is taking place at an alarming rate, particularly so in those parts which I have mentioned.
I would like to turn to some of our industries. Historically, mining has played an early and important part in our growth and economy. Present-day prices for metals have forced once profitable operations to close and I regret the decision to close the mines at Copper Mountain, Hedley and Greenwood.

The Budget-Mr. Pugh This stoppage has been felt keenly through- These industries, along with fruit and vegeout my riding. We live in hopes that more realistic local legislation and higher world prices will lead to further exploration in the area.
There is one point that I might mention at this time and that is the number of young men who have completed their university courses and are prepared to go into the mining field, but mining is being curtailed in my riding and also throughout the rest of Canada, which means that there are no positions available for them. I would suggest to the government that long-needed surveys be carried out to provide work for those people to keep them here in Canada. We have had far too many moving out of our country to get jobs elsewhere.
I should like to say a few words on lumbering. Lumbering flourished in the early days. Perhaps the word "flourish" is an unfortunate one but at the same time I think it is sufficient to say that our mills have grown, that the forests are being utilized and that many men are being employed. Because of weather conditions- and I might say here that we have an ideal climate in Okanagan Boundary-our mills were able to operate with little interruption throughout the year. However, the bulk of our product must be sold to the United States and a poor market there price-wise means stocks of lumber lying unsold in our yards.
And now a word about cattlemen and poultrymen. Our cattlemen and poultrymen are producing under considerable hardship. We have plenty of room for furthering both these industries in the Okanagan Boundary area. However, our main trouble is the laid-down cost of feed grain. It is more than a little hard to know that our competitors can obtain feed grains for one-half the cost that it is available to us. For instance, we pay approximately $60 a ton; our competitors elsewhere in Canada obtain the same feed grains for $20 a ton. I would recommend that where grain is required by cattlemen and poultrymen for feeding purposes it be obtained through the wheat board at the prevailing door-to-door price in the wheat board area. It does seem to me ridiculous that our great overload of feed grain cannot find its way to a legitimate market such as this. May I here commend the prompt action the government took earlier this year to protect our poultrymen against the United States invasion of turkeys at distress prices.
I have mentioned mining, lumbering, cattlemen and poultrymen, Mr. Speaker.

tables, suffer from our position in the mountains. The common problem to all our industries, and indeed to the future location of any industry, is one of freight rates. Not only must we ship to distant markets but the necessities coming to our area suffer from a heavy rail bill, a heavy additional toll. This adds to our cost. We are in a somewhat different position from that of eastern Canada because we are a long way from a large population centre. For instance, Vancouver is 300 miles away from the Okanagan valley. We have to ship a long way. We have no market close at hand and it means the rail bill is a heavy one. The resulting costs of transportation are nothing less than a slow process of strangulation.
May I now refer to our fruit industry. My remarks will apply equally to the vegetable industry. We grow wonderful fruits and vegetables but in order to avoid any argument I will simply say this: they are second to none. Over the years our fruit industry has expanded and improved its product. Every effort is being made to keep up to date in quality and variety. We have an industrywide marketing agency. By-products have been developed and in this respect a great deal of credit is due to the experimental farm at Summerland. Perhaps a few words here will give the house an idea of the tremendous behind the scenes work which has helped our industry keep up to date.
In the beginning we planted our whole area entirely to fruit and fruit designed for the fresh fruit market; that is, fresh fruit for the consumer but we soon developed annual surpluses and we had to look elsewhere. The fruit and vegetable processing laboratories of the dominion experimental farm went to work with the full support of our industry. This forward looking has paid off. We now process roughly one-third of our entire apricot, cherry, peach, plum and Bartlett pear crops. We now have products which we hope will utilize all our surplus apricots not required by the fresh fruit market. These are worth-while outlets from a remunerative standpoint.
Apple processing has remained a large problem but we actually process approximately one-third of our crop, or 33,000 tons. Apple cider, which has been newly introduced, is another feather in the cap of the farm; that is, of the dominion experimental farm. Here extensive research work in the laboratories has resulted in a fine product. The B. C. fruit processors co-operated to the full in providing material, equipment and encouragement. Of greatest importance, of course, is the fact that the industry hopes

lower grade surplus apples will be used here leaving the better grade apples to the fresh market.
The experimental farm also has provided its worth by its work on new varieties. Another important function is their fight against plant pests and disease. Here ruthless measures have to be taken and the industry supports them through the Palmer memorial research grant. It allows large scale experimentation in the orchards and gives a form of insurance against loss through such experiments. Effective sprays are developed quickly. We back our experimental farm to the hilt. It has proved its worth and brought dollars to the industry.
Now, Mr. Speaker, may I summarize the major problems facing our fruit industry. Through its chief spokesman, the industry has stated that it requires consideration on four major points and, indeed, more than consideration if it is to survive. These four major points are: First, stability of returns from year to year; second, protection specifically aimed at distress selling; third, relief in freight rates; and, fourth, farm financing and farm credit.
To enlarge on these four points and deal with them in a slightly different order, I would point out that I have already made mention of freight rates and stated the necessity of an overhaul. With regard to farm financing and farm credit, to understand this need it is necessary to understand the problem of weather in relation to orcharding. The orchardist accepts normal hazards of weather. Troubles arise through early frost, poor weather when the crop is setting, improper humidity at thinning time, rain when the cherries are being harvested. All these and many more take a tremendous toll. But this is an annual problem and in all forms of farming an accepted hazard. We accept it. There is, however, a weather condition which has in many cases caused widespread disaster. I refer to the tree-killing winters commencing in 1950. This has meant a heavy drain on our resources. It has meant replanting and in many cases new trees planted have been severely damaged in the years following 1950.
The situation requires long term rehabilitation financing. This is not available through the banks. The only other source, the Canadian farm loan board, is not available either as this type of rehabilitation loan does not meet its requirements. It is a straight question of rehabilitation and I would ask the government to give immediate consideration to this urgent problem.
On the short term basis credit has been cut as a result of the poor return in the
57071-3-106
The Budget-Mr. Pugh last five years. But the combination of winter kill and poor returns has been more than the average orchardist can stand. The position has deteriorated until now many are in serious difficulty. Financing through the banks has been curtailed in many cases. Poor annual returns are the sort of thing that make any banker, even if he is a friendly type, think twice. The result has been that a large percentage of growers now work out part time or full time. This, of course, makes it impossible to maintain the orchards properly. From the foregoing you will see that our credit position needs overhauling on both a long and short term basis.
Let me deal now, Mr. Speaker, with the remaining two major points brought up by the industry, namely stabilization and protection against distress selling. We welcome the stabilization act and we look for a measure of relief under this legislation. We appreciate its intention and feel that an honest effort based on the intention will aid in partially providing the answer to stability. But this act alone will not provide the stability that the industry needs. We require the benefits of the stabilization act certainly, but we also require an effective stoppage of United States distress selling.
Let me digress for a moment. Our fruit industry is twofold, first, apples and, second, soft fruits. There is a basic difference. Our apples are an export product and sell well in the United States market. In fact, we have a premium product and we consistently get a better price than the same type of United States fruit does in its own market. That goes for both quality and grade. There is no question of our ever having tried to undersell the American producer in his own market. We do not now ask fair value for duty in this instance. It is sufficient to state that we suffer tariff-wise. But here we can rely wholly upon the stabilization act to balance costs of production in order to provide a fair return.
With regard to soft fruits, that is, peaches, pears, apricots, prunes and cherries a different situation exists. In Canada we do not produce sufficient for our own needs and that is an important point. We do not export and we annually fill our extra requirements from the United States. The problem is one of the price at which United States fruit enters our market and also the timing. United States soft fruits reach maturity well ahead of ours. Their market is saturated before we commence to pick. When the United States market is saturated their prices begin to drop in their own country and they are faced with a disposal problem. Highly perishable fruit still in great quantities must be sold. This fruit is dumped in the United

The Budget-Mr. Pugh States market. I would ask hon. members to note that they dump their own fruit in their own market and they do so at distress prices, at prices designed to clean up the crop, at salvage prices or, if you will, fire sale prices and, of the utmost importance to us, at prices that bear no relation to the United States cost of production.
The importance of these prices is seen because it is at this stage that our own production comes on our own market. Here you see the chronic disability under which we suffer. The United States fire sale price is the price at which we must begin to sell, a price at which no self-respecting United States producer would produce, let alone sell. Much more important, this distress selling becomes the controlling factor in our price structure. These imports do occur but, believe me, fruit does not have to come across our border to dominate our price structure. The threat of import is sufficient. A quotation f.o.b. any point in the United States will do the trick.
As the Customs Act now stands we are powerless. With distress imports, that is, actual imports coming into our country before relief can be obtained, the damage is done. But over and above this there is no power in the act which can stop the harmful, in fact, disastrous results of a United States f.o.b. quotation. That is our picture. It is from this set of circumstances that we seek relief. Hon. members will now see why we have taken heart at the expression of policy with regard to distress selling and fair value for duty. Here is what the Minister of Finance said while referring to unfair trade practices and I quote from Hansard of June 17, page 1246:
During the past year many representatives of Canadian industry, large and small, and agriculture, have discussed their problems with members of the government. We have been impresed by the serious difficulties that have been created for many of them by the dumping of foreign goods in the Canadian market. Such dumping may arise from a variety of causes and may take many forms. The present dumping duties section of the customs tariff together with the valuation provisions of the customs act are adequate to deal with some forms of dumping. However, they do not deal with cases where goods are being imported into Canada at less than their cost of production and are also sold in the country of export below cost.
That is precisely what I was saying before. Later the minister went on to say:
-have examined this problem with the utmost care and am satisfied that this unfair trading practice is in fact occurring, with a harmful impact on Canadian producers.
He went on to say:
Most countries which carry on substantial foreign trade have laws to protect their domestic producers against dumping. Indeed the right to take effective measures against dumping has long been a standard provision of international trade treaties including

the GATT. The government intends to defend Canadian producers against the practice of dumping, whatever form it may take. This will require the strengthening of the present valuation provisions of the Customs Act and their effective enforcement. To this end my colleague, the Minister of National Revenue, will shortly submit a bill to parliament amending the valuation provisions of the Customs Act to add a provision to section 35 along the lines of the legislation in effect prior to 1948, requiring that, where appropriate, the value for duty of imported goods shall not be less than the cost of production plus a reasonable advance for selling cost and profit.
Furthermore may I suggest that in the proposed amendments to section 35 of the Customs Act, the representations of the Canadian horticultural council be given the full hearing and respect to which they are entitled. We should remember that this council is the Canada-wide voice of the fruit and vegetable growers and their representations should be treated in the light of the words I have quoted which were spoken by the Minister of Finance. Let them also be treated in the light of the words of the hon. member for Carleton (Mr. Bell) when he stated that in his view Canada made a grave mistake in 1948 in amending the then provisions afforded by the key valuation section of the Customs Act. He might well have said that at that date we sold the safeguards of our producers.
There is nothing new in fair value for duty. We had it once and we lost it, or gave it away. The Canadian horticultural council fought for this principle in the twenties. They received it in 1930 and from 1930 until 1935 the fruit and vegetable industry had a measure of protection unequalled before or since that time. I say since! Look what has happened. In 1935 the gradual whittling away of protection began both on specific duties and on minimum fair value for duty. Year by year concessions were given and lost until finally in 1948 the Customs Act was emasculated and we sold out to GATT.
Regarding fruit and vegetables, there are difficulties in the proposed amendment to section 35 of the Customs Act. The amendments will be based on cost of production. The Canadian horticultural council, realizing the difficulty of fixing costs of production on fruits and vegetables, has suggested an additional amending clause as follows:
Sec. 35(13) Notwithstanding anything in the Act, whenever duty ad valorem or specific is imposed on any fresh or processed fruit or vegetable of a class or kind produced in Canada, where the market price in the country of export has, as the result of the advance of the season or the marketing period, declined to levels that do not reflect, in the opinion of the minister, their normal price, the minimum value for duty shall be the amount determined and declared by the minister to be the average price for the same or similar products entered at customs during the immediately preceding ten calendar years.

(14) The operation of the value for duty fixed pursuant to the last preceding subsection may be suspended by the minister in the case of such fruit or vegetable imported into any specified region or part of Canada.
There is merit in this suggested clause because in the clause the price at which imports of fruits and vegetables enter Canada is a known amount and is easily ascertained. It is a matter of record in the dominion bureau of statistics. Such a clause would settle our difficulties to a great extent. Stability should follow as result of crop disposal at higher average prices; the government would not be called upon to subsidize the soft fruit portion of the industry under the stabilization act; United States dumping or distress selling would be curbed. It might well be that growers would become taxpayers. These advantages make sense. To my mind there is a further common-sense factor. As it now stands, when payments are made under the stabilization act the government will be subsidizing United States fruit imports. Would it not be better to provide the opportunity for the grower to stand on his own two feet?
Once again, I agree with the forthright statements of the hon. member for Carleton. May I state without reservation that the fruit industry of British Columbia is an industry of long-standing growth and is properly situated. We can face reasonable and proper competition from imported goods; we are not asking to be pampered and petted by excessively protective measures. What we want is the benefit of the amendment to the Customs Act so that foreign dumping is eliminated. And I reiterate and expand the sentiments of the hon. member for Carleton -surely there is no member of this house who wants Canadian agriculture to be compelled to compete with foreign agricultural goods sold at less than their cost of production and normal profit.
I further concur with him-I too, so long as I have a vote in this house, will not vote to compel Canadian growers and agricultural workers to compete with dumped foreign fruits and vegetables.


Mr. Augusiin Brassard (Lapointe):: Mr. Speaker, the Minister of Finance (Mr. Fleming) deserves congratulations upon creating a precedent when he spoke several sentences of his budget speech in the French language on the evening of June 17 last. He deserves congratulations not only because of this venture but because of the quality of his French. This is a praiseworthy precedent which the Liberal minister of finance in the next parliament will, I am sure, be happy to follow. Incidentally I had an opportunity to admire 57071-3-1064
The Budget-Mr. A. Brassard the minister's French last March when he did me the honour of coming to speak to the voters of Lapointe on my behalf.
I feel it is regrettable that the minister did not deliver his budget address on the memorable evening of June 10, 1957 as it was rumoured he would do. The blue suit, the blue lectern and the artificial blue carnation would have stood out the more against a red banner indicating the $100 million deficit and by such a gesture he would have given to this anniversary the real significance of the arrival of a Conservative government in this country.
While the minister created a precedent by speaking French the other evening he certainly did not break new ground in offering to the Canadian people an enormous deficit. In this he carefully followed the well-trodden path of the Conservative party, because Canada has not seen a balanced Tory budget in the last 45 years. How could the Progressive Conservatives offer us anything else because there is a contradiction in their very title. The 20,500 words of the budget speech deserves to be considered almost a work of genius. I remember, as do many others, my college years when our professors judged our essays according to two principles-their contents and their style. If I were to apply these standards to the minister's work of art I would give him, being a Liberal, about 60 out of 100 points for style and one or two for content. However, it is for another reason that I believe the minister's effort is almost a work of genius. I believe it was Carlyle, who said that genius is composed of 99 per cent perspiration and one per cent inspiration. What a pity that little one per cent of inspiration is missing in this instance. However, the minister deserves full credit for the 99 per cent perspiration which he so elegantly exhibited to us.
(Translation):
When one reads the budget speech in the official record of this house, where it is divested of the sheen and sensationalism with which the Minister of Finance (Mr. Fleming) managed to clothe it in by his intonations, his emphasis, his gestures and his rhetorical flourishes, one is struck by the absence of concrete steps designed to solve the most urgent problem which afflicts at this time so many families in my constituency and throughout this country: unemployment.
There is no word there of any reduction in tax, only ominous silence with regard to family allowances, and complete silence too with regard to federal provincial fiscal relations. There is however another thing which
1S76

The Budget-Mr. A. Brassard will strike anybody who will take the trouble to read this speech attentively. It is the government's rather guilty spirit of self-congratulation in the presence of the difficult situation which Canadians have been facing over the last few months. This feeling cannot be necessarily inferred from the words spoken by the minister, but it can be drawn as a logical conclusion from the absence of an energetic and aggressive policy designed to fight the present recession. When account is taken of the commitments made by the Prime Minister (Mr. Diefenbaker) to the Canadian people during the 1957 campaign, when he was still leader of the opposition, and if the first Conservative budget is compared with those promises, there is no escaping the fact that the government has repudiated its solemn commitments to the Canadian people. The Prime Minister refuses to admit at this time that he had in fact promised to reduce taxation by $500 million. But what did he mean, speaking in Victoria on May 21, 1957? In a Canadian press report published in the Ottawa Journal of May 22, the following sentence is attributed to the Prime Minister:
(Text):
A Conservative government would cut unnecessary taxation to promote production which would help meet the threat of inflation. Last year the government had overtaxed Canadians by $500 million.
(Translation) :
On the other hand the Victoria Times of May 22, 1957, reported as follows:
(Text):
The Conservative leader claimed that the federal government had taken $500 million more than it needed from the people of Canada.
(Translation):
What is the meaning of those words pronounced in the heat of an election campaign if not a clear $500 million tax cut. To all intents and purposes, they surely intend to give the impression that a Conservative government will not collect those $500 million which the former administration had overcollected. If that is not-


An hon. Member:: Why?


Augustin Brassard: Why not? Even if I am not a professor of French at Laval, I understand French just the same. If that is not the impression sought to be created by such a turn of speech we might as well forget the meaning of words right now and perhaps lay off some French professors.
What were we offered after those promises were made to the Canadian people? A $178 million tax cut by way of resolutions in the last parliament and a ridiculous $26 million

tax cut in the last budget speech. All told, it is a little more than $204 million, when the public was led to expect $500 million. As the hon. member for Assiniboia (Mr. Argue) so aptly put it the other day, the government or the Conservative party gave us an example of dual policy, namely a progressive policy before the elections and another one, the conservative policy, the genuine one, after the elections.
After witnessing so many examples of this kind given by politicians lusting for power, who have one policy before the elections and another afterwards, the public will end up by saying: What is the good of being interested in politics. Politicians are all of the same ilk. If we want voters to lose confidence eventually in public men,-and in saying we, I do not include your humble servant,-all we have to do is to continue acting this way for that is the best means to that end.
There is no doubt that the government should have reduced personal income tax. It was imperative, the more so since the purchasing power of the dollar has been substantially reduced, and it would have been absolutely necessary to put more money in circulation to stimulate our weakening economy. The budget offered an opportunity to increase the basic exemption, which would have been a form of a tax reduction. I make this claim first because it is absolutely reasonable,-it may perhaps not be understood by the hon. member for Roberval (Mr. Tremblay) but it is nevertheless a reasonable thing,- and also because it was one of the main demands of the Canadian and Catholic Labour Union during the last electoral campaign and, finally, because I wish the Minister of Finance to keep his word. In March last, the C.C.L.U. asked that the basic exemption be raised from $1,000 to $1,500 for single persons and from $2,000 to $3,000 for married people. I make this request to the government with the conviction that the Minister of Finance is a man who fulfills his promises. He must surely remember what he said here, in this house, on March 27, 1956, following Mr. Harris' budget. The hon. member for Eglinton, now Minister of Finance, as shown on page 2,648 of volume III of Hansard for that year said:
The next matter to be mentioned, sir, is the income tax. It is true that the rate is unchanged. It should have been reduced. Of course, we are going to have to wait until election year for those increases in the exemptions which are long overdue.
.. .In 1953, in the general election, the Progressive Conservative party advocated in the plainest terms an increase in the income tax exemptions to $1,500 for single persons and $3,000 for married persons.

What then is the hon. Minister of Finance waiting for to implement what he himself advocated? If this suggestion was good, and if he believed it was good in 1953, surely it is just as good today, in 1958.
This year the government boasts of providing supplementary benefits for the unemployed, and we hear much about its public works program. As far as the supplementary benefits are concerned, there is no doubt that the Minister of Labour (Mr. Starr) had no wish to mislead the public, but he was so vague and so lacking in clarity,-I hope not deliberately so,-that he left with the people the impression that everyone qualifying for seasonal benefits would be entitled to the supplementary benefits. The government seemed to feel that it was highly generous towards a great number of Canadians who were in dire straits.
When I went home for a few days, I met quite a number of unemployed who, after the statement of the Minister of Labour (Mr. Starr) on the matter, and all the publicity that was made about it, asked me why they were not entitled to supplementary benefits.
At a time when hardship has seldom been so prevalent, why did the government not take any steps to protect those who were suffering and are still suffering from the difficult situation we experience today? This is no time for arguing, and pointing an accusing finger at those we believed responsible for the situation. It is time to tackle the problem and try to solve it.
I was disappointed the other day by the answer the hon. member for Carleton (Mr. Bell) gave to an inquiry by the hon. member for Maisonneuve-Rosemont (Mr. Descha-telets), when he said:
(Text):
What about unemployment? I will tell you plenty about it and I will make it clear who is responsible tor the present situation in unemployment before I am done if that is the issue the hon. gentleman wants to raise.
(Translation):
Mr. Speaker, when we come across someone who is sick, wounded or destitute, we hasten to help him out, before quarrelling with those who might be responsible for his plight.
Much has been and still is being said about public works. I now come to Lake St. John and Roberval. What has been done there? At this point I could leave the floor to my hon. friend from Roberval if he wishes to answer. What has been done in the four constituencies of my district to improve the
The Budget-Mr. A. Brassard situation? I am certainly not to be told that the contract for the runway at Alma has been or is about to be granted; I was in the Department of Transport-I was employed there for three years-when the former minister, the Hon. George Marler, announced to the previous Liberal member for Lake St. John and to the mayor of the city that the Department of Transport had agreed to build the airport in Alma. I have followed this matter too closely, on the request of Mr. Andre Gauthier, the former member, not to be perfectly aware of what has gone on, and I am now awaiting a reply from my hon. friends in the house.


Mr. Boivin:: They do not answer.


Augustin Brassard: And yet, Mr. Speaker, the ministers came to us during the last election and approved every promise made by the candidates who said they had a vast program of public works for their respective ridings-


Mr. Tremblay:: This is not true.


Augustin Brassard: All the ministers approved them, except the one chiefly responsible, the Minister of Public Works (Mr. Green), not to speak of the approval of the house, of course.


Léonard-David Sweezey Tremblay: That is not true.


Augustin Brassard: All that has been done up to now back home is merely what had been planned and decided by the former Liberal government.
I hear my hon. friend saying: "That is not true." I had thought that since his election he had learned how things are done in Ottawa, and among other things, that no lies may be told here. He would seem to have a very vivid recollection of the last campaign.
The Prime Minister (Mr. Diefenbaker) felt keenly about the unfortunate circumstances of the municipalities of this country and gave the impression that he was about to solve their problems. But what concrete steps has he taken in this connection, apart from all the words which he has used to say that he was going to do something. He simply chose to announce that he was proposing to go over the heads of the provinces, that have jurisdiction in this matter, to gather together the representatives of the municipalities. And this is the man who spoke so movingly and touchingly of respect for provincial autonomy. It is still time to help the municipalities and to bring about a material reduction in unemployment, if only the government will prove its sincerity.

The Budget-Mr. A. Brassard
For instance at Jonquiere, where I live, the corporation intends to build a badly needed municipal filtration plant. More and more new subdivisions are going up all the time, and this involves very large municipal expenditures for water supply, power and sewer systems. There are also some urgent and necessary works to be carried out in the town of Kenogami. To give but one example, it will cost close to $800,000 to rebuild and improve the water system.
The town of Arvida is in the same situation. It has to eliminate at least two level crossings which have already cost human lives and it is important that those crossings disappear as soon as possible. It still has an urgent need of a town hall to accommodate its various services. It also has other important projects which, if they were carried out, would relieve to that extent the painful unemployment situation. The same urgent needs can be noted in all municipalities. I shall look forward to hearing what the hon. member for Roberval has to say in this regard.
If the government, which promised so much, gave assistance to municipalities by way of low interest loans, unemployment would be reduced substantially in all municipalities of this country and it is a truism-I use simple words now, so that the hon. member for Roberval will understand me,-it is a truism that if unemployment is reduced locally, it will automatically be reduced nationally. As this is not hard to understand I am sure the hon. member for Roberval has already understood.
There would be much to be said about this old question of the public works promised by the Prime Minister and the Conservative candidates during the last election and I regret I will not have enough time to read a very appropriate article by a most distinguished journalist, Mr. John Bird. In that article published in the edition of February 28 last of the Toronto Star, the author describes the seriousness of the Prime Minister's gigantic program of public works and does so with as much accuracy as humour. Of course, the hon. member for Roberval would have to listen to me closely when I read it because there is considerable wit in that article. I cannot however resist the temptation to read two or three paragraphs from it for the information of the house.
(Text):
John Bird, in this article from Ottawa, writes:
The Conservatives' $1,185,000,000 "works project" to relieve unemployment is just a diddle of old

figures. It whittles down to only about $50 million of new money to provide jobs. Even Tory ministers are chary of the bogus big figures now. It centres upon that $1,185,000,000 "works project" announced with such flourish and advertised as "great" and "new" from Tory platforms across the country. And on high authority, too. Here is Prime Minister Diefenbaker's own statement, broadcast over station CKY, Winnipeg, on Feb. 12: "Now what about the future? And I know what unemployment is. Ladies and gentlemen, to provide for the future of Canada and to ensure jobs, we have launched a nationwide works project for constructive works, for dividend-paying works of $1,185,000,000 of which $270,000,000 will be spent in the first three months of this year." The text is from the Prime Minister's own office. And, in due course, out from the Prime Minister's office in Ottawa came a press release giving some particulars of the $1,185,000,000 but couched in much more cautious, canny terms than those employed by the Prime Minister himself at Winnipeg or by Conservative orators elsewhere. And there is good reason for this caution in language, because that touted $1,185,000,000 is little more than the regular departmental construction estimates for 1958-59, plus $140,000,000 of CNR maintenance and construction, which last, incidentally, is a much lower figure than the comparable one for last year. In accounting for $1,185,000,000, the Prime Minister's office tabulates $106,000,000 for that fine Tory project, the St. Lawrence seaway, launched by the Liberals, of course . . . And in blowing up to inflate the figures, $40,000,000 is included for that fine Conservative works project, the Northern Ontario pipe line against which every Tory member of parliament in the house at the time quite naturally voted "no".
The article continues:
By and large, the $1,185,000,000 figure consists of the totals for construction work of various kinds that would have appeared in the regular 1958-59 federal estimates, if ever they had been presented to parliament. But by the device of failing to present estimates and failing to give the nation an accounting in a budget before the election, the Conservatives felt able to announce regular, even routine departmental expenditures, plus expenditures on such projects as the seaway and pipe line, as if they were somehow new.
And the article concluded with these words:
For assorted politicians on the hustings to play fast and loose with statistics is nothing new in the politics of Canada or any other country. What is new in recent history is for a Prime Minister of Canada to encourage such political legerdemain.
(Translation):
To put it bluntly, Mr. Speaker, the government has noisily blared away what it intended to do to alleviate the unemployment problem. It has done absolutely nothing, except stretching winter into June, if I may use the very picturesque and pertinent phrase coined by the hon. member for Bonavista-Twillingate (Mr. Pickersgill). Yet, unemployment is still cruelly prevailing and it is not the government's public works that have produced a lowering of the statistics: it is simply the normal resumption of business. Only a month ago, there were 12,745 unemployed in our district-I mean the four constituencies-I do not expect the hon. member for Roberval to

be aware of the latest statistics, as I am not asking so much of him,- while during the same period last year, there were only 5,622.
The municipality of St. Ambroise sent me a resolution calling for help from the federal government in order to reduce the heavy unemployment. If the government helped the municipalities, St. Ambroise might immediately start building a town hall, water mains and sewers, and tackle much other work for new services. But under the leadership of a man who will surely go down in history in this field, the government prefers to just talk.
I wanted to deal at length with family allowances and, more particularly, with the extreme indifference of the government in this matter. I listened with a great deal of satisfaction and attention to the very eloquent plea of my friend, the hon. member for Beauce (Mr. Bacine), on the subject of family allowances and, frankly, there is not much I can add, except that the government has failed to do its duty in a serious matter. I shall refer to the requests of the C.C.L.U. and I quote the petition its officers submitted to me during the last election: "In order to restore all the social value family allowances had when first introduced, their minimum rate should be raised to $8 and the maximum rate to $13 for each child."
This was from a text by the C.C.L.U. I also received from the city council of Arvida a resolution asking me to support the council in the request it sent to the Minister of National Health and Welfare (Mr. Monteith) to have family allowances doubled and the benefits of family allowances extended to all children attending school regardless of age.
At the Conservative convention of December 13,	1956, Hon. T. L. Smith stated
that the Progressive Conservative party accepts the principle of family allowances. It is being quite generous to say that one accepts this principle much as one w(ould accept the great principles of physics and chemistry. However, in the matter of family allowances, words must be followed by deeds. Of course, that is one thing I would never ask the hon. member for Roberval.
Before concluding, Mr. Speaker, I should like to ask the Acting Minister of Labour (Mrs. Fairclough) to kindly study the decision just handed down by justice John D. Kearny of the exchequer court in his capacity as arbitrator in a case relating to a
The Budget-Mr. A. Brassard request made by the national union of aluminum workers of Arvida, office employees' local. This was an appeal made after the case had been heard by the arbitration board at Chicoutimi.
The members of the office employees union at the aluminum plant at Arvida have their own union which has its own collective bargaining agreements with the company.
In 1957, shortly before the Arvida strike, the office employees, having discussed the matter, decided to send a delegate or representative to the talks going on at that time between company authorities and the officials of the national union of aluminum workers of Arvida.
Once work had come to a stop after the beginning of the strike, those office employees did not leave work. Rather it was the company that notified them that there was no more work for them. In other words, they were to all practical purposes forced to leave their employment for the duration of the strike.
The appeal has been maintained and the cause referred to the arbitration board. Moreover, representations have been submitted to the hon. Minister of Labour. I am very happy to see that the arbitrator has decided to refer the cause to the board of arbitration of the company. And one of the findings of the report reads as follows:
After having carefully examined all documents pertaining to this appeal, and taking also into account the above remarks of the appellant's attorney, I consider it would be to the advantage of all parties concerned that the arbitration board proceed to a new study and hearing of the whole case.
Here is a human problem affecting slightly more than 400 employees of Arvida, Jon-quiere, Kenogami and Chicoutimi. If the Minister of Labour should care to look into this matter, I believe that not only would he make some people happy, but perhaps-you never can tell-the population might show its gratitude in the next elections by sending to Ottawa someone well grounded in the Conservative gospel.
Mr. Speaker, there is in my riding another problem of which my colleagues opposite are aware. I received a letter from the Federation of the U.C.C. (Catholic Farmers' Unions) of the Saguenay district.


Léonard-David Sweezey Tremblay: As for me, I got an answer from the department.


Augustin Brassard: If you want me to explain the answer you got from the department, I shall do so.
1680	HOUSE OF
The Budget-Mr. A. Brassard


Léonard-David Sweezey Tremblay: I read it, and it is an excellent one.


Augustin Brassard: Mr. Speaker,
everybody knows, and I have it from the government itself, that the Conservative administration has set the price for cheese at 34 cents a pound in Ontario and 33J cents a pound for the Quebec producers. I shall now quote a paragraph from this letter. As I said before, at the beginning of my speech, this is a letter received from the Federation of Farmers' Unions of the Saguenay district. It reads as follows:
We therefore wish to point out to you that we have had in our area for about twenty years three recognized grading stations filling all the requirements of the federal government. They are situated in Chambord,...
A well-known place where the hon. member for Roberval lives

.. .in St. Bruno and in Chicoutimi. Those stations even have export permits through the Port Alfred seaport. In other words, cheese is shipped from its warehouses after grading, weighing and waxing.
I was about to say "by the hon. member for Roberval."


Léonard-David Sweezey Tremblay: Thank you.


Augustin Brassard: The U.C.C. Federation of the Saguenay area would therefore ask you to kindly approach the Minister of Agriculture without delay...
That has already been done. The hon. member for Roberval did it.


Léonard-David Sweezey Tremblay: That is true.


Augustin Brassard: ...and the president of the agricultural prices support board with a view first to having the support price of cheese raised to 34 cents a pound in the province of Quebec as it is in Ontario and to making this price payable to recognized grading stations, which means in our area, Chambord, St. Bruno and Chicoutimi.
Mind you, Mr. Speaker, I say this with perfect detachment because none of those places is in my constituency. I do it perhaps to make up for the incomprehensible silence of the hon. member for Roberval.
I continue the quotation:
There is only one support price on butter in Ontario and Quebec. Why should there be two in the case of cheese?
I submit this problem to the Minister of Agriculture (Mr. Harkness) and I would ask him to kindly take it into consideration. He might perhaps let me have a copy of the letter which he sent to the member for Roberval.


Léonard-David Sweezey Tremblay: I got a reply; and an excellent one.


Augustin Brassard: Be that as it may, I shall be glad to hear from him.
Mr. Speaker, I am very anxious for you to recognize the hon. member for Roberval.
Moreover, there is in our area another problem which does not concern only my own constituency. I am not merely talking politics but I am dealing with a human matter and I will get to the hon. member for Roberval in good time, human matters being of interest to me, even those which concern the member for Roberval. I have reference here to the layoff of employees by the Canadian National Railways. Since this is a human interest problem I might add at this point that these layoffs are due to the fact that in our area, as everywhere else, there has been a switch over to diesel engines. There has also been an extension in the sections which the various railway employees must look after. I believe that one section-man must now look after twelve or fifteen miles of track as against seven or eight miles formerly. It will be appreciated that this has brought about a substantial reduction in the number of employees.
I have no bone to pick with the Canadian National Railways management. When I was with the Department of Transport I heard too many opposition members rise to say rude things. As far as I am concerned, I will not say everything I have in my mind, but if I had the word power of the member for Roberval-


Mr. Rouleau:: It would be a rather poor choice of words.


Augustin Brassard: When hon. members in the opposition used to talk about the officials of the Canadian National Railways, you would have thought that these gentlemen did not know how to run their own business. I have worked in close cooperation with top C.N.R. officials, and Mr. Gordon, its distinguished president, knows the network of railroads very well but he is a businessman. What he is lacking perhaps in some degree-and I don't hold it against him-is that his decisions sometimes are crushing for poor members of parliament, who have to carry the load of everything that might be going on in their constituencies and which they, themselves, are unable to solve.
Now, the dismissal of these employees at home is another problem which hurts. There are heads of families who had been working for the C.N.R. for 15, 18 and even 20 years, in fact, one of the last to be dismissed had at least 31 years of service. I have no wish

to put the government on the spot. I appreciate the situation but I ask them to look at that problem and to urge the Canadian National to study it and try to find a solution which will not increase the expenditures of the Canadian National in such a way as to put its annual balance sheet in the red.
There is another problem connected with this question of railway employees. Many of these employees, ten, fifteen or even eighteen years ago chose to work for the Canadian National because they felt that that crown corporation offered more stability than private industry. They made a sacrifice in turning away from private industry to join the C.N. so as to work, as they said, for the government because, while the Canadian National is an independent corporation, in the mind of the public it is the government.
Once more I ask the hon. Minister of Transport (Mr. Hees) to take up the matter with the railway authorities in order to find a solution.
Mr. Speaker, in my closing remarks, I am going to please the hon. member for Roberval because I want to sum up my impression of the budget speech by quoting what was said in this house, in 1955, by the then hon. member for Broadview, who is now the hon. Minister of Transport.
(Applause).
I hope that there will also be applause when I have read his statement. At the end of his speech of January 14, 1955, reported on page 218 of volume I of the House of Commons debates official report, the hon. member for Broadview said:
I would therefore urge this government to stop thinking of curing unemployment merely by making adjustments to the Unemployment Insurance Act and accelerating our public works program, necessary though those measures may be. The problem we are facing requires far sterner measures. Unemployment is the barometer of economic progress within a country, and when it increases by anywhere from 40 to 100 per cent over the corresponding figures for last year it demonstrates that we are not nearly as healthy economically as we should be.
I therefore ask my hon. friend, our genial Minister of Transport, to use all his influence with the Minister of Finance to have the very sound statement he made in this house in 1955 taken into consideration.
(Text):


Mr. F. J. W. Fane (Vegreville):: Mr. Speaker, in rising to make my initial contribution to the debate in this house may I 57071-3-107
The Budget-Mr. Fane presume on my own behalf to paraphrase your initial statement to the other house, and remark that should I transgress the rules in any way the fault is mine alone. For the last six weeks I have sat in my place trying to emulate that wise old owl who sat nodding in an oak tree and the more he heard the less he spoke and the less he spoke the more he heard. Well, Mr. Speaker, I have heard so many words in those six weeks that I am compelled to register a few of my own and to say that my first observation is that at this level of democracy perhaps we are prone to treat the meaning of the word "parliament" a mite literally.
Now, Mr. Speaker, may I add my felicitations, belated though they are, to the accolades which you have already received on your re-election as the first commoner. At the same time I must congratulate this house on having among its members one so em-minently suited for that onerous position which would appear to demand that its incumbent be endowed with the wisdom of Solomon, the patience of Job and a disposition that commands equanimity, good humour and fairness in the face of all conditions, and all this in two languages.
I would like to point out at this time that having as a child had the honour of being acquainted with that honourable and gracious gentleman who was your father, when he and my father campaigned together in that part of the Northwest Territories which is now Alberta, I know that it is not by chance that you have the necessary attributes to fill your high position with honour.
May I add my congratulations to the Deputy Speaker and to the deputy chairman of committees of the whole on their election to the posts they fill with such efficiency. I wish also at this time to convey my felicitations to the right hon. Prime Minister (Mr. Diefenbaker) on his success in the election just past, in being returned to office with such a decisive mandate from the people of Canada and on now having completed one full year in his high office, and on having achieved in so short a time the high ideal of a united Canada.
I must also congratulate Canada on being blessed in having a native son in the person of the right hon. Prime Minister who has been able to don the mantles of those two outstanding Canadians, Macdonald and Cartier, who, over a hundred years ago, originated the Progressive Conservative party with the object of making a united Canada, a nation composed of Canadians of many national origins, many creeds and many cultures, all welded into one people and proud to bear the name "Canadian". The
1682	HOUSE OF
The Budget-Mr. Fane
result of that achievement can be seen right in this house where all the major ethnic groups in Canada are represented and are all proud of the comradeship that exists between them. This achievement is more remarkable in that other parties have worked on the principle of "divide and conquer", with very marked success in the past, having stirred up regional, national and religious animosities for purely political expediency.
1 must now make a few remarks about the constituency of Vegreville, Alberta. The constituency which I am so proud to represent takes its name from the largest town within its borders. It is truly Canada in miniature because the people who live there are descendants of those hardy pioneers who came from many lands, with many cultures and many faiths and with one idea, to make a home for their families in a country where they could be free, free to own the land on which they lived, worship according to their own belief and, in short, help to establish the freedom that we now enjoy in Canada. This they did with the result that we, the descendants of those pioneers, are welded together into a nation, Canada, and we are fiercely proud to be able to say, "I am a Canadian".
Vegreville constituency is situated in almost the centre of Alberta. In order to fix its location better in your minds, may I say that the wide spot in the road that we call the city of Edmonton, our capital city, is located about 25 miles straight west. Many Edmonton citizens were raised in my constituency, among them, for example, the hon. member for Edmonton East (Mr. Skoreyko) and the mayor of Edmonton who has made such an outstanding name for himself. It comprises an area of about 5,000 square miles which I somehow thought was quite a size until I came to Ottawa and heard the extent of other constituencies. There are about 25,000 electors with a total population of about 50,000. It contains three complete provincial constituencies and parts of four or five others.
The main industry is mixed farming, with oil activity in the Redwater and Bruder-heim oil fields. Elk Island national park lies entirely within my constituency. Last year over 183,000 persons visited this park which is the home of some 1,500 plains buffalo as well as elk, moose and deer. In the northeastern part of Vegreville constituency is situated the Saddle Lake Indian reserve which has quite a large population of our original Canadians, many of whom are veterans of the first or second world wars and some of both. There is also a chemical plant at Duvernay.
The constituency is crossed from east to west by four railway lines but the Canadian


National line that lies north of the North Saskatchewan river and runs from Edmonton to Heinsburg via St. Paul stops abruptly at Heinsburg and requires an extension of some 38 miles to connect with the Canadian National at Frenchman's Butte, Saskatchewan.
The constituency has been represented by Liberals, one U.F.A. member and Social Credit members, the last representative having been Peter Stefura, a Social Crediter, who was here only from June 10, 1957 to March 31, 1958. Before that John Decore, a Liberal, represented the constituency for eight years but he did not stand for re-election last June. Through the united efforts of a great many people from both inside and outside the constituency, I have been given the honour and privilege of serving the finest constituency in Canada for the next four years as its first Conservative member. I am reminded that one day last spring in my home town of Mundare I went to a Liberal meeting where the hon. member for Essex East (Mr. Martin) was speaking on behalf of the Liberal candidate. I had the pleasure of meeting him that day and I remember well saying to him that I would meet him in Ottawa after March 31. At that time I did not know that I would be sitting on the same side of the house on the left of Mr. Speaker but outside the black line that surrounds the opposition.
Since I am a farmer, Mr. Speaker, and represent a constituency that is 90 per cent dependent on the farming industry, I wish to place before you the reasons for the dissatisfaction of Canadian farmers in general and western Canadian farmers in particular. However, it is my personal opinion that, while something more must be done at this time to assist Canadian farmers to get their fair share of the national income, whether by deficiency payments or other methods, such subsidization on a permanent basis is not the answer to the farming problem. I believe that continual government subsidization of any business or industry tends to destroy initiative and will in time destroy the industry and those engaged in it. There will always be more and bigger demands for additional government help if the idea of subsidizing every industry continues. I see that we are travelling along a road that will shortly divide into two roads. We have our choice. One road leads to a total welfare state, that is, one with total government control, and the other road, while embracing something of the final results to be found at the end of the first road, has at its end an economy based on agreement between all levels of business or should I say all levels of life.
To get back to the business of farming, I want to make it perfectly clear at this time

that the farmers of Canada do not wish to require handouts or subsidies or whatever you may call them, but the farmers, who are the most independent group of people in Canada, want to have it recognized that they are the backbone of the country and that it is their right to have their business placed on a level with that of other businesses. All that we ask is that we get a square deal in the economy of Canada, which means that we get our fair share of the national income. This objective is a must for our government, because, as I said before, the economy of the country is dependent on its basic industry, agriculture. We do not like to be accused of begging for special treatment in order to survive but we do want it recognized that steps must be taken to see that we get what is our due. Unlike labour, the farmers of Canada do not wish to strike and tie up the whole economy of the nation to enforce their demands because when a strike is in effect the people who suffer most are the women and children and it is not right to cause hardship to people who are innocent.
The farmers of western Canada are faced with a situation where, when we sell our grain, we have to pay the freight on it to Fort William or Vancouver. In other words, we sell our grain f.o.b Fort William or Vancouver. The freight rate from where I live to Fort William is 26 cents per hundred pounds. It is deducted on delivery. It would be more if the Crowsnest rate was not in effect. It is a fortunate thing that this rate was agreed to by the government of Canada and the Canadian Pacific railway with the idea of it being in effect forever. We are also faced with a freight rate to the prairies which is higher than the freight rate to other parts of Canada. It is a well known fact that freight from eastern Canada can be shipped to Vancouver and trans-shipped to Alberta at less cost than if the shipment was made directly to Alberta. A situation like this should be corrected.
The farmers are also faced with the excessive cost of the machinery required to operate the farms. The increase in the price of all machinery required bears no proper relationship to the value of the work it is called on to perform. Something therefore must be done to bring the price of the machinery that we must have into a fair relationship with its value to the farming industry. Positive measures must be put into effect to correct the inequities in the spread between what the producer receives for his goods and what the consumer pays for them.
I want now to commend our government for what it has already done to assist the farmers and what the government proposes to do at this session of parliament. Cash advances on farm-stored grain have been a 57071-3-1074
The Budget-Mr. Fane
very great help to the farmers of western Canada. Income tax reductions, in the next year will total over $200 million. The hospitalization plan is coming into effect in five provinces on July 1, this year. The Prairie Farm Assistance Act is being changed to make it more realistic and be of benefit to more people. A national crop insurance plan is being studied and the farmers will be very happy when a comprehensive plan of crop insurance becomes effective.
At the moment, because of the inequities in the business of farming, a system of deficiency payments on farm products would be of great assistance. This would be a stopgap, until such time as the government can see its way clear to institute a two-price system on farm products.
It is very heartening to note that provision is made to expand the harbour facilities at Fort William and Port Arthur for the handling of sea-going ships and that the St. Lawrence seaway is expected to be in operation next year. This, it has been stated, will increase the return in respect of wheat to the western farmer by four cents a bushel owing to the saving in freight between Fort William and Montreal. I do hope that this is correct because the farmers in western Canada believe it to be so.
I am pleased to note that the government proposes to bring into effect a Canadian bill of rights. In my opinion, such a measure is long overdue.
I may say that the government proposals for the development of northern Canada are also long overdue, because it is well known that locked in the vastness of our great northern territory are the richest deposits of minerals and oil in the world. We must develop these for the good of Canada and Canadians and make room for increased population in Canada and provide a larger market within the nation for our Canadian products. With respect to developing this country, I would refer hon. members to the address of my good friend and neighbour, the hon. member for Peace River (Mr. Baldwin), in which he so ably set forth the situation in his constituency and further to the north. Other hon. members from northern Canada are also to be commended for the way in which they have set forth the measures necessary in order to open up this wonderful country and make its treasures available for the good of Canada as a whole.
I am very happy to notice mention has been made of a northern branch of the trans-Canada highway to serve the north central, and northern part of the prairie provinces and British Columbia. Such a highway through the Yellowhead pass would be of inestimable benefit to Canada. I would like to

The Budget-Mr. Fane
see it come through my constituency on the direct route from Saskatoon to Edmonton, which would be over Alberta's highway No. 16, and this as soon as possible.
A great deal has been said about the railway situation in northern Alberta. The hon. member for Athabasca (Mr. Bigg) has at times remarked on an extension to the Canadian National Railways line which goes from Edmonton to Heinsburg, through St. Paul, Alberta-a matter of about 38 miles-and the benefits this extension would provide for the people living in the country served by this railway, and also for the industry situated at Heinsburg. The first benefit to the farmers of the Vegreville constituency, who five north of the North Saskatchewan river, would be a saving of two cents per bushel in freight on their grain. I would suggest that this government very strongly consider the necessity of urging the Canadian National Railways to complete the extension of this line from Heinsburg to Frenchman's Butte. I have never been able to understand how or why this extension was not insisted upon by former governments.
As I have mentioned before, I have within my constituency the Saddle Lake Indian reserve and I may say that I have strong opinions on the way that these people should be helped to take their places as full citizens of Canada. I know perfectly well that many of them still wish to enjoy the benefits of their more or less sheltered existence, without the added responsibility of citizenship, but if this policy of treating them as children and wards of the government continues they will never be able to take their proper place in the life of their country, and to make the contribution to Canadian life of which they are capable. I think they should be permitted to enjoy full Canadian citizenship with, for some years, no restriction on the benefits they have been receiving under the original treaty.
We have heard a very great deal of talk about the unemployment situation in Canada. This is a real problem, but I would bring to your attention the fact that there are jobs for 150,000 to 200,000 workers if they would only accept work on Canadian farms. The farmers are unable to properly carry out farming operations, because of the lack of farm help, and farmers cannot compete with industry in the matter of wages paid to farm help because farmers do not get that kind of money for what they produce. Therefore, when the returns to the farmers of Canada for their products are brought to the proper level the agricultural industry will be able

to be conducted along the lines of other industries and farmers will be able to get the necessary help to conduct their operations efficiently.
The increase in benefits to veterans and their dependents through the changes in the War Veterans' Allowance Act and the legislation covering veterans' dependents are greatly appreciated by those people to whom this country owes so large a debt of gratitude.
I was very pleased to hear the Right Hon. Harold Macmillan, Prime Minister of the United Kingdom, remark in this house a few days ago that the results of the visit of the trade mission sent to the United Kingdom by the present government in late 1957 were most gratifying, and that the benefits will increase as time goes on.
I now want to congratulate the Minister of Finance (Mr. Fleming) on having the intestinal fortitude to bring down a deficit budget at this time. This shows that our government has a full realization of the situation in Canada and is taking drastic measures to control the situation. In time of war there is always money available for everything that is necessary. A budget based on a large deficit is the normal course to follow at that time. Why, then, is it wrong to follow the same course during peace? The statement has been made so many times that there is always money to fight a war, so why is there not money for peace? Among the many things the budget provides-and I am going to confine my remarks to a very few-are the changes in the Succession Duty Act under which a widow will now have a total exemption in respect of her husband's estate of $60,000. The injustices perpetrated under the former act have always been a very great hardship to the widows and their families. I am also pleased to see provision made for deductions in respect of medical expenses. The savings to municipalities in removing the duty on culverts and machinery will be of very great assistance. The removal of duty on parts for farm machinery will also help the farmers.
In view of what I have said, I would like to suggest that this house vote against the subamendment and, when the time comes, that it likewise vote against the amendment and that the motion proposed by the Minister of Finance be approved in its original form.


Mr. D. R. Mitchell (Sudbury):: At the outset of my remarks, Mr. Speaker, I wish to assure hon. members that in the vote which will be taken in a few moments we in this party will support this amendment to the amendment because it is based on the principle of tax reduction as an anti-recession measure. We made such tax reduction the main plank in our anti-recession program. It was a planned and co-ordinated program without

similarity to the unco-ordinated measures of the present government which would not perhaps be improved in practice by adding the provisions of this amendment. However, as I have said, the subamendment is based on the principle of tax reduction as a stimulus to employment and an anti-recession measure. For that reason we will support the amendment to the amendment.
In rising to take part in this debate, Mr. Speaker, I hasten to make a few observations concerning the recent budget brought down by the Minister of Finance (Mr. Fleming). As one of the members from northern Ontario I assure you that it is still a stronghold of Liberalism and I am sure that it will remain so for some time to come. I might add that we in northern Ontario are honoured and privileged by our leader having his constituency there, a fact of which we are extremely proud. Following the recent election, in which not one Conservative was elected in northern Ontario, it is easy to understand why Conservatives would be concerned about this situation.


Mr. Speaker:: Order. It being 9.45 o'clock p.m., it is my duty, pursuant to section 4 of standing order 58, to interrupt these proceedings and forthwith put the question on the amendment to the amendment.



BUSINESS OF THE HOUSE

John Whitney Pickersgill: Mr. Speaker, I wonder if I could ask the leader of the government if the government has yet reached any conclusion

Business of the House
about Monday? I assume this debate goes on tomorrow.


Mr. Green:: Yes, Mr. Speaker. We shall continue tomorrow with the budget debate. On Monday we are bringing on a motion to go into supply and I am hoping that the house will be in an amiable mood-


Paul Joseph James Martin: Will the Minister of Public Works be in an amiable mood?


Howard Charles Green: -and once we get into supply we shall call the estimates of the Department of Public Works and then we hope even more that the hon. member will be in an amiable mood.


John Whitney Pickersgill: I did not catch what the minister said.


Howard Charles Green: I think you did. And then on Tuesday we will go on with government business.


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

[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. Martin (Essex East): 1.	Has the government received representations from any organization or trade union to further extend unemployment insurance benefits when the present extension expires?
2.	If so, was a reply given to such representations and of what nature?
3.	Has the government taken any action towards a further extension of such benefits?
Answer by: Hon. Ellen L. Fairclough (Acting
Minister of Labour):
1.	Representations have been received by the government from one organization.
2.	Yes, the government replied that the representations had been brought to the attention of the proper authorities for careful study.
3.	See answer to No. 2 above.
Questions


UNEMPLOYMENT INSURANCE
Mr. Martin (Essex East): 1.	Has the government received representations from any organization or union to amend the unemployment insurance regulations so that any claimant being laid off indefinitely from his or her plant at any time prior to the normal vacation will be enabled to draw benefit for the vacation period?
2.	If so, has the government taken any action to amend the regulations as suggested?
Answer by: Hon. Ellen L. Fairclough (Acting
Minister of Labour):
1.	The unemployment insurance commission has received no such representations. However, the present regulations provide that a claimant for unemployment insurance benefit who has been laid off prior to a general continuous holiday may be paid benefit in respect of the holiday period. There is one exception. If the holiday starts within six weeks after the commencement of the lay-off, any holiday pay received or receivable is treated as earnings for the period of the holiday and the amount of benefit adjusted accordingly. It follows that, if a claimant is not entitled to holiday pay, benefit is paid in full for the holiday period.
2.	See answer to No. 1.

Friday, June 27, 1958