1958-08-07

SPEECH FROM THE THRONE


Mr. Speaker:: I have the honour to inform the house that I have received a message from His Excellency the Governor General, signed by his own hand, reading as follows:
Government House,
Ottawa.
4th August, 1958.
Members of the House of Commons:
I have received with great pleasure the address that you have voted in reply to my speech at the opening of parliament. I thank you very sincerely.
Vincent Massey



RAILWAYS, CANALS AND TELEGRAPH LINES

[Stage Direction]
Eighth report of standing committee on railways, canals and telegraph lines.-Mr. Fraser.


[Stage Direction]
On the orders of the day:
Hon. Paul Martin (Essex East):: May I ask
the Minister of Trade and Commerce if he could tell the house whether or not the following quotation from an article published in the Ottawa Journal of August 4, written by Mr. James McCook, is without foundation. The article-


Mr. Speaker:: Order. Yesterday I disapproved of a similar question. If the hon. member has a further question than that which he has asked it may be in order, but simply to ask a minister to verify the correctness of a quotation from a newspaper is not in order at this stage of the proceedings.


Paul Joseph James Martin: I thank you for your very valuable and helpful correction, Mr. Speaker. Could the minister say whether or not his attention has been drawn to an article in the Ottawa Journal of August 4, which reads as follows:
Mr. Churchill told the Journal outside the house that he had taken only these steps when informed of the article published in Toronto:
1. Asked for the number of copies of the confidential report issued and the distribution list.
57071-3-200i
2. Asked for the names of those who prepared the report.


Some hon. Members:: Question.


Mr. Speaker:: Order. The hon. member has not modified his question. He has simply asked the minister whether his attention has been drawn to the article-


Paul Joseph James Martin: May I ask the
minister if his attention has been drawn to this article-


An hon. Member:: That is the same thing.


Mr. Green:: Mr. Speaker, this whole issue was dealt with in a debate on Monday and Tuesday of this week, and the hon. member for Essex East has no right whatever to raise it again on the orders of the day. This period is reserved for asking urgent questions. This is nothing of that kind; it is simply an attempt to follow up the debate concluded two days ago.


Paul Joseph James Martin: On the point of order, Mr. Speaker, it is true that the general subject matter was discussed, but this is a report in a newspaper which appeared on the second day, and I am now asking the minister if his attention has been directed to this report, and I am also asking whether or not the investigation which was to be made, according to that report, has been made by him.


Some hon. Members:: Order.


Mr. Speaker:: The hon. member has not addressed himself to the point of order. He has modified his question, but as he asked it the second time I would consider it not to be an appropriate question. I do not say the hon. gentleman does not have the right to direct a question based on the report, but both the questions he asked were, in my opinion, not questions that should have been asked. Had the hon. gentleman asked whether a certain investigation referred to in the report had been carried out I would have considered that a proper question.


Paul Joseph James Martin: Then I ask the minister whether the investigation referred to in the report has been carried out and whether he would advise the house of the result of his investigation to date?

Inquiries of the Ministry


Hon. Gordon Churchill (Minister of Trade and Commerce):: I do not consider that that constitutes other than a routine inquiry I have made of my officials with regard to several confidential reports.


Paul Joseph James Martin: Would the minister say what the result of that inquiry has been?


Gordon Minto Churchill: I received the information for which I asked.


Hon. L. B. Pearson (Leader of the Opposition):: Could the minister tell us what are the other confidential reports that he is investigating?


Gordon Minto Churchill: I do not think I am obliged to inform the hon. member with regard to confidential reports from officials of the department which pass month by month over my desk.


Paul Joseph James Martin: May I ask the
minister if with regard to another portion of the interview he is in a position to advise the house of further steps the government is taking with regard to this important matter, as indicated by him in the interview as the government's intention to pursue?


Mr. Speaker:: If the matter is to be pursued in this way I will have to consider it in the light of the objection taken by the Minister of Public Works, namely that this whole matter was the subject of a debate and an amendment which have been dealt with by the house, and unless there is something completely novel which was not included during the course of that debate I feel hon. members should not pursue the matter in the way they are now doing.


Mr. Hazen Argue (Assiniboia):: I have a question which is based on a newspaper report which appeared in yesterday's Toronto Star and therefore, as Your Honour has suggested, it is subsequent to the debate. I am wondering whether the attention of the Minister of Trade and Commerce or of the Prime Minister has been drawn to what are stated to be further excerpts from "The Canadian Economic Outlook, 1958", as reported in the Toronto Star yesterday.


Some hon. Members:: Order.


Hazen Robert Argue: Has either minister-


Mr. Speaker:: Order. While the newspaper report may be subsequent to the debate the subject matter is precisely the same, and I think what I said with respect to the question of the hon. member for Essex East relates to what the hon. member for Assiniboia has said. I would ask hon. members not to pursue this line of questioning unless they can convince me it is proper to reopen a matter which

has been dealt with by the house. I ask hon. members if they wish to pursue the matter to address themselves to the point of order before asking any more questions.


Hazen Robert Argue: With great respect, Mr. Speaker, when we questioned the Minister of Trade and Commerce about the original report by Mark Harrison the minister informed this house that there was not sufficient indication in the press report to inform the minister as to the document from which it might have been taken. Since this is a different press report, since it has been published in the newspaper, following the appearance of the other extracts, since it includes what it alleges are other and more substantial paragraphs from the report, I submit it is in order to ask the Minister of Trade and Commerce whether his attention has been drawn to this press report and whether or not the published excerpts purporting to be taken from a departmental report are sufficient to indicate to him that they are taken from "The Canadian Economic Outlook, 1958"; and I would direct that question to the minister.


Howard Charles Green: Mr. Speaker, I rise on a point of order. There was a debate in the house on Monday and Tuesday concerning a hypothetical report, shall I say.


Some hon. Members:: Closure.


Howard Charles Green: This subject was debated from top to bottom, inside and outside, and the whole field was canvassed at that time.


Lester Bowles Pearson: Not at all.


Howard Charles Green: Now my hon. friends across the way are attempting to come back and raise the same debate again, and furthermore they are seeking to conduct a cross-examination. Questions on orders of the day were never designed for cross-examination.


An hon. Member:: Cry baby.


Howard Charles Green: I respectfully submit that the question the hon. member for Assiniboia is now attempting to ask is not in order.


Lester Bowles Pearson: Mr. Speaker, on the point of order, the implication of the position taken by my hon. friend is that instalment after instalment purporting to come from this confidential report of the Department of Trade and Commerce could appear in the Toronto Star, to the point where we could read the whole report, yet we would be precluded from asking questions here to ascertain its accuracy or otherwise. Surely it is important, because of the subject matter of the report, that the accuracy of excerpts be established or denied. That is all we want to find out.


Hazen Robert Argue: Mr. Speaker, I wonder if I may add another word on the point of order raised by the Minister of Public Works. As I understand the rule directed against raising a debate that was concluded, it is clear that hon. members cannot raise in a new debate something on which the house has taken a decision in a former debate. That is a very sensible ruling which we all agree should be maintained. But I would submit that is quite a different thing from raising a question on the orders of the day merely asking the Minister of Trade and Commerce a question about a press report which appeared subsequent to the date of the debate and which, as far as I have been able to ascertain, is completely new. I believe this question is in order, and the government would be doing itself credit if it answered the question forthwith instead of having hon. members on the government side of the house rising on points of order.


Some hon. Members:: Order.


Mr. Speaker:: As I understand the question which the hon. member for Assiniboia has asked it is whether or not a reported extract appearing in the Star on a date subsequent to the debate is true, or whether or not the extract as contained in the paper is a true copy of the document that was under consideration in that debate.
That question offends in two respects. It offends in the respect that it is simply asking the minister to verify a newspaper statement. That is all the question is asking. It is also reopening a matter which was discussed for two days in this house at very considerable length and in very considerable detail. This is not the time to engage in debate. A proper search for information as to what a minister has or has not done is in order, but these questions are not of that kind, and I rule them out of order.


Paul Joseph James Martin: May I just make one comment on what you said, Mr. Speaker?


Some hon. Members:: No.


Lester Bowles Pearson: What are you so frightened about?


Paul Joseph James Martin: I am simply pointing out to Your Honour, for whom I and all members of the house have the greatest respect, the implications of Your Honour's observations. The implications are so far-reaching that I wonder whether, in the face of the great interest in this matter on this side of the house, Your Honour would not want to consider the desirability of postponing possibly until tomorrow or another day the full implications of the ruling you have made; because it would mean, as my leader has
Inquiries of the Ministry said, that we on this side of the house could not ask of the treasury benches questions relating to a matter of such importance. We would be precluded from pursuing a line of questioning regarding a matter of such importance, and I would think that would raise a question involving fundamental rights of members of this house. I wonder whether Your Honour would not think in the circumstances that it would be desirable to act on the suggestion I have made.


Howard Charles Green: May I point out that Your Honour has already given a ruling on this question, and now the hon. member for Essex East is simply endeavouring to get into a position where he and his colleagues can go on asking questions of this kind day after day. I submit that in the first place he has no right to question Your Honour's ruling.


Mr. Speaker:: I am sure the hon. member for Essex East is prepared to accept the ruling I have made, as he has indicated. As hon. members know, I have no desire to curtail in any way the right of members of the house to obtain information from the ministry. It will be my objective to maintain and enforce that right. We have disposed of the particular questions. I am not prejudging any issues that may arise again. In view of the feeling of the members of the opposition I shall look over the questions again and also confirm my own view about these particular questions. They are disposed of, and I hope hon. members will accept that as final.



CANADIAN PACIFIC STEAMSHIPS


[Stage Direction]
On the orders of the day:
Mr. Frank Howard (Skeena):: Mr. Speaker, may I direct a question to the Minister of Labour. Is the minister in a position to indicate to the house the progress of negotiations between the Canadian Pacific Railway and the three unions on the west coast as a result of the British Columbia Coast Steamship Service Act which we passed a few days ago?


Hon. Michael Starr (Minister of Labour):: The only report I have, Mr. Speaker, is that a mediator is on the scene endeavouring to negotiate between the two parties, but no progress report has been submitted to me as yet.



THE SENATE


[Stage Direction]
On the orders of the day:
Mr. J. P. Deschaielets (Maisonneuve-Rosemcni):: Mr. Speaker, I should like to

Inquiries of the Ministry direct a question to the Prime Minister. I am sorry I did not send him a previous notice, but he can take this as notice. Will the Prime Minister inform the house when he intends to implement his electoral promise to reform the Senate?


Right Hon. J. G. Diefenbaker (Prime Minister):: Mr. Speaker, I must say I am glad to see the interest of the hon. gentleman in this subject. I realize that he has more than a personal interest in the reformation of that body.



THE MINISTRY


[Stage Direction]
On the orders of the day:
Lester Bowles Pearson: Mr. Speaker, inspired by feelings of the purest humanitarianism, may I ask the Prime Minister will he be in a position shortly to announce the appointment of parliamentary assistants?


John George Diefenbaker: I think I have answered that question on a number of occasions, and in the case of my hon. friend I do not believe he is one of those who is interested.



NIAGARA PENINSULA


[Stage Direction]
On the orders of the day:
Mr. W. H. McMillan (Welland):: Mr. Speaker, I should like to direct a question to the Minister of Agriculture, of which I have given notice. According to a press dispatch the Niagara peninsula cherry growers have asked the provincial and federal governments to buy surplus cherries. They blame the surplus on the large quantity of imports from the United States. What action does the federal government intend to take in this matter, and why was there not a support price on cherries?


Hon. D. S. Harkness (Minister of Agriculture):: Mr. Speaker, I thank the hon. gentleman for sendirfg me notice of this question. No request has been received from the Niagara peninsula cherry growers or any other organization for assistance to cherry producers under the Agricultural Stabilization Act.



LIVESTOCK


[Stage Direction]
On the orders of the day:
Hazen Robert Argue: I have a question I should like to direct to the Minister of Agriculture. Would the minister care to
[Mr. Deschatelets.l
comment on the reported outbreak of a new disease in Ontario swine? Can the minister say whether the disease has been diagnosed, to what extent it is prevalent, and what steps are being taken to control it?


Douglas Scott Harkness: I thank the hon. member for notice of this question, particularly as it is of a technical nature. The swine disease to which the question refers was first reported in the fall of 1957. Since then both Department of Agriculture animal pathology laboratories and the Ontario Veterinary College have been engaged in research on it. It is a disease of young pigs, generally under 10 weeks of age. It resembles transmissible gastroenteritis of swine, but because of certain variations in the clinical symptoms it has been called vomiting and wasting disease of suckling pigs.
Research to date has not been successful in isolating the specific organism causing the disease. Study of the disease is being continued actively by the department and the veterinary college, both in the laboratories and in field investigation of reported outbreaks.
While the disease is serious and can result in a fairly high mortality in young pigs, investigations by veterinary staffs do not indicate that it has reached proportions which would have serious economic effects on the swine industry. Up to the present the condition appears to be confined to Ontario. When the disease has occurred in a herd, the surviving piglets and the nursing sows appear to develop immunity. There is no specific treatment known. Antibiotics seem to have little effect.


Hazen Robert Argue: Has the government given consideration to the payment of compensation when there have been losses, or is it giving consideration to such payment in the event of an extension of the outbreak?


Douglas Scott Harkness: No consideration has been given yet to that phase of the matter because, as I have said, the disease is not yet really widespread, and not sufficient is known about it to be able to come to any definite conclusions with regard to it.



IRRIGATION


[Stage Direction]
On the orders of the day:
Mr. J. R. Tucker (Trinity-Concepiion):: should like to direct a question to the Minister of Agriculture, who is having quite a run of questions at the present time. Would the minister please advise if he is yet in a position to table a copy of the agreement

respecting the South Saskatchewan dam, which was signed on July 25?


Douglas Scott Harkness: That agreement was tabled several days ago. I do not know the exact date, but it was several days ago. It was the day after the hon. gentleman asked the same question last week.


Douglas Scott Harkness: With regard to the tabling of the agreement on the South Saskatchewan dam, may I say this. If the hon. member will look at Votes and Proceedings for Friday, August 1, at page 343 he will note therein under "Returns and Reports Deposited with the Clerk of the House" that the first is this agreement with Saskatchewan on the South Saskatchewan dam.



BUSINESS OF THE HOUSE


[Stage Direction]
On the orders of the day:
Mr. W. L. Houck (Niagara Falls):: May I
ask the Minister of Justice if he intends to carry through at this session his bill pertaining to the humane slaughtering of animals?


Hon. E. D. Fulion (Minister of Justice):: Mr. Speaker, we are having a look at the legislative program to see what the position is in that regard.



DEFICIENCY PAYMENTS


[Stage Direction]
On the orders of the day:
Hazen Robert Argue: Mr. Speaker, during this session I have asked the Prime Minister and the Minister of Trade and Commerce on a number of occasions when the government would be in a position to make an announcement on deficiency payments. On July 31 the Prime Minister indicated that an announcement would be made at an early date. I am wondering whether the Prime Minister can say when the government will reach a final decision on the very important question of deficiency payments on western grain.


John George Diefenbaker: Mr. Speaker, I can add nothing to what has already been said. The whole question of an agricultural program to meet the situation of agriculture in the western provinces as well as in other parts of Canada is still under full advisement.
I am hopeful, as I said recently on the occasion to which the hon. gentleman has made
Inquiries of the Ministry reference, that an announcement can be made and will be made before the end of this session. Further than that I do not want to go at this time.



SEED GRAIN


[Stage Direction]
On the orders of the day:
Paul Joseph James Martin: May I ask
the Minister of Trade and Commerce whether he is aware of the fact that the House of Representatives in Washington has passed a bill excluding Canada from the seed grain market in the United States, a market in which Canada sells several million bushels per year. If the minister's attention has been drawn to this measure, is he in a position to say what representations are being made by the government in the matter?


Gordon Minto Churchill: Mr. Speaker, I am having a report from my officials with regard to that matter. I am not at this moment prepared to make any further statement.



PUBLIC SERVICE


[Stage Direction]
On the orders of the day:
Frank Howard: Mr. Speaker, the day before yesterday I directed a question to the Minister of Finance with respect to prevailing rate employees and whether or not he could arrange that there would be no deduction from their wages for absence when they were sent home owing to conditions of heat and humidity. The minister's answer was that he thought his answer on the previous occasion covered the matter. I wonder whether he has anything further to add.
Hon. Donald M. Fleming (Minister of
Finance): Mr. Speaker, on reviewing the answer I gave to the house on an earlier occasion I think the answer covered the question completely, but this aspect of the earnings of the employees was not included in the question. I am glad to deal with it now.
The conditions of employment of prevailing rate staffs, unlike those of classified civil servants, are determined by reference to the practice of good private employers. The treasury board and its advisory committee on prevailing rate staffs have found no evidence that good private employers release the equivalent of the prevailing rate employees of the public service from duty before normal closing hours on account of conditions of heat

Canadian National Railways or humidity. The prevailing rate employees' general regulations, which are founded on the general principles stated above, consequently make no provision for leave with pay for prevailing rate staffs in the public service of Canada when conditions of excessive heat or humidity lead the civil service commission to authorize the release of classified civil servants.
It may be observed that a majority of the prevailing rate employees of the public service, unlike classified civil servants, perform their duties out of doors, where the effects of heat and humidity are not ordinarily as oppressive as in the case of clerical staffs working in confined areas.


Frank Howard: I have a supplementary question. Does the minister not think it would be wise, in view of the fact that there are apparently only a relatively small number of these people involved, to show the lead to private industry and treat prevailing rate employees in the same way that permanently appointed civil servants are treated?



CANADIAN NATIONAL RAILWAYS


Hon. Donald M. Fleming (Minister of Finance) moved: the second reading of Bill No. C-47, to authorize the provision of moneys to meet certain capital expenditures of the Canadian National Railways system during the calendar year 1958, and to authorize the guarantee by Her Majesty of certain securities to be issued by the Canadian National Railway Company.


Mr. Speaker:: Is it the pleasure of the house to adopt the motion?


Mr. C. R. Granger (Grand Falls-Whiie Bay-Labrador):: Mr. Speaker, I should like to say a few words in connection with this matter. I hope that sufficient funds are supplied so that one class of employees of the C.N.R.- and I refer to the employees of Canadian National Telegraphs in many Newfoundland communities-may receive better salaries.


An hon. Member:: Speak up.


Charles Ronald McKay Granger: It is quite notorious that many of these operators who must put in a week of 48 hours receive very small salaries. There are many instances of extremely low salaries which may be quoted.


An hon. Member:: We cannot hear.


Mr. Speaker:: Order. Before the hon.
member goes too far may I say that I think perhaps we should try to confine our remarks to the scope of this bill. We are on second reading, which involves the principle of the

bill. It is a bill to provide moneys to meet certain, capital expenditures of the Canadian National Railways system. I am not disposed to be too strict as to what are capital expenditures, but I do not think the bill opens up a free ranging debate on the operation of the Canadian National Railways system. If any hon. member has a contrary view I shall be glad to hear him, but as presently advised it seems to me that the question before the house is whether it is desirable to provide the Canadian National Railways with funds for precise capital expenditures which are to be authorized and are set out in the bill.


Charles Ronald McKay Granger: I will leave all the detailed arguments until another time, Mr. Speaker, but I should like to mention this-


Mr. Speaker:: May I say to the hon. member that there will be an opportunity to discuss the details of the administration of the C.N.R. when the estimates are before the house for consideration.


Mr. Pickersgill:: On that point, Mr. Speaker, may I say this. Is it not true that there is not an opportunity on the estimates to discuss the C.N.R.? It being a crown company, I think it has always been understood in this house that it could not be debated in the committee of supply. I think it was for that reason that my friend the hon. member for Grand Falls-White Bay-Labrador desired to make a few observations about certain capital improvements which he hoped could be made by virtue of the provision to be made in this measure.


Mr. Speaker:: I perhaps should not say there is an opportunity on the estimates because I am not sure of that position. Perhaps some hon. members can help me on that matter. I have no desire to limit the hon. member in dealing with capital improvements for which this money is provided or which he thinks should be covered by this provision. I just did not want him to get into a discussion of conditions of employment and that sort of thing at this time.


Mr. Fisher:: I hope to speak in this debate, Mr. Speaker,-


John Whitney Pickersgill: The hon. member for
Grand Falls-White Bay-Labrador has the floor.


Mr. Speaker:: I think the hon. member for Port Arthur is speaking to the point of order.


Douglas Mason Fisher: Yes, Mr. Speaker. That is
exactly what I want to get into from this point of view, namely that the capital program of the Canadian National Railways for this year includes a very large expenditure.

That is going to reduce employment in certain centres in certain areas. Because that capital program is involved in that way I feel this is an opportune time to bring up the whole question of the labour policies and the labour relations of the Canadian National Railways, in the very broad view. That is what I have prepared for, and I would certainly think it is quite in order since most of the ideas I have come from my attendance in the special committee dealing with the annual report. It is out of that knowledge that I wish to speak on this bill before us. If one does not have an opportunity at this time to go into the matter I cannot see when one can touch that subject within the framework of the House of Commons.


Mr. Speaker:: I shall deal with the hon. member's problem when it arises, but in the meantime I feel that this debate should be directed toward the lines of capital enterprise of the Canadian National Railways.


Donald Methuen Fleming: Mr. Speaker, I rise only to make a suggestion. While some of the remarks that the two hon. members indicated they had intended to make at this stage may be out of order in the debate on the motion for second reading of the bill, on which after all hon. members are confined to the principle of the bill, it may be that their points relate to the clauses in the bill and should be raised at the committee stage. I do not know whether or not they do so; we shall not know that until we know more about their remarks. However, it occurs to me that perhaps that may be the way in which the problems that have been raised might be met.


Charles Ronald McKay Granger: As much as possible, Mr. Speaker, I shall confine my remarks so they will come within the minister's suggestion and your ruling. I do not think the amount of money paid to these Canadian National employees is consistent with the amount of money voted for the operation of this telegraph system. I was about to say that salaries as low as $87.50 per month are not unusual.
I do not need to belabour the point that such salaries are low because they speak for themselves. It has been customary in the past, where possible, to combine the position of postmaster and Canadian National telegraph operator, which sometimes enables better salaries to be paid as a result of combined operations. I mentioned this before in connection with the post office estimates. I hope that system can be reinstituted.
I should like to mention also the need for a new steamer for the Labrador service. I hope sufficient money will be provided so consideration can be given to the construction of a new steamer with refrigeration to 57071-3-201
Canadian National Railways replace the S. S. Kyle. The Kyle has supplied excellent service for many years, but now she is a very old ship and needs replacing by a ship with more modern facilities. There should be, as I have said, an extension of the Canadian National steamship service to Labrador and a continuation of the service each year until the month of November.
Another suggestion I should like to make is concerned with the provision of better railway stations at many places in Newfoundland. There are quite a few places where the railway stations are not at all the type of building which should be owned and operated by an institution like Canadian National Railways. An example of such a railway station is the one at Gander, which is the real gateway to Canada. Today that railway station is not at all in keeping with what I might call, if I were to make a pun, its station. I would suggest that new stations should be provided at Gander and other places where antiquated buildings are made to serve.
While I am dealing with the railway station at Gander, I should like to point out that the railway no longer delivers express parcels from this station because the town has been moved away from the station. When Gander airport was extended and a new townsite built, the town was moved several miles away while the railway station remained where it was, right at the edge of the airport. The railway will no longer deliver express parcels to the town, and this is the cause of great annoyance and inconvenience to the people.
I should like to suggest, too, that the Canadian National steamers on the Labrador coast and along the northern part of Newfoundland should add to their ports of call instead of bypassing so many of the smaller settlements. I hope Canadian National will increase the number of ports at which their steamers call and bring their very valuable service to these smaller centres.
In conclusion I should like to say a word of appreciation of the very fine services, which over many years now have become traditional, performed by the captains, officers and crews of the Canadian National coastal steamers operating along the Newfoundland and Labrador coasts.


Douglas Mason Fisher: The
president of Canadian National Railways, Mr. Donald Gordon, made a great impression upon most of the members of the special committee on railways and shipping. When I say "a great impression", that does not define it specifically. Certainly the impression he made on some of us was different from that which he made on others. However, he brought

Canadian National Railways home to all of us the many problems in connection with this largest single enterprise in the Canadian nation. The Canadian National Railways has been close to my interests for many years because I was brought up in a Canadian National Railways family and worked myself for the railway for a time.
Furthermore, the railway itself has always been of interest to my particular political party, the feeling being that as a government-owned enterprise it should be and could be a model for the country. Many of the things I hope to say in connection with this bill will indicate that we in this group approve of the principle of the bill, but feel there are certain aspects of the capital expenditures that open up problems and difficulties which we believe have very important application in labour matters and in the future financing of the railway.
In a speech which Mr. Gordon gave to the Canadian and Empire clubs in Toronto on April 1, 1958, he said, among other things:
The capital expenditure of one billion dollars since 1950 needs to be put into perspective, particularly so in light of the fact that it does not by any means complete the job. First we should recall that the period in question has been a high cost period and that a technological revolution has added larger units of machinery to our complement of equipment and has, as well, greatly enlarged the use of labour saving devices. Moreover, because of inflation, a depreciation based on original cost has fallen far short of meeting current replacement costs. That Is one of the major reasons for the increase in our fixed charges. However, you may be interested to know that our net capital expenditures expressed as a percentage of the total property investment of the system have during the past ten years averaged only 3.4 per cent annually.
He went on to state:
On dieselization from 1950 to the end of 1957, we had spent approximately $250 million on the locomotives and the necessary facilities. Our present estimate of the remaining cost to completely dieselize our operation is roughly $268 million, to be spent over the next four or five years.
No doubt the capital expenditures that will be approved by the passage of this bill will go for further dieselization, and quite a bit of these expenditures will go for the establishment of central traffic control on a considerable portion of the Canadian National Railways system. These two phases of expenditure have opened up very real labour problems. The Railway Age, a United States magazine that deals very generally with railway problems in North America, has pinpointed the importance of the industrial dispute that has raged between the brotherhood of locomotive firemen and enginemen and the Canadian Pacific Railway, as well as the other aspects of that dispute that have now

arisen with the Canadian National Railways and over which we are likely to have further labour troubles.
I suggest in this regard that the capital expenditures of the Canadian National Railways are putting quite a number of men out of work, and will put even more men out of work in the future. This will be a subject of discussion at divisional points across the country. There is no point in refusing to recognize that these things are going to happen. Perhaps they need to happen, but we are in a position where, very often, the labour organizations are not prepared for these particular situations in connection with the changes such as central traffic control or dieselization will bring.
Mr. Gordon had this to say in the committee. I had asked him whether it had been the thesis put to him by union men that in regard to the dieselization program which has resulted in great savings to the railway and great increase in productivity, in terms of labour, this particular point has never been recognized by the railways in labour negotiations. I asked him if he would care to comment on that statement. Mr. Gordon was very glad to comment, and he said:
We have in the course of our presentations before various conciliation boards dealt with that point again and again. I have no hesitation in saying that in regard to the improvement in our efficiency brought about by dieselization, labour has now received its share of that improvement.
Then he went on to say:
I feel that labour has received more than its share. In other words, the capital investment has not produced for us the result that we, as management, feel we are entitled to.
You can certainly see the sharp and definite position being taken by the president of the railroad. He went on to say:
This question of productivity is another one of those easy economic terms that is commented on loosely and which is very seldom understood.
Then, after elaborating on that, he went on to make this recommendation:
I do feel there is a great need for a thorough economic analysis of what is true productivity in terms of labour. If we could get that analysis, plus the other indexes we have, then we might be able to talk to labour on a much more sensible basis than we are able to do now.
And he went on to say that he is thinking in terms of a statistical study of the situation by a department such as the dominion bureau of statistics. I should like to take this opportunity to suggest to the government that now is the very time to go to work on such a study. As these capital expenditures unfold they are going to cause more and more dislocation and trouble. There is a labour problem developing, as I indicated yesterday, in connection with the

introduction of central traffic control, which means cutting down what might be called the tail end crews. In the record at page 96 of the committee proceedings-


Mr. Speaker:: Order. I have let the hon.
member deal with operational problems to some extent, but I think he ought to consider whether he is not doing more than illustrate his point by going deeply into operational problems. After all, this bill has nothing to do with that. It is to authorize the payment of money for capital purposes to the Canadian National Railways system, and there is no principle in it as far as I can see which would permit a general discussion of operational problems.


Douglas Mason Fisher: Mr. Speaker, the capital expenditures, as you will note in perusing the bill, are to an appreciable extent intended for equipment. Part of those expenditures will be accounted for by the dieselization program and provision for centralized traffic control. Surely the whole question of labour and labour relations could come under this.


Mr. Speaker:: Only incidentally and by way of illustration. I would not have objected to a discussion of the effect of the provision of certain types of capital equipment, but to make that the substance of comments on the bill seems to me to be getting off the track.


Douglas Mason Fisher: Perhaps I could get more on the track by referring to the financial problems which the Canadian National are facing at the present time. The railway had a deficit this year and it is going to have a deficit next year, or at least that is the prediction. This capital expenditure program is certainly extremely necessary but there are a number of suggestions one could make at this time which, if carried out, might put the railway in the position of not needing such a large capital investment program.
One of the points that was made by the president of the railway at the time of the sittings of the committee was that the railway does not seem to be getting its fair share in relation to the express and mail set-up. They carry the mail at the present time for the government, and that mail is competitive with their express service. One of the other points Mr. Gordon made in connection with unprofitable services was that there are a number of lines and sections in the Canadian National Railways system that need to be dropped, from the point of view of profit. One of the other points he made was that the raising of freight rates has to be done on a more realistic basis if the railway is to continue to meet its financial obligations. I am trying to suggest that all these points have validity in relation 57071-3-2014
Canadian National Railways to capital expenditure, and I want to take this opportunity of referring to them.


Mr. Speaker:: Is the hon. member referring to the proceedings before the committee on railways, canals and telegraph lines?


Douglas Mason Fisher: Yes.


Mr. Speaker:: Has that committee reported yet?


Douglas Mason Fisher: Yes.


Mr. Speaker:: I see a meeting is scheduled for Thursday, August 7 at 10.00 a.m.


Douglas Mason Fisher: This is a separate committee, on railways, air lines and shipping. One of the other problems Mr. Gordon raised in connection with capital expenditure is how far the C.N.R. should go in getting into the truck business and piggyback business. The hand of the Canadian National Railways has, to a certain extent, been forced by developments in the C.P.R., which has built up an extensive relationship with trucking interests.
This is one of the points with regard to which Mr. Gordon would not go into specific details, because he suggested that would be revealing his company's hand. I should like to hope that part of the capital expenditure involved under this bill will go for that purpose, namely to extend the piggyback service and tie in various truck lines with the service and give this diversification aspect of the C.N.R. more room to operate.
One of the other points made by the president of the C.N.R. in the committee which relates to this question of capital expenditure is the difficulty the two railway companies have had in working out pooling arrangements. Ever since 1933 an act of parliament has required the C.N.R. and the C.P.R. to work in a pool arrangement in certain sectors. We all know the sectors between Montreal and Toronto, and Ottawa and Toronto. Evidently discussions which have taken place between the railways themselves have been completely unsatisfactory.
Neither side will blame the other but this, it appears, is another place where direction by the government in relation to certain expenditures in connection with this bill might possibly lead to the C.N.R. being put on a better competitive basis as compared with the Canadian Pacific Railway. I certainly got the impression from the president that this is what he wanted, and he certainly feels that if his company were put in a better competitive position it would soon give the lie to all those Jeremiahs who are always going around pointing to this deficit and saying, "See what private enterprise can do and public enterprise cannot do".

Canadian National Railways
I see the hon. member for York North nodding his head and expressing approbation. I wish he had had the educational opportunity to hear Mr. Gordon, in which case I am sure he would have reached the conclusion that the C.N.R. could do much better if it was given the opportunity.
One great capital expenditure of the C.N.R. in the last few years has been directed toward the improvement of maintenance of the permanent way, equipment and yard operations. There are a number of big electronic yards being built. This is a form of automation which is going to cut down employment, yet on the other hand it will lead to a much smoother type of operation, and we think the C.N.R. should be commended on going ahead.
One of the significant things in connection with expenditure on maintenance of way equipment is that it has cut down employment along the sections to a tremendous extent. Specialized machines now lay the ties, put in the spikes and so on, and you no longer need the number of people along the lines you formerly needed. Of course, this improvement is not something that is instinctively or easily understood by the people who lose their jobs.
I hope to come back to this particular point in greater detail when we are on a specific part of the bill. I confess I feel a certain amount of guilt in attempting to conduct a general discussion of the operations of the Canadian National Railways in the light of what was said, and in view of the most munificent offer of the Minister of Finance, which at first struck me as being completely out of character for him. Perhaps I do not really appreciate the character of the Minister of Finance as yet.


Mr. C. W. Carter (Burin-Burgeo):: Mr. Speaker, I should like to make one or two observations on the second reading of this bill. In the first place, I feel I would be failing in my duty to my constituents if I did not protest on their behalf the fact that some of this capital expenditure is going to purchase radio-telephone equipment to replace the ordinary wireless telegraph sets which have served our needs in Newfoundland so very well for many years. I know the feeling is very strong in my own riding about this decision, and personally I feel it is a most unwise move; because we all know from experience that this type of equipment breaks down frequently and in isolated communities such as ours it takes weeks before a maintenance man can go to the place to effect the necessary repairs. During the interval the messages are either not transmitted at all or else are transmitted on a clear channel so as to make it possible for them to be picked up by all the household radios within range.

The people in my riding consider this a backward step. It is an ill-advised move because it provides a service which in many respects, as far as privacy is concerned, is inferior to what we have enjoyed for the past 50 years. I know it is going to create a great deal of discontent and ill will among the people who have to put up with this type of service. Although it may save a few dollars it is putting the consideration of money before the consideration of the people.
I should also like to express the hope that some of this expenditure will be used to provide express offices in my riding. At the present time there are 250 communities in my riding and about 80 of these are ports of call for C.N.R. coastal steamships; but despite this number of ports of call only two communities have the services of an express office. There are many large communities which should be provided with this service, and it could be established at very little cost.
I wish also to bring to the attention of the house and the Minister of Transport the hope that this service will not be delayed much longer. It would be my hope that these expenditures will be utilized in such a way as to provide the maximum amount of winter employment. This could be done in my province and in my riding if the program were to be drawn up well in advance so the contracts for telegraph poles could be let soon enough for the people to know that this work would be available in the winter months when there are very few opportunities available to them to earn a livelihood.


[Stage Direction]
Motion agreed to, bill read the second time and the house went into committee thereon, Mr. Rea in the chair.
Clause 1 agreed to.
On clause 2-Definitions.
Mr. Forgie:: Mr. Chairman, if it is in order I should like to know if any of the bond issue of the C.N.R. guaranteed by the federal government has been sold.


Donald Methuen Fleming: Mr. Chairman,
there was an issue of C.N.R. bonds last January to the aggregate of $300 million bearing the guarantee of the government of Canada.


James Moffat Forgie: May I ask what was the percentage of the yield, the premium or the interest coupon?


Donald Methuen Fleming: The coupon rate was 4 per cent. The issue price was $97 to yield 4.2 per cent to maturity.
Clause 2 agreed to.

On clause 3-Capital expenditures authorized.


Mr. Bourgel:: Mr. Chairman, I wonder if the minister would be able to give us a breakdown of the amount of $146 million-odd representing road property by region and by district. I do not want to delay the procedure and the committee could proceed to another clause if the information is not readily available.


Donald Methuen Fleming: Mr. Chairman, I could give a breakdown of the figure, but I understand my hon. friend wished to have it broken down on a regional basis. I am not in a position to do that. I can give him a breakdown by nature of the properties affected, but not by regions.


Maurice Bourget: Could the minister obtain that information later on? I could wait. He could do it even tomorrow. I should like to have a breakdown by region and district.


Donald Methuen Fleming: Would my hon. friend indicate if he is speaking of regions in terms of the operation of the Canadian National Railways?


Maurice Bourget: Yes. I think there are four or five including the western region, central region, Atlantic region, etc.


Donald Methuen Fleming: I shall be glad to endeavour to obtain that information for my hon. friend from the Canadian National Railways and communicate it to him.


Douglas Mason Fisher: y dliU idU
to be witnesses to these hearings-

These were hearings in the United States:
-indicates, it seems to me, that the members of the committee also consider such an approach valuable.
In other words, this expert on automation and its effects is plumping for case study wherever you can possibly get it in order to determine the effects. I submit that as a result of expenditures by the C.N.R., when authorized by this bill, we will have this problem right across the country, but specifically at four divisional points in the constituency of Port Arthur. I would certainly like the minister to tell me something about it so we can get some idea of the effect of this expenditure upon our whole employment pattern and even on the social life

Canadian National Railways in those communities in the future. Referring to the Canadian scene this particular report concludes:
But we must all resist any temptation to postpone action "till all the facts are in." They never will be. They never can be, not even with all the giant computers working full time. Too many different things are constantly happening too fast and all together. We must investigate and study and plan; but we must also act, and act promptly, on the basis of the facts we have and the new facts as they come in.
I suggest that these changes and the new equipment which has been introduced and is being introduced by the Canadian National Railways by these expenditures here and the gross capital expenditures are creating just the kind of problems that are talked about here. I think it is of fundamental importance that we do some planning and more study of it now. I know the Minister of Finance who is shepherding this bill is not the person in the government who is most directly involved, but the whole problem will appeal to him as something that can be faced with a view to bringing these particular points before the government. If the government does not move within the next two or three years to handle the particular problems on that basis I think we are going to be faced with the danger of some of the dirtiest strikes and some of the greatest bitterness that this country has ever had.


Mr. Garland:: I notice the item of $12,510,000 for branch line construction. Can the minister give the details of that?


Donald Methuen Fleming: There are five new branch lines which are contemplated under this item, aggregating $12,510,000. The first is Hillsport-Manitouwadge, $60,000; then Beattyville-Chibougamau-St. Felicien, $7,300,000; Bartibog-Heath Steele Mines, $200,000; Sipiwesk-Thompson, $4,500,000; Optic lake-Chisel lake, $2 million. That is a total of $14,060,000. Then there is one sum to be subtracted as a subsidy to Beattyville-Chibougamau-St. Felicien of $1,550,000, leaving a residue of $12,510,000.


John Richard Garland: Are there other branch line projects receiving consideration?


Donald Methuen Fleming: I have no doubt, Mr. Chairman, that there are other proposals that are constantly before the railway and under consideration. These are the ones that are embraced in the plan of capital expenditure for this year.


[Stage Direction]
Clause agreed to.
Clauses 5 to 10 inclusive agreed to.
On clause 11-Auditors.
Mr. Mcllrailh:: Mr. Chairman, I wonder whether the minister will tell us why he is

changing the auditors of the Canadian National Railways system?


Mr. Hees:: Mr. Chairman, I can probably answer this, as it is on my recommendation that the auditors be changed, since the Canadian National Railways come under my jurisdiction. It is simply this. The firm of George A. Touche and Company have done the auditing for the past 23 years. This government is against monopoly; we are fundamentally opposed to it, and believe that in the interests of the free enterprise system various business firms should have opportunities from time to time to do work of this kind. It is for that reason that the auditors are being changed.


George James McIlraith: Mr. Chairman, I should like to ask the minister how you overcome monopoly by simply substituting one monopoly for another. Only one firm is involved in doing the auditing work of the C.N.R., and I just do not follow the logic of the minister's statement that he is doing away with monopoly when he changes the monopoly from one auditing firm to another.


George Harris Hees: It is very simple. One firm, the firm of George A. Touche and Company, has had this audit for the past 23 years. They have carried it out each year for the past 23 years, and we believe it is a good thing for first class auditing firms to have a chance to carry out an important task of this kind. It is for that reason that a new auditor is being appointed at this time.


George James McIlraith: I understand they are being appointed on the recommendation of the minister. Did the Minister of Finance concur?


Donald Methuen Fleming: This is a government bill. My hon. friend realizes that this is a government bill, and the government is asking parliament to make the appointment contemplated in clause 11. There was a time when the appointment of auditors for the Canadian National Railways system was made by the minister. That was the situation until 1932. Then the law was amended to provide that the appointment should be made by resolution of the two houses. Then the legislation was amended in 1935 to provide that the appointment should be made annually by parliament, that is to say in the form of a statute.
It was the practice in the intervening years down to 1954 for a separate bill to be brought in each year for the appointment of auditors. Sometimes there have been debates on that question. Those who were in the house in 1947 will remember the very vigorous challenge delivered by Mr. James Sinclair, M.P., against the appointment proposed in the bill. But since 1954 it has been the practice, as

the hon. member for Ottawa West will recall, to include the provision for the appointment of auditors in the annual C.N.R. financing bill, and in that period it has taken the form of a clause in the bill.


George James McIlraith: The Minister of Transport tells us that the auditors who are being released have been doing this work for the last 23 years. Would he give us his authority for that statement? It is not in accordance with my knowledge of the facts and understanding of the matter.


George Harris Hees: I would be very interested to hear what the hon. member's authority is. It is my understanding that these auditors were appointed by the Liberal government in 1936 and that they have carried out the audit every year since. If he has any other information I will be interested in hearing it. I have discussed this matter with Touche and Company and that is the information they give me. I should think they would know who has been doing the audit.


Lester Bowles Pearson: If the minister will consult the statutes of Canada, 1934, he will discover that George A. Touche and Company were appointed as auditors in that year by the government of Right Hon. R. B. Bennett.


George James McIlraith: And in all the previous years of his government and also back to 1923.


George Harris Hees: Perhaps the executives of Touche and Company do not know when they were appointed.


George James McIlraith: I think it is the minister who does not know.


George Harris Hees: However, Mr. Wilson, the president of the company, told me that they were appointed in the spring of 1936 and have done the audit consistently ever since.


Donald Methuen Fleming: I think the Leader of the Opposition and the hon. member for Ottawa West have overlooked the fact that the Clarkson firm was appointed in 1935. The Touche firm was appointed again in 1936 and has been appointed annually since.


George James McIlraith: And was appointed before 1935.


Donald Methuen Fleming: Yes, they had been the auditors for a time prior to 1935.


George James McIlraith: That is right, since 1923. Therefore the information given the house by the Minister of Transport is quite inaccurate.


George Harris Hees: No, the information given the house by the Minister of Transport was 100 per cent accurate. I said that George A. Touche and Company had been appointed in
Canadian National Railways 1936, as they were, and had done the auditing for a straight 23 years. I believe the Clarkson Company did the auditing for one year before that and Touche and Company for a number of years before that, but my statement was that Touche and Company had done it continuously for 23 years, and that statement is correct.


George James McIlraith: Would the minister give us any other reason he has for discharging the Touche firm, bearing in mind all the experience they have had in auditing the books of the railway company since 1923 with the exception of one year? Would the minister explain to the committee just what benefit is to be gained by throwing away all that experience in favour of a new auditing firm?


George Harris Hees: I will be very glad to do so. After 22 years of continuous Liberal government the people of Canada overwhelmingly decided that a new party should have the job of running the affairs of the country. I believe that after 23 years of continuous auditing, or 35 years out of the last 36, whatever it was, it is a good thing to give other firms the opportunity to do important work of this kind instead of conferring a monopoly on any one firm.


George James McIlraith: Mr. Chairman, since this appointment is made on the minister's recommendation I should like to ask him whether the fact that this monopoly has been given to one of the defeated Conservative candidates in the city of Montreal has any bearing on the qualifications?


George Harris Hees: I will be very glad to answer that cheap, political question. The fact of Mr. De Lalanne being a defeated Conservative candidate has had no effect whatsoever upon this appointment. In fact, what has had more effect on the appointment is the fact that his colleagues in the chartered accountancy business did him the honour this year of choosing him to be president of the Canadian chartered accountants' association, thereby showing that they hold him in very high regard as a colleague.


George James McIlraith: So that it will be available in Hansard I should like to question the wisdom of the minister in making a change of accounting firms for the reasons or lack of reasons stated by him at a time when expenditures of taxpayers' money on the railway system are fairly substantial. I would point out to the committee that the Auditor General does not have any part in the auditing of these accounts, and it is a pretty serious thing when the taxpayers' money is involved that the appointment of auditors should become merely a matter of patronage at the whim of the Minister of Transport.

Canadian National Raihoays


Donald Methuen Fleming: I do not think that remark should be allowed to pass unchallenged. This is not something done at the whim of the Minister of Transport, and that has been made abundantly plain. I wonder what my hon. friend had to say in 1936 when a change was made.


George James McIlraith: A change was made to revert to the auditors who had audited the accounts of the railway system under both Liberal and Conservative governments. I would point out that the Minister of Transport has repudiated the action of the Conservative government in the period 1930 to 1935.


George Harris Hees: I would be very much interested in hearing the opinion of the hon. member for Ottawa West regarding how long he believes a firm of auditors should be continued on a job of this kind. Once they have started does he believe they should be continued for 45 years, 68 years, 85 years, 99 years or how long?


George James McIlraith: The answer is very simple. They should be continued as long as they continue to do a thoroughly efficient job, and as long as the committee of the House of Commons that examines their financial statements can find no fault with ^ them and does not find any weakness in their auditing system In other words, the period of time is to be gauged by the efficiency of the service and the competence of the service they perform and not merely by the number of years.


Douglas Mason Fisher: On this particular point most of the questions I w'anted to ask have been asked. I just wanted reassurance from the Minister of Transport as he is the spokesman in this matter. There was not any particular question of inefficiency as to the Touche Company and there was not any particular question or feeling that there was political patronage involved with this company having had it for such a long period of time?


George Harris Hees: I am very glad to answer those two very sensible questions. It is nice to hear sensible questions for a change. The answer is that there were no political considerations in this case whatsoever, as I stated earlier, and there has at no time been any question as to the ability or the efficiency of the George A. Touche firm.


Lester Bowles Pearson: Why discharge them?


Douglas Mason Fisher: After that very complimentary answer, I can only say that I want to compliment the minister for his indication that he is now anti-monopoly and I might say a trust buster. We hope to see him out with the Minister of Justice skirmishing with the

large corporations and making sure that monopoly does not flourish in Canada and that we can get back to genuine free enterprise.


[Stage Direction]
Clause agreed to.
Title agreed to.
Bill reported.
Mr. Speaker:: When shall the bill be read a third time?


Donald Methuen Fleming: Now, by leave.


John Whitney Pickersgill: By leave.


Donald Methuen Fleming: the third reading of the bill.
Motion agreed to and bill read the third time and passed.

The house in committee of supply, Mr. Rea in the chair.



DEPARTMENT OF JUSTICE

[Stage Direction]
15S. Remission service, including $50,000 for grants to recognized prisoners' aid societies as may be approved by treasury board, $319,194
The Deputy Chairman:: Shall vote 158 carry?


Douglas Mason Fisher: I do not want to speak on this item but I wonder whether the minister would be agreeable to allowing us to come back to it in a few minutes. In the meantime I shall get in touch with the hon. member for Vancouver East who, I understand, wanted to raise some questions in connection with it.


Charles Edward Rea: Shall vote 158 stand by leave?


Some hon. Members:: Agreed.
Item stands.
160. Administration, $131,238.


Mr. Hardie:: I have not the page in front of me, but I think this item deals with the Northwest Territories. I am wondering whether the minister can tell me whether there are two kinds of inquests in Canada, one for the Northwest Territories and one for the provinces.


Edmund Davie Fulton: I think the position is that the form of inquest and the requirements and procedures to be followed at inquests are regulated by the various provinces; and certainly inquests to be carried out in the Northwest Territories and the forms and procedures are settled by the relevant ordinance of the Northwest Territories council.


Mervyn Arthur Hardie: In the case of an inquest, who would appoint the coroner?


Edmund Davie Fulton: I have no knowledge of this matter but I believe the appointment of coroners would be settled by the commissioner. I suggest to the hon. gentleman that details in that regard would properly be sought under the estimates of my colleague the Minister of Northern Affairs and National Resources who has responsibility in parliament for reporting on these matters. We in the Department of Justice are responsible only for the administration of justice in the courts of the Northwest Territories and the matter of appointment of coroners would, as I understand it, be an administrative matter not related to the jurisdiction of this department with respect to the administration of the courts.


John Whitney Pickersgill: Is the minister quite
satisfied that what my hon. friend is asking about would not be covered under item No. 161?


Edmund Davie Fulton: Yes. Item No. 161 covers the Northwest Territories territorial court. My hon. friend will see "Northwest Territories territorial court". There is a statutory item "Judges' salary and travelling allowance" et cetera. Then item No. 161, "Administa-tion, including administration of justice- Northwest Territories". As the set-up in the estimate goes, I think it will be found that that refers to the administration of the Northwest Territories territorial court.


John Whitney Pickersgill: In other words, it does not mean the administration of justice in the sense in which it is used in section 92 of the British North America Act? Perhaps I could make my point in another way to the minister. Is the minister the attorney general for the Northwest Territories or is someone else the attorney general for them?


Edmund Davie Fulton: The Minister of Justice is the attorney general for the Northwest Territories. However, I am also informed that the Northwest Territories Act governs matters such as the appointment of coroners in the Northwest Territories. For instance, I am quite certain that I do not appoint coroners in the same way that I recommend the appointment of judges. As I understand it, that is a matter of administration which falls under my colleague the Minister of Northern Affairs and National Resources.


John Whitney Pickersgill: If the minister could give us the assurance that this matter could be discussed in an unrestricted way on the estimates of the Department of Northern Affairs and National Resources, I imagine my hon. friend would be quite satisfied.


Edmund Davie Fulton: As I understand the position, there would be no way in which discussion could be limited,-
Supply-J ustice


John Whitney Pickersgill: That is to say, whatever discussion is proper.


Edmund Davie Fulton: -apart from the rules of the house. I am not familiar with the detailed information of the Northwest Territories. Therefore my answer cannot be taken as meaning anything further than what I say.
I understand that will be the proper place to discuss the matter.


Charles Edward Rea: Shall vote 160
carry?


[Stage Direction]
Item agreed to.
Combines Investigation Act-[DOT]
164. Restrictive Trade Practices Commission, $79,120.
Frank Howard: I think it would be well to be able to discuss the general questions arising out of the operation of the restrictive trade practices commission and the office of investigation and research which is in the next vote under this item because the two votes overlap. I wonder whether that procedure would be all right with the minister, if we should wander a little bit far afield. I am suggesting that there are two votes here, one dealing with the restrictive trade practices branch and the other with the investigation and research branch, and I am wondering whether it would not be well to have them overlap in our discussions?


Edmund Davie Fulton: Yes.


Frank Howard: With respect to the Combines Investigation Act itself, which, in my opinion, is one of the most important pieces of legislation in Canada, I may say that it has been revised periodically and probably should be revised again in the light of developments over the past few years. I should like to have the minister, if he would, give the committee an indication of the scope of the operations of the administrators of these two groups which are established under that act, particularly in the light of an article which appeared in the Financial Post about the middle of June of this year, I believe it was, which indicated that there may be a change in view on the part of the officials administering the act or the government concerning the rules applying to mergers, combines, monopolies and other similar organizations.
I wonder whether the minister could indicate, in a general way at first, the effect of the operations of the act, and especially whether there is any change in attitude of the administrators or the minister as indicated in the article which appeared in the Financial Post.


Edmund Davie Fulton: I think I must say, Mr. Chairman, that the article was one which reflected the views and opinions of the writer, not of

Supply-Justice
the minister or of the department. I have said, I think in the house since taking office and elsewhere, that we are making a study of the general scheme of the combines legislation as it is in effect in Canada today. My hon. friend will appreciate that there have been alterations to similar legislation in other countries, notably in the United Kingdom in recent years. I think it behooves any government, especially one taking office for the first time after a good many years, to make a study of matters of this kind and especially of matters of this kind which are so inextricably interrelated with questions of economic policy. It is in that sense I have, on the various occasions when I have spoken, indicated that we are making a study of the combines legislation, and of its impact on Canadian economic interests. I used the words "economic interests" as applied to the nation and not as applied to particular individuals.
In the case of this particular inquiry into yeast, the commission found, as I recall, that there was no evidence of an offence. There had been, in fact, a merger, but it was not a merger which brought the companies concerned within the terms of the legislation which requires evidence of detriment to the public. In effect, they found that the company, while effecting a merger which did give an increased measure of control, that measure of control had not proceeded to the point where it was likely to be detrimental to the public. It was inherent in their findings, if it was not explicit, that any further activities of this sort, any further mergers or acquisition of other companies in this field would, however, be very likely to bring the whole situation within the territory where there might well be an offence under the act.
It is in that light we are studying it. We Mr- Howard: If I understood the minister are making particular studies, of course, of correctly with respect to that last part of particular aspects of it, such as those which	comment-his comments related to the
arise under section 34 and under section 412-Teast industry, did they?
of the Criminal code which present particular problems within the over-all study to which I have referred. Having said that, I come back to the statement I made at the beginning. I can take no responsibility for the views expressed in the article in the Financial Post.


Frank Howard: If I could elaborate a bit there, I might say that from what I can recall from reading this particular article, it arose out of a report of the restrictive trade practices commission on yeast. Apparently there was an opinion expressed in that report-I am not trying to interpret the report but merely to relate my remembrance of it- relating to the detriment, if any, to the general public of this particular merger in the yeast industry, or the acquisition of one company by another. In earlier reports of the commission dealing with similar types of mergers there was no reference to the degree of effect that it would have on the general public, so this report was taken to be a departure from the approach in the past.


Edmund Davie Fulton: As I recall there was no departure in this report from what has been the practice in the past. The act itself now, and for many years, has authorized the procedure under which, if the commission itself is of the opinion that there is no evidence of an offence or nothing in the subject that they have investigated which warrants further action, then they may so report and recommend to the minister that no further action be taken; that provision has been in the act for some time.


Edmund Davie Fulton: Yes.


Frank Howard: If there were any further acquisitions or mergers by this company, then it might come within the ambit of the legislation?


Edmund Davie Fulton: I think to put it correctly, that would represent circumstances warranting a further investigation to establish whether or not, in fact, that further acquisition did not constitute an offence under the act.


Frank Howard: Of course, we might get into the question of whether or not monopolies, by themselves, are detrimental, and what action can be taken with respect to them. From what I can recall of this yeast merger, Standard Brands, I believe it was, was the large company which acquired the control or bought out some other company. This, in effect, gave Standard Brands 100 per cent control over the production of one type of yeast and 85 per cent or 80 per cent control over the production of other types of yeast in Canada. Only one other company was left in the yeast producing business, and that was confined to the province of Quebec. In effect, therefore, the acquisition by Standard Brands Limited of this other company placed them in a position of having a virtual monopoly in the production, distribution and sale of yeast in Canada, with the exception of the province of Quebec.
If that situation is correctly stated or if a similar situation arose, in what position is that monopoly with respect to the legislation? Would these facts, by themselves, constitute an offence?


Edmund Davie Fulton: In the case of a merger the requirements of the act under section 2 are that the merger, trust or monopoly has operated or is likely to operate to the detriment or against the interests of the public, whether consumers, producers or others. The commission, in this case, found that the facts disclosed on the inquiry led to certain conclusions.
Firstly, that no monopolistic intent was shown on the part of Standard Brands and, secondly, that the price paid by Standard Brands for Best Yeast was not shown to be excessive, nor was Best Yeast pressured to sell but, on the contrary, the approach came from Best Yeast. As I recall it, Best Yeast was in a strong financial position. They made the approach. They said: if you will pay us a reasonable price we would rather sell out than continue in operation.
Thirdly, the reasons given by Standard Brands for the acquisition, that is to provide needed expansion of capacity and reduce freight costs by having better located plants, appear to be sound business reasons.
I might elaborate on that a little. If you have a business or an enterprise, such as many are in Canada, where very large sums of capital are required to get into that business, then anything whereby competition is lessened, or competitors are acquired, naturally tends to place the person acquiring it in a very powerful monopolistic position. But where you have a form of activity with regard to which no great sums of capital are required in order to be able to enter, and where the channels of distribution are relatively open and free so that entering into that business is, on the face of it, not terribly difficult, the mere acquisition by one company of a competitor does not, in that field, place the company in a very powerful position. That is what the commission had in mind in referring to this factor.
They further found that the slight increase in the price of Best Yeast to the jobber which apparently resulted from the merger may have been accompanied by an improvement in quality and cannot be said to involve detriment to the public.
On the basis of these factors the commission found there was no creation of a monopoly to the detriment of the public, but they did, as I say, warn that this merger has considerably narrowed both existing competition and the opportunity for competition in the industry, and that it has strengthened what may be called Standard Brands monopoly position.
I would sum up as follows: In the result, the commission was not convinced that the public interest had been so affected as to
Supply-J ustice
justify it recommending action to dissolve the merger. Its concern at the reduction in competition and the possibility of long term injury arising from the near monopoly position created led it, however, to express the opinion that Standard Brands should not be permitted to acquire either Lallemand's, of which there was no immediate suggestion, or any new competitor that might enter the present field.
It amounts to a finding that there was no evidence sufficient to warrant a finding of a monopoly operating against the interest of the public, but there was evidence which warranted the commission keeping a close eye on the situation and issuing a warning that further activities along these lines would immediately result in further investigation.


Douglas Mason Fisher: Following along the same line, and referring to the question of the press in Canada, especially the daily press, we have no particular monopoly except in specific towns and, in a sense, these monopolies make sense because a competitor could not make a go of it with any reasonable financial chance. But there has been a considerable growth of newspaper chains in this country which is tending toward a monopoly and there has also been the development of a co-operative press organization, the Canadian Press, which in effect means that a member of the Canadian Press is in a perfect position in competition with anyone who may intend to get into the business but who does not belong to the Canadian Press, and according to the Canadian Press regulations as they are presently set up it is almost impossible for a new enterprise to get going in that field and to be accepted by the Canadian Press.
With regard to this question of the development of chains in the newspaper area and the control of this system of sending press information across the country, is the combines investigation branch watching developments in this particular field at all?


Edmund Davie Fulton: Yes, Mr. Chairman, I think it has become public knowledge that we are looking into one particular case of a mutual arrangement made between two newspapers in Canada, and we are aware of the position of the Canadian Press in the sense in which the hon. gentleman refers to it. If any specific case comes to our attention whereby the existence of this agency were used to foster a monopoly by one newspaper or any combination of newspapers, we would, of course, be prepared to investigate.


Douglas Mason Fisher: I have no particular case to refer to, but I wanted to make sure the minister was watching it because in the lakehead community, which in a sense is a

Supply-Justice
unit, we have two newspapers and the owner of one of them has died recently. There was a certain fear expressed on the part of some people, including myself, that the chain which owns the paper in the other town is trying to purchase, and if it should do so it would leave us in that area without any competition at all, which is the cause of some concern. But, of course, we cannot ask the combines branch to take any sort of a priori action.
One of the points I wanted to raise in connection with combines-and the minister will remember that last year I raised the same point that was raised by the hon. member for Skeena today,-was this new policy towards which the department is working, and there are a couple of other points I wanted to deal with also. I want to ask the minister whether he can comment on an article called "Anti-combines and Injury to the Public," written by Mr. George W. Wilson, which reads, in part as follows:
In recent years certain business interests, lawyers, and professional economists have been insisting that the Combines Commission be required to demonstrate more than an "undue lessening of competition" to obtain a conviction under the Combines Investigation Act and the Criminal Code. What is being suggested is that the commission prove that the economic consequences of the anticompetitive business practices complained of are less desirable from the public point of view than they would have been in the absence of such restrictive activities.
Is that one of the points on which the minister and his officials are trying to determine policy, or are they prepared now to say that do not agree with this general criticism put forward?


Edmund Davie Fulton: It is too early to give an opinion on that, because we have not formed a conclusion. But that is one of the more significant aspects of the jurisprudence which has been developed as a result of recent cases, and it would be foolish of me to deny that there are various elements in the country which regard that aspect with a great deal of concern. They have brought it to my attention; we have said we will look into it and say whether in our view there is any change to be made in the jurisprudence in that respect.


Douglas Mason Fisher: Can the minister assure us that the policy when it is enunciated will not be based purely on economic considerations, but that political and employment considerations will come into it?


Edmund Davie Fulton: Yes, indeed, and I suppose, to be frank, I should admit that no one in my position could make any decision divorced from political considerations-certainly not a provision of that kind.


Frank Howard: There is a provision with respect to monopolies and it relates to research into monopolies and their effect upon the economy, is that not so?


Edmund Davie Fulton: There is section 42 of the act which authorizes the commission to institute inquiries of its own motion into trade practices generally. Perhaps I should read it. Section 42, subsection 1 of the Combines Investigations Act reads as follows:
42. (1) The director upon his own initiative may and upon direction from the minister or at the instance of the commission shall carry out an inquiry concerning the existence and effect of conditions or practices having relation to any commodity which may be the subject of trade or commerce and which conditions or practices are related to monopolistic situations or restraint of trade, and for the purposes of this act any such inquiry shall be deemed to be an inquiry under section 8.


Frank Howard: What is the position of the court, if it gets to the court, with respect to prosecutions and penalties against monopolies themselves as differentiated, if there is a differentiation, from combines?


Edmund Davie Fulton: Perhaps the hon. gentleman means would there be any difference in the position if charges were laid as the result of an investigation started under section 42 or whether they are laid as the result of an investigation commenced in another way. I think if charges were laid then the courts would be in exactly the same position no matter what had been the occasion of the commencement of the investigation. But I should say the purpose of section 42 is rather to conduct the sort of inquiry which might lead to the consideration of recommendations for changes in legislation rather than to laying charges in court.


Frank Howard: That is what I had rather expected was the situation, that this was primarily for research purposes and that arising out of it some change in legislative approach might develop with respect to monopolies themselves. I imagine there has been some research along these lines of monopolies and their effect. Could the minister indicate what the results of these inquiries and that research have been with respect to monopolies?


Edmund Davie Fulton: Mr. Chairman, I am advised that there are four in process, one in the field of automobile insurance, one in the field of antibiotics, one in the field of discriminatory pricing and the fourth in the field of tires, batteries and accessories. These inquiries are in process. There are two before the commission now, the one relating to discriminatory pricing and the other relating to automobile insurance. These inquiries are

completed as far as the director is concerned and are before the commission for consideration and recommendation. The other two inquiries have not yet been completed by the director. When we receive the report of the commission we will then be in a position to make some further assessments as to whether, and if so what changes in legislation might be indicated as a result of these inquiries.


Frank Howard: At the present time, though, apart from what the commission may report, in the minister's opinion at the moment, without taking into account what may be in the report, could he give us any indication what his views are with respect to the legislative program as it would apply to monopolies. Are there any in that field?


Edmund Davie Fulton: I do not think I can give any indication of that. The whole field is being studied and my first responsibility is to make my own conclusions and then draft a set of recommendations and present them to my colleagues in cabinet. Until that is done and until cabinet has accepted, rejected or modified any recommendations that may be made I do not think I am free to hint at what my own views are.


Mr. Hanbidge:: Mr. Chairman, I should like to ask the minister if there has been any investigation with regard to fixing the price of fish on the Pacific coast. I should like particularly to know what is the present status of any investigation that has been carried on.


Edmund Davie Fulton: Yes, Mr. Chairman, there is such an inquiry and it has been referred to on several occasions in this house. It is well advanced. The taking of evidence has been completed and the evidence is now being compiled so that a statement of the evidence can be laid before the commission.


Robert Leith Hanbidge: I am referring particularly to the united fishermen's organization.


Edmund Davie Fulton: Yes. As far as I am aware that is the only inquiry into the field of fish prices that is under way and it was to that inquiry that I had reference in my previous answer.


Douglas Mason Fisher: Mr. Chairman, the minister has one particular case in relation to combines investigations that spills over, as it were, surprisingly enough into the field of agriculture and comes under the purview of the Department of Agriculture.
As the minister probably knows there has been a fairly strong demand in certain parts of the country that there be support prices established for pulpwood. That demand has been especially strong in the maritimes and Quebec and it is present to a degree in
Supply-Justice
eastern and northwestern Ontario. There are a number of difficulties involved in the government establishing a floor price on that commodity. One of the main difficulties is the fact that there is a report concerning the purchase of pulpwood in certain districts in eastern Canada which would dynamite the establishment of any sort of a fair price because, if the information in this document is correct, it would indicate that a fair price has not been paid up until now. This means we are rather chasing our tail in this particular regard. We are not going to get a floor price until we can get something definite in terms of what the floor price should be. We have not had a just market price if the report is correct so how do we get out of the difficulty and arrive at a fair floor price? That is a problem for the Minister of Agriculture but I should like to know what the Minister of Justice could do in speeding up the matter and what are his opinions on it.


Edmund Davie Fulton: Of course, as the hon. member himself has said, the question of a floor price for pulpwood is a matter for the Minister of Agriculture. There are, I think, other difficulties in the way in addition to any difficulty that may arise as a result of this report and any prosecutions that may result. There is the fact that in many cases pulpwood is not grown by farmers but is grown by others. How do you in fact set a support price for pulpwood?
In so far as the situation may be affected by this report and action taken thereunder, as I have informed the house the matter has been referred to counsel in the city of Montreal with instructions for prosecution and I can assure my hon. friend that although these cases being complicated, difficult and technical always take a surprisingly long time, nevertheless we do not anticipate any excessive or undue delay in disposing of this matter.


Douglas Mason Fisher: Could the minister say from talking with his commissioner that the combines commission should be in a position to give the Department of Agriculture advice as to what a just market price would have been if it had not been for the restrictive trade set-up that was in operation? In other words, if the Department of Agriculture has to get information and establish a fair price, is the combines investigations commissioner in a position to advice the minister what a fair price might have been?


Edmund Davie Fulton: No. I think it would be quite improper for the combines commission or the restrictive trade practices commission to enter into that sort of field at all, but information

Supply-Justice
might be obtained from the report itself and from the facts disclosed there. We are not concerned with the detail of whether this or that particular price was too low or too high. Our responsibility is to assess whether prices have been affected by the activities of the companies concerned on the one hand, and also whether the activities of those companies, or whether there is evidence that the activities of those companies, constitute an offence under the combines legislation. We are not qualified, nor is it any part of our responsibility, to make recommendations as to what the price actually might have been or should be.


Douglas Mason Fisher: Mr. Chairman, one other
matter in connection with combines; I have here a copy of a letter from the general manager of the garage operators' association in Ontario which was sent to the minister on May 29, 1958. The substance of the letter is contained in three paragraphs. These paragraphs read:
The governors and directors of the garage operators' association are greatly concerned by a practice of the oil companies in Ontario which the association's legal advisers have instructed is perhaps both contrary to the combines act and also contrary to the Unfair Competition Act, and in fact and law is likely in restraint of trade.
This practice of the oil companies involves gasoline price wars where prices are reduced by one station serving one type of gas across a community and the gas station attendant is sponsored and recompensed by the gas company and still will go on for some time, one company bettering the offer of another and then suddenly the war comes to an end on the last day and oddly enough the price of gas ends up being the same as it started on the same day for every company in the community and at the same level.
Although for obvious reasons this may be amusing to the oil companies, it is a great injustice to the public and to the small operator.
That is the end of the paragraphs that I feel carry the meat of the complaint. Whenever one raises questions in regard to this he realizes that perhaps he is prodding into areas that would be just as well left un-prodded until some definite action is taken. Since this particular complaint is such a pertinent one right at the present time when gasoline wars are going on in various parts of the province of Ontario,-and I gather also out in Manitoba-can the minister indicate the scope of any possible action in connection with this? Does it look as though it is worth while proceeding on the basis of complaints that have been received so far?


Edmund Davie Fulton: The complaints allege matters which, if substantiated, would warrant investigation with regard to discriminatory pricing contrary to section 412 of the Criminal Code. That was the allegation made by those who brought it to our attention. As a result of

this complaint the director interviewed two of the officials of the associations bringing them to our attention, and he has consulted with them as to the specific nature of the complaint, and the situations complained about are under study in the branch with a view to making a more formal inquiry or investigation as soon as staff is available who are now engaged on other inquiries. Until the inquiry is launched and more specific facts are ascertained we could not give any indication of the direction in which the inquiry may lead us.


Douglas Mason Fisher: What is the staff situation in your department at the present time to handle what may be an increasing amount of business? Have any attempts been made in the past year, let us say, to extend the scope of the activities and has the minister the men to do it?


Edmund Davie Fulton: At the present time the staff is normal in comparison with past years. There are always some vacancies but we are carrying out a competition at the present time with a view to recruiting staff in the category of inquiry officers. If there should be any increase in the numbers of inquiries to be undertaken we shall be in a position to deal with them. The staff has also increased but are fully engaged, particularly the director personally, in the studies and discussion which I have indicated which are taking place with regard to a general review of combines legislation.


Frank Howard: I have a question arising out of the minister's last comments with respect to staff. Can he indicate whether there is a backlog of cases to be inquired into and whether he finds when a complaint is raised either by six people or by an order given by the minister, or the director on his own initiative decides to make an inquiry, these things pile up because of a lack of staff members?


Edmund Davie Fulton: I am informed there is always some backlog of cases under inquiry at the end of a fiscal year. On March 31, 1958, the close of the last fiscal year, some 30 inquiries were waiting to be proceeded with as against 20, the average of the previous fiscal years. That is one of the reasons why we have conducted this competition for the selection of further junior officers.


Frank Howard: How many officers are there?


Edmund Davie Fulton: I believe I said 30 inquiries awaiting attention; a more accurate phrase would be proceeding, as against an average of 20 at the close of previous fiscal years.


Frank Howard: How many junior officers were you conducting this competition for?


Edmund Davie Fulton: We would fill up to five
vacancies as a result of the competition.


Frank Howard: If my memory serves me right the minister indicated that there were five vacancies in January when this question was last before the house. I think it was January when the estimates were last before the house. There were five vacancies then and there are five vacancies now. Is that the same five? Have they not been filled since that time?


Edmund Davie Fulton: I am informed that of those five vacancies one has been filled, but another member of the staff has left so we still have five vacancies. The competition was in process last January when I spoke. Civil service competitions do not always get finished as early as one anticipates. But the director tells me that the competition-I am not sure of the technical term-the date for applications has been closed and the civil service commission is in the process of compiling the eligible list now from which the selection will be made.


Frank Howard: According to the details on page 244 of the estimates book, 53 employees are listed under the office of investigation and research. In actual fact, that would mean less five, would it? Five of those 53 are potential employees?


Edmund Davie Fulton: Yes, the figures shown here
would be the establishment. Therefore there would presumably be 48 actually on strength at the present time.


Frank Howard: I do not know what qualifications you look for in these individuals or what salary structure is offered to them but in view of the qualifications required for such a position, which I appreciate must be fairly high, is the minister of the opinion that the salary structure is sufficient to attract capable people or would more capable people be attracted by higher salaries?


Edmund Davie Fulton: The hon. gentleman will notice that the starting salary for combines investigation officers is $5,400 and rises through various grades to $11,000 for combines investigation officers and $12,500 for senior combines investigation officers. I am informed that the salary ranges compare reasonably with the rest of the public service in similar categories of skill and qualifications and that our experience in recruiting staff at these salaries is about the same as other departments.


Frank Howard: I am going to suggest that
in all probability the staff is far too small and that if it were larger the branch, merely by being larger, would be in a better position
Supply-Justice
to conduct many more inquiries than are being conducted at the moment. I am sure the minister will probably agree there are many conditions existing across the country involving organizations on a nationwide basis or smaller groups in provinces or municipalities that require investigation because these organizations are in fact operating contrary to the provisions of the act. If a larger number of people were employed on the staff to investigate these cases there would be a far more beneficial effect on the economy and the general public than there is at present.
I am going to make a suggestion arising particularly from what the hon. member for Port Arthur said with respect to gasoline price wars. I have also heard comments from four or five individuals in cities across Canada that price fixing arrangements are entered into between gasoline retailers in those cities similar to the situation which existed in Vancouver a few years ago but that no action is taken to deal with them. It may well be the reason is that the matter has not been brought to the attention of the director in one way or another. In any event, if these conditions were brought to his attention and if all the other illegal practices being followed which have not come to his attention were brought to his attention the present staff would be even less able to cope with such cases than it is at the present time. I suggest that there should be an ample increase in the numbers of the staff in order to police the provisions of the act properly.
Extensive amendments were made to the act in 1952 and I suggest that since then individual corporations, feeling that it is beneficial to their business from a profit point of view to operate combines for fixing prices or to restrict distribution, markets, warehousing or anything else in order to ensure control of a certain market and the highest possible income, are finding ways and means of escaping the eye of the director. In past years it has been indicated in reports of the commission that one way in which evidence of illegal combinations came to light was through extracts from correspondence between companies with respect to how they were going to carve up markets and fix prices. However, in order to overcome that they are writing fewer letters and there are more telephone conversations with respect to price fixing and other illegal acts. Therefore it will become more difficult to ferret out and discover evidence leading to the establishment of the operation of a combine, which is what is required if we are going to be able to cope with the problem.

Supply-Justice
Even though the minister may not now have any clear idea of what changes will be made in the legislation, and I hope he will not be too long in making up his mind about necessary changes, I hope that he will indicate now that there will be an increase in the staff for the administration and policing of the Combines Investigation Act in order to ensure that under our society the interests of the public will be served.


Edmund Davie Fulton: I do not think I should let those remarks go without comment. Possibly the hon. gentleman might be interested in this general statement of the activities of the branch as at the end of the fiscal year, March 31. Sixteen new inquiries were commenced during the 1957-58 fiscal year. The number of formal investigations of possible contravention in progress at the end of the year was 30 compared with 20 in progress at the end of the previous fiscal year. The number of general inquiries in progress was 4 against 3 at the end of the previous fiscal year. Four prosecutions were successfully concluded during the fiscal year and one prosecution was commenced. The total combined staff of the restrictive trade practices commission and the director of investigation and research was 51 at the end of the 1957-58 fiscal year compared with 50 at the end of the previous fiscal year. The staff of the director included 16 investigation officers compared with 15 at the end of the previous fiscal year. There is also the competition to which I have referred which will result in an increase of anything up to five. This would be an increase of 33J per cent in the investigational staff in the office of the director which would, of course, be a very substantial increase.
Therefore I do not think there is real justification for the comments made by the hon. member. With respect to the existence of the fact to which he refers, namely that companies are finding ways and means of escaping the eye of the director, I can assure him that this is far from the case. If he sat at my desk he would know about the benevolent but watchful or should I say watchful but benevolent eye that the director keeps on the activities of these companies and he would know of the feeling of business in Canada that the director is a man who is remarkably able to exercise the supervision which it is his responsibility to exercise under the legislation under which he is appointed. Therefore I do not think the hon. member need have too much fear on that score.


Frank Howard: I am sure the minister was not trying to construe my remarks as casting any reflection upon the director.


Edmund Davie Fulton: No. I took the hon. member as saying that he questioned whether the director had an adequate staff to carry out his responsibilities. I can assure him that the experience of those concerned is that with comparatively small staff they do an enormous volume of work and exercise a very remarkable degree of surveillance over the field for which they are responsible.


Douglas Mason Fisher: The only remark I wanted to make in connection with salaries is this. It seems to me that if most of these officers are going to have legal training there might be a special adjustment in the salary scale. I know the House of Commons has a great many lawyers in it. I know that here they get $10,000 a year approximately. Yet I understand from talking to almost all of them that this is a tremendous come-down. If we assume that lawyers in the House of Commons are average lawyers, it would appear that the wages paid to investigation officers are rather poor for people with that particular training.


Edmund Davie Fulton: My hon. friend will appreciate that while the starting salary as reported in the blue book of estimates is $5,400, the next grade up is $7,500 and the next one is $8,300, the next $10,000 and so on. These, as they start, would be lawyers, economists and accountants who would normally be quite recent graduates from their respective professional schools. It therefore is not a case of our trying to get men who are earning large amounts in their profession and getting them to come in at small salaries. We recruit them as fairly recent graduates and then train them through the department with the increase in salaries shown here.


Douglas Mason Fisher: My only comment is this. The fact that members start and finish at $10,000, unless they are lucky enough to become parliamentary assistants, may be the unfair part. On June 10 the minister is credited with having said in Vancouver in a speech to the retail merchants of Canada that his department is carrying out investigations into two fields, an inquiry into loss leader selling of cigarettes, electrical appliances, hardware and jewellery trade and a study of whether some types of grocery stores receive unfair price preference from the supplier; it is reported that in this address the minister said that steps are being taken to remove "artificial" obstacles to small business in Canada. This general or rather-I must be fair-slight indication of what was the meat of the minister's argument on this particular occasion I am sure would interest all of us at the present time.

As the minister is aware, across Canada- and usually out of a local marketing situation-small merchandisers are wrought up over the fact that, for example, the big chain is able to offer cigarettes so much more cheaply. The appeal of the small retailer and the small merchant is a very powerful one, as the minister himself has remarked. What is his general thinking with regard to the way in which this particular problem can be attacked by the combines investigation branch? With the number of officers that was mentioned that they had, surely it is apparent that they cannot attack this problem on a continental scale; that their way of attacking it has to be based upon picking some specific market and trying to use that as an example right across the country. I wonder just how effective that approach would be. Perhaps that is not the approach that the minister had in mind when he announced this matter. I would appreciate hearing his comments in regard to this problem.


Edmund Davie Fulton: To mention some of the inquiries that have been instituted, inquiries into cigarettes or practices with regard to cigarettes have been instituted both in Edmonton and Toronto and also Ottawa and Hamilton; and with regard to electrical appliances in Vancouver. With regard to discriminatory prices in the grocery trade, that inquiry is a general inquiry which will take in the whole of the country.
With regard to the availability of staff to carry out these inquiries, as I have pointed out there are 30 formal investigations of possible contraventions and 4 general inquiries under way at the present time. As to what the restrictive trade practices branch might do to help small business, of course the completion of these studies will give us an indication of what should be done. If in fact it is shown that the section regarding unfair trade practices is not an adequate protection then we will know whether we require additional legislation. I might say that the most universally expressed desire of small businessmen in so far as matters in our field is concerned is for the repeal of section 34. These men say that they have lost the protection against the big chains which the resale price maintenance system formerly gave them. They say that they are now at the mercy of unfair selling practices, loss leader practices and so on. It is to give us a fresh starting point or a starting point to assess what action we can take in this department that will be helpful that these inquiries are under way.
My remarks at Vancouver referred also to the proposal made by the government to set up a small business section within the administrative machinery of government to which
Supply-Justice
these men might bring their problems. Ours is only one of the aspects of the problems with which small business is faced in the field for which this department is responsible.


Douglas Mason Fisher: The minister by his comments indicates that he is aware that there is a paradox in this whole problem of small business. The position of small businessmen and the sort of rat trap they have got themselves into appeals to us because we like the idea of the small businessman having an opportunity, especially in the line of competition. Yet to save the small businessmen in a sense we have to wipe out the advantages that very large organizations are able to obtain through competitive means. I wonder whether the minister can express an opinion or his views on whether, if the small businessmen or the small merchants are given the kind of legislation that will enable them to get away from this unfair advantage that they feel the big companies have, we will be getting ourselves into the situation where we are actually denying the whole essence of the legislation itself which is to encourage competition.


Edmund Davie Fulton: I think I must say that the hon. gentleman has put his finger on the very problem that we have to wrestle with. I do not know that I can do much more than put the matter in that way. It is certainly the policy of this government, as I understand it, to encourage the maximum degree or the maximum number of independent enterprises. The traditional way of putting the matter is, of course, whether you want to see the small independent corner grocery maintained or whether you want to see people served by a chain store. To reconcile the steps which may be required to be taken to protect the small independent operator on the one hand with the desire to maintain the maximum of competition on the other hand is the problem with which we are faced. That is one of the thorny problems towards which this study is directed. It is not an easy one to solve. That is why I make no forecast as to when I will be in a position to make a recommendation beyond saying what I have said, namely that we hope we can resolve our thinking on this and other aspects of the matter in time to make recommendations for next session.


Douglas Mason Fisher: I should like to leave this question by making these two points. I had a conversation the other day with a gentleman who told me several years ago about a combine that was operating in the fine papers business. As the minister knows, proceedings were taken. There was an investigation followed by some prosecutions. The information

Supply-Justice
he gave me was that so far as he was concerned, and he is in the specialty field dealing with retailers and wholesalers of paper, the combine is just as strong as ever despite what may have taken place. I asked him to give me this information in printed form with signatures so that I could use it. He refused because he said he was thinking of his own protection. I just wanted to make that point. This gentleman felt that this particular situation still exists despite the activities of the combines branch and the prosecutions that have been undertaken.
I believe I mentioned this other point last year. It has been brought to my attention again by a man in the automobile business who refused to put his name to a sheet of paper because he is involved with one of the big automobile manufacturers. He insists that there is a system of kickbacks arranged so far as the financing of automobiles is concerned, depending on the volume of business done. In other words a man who is selling cars and who has a very large volume of business is able to arrange for certain kickbacks with the acceptance corporations at the beginning of a year's financial operations which give him a much better margin on which to work in selling the cars on credit than the smaller dealer is able to obtain.
As I say, I asked this man to put these facts on paper but he said if he did he would just get himself into trouble since most of the people about whom he would be complaining were in the business with some of the acceptance corporations and some of the large automobile companies. I should like the minister to have his commissioner take an interest in this problem, if possible, to ascertain if there is any substance to this charge.


Edmund Davie Fulton: I can assure the hon. gentleman we will be very glad to do that. I can assure him also that if any person feels a reluctance to reveal his name or put the matter in writing, if he calls at the office of the director he may be seen personally and the interview will be entirely confidential. It may well be that if information is given which results in a prosecution, at that stage witnesses might have to come forward. Certainly, however, in the preliminary stages, until we get the matter advanced to the point where a decision as to further action has to be taken, an interview can be entirely confidential.
Indeed I see no reason why the name of an informant should not be confidential throughout until it becomes a matter of gathering evidence. As I said a few moments ago, it would seem to me that the gathering of that type of evidence would not involve revealing

the name of the person who first gave the lead to the inquiry. I think it would be safe for me to assure my hon. friend that he can tell his informant that if he cares to come to the office of the director of research and investigation there can be a discussion there that can be kept confidential.


Douglas Mason Fisher: Last year I had an interview with the director, and he was kind enough to give me some advice in connection with pulp-wood prices. As you know, if you can get six people to request an inquiry it has to proceed. I was supremely confident that I could get six people. I landed home in my constituency and went canvassing, but I have to be quite frank and say I was only able to get two names, although I could get dozens of people who would agree with the general complaint. It is for this reason I know that particular section of the act does not work too well in initiating investigations. I am hopeful that the commissioner will not hesitate at all to act on his own initiative in following these leads. We welcome the assurances that have been given that the minister gives his whole-hearted support to these activities.


Frank Howard: May I ask one other question? The other day the minister, in response to a question of mine, indicated that Mr. Meighen in the city of Winnipeg-


Edmund Davie Fulton: Brandon.


Frank Howard: -in the city of Brandon, had been retained to study the evidence relating to the acquisition of Manitoba Sugar Company by B.C. Sugar Company, and to proceed with a prosecution if he felt there was sufficient evidence. Could the minister indicate what the position is with respect to that matter at the moment?


Edmund Davie Fulton: The counsel named is studying the evidence. He was instructed on July 10 and we have not had a report from him as yet. It is a little early to expect one.


[Stage Direction]
Item agreed to.
165. Office of investigation and research, $446,321.
Mr. Richard (Ottawa East):: I should like to ask the Minister of Justice if the director of investigation and research, under the Combines Investigation Act, either independently or through the royal commission on patents, has made any recent study to ascertain whether the Canadian patent system has been used by the holders of Canadian patents in a manner that might be considered to be detrimental to industrial growth in Canada?


Edmund Davie Fulton: I am informed that the office has not made any study of patents, as a general study of inquiry. Patents do come up

incidentally in connection with our cases and are then dealt with on an ad hoc basis.


[Stage Direction]
Item agreed to.
Penitentiaries-
167. Administration of the office of the commissioner of penitentiaries, including $60,000 for grants to recognized prisoners' aid societies, as may be approved by the treasury board, $518,701.
Mr. Winch:: I should like to ask the Minister of Justice-


Edmund Davie Fulton: Would my hon. friend permit me to interrupt a moment? We allowed item 158 to stand, remission services. Before we go on to penitentiaries, may we either revert to that or carry it as part of the department itself?


The Chairman:: Shall 158 carry?


Some hon. Members:: Agreed.


Harold Edward Winch: On 167 again, then, may I say that I realize the present minister has only been in this post since June of last year. I am wondering whether or not it is possible now for him to give a review of his study of the penitentiary situation since he has taken office, and what he has in mind for the future with reference to that type of institution. I know that we will have before us in a few days a motion for second reading of the parole bill, so I am not going to discuss that phase of penitentiaries. Only a few days ago the minister announced that he hopes, within a period of the next two months, to have a meeting between his departmental officials and the attorneys general of the provinces concerning the major sections of the Fauteux report. Even although these announcements have been made by the minister, could he give us a little more information as to just what he has in mind with regard to the penitentiary system itself, and the inmates who have to be in these institutions. I have not visited all the penitentiaries in Canada, but I have been through some.


An hon. Member:: For how long?


Harold Edward Winch: O.k., smart boy, as an M.P., I got in and got out. I hope I always will be able to get out. I hope the Minister of Justice will not mind if I draw to his attention the fact that penitentiary buildings in Canada are hopelessly outdated and antiquated. One has only to visit them to know that.
So my first question to the Minister of Justice is this, and I address it to the minister through you, Mr. Chairman: how can you, as Minister of Justice, believing, as I am sure you do, in modern penology, in particular from the point of view of rehabilitation, hope to achieve any success with
Supply-Justice
completely outdated and antiquated institutions? And we have as yet had no pronouncement of any policy of change with respect to the capital structure of the penitentiaries themselves.
Go to Kingston, and visit that institution. I am not questioning the work of the warden, his deputy or his officers. I think they are trying to do a wonderful job. But how can they do the job they are expected to do? How can you, as Minister of Justice, obtain the results you hope you can obtain by a new approach when you have an institution so antiquated and outdated? I hope the minister can give us at least some indication as to his thoughts along this line with respect to the modernization of these penal institutions so that they may coincide with modern penology and its thinking on the subjects of supervision, treatment and rehabilitation.
Further, when we think of penitentiaries- and this is not a nice subject-we have to study those who are in these institutions, and I was disappointed when I read the report of the commissioner of penitentiaries for the period ending March 31, 1957 to note that 12.94 per cent of the population represented people under 21 years of age and that of the 703 persons who were under 21 years of age at that time only 232 were in prison for the first time. Thus, of those in the penitentiaries in the year under review the majority even of those under 21 years of age were recidivists. That should make us ask ourselves whether our penitentiary system is working out satisfactorily with respect to these young people.
At the same time as I studied the report of the commissioner of penitentiaries I read for the same period, the report of the warden of the Okalla jail in British Columbia which deals with the same subject. I note that the warden says in his report at page BB9:
The increase was made up partly from the growing numbers of teenagers who, for lack of adequate alternatives to delinquency, and a deficiency of preventative services in the community, are not being dealt with in time to avoid the inevitability of sending them to prison.
And in this report-I am speaking now of the report of Warden Christie, who, I think, is outstanding in the field of penology in Canada-it is pointed out that there is a need for facilities for those awaiting trial, for proper segregation and for psychiatric treatment and psychological advice.
I should like to return now to the report of the commissioner of penitentiaries in which it is pointed out that 12.94 per cent of the prison population were under 21, and of the 703 people represented by that percentage approximately 400 were recidivists. I know how deeply the minister feels about this

Supply-Justice
problem; I know he has a bill on parole coming before us, and I know he is arranging this meeting in two months time with the attorneys general and his officials, but in view of the seriousness of the situation and in view of the outmoded capital structure of our penitentiaries I wonder whether the minister could give us an indication of his views and of the progress of his investigation and, possibly, his hopes and aspirations as to what may be achieved in the not too distant future.


John Whitney Pickersgill: Before the minister replies, I wonder whether he could also say what the situation is with respect to Newfoundland where I believe there is not, in fact, a penitentiary.


Edmund Davie Fulton: I think I should explain at the very beginning with regard to what I must say in reply to the hon. member for Vancouver East that I must sound a note of caution, since any program I outline, tentative though it may be, is not one which I could say would be fulfilled in the near future.
I think we are confronted with a major task here in bringing the penal system into line with the best thinking as to what a panel system should be. An enormous amount of capital expenditure must be made if the plans which we are developing now are to come to fruition. I think that for this reason, as well as for the reason that it is going to take time to train staff and that we may well have to assume responsibility for a very substantial increase in the population, both the physical and the financial implications of this program may well dictate that it be carried out in stages, perhaps three separate stages of, maybe, five years each.
Perhaps I should deal at this point with some of the things which are now being done. The hon. member has stated that our penitentiaries are antiquated as buildings. Perhaps they are not quite as antiquated as that bald statement, accepted without modification, might indicate, because I am informed there has been a substantial rebuilding program over the past number of years in the institutions themselves, quite apart from any new building program. In Kingston, for instance, to mention one example, three shop buildings have been completely rebuilt since 1954. And, to speak of new institutions, a new federal training centre was opened at St. Vincent de Paul in 1952. That is a completely new building, as well as a new departure.


Harold Edward Winch: Is that Collin's Bay?


Edmund Davie Fulton: No, that is the federal training centre at St. Vincent de Paul in Montreal. The new institution at Joyceville

was started last year in 1957. Its construction is well on now. We have a small number of people there and hope it will be ready for full occupancy in the summer of next year.
In addition there is a completely new building-it will almost be an institution in effect-to be started again at St. Vincent de Paul the authority for which is given in the supplementary estimates this year. An appropriation of $800,000 is being asked for to start the building of that new institution at St. Vincent de Paul.
There is at the present time a substantial building program both recently completed and in progress but we recognize that this building program has been designed and is designed to take care only of the present penitentiary population and to some extent the anticipated increase in penitentiary population under the present division of responsibilities between ourselves and the provinces. We recognize, therefore, that this new building program is designed only to take care of that portion of the penitentiary population for which we are responsible now and even then we know we shall soon have to be starting new buildings in addition to those I have mentioned just to take care of our own responsibilities. It becomes obvious then that if and when we accept responsibility by agreement with the provinces for a very considerable increase in the number of prison inmates, namely all those sentenced to terms of over six months, our capital requirements for building are going to be vastly increased. It is a question of whether we can meet that problem in part at least by taking over some of the provincial institutions in which these men are now accommodated or whether we are going to find we have to provide entirely new buildings for them and until, therefore, our discussions with the provinces are completed we will not know the full extent of our building requirements in this field although we are aware, as I say, that in order to meet the expansion of our own present responsibilities, owing to increased population and so on, we are still going to have to continue with a building program.
What are the sort of things then that we have in mind as other measures of reform? I have said we are fully conscious of the need for new buildings and new types of buildings and our problem is the contemplation of the implementation of that program although, as I say, it is going to have to be stretched out over a period of years. Therefore, what we have to do is design a program.
What about some of the non-physical aspects of our thinking? There are such

matters as the training of staff in connection with the line of thinking we are now following with regard to parole, for instance, which is designed to return as quickly as it is possible to do so the maximum number of prisoners to lead a useful life in society outside the walls of a prison rather than inside. In order to make that program workable and realistic and to ensure that it serves the best interests of society we are going to have to have considerable increases in trained staff so the parole system will be an advantage rather than a disadvantage. That is a matter involving both physical as well as financial outlays as well as administrative problems in recruiting and training staff and problems of consultation with the various institutions, universities and so on where a good deal of the initial training, schooling or education of that type of staff should take place. Schools of social work will be involved.
Then there is the question of the type of facilities which will be provided. There are the recommendations of the Fauteux commission in this respect, of course, as to segregation of types of offenders. That, of course, if carried out increases the number of institutions that may be required and so it involves both an administrative as well as a financial problem. Then there is the other important recommendation for reception centres where prisoners might be classified before they are committed to the final institution in order that they may be sent to the right type of institution where the right type of rehabilitation training designed to suit the needs of that prisoner would be available. In a country as wide as Canada it might be impossible to have only one reception centre. We may have to have more than one and I believe the ideal objective would be a number of reception centres adjacent to the pentientiaries so that the transportation costs and delays might be cut down. The reception centres in turn would require classification staffs, men or women trained in the assessment of prisoners, in assessing their need and the type of rehabilitation they require so they may be properly assigned to the proper institution when the proper institution is available.
I say these things in order to indicate the line of our thinking. We are attempting to develop a scientific and socially adequate system of penology in Canada, one designed to serve the best interests of society and designed to keep our prison population to a minimum -that is, the population inside the prison walls-and to ensure that men committed to prison receive the type of consideration, education, handling and rehabilitation training that they need and which is designed
Supply-Justice
to return them as quickly as possible as useful members of society rather than as continuing enemies of society.
I would conclude this summary of the sort of program we have in mind by saying it must be realized it is going to be an expensive one in terms of dollars. I doubt very much- and I think this warning should be sounded and sounded now-if we are going to be able to point to savings in terms of dollars. Our population is growing. Probably the numbers coming into prison for the first time will continue to increase. What we want to cut down on is on the number coming back to prison. This is indeed going to be an expensive program and, as I say, we probably will not be able to point to savings in terms of dollars. But I believe that when it is established on the basis we envisage we shall be able to point with pride in Canada to the fact that we have brought our system up to date and to the fact that we are achieving substantial savings in terms of social and sociological results.


Harold Edward Winch: Mr. Chairman, before the
minister concludes would he comment as to what special attention is now being given to the very serious problem I mentioned of the high rate of recidivism amongst penitentiary inmates under 21 years of age. There appears to be a serious problem when we read that 12.94 per cent of those in penitentiaries are under the age of 21. According to the last report out of the 703 under that age 471 were recidivists. Is there any special attention being given to that problem now?


Edmund Davie Fulton: Yes. Along with the attention being given to the problem of recidivism generally I think a proper reading of the figures referred to by my hon. friend would establish that while the figure refers to those under 21 who have previously served jail sentences they may not be recidivists in the sense that they have served a penitentiary sentence but may have been in some other form of prison.


Harold Edward Winch: They have been in jail or
reformatory?


Edmund Davie Fulton: Yes, that is right. This is a problem, of course, and perhaps in part it will be solved by a more adequate parole system. As my hon. friend knows one of the things we are working toward is a national system of parole. Under that system we may be able to cut down the rate of recidivism particularly on the part of young offenders. As my hon. friend also knows there are only two provinces at the moment in which there is any parole system so there is a great gap across this dominion where there is no system of parole which involves in part the training and rehabilitation of young offenders. I would hope that the new parole system might have

Supply-Justice
a substantial influence on the rate of re- the hon. member for Bellechasse. I think cidivism, or the rate of repetition on the part there are some implications to it that we particularly of young offenders; but I should would both like to discuss before accepting say also we are very much concerned with it fully, as I have indicated to him already, and very much aware of the rate of recidivism There is much in what he has said and we generally on the part of penitentiary inmates, are discussing the proposal with him.


Harold Edward Winch: Almost 80 per cent.


Edmund Davie Fulton: Yes; recidivism in the penitentiary, that is, those who have served previous penitentiary terms, is something in the neighbourhood of 40 per cent, but it is true, that some 80 per cent of the total population of our penitentiaries have served previous prison sentences, reformatory sentences, and so on.


Harold Edward Winch: It is a real problem, then.


Edmund Davie Fulton: It is, indeed.
I would like to answer the question of the hon. member for Bonavista-Twillingate. The arrangement we have with Newfoundland is that those from that province sentenced to terms which would ordinarily involve going to a federal penitentiary are accommodated in jails of the province within Newfoundland, under an arrangement whereby we pay a per diem per capita cost. The number so accommodated has gone down in the last 10 months from 48 to 31 at the present time, so that we are happy to say, and I am sure my hon. friend is proud to say, that the number of penitentiary sentences coming from Newfoundland is not great.


John Whitney Pickersgill: I am sure it is the most law-abiding part of Canada, sir, but I wonder whether the minister can say a word about women prisoners; are there any?


Edmund Davie Fulton: I am informed there are no women prisoners from the province of Newfoundland who have been sentenced to two years or more.


Mr. Creslohl:: Under the same heading, will the minister inform the committee what steps have been taken or are being taken, or what consideration is being given to the problem of juvenile delinquency? I particularly address myself to Bill No. C-20 which is on the order paper and which was introduced by the hon. member for Bellechasse. I wonder whether the minister would facilitate the passage of this bill which is a private member's bill?


Edmund Davie Fulton: Mr. Chairman, I do not really think that the question of juvenile delinquency is relevant to the consideration of this particular problem. I would be glad to answer the hon. member's particular question and say that I am looking forward to the opportunity of discussing his proposal with


Harold Edward Winch: I have one question. I am trying to decide how to put myself in order and ask it. The only way I can do it is this. I refer to the question of capital punishment which comes under the Criminal Code and therefore under the Minister of Justice. If the minister could give us some information on this I would be interested to hear it. When a person is sentenced to capital punishment it takes place in a provincial jail and not in a penitentiary. I ask the question for one reason. We have come to the point where capital punishment is under the Criminal Code and therefore under the Minister of Justice, but the sentence is carried out in a provincial jail. As long as as we have this most vicious system, is there any way by which the Minister of Justice can see that it is not carried out within the confines of the jail itself, with the consequent disruption and heartbreak of the inmates and the employees? As the minister knows, that is the situation in British Columbia.


Edmund Davie Fulton: There are a number of considerations which I think indicate or argue in favour of confining the person under sentence of death to jail in the province. For instance, there is the matter of appeal. It is necessary for him to be in constant communication with his lawyer whether the appeal be through the courts or whether ultimately appeal be to the governor in council in the exercise of the prerogative of mercy. In addition, there would be the occasion of the last visits from relatives and friends of the sentenced person. I think all of these considerations argue in favour of the retention of that man in jail close to-his home.


Harold Edward Winch: Is it possible for the minister in his capacity of Minister of Justice and almost the court of last resort as to whether a man dies or not, to say that as long as we have capital punishment it will not be carried out within the confines of the prison, as is the case in British Columbia. There it is. carried out right in the confines of the main building itself, which means-I will not describe what it means-that all the inmates know that a man has died, the staff know that a man has died right inside the confines. There was the recommendation of the joint committee of the Senate and House of Commons that if you have to retain it, it should. not be done inside the jail.


Edmund Davie Fulton: I am inclined to agree with my hon. friend on that point. I remind him that, as he said, it is difficult for me to keep in order. When he raises this matter under this item I think he is getting dangerously close to the margin.


Harold Edward Winch: I had to have some way of doing it.


Edmund Davie Fulton: I think I can only answer in this case by saying that inasmuch as the responsibility is that of the provincial authorities, then the acceptance of the recommendation depends on their views in that regard. I am quite certain that they would be impressed by the recommendation of the committee and that as and when they find themselves able to do so they may consider instituting that reform.


[Stage Direction]
Item agreed to.
169. Construction, Improvements and Equipment. $2,817,305.
Maurice Bourget: Just a moment ago the minister said that the department was going to depart on a new construction program. He will recall that when the Minister of Public Works was in opposition he often recommended to the administration of the day that all construction be transferred to the Department of Public Works. I am asking the minister whether any discussion has taken place between the Minister of Public Works and himself looking to the transfer of construction of penitentiaries to the Department of Public Works?


Edmund Davie Fulton: No, Mr. Chairman, no discussion looking to the transfer of penitentiaries construction to public works has taken place, but when I was acting minister of citizenship and immigration we did have discussions with regard to the construction of Indian schools. Certainly, changes were instituted in that regard.


John Whitney Pickersgill: That had already happened.


Edmund Davie Fulton: No; changes were instituted in that regard while I was acting minister. With respect to penitentiaries, the technicalities involved do not make it desirable from that point of view.
Progress reported.



THE ROYAL ASSENT

Mr. Speaker:: I have the honour to inform the house that I have received the following communication:
Ottawa, August 7, 1958
Sir:
I have the honour to inform you that the Honourable Mr. Justice J. H. G. Fauteux, acting as
The Royal Assent
Deputy of His Excellency the Governor General, will proceed to the Senate chamber today, the 7th August, 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)

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 to give, in Her Majesty's name, the royal assent to the following bills:
An act for the relief of Annie Allish Watson.
An act for the relief of John Spence Brown.
An act for the relief of Verne Alfred Freeman.
An act for the relief of Davina Betsy Snow Campbell.
An act for the relief of Jack Spinner.
An act for the relief of Claude Hector Proulx.
An act for the relief of Mary Florence McLelland Pringle.
An act for the relief of Robert Maurice Sherwood.
An act for the relief of Margaret Jeanette Young Warmington.
An act for the relief of Mary Isabella Cross Davidson.
An act for the relief of Rita Firestone Flax.
An act for the relief of Dorothy June Pearce Tribble.
An act for the relief of Anne Rottermund David.
An act for the relief of Gordon Edwin Limbrick.
An act for the relief of Helen Paperno Bogatin.
An act for the relief of Joseph Victor Cyril Goyer.
An act for the relief of Henry Joseph Haggett.
An act for the relief of Ethel Roe Emond.
An act for the relief of Frederick Wilson Abbott,
An act for the relief of Gilda Rosen Silverman.
An act for the relief of John Luczko.
An act for the relief of Anita Fischer Staub.
An act for the relief of Margaret Irene Dawe Mays.
An act for the relief of Janine Lafontaine Frost.
An act for the relief of Lydia Feodorovna Ovchinnikova Lipsman.
An act for the relief of Donald Malcolm Gangin.
An act for the relief of Marie Louise Plourde Auld Emard.
An act for the relief of Ralph Murrin.
An act for the relief of Bruno Giovanni Albertini.
An act to implement a Convention between Canada and Belgium for the Avoidance of Double Taxation with respect to Income Taxes.
An act to implement a Convention between Canada and Belgium for the purpose of extending to the Belgian-Congo and the Territory of Ruanda-Urundi under Trusteeship the Convention between Canada and Belgium for the Avoidance of Double Taxation with respect to Income Taxes.

Supply-Justice
An act to amend the Prairie Grain Advance Payments Act.
An act to amend the Prairie Farm Assistance Act.
An act to amend the Animal Contagious Diseases Act.
An act respecting Canadian Pacific Railway Company and certain wholly owned subsidiaries.
An act respecting The Catholic Episcopal Corporation of Timiskaming.
An act respecting Ogdensburg Bridge Authority.
An act respecting The Algoma Central and Hudson Bay Railway Company.
An act to amend the Canadian Farm Loan Act.
An act for granting to Her Majesty certain sums of money for the public service of the financial year ending the 31st March, 1959.

The house in committee of supply, Mr. Rea in the chair.



DEPARTMENT OF JUSTICE

[Stage Direction]
169. Construction, improvements and equipment, $2,817,305.
Charles Edward Rea: When the committee was interrupted we were considering item 169.
At six o'clock the committee took recess.


[Stage Direction]
AFTER RECESS

The committee resumed at eight o'clock.
Charles Edward Rea: We are discussing
vote 169.


Harold Edward Winch: On this item I wish to ask
the Minister of Justice one question. This vote is for construction, improvements and equipment. Could I ask the minister if this is the entire vote that is required by his department, or is there any additional vote under the Department of Public Works for any construction whatsoever.


Edmund Davie Fulton: The vote for construction
under the penitentiaries branch is entirely within this department. We have, however, a supplementary estimate, so this main item is not the only one we have. But nothing in this respect comes under the Department of Public Works.


Harold Edward Winch: No vote of any kind under
the Department of Public Works?


Edmund Davie Fulton: That is correct.


Harold Edward Winch: May I ask that the Minister
of Justice should maintain the principle that this vote always remain within his department, and not come under the Department of Public Works? The treasury board has, of course, power to transfer it. Here, he has always got the money.


Leon David Crestohl: I should like to ask the
minister a question under the same heading. In constructing or repairing penitentiaries
'lr. Speaker.]
does the department use its own architects, or does it engage the services of architects of the Department of Public Works, or does it invite independent architects to do the drafting and make suggestions.


Edmund Davie Fulton: In connection with penitentiaries generally, the policy is that because they are specialized institutions they require a specialized type of construction and so on, and we have therefore developed within our own department, and within the penitentiaries branch a specialized staff of architects and engineers for this purpose. With respect, therefore, to the preparation of plans for the design of institutions, our own staff exclusively are engaged on this work, and we do not retain the services of outside architects or engineers. However, with respect to some special projects-I could mention the sewage disposal plant at Joyeeville as one example -which are to some extent not of a peculiarly penitentiary aspect, we do, I think, retain the services of outside consultants with regard to the preparation of the plans.


Leon David Crestohl: I can understand that the designing of a penitentiary may be best done by men who have specialized in that work, but with regard to the discharge of plans and specifications, specifications particularly, I should think that is within the scope of work of the architects employed in the Department of Public Works and that their services might be utilized in the interest of economy.


Edmund Davie Fulton: I think if the hon. member
were to ask the Minister of Public Works, he would be told that the staff of his department is fully engaged on the department's present construction supervision and engineering projects. We have, as I say, developed a specialized staff within the department and it would therefore seem to me, at least at present, to be a duplication if, having prepared the plans and being familiar with their requirements and specifications, we should then turn the work over to another department for supervision and construction when our own staff is qualified to do this work.


Mr. Woolliams:: I should like to ask the minister a question with reference to Alberta. As the minister knows, a person who is convicted in Alberta is sent to the Saskatchewan penitentiary at Prince Albert. I should like to ask the minister whether there has been any discussion with the provincial government of Alberta, in the light of the Fauteux report, with the object of working something out about the setting up of a penitentiary in Alberta.

In my early days in Calgary, I got to know something about the jail situation in that city, and I said some years ago, and I think it bears repeating, that if John Howard were to walk in and see the jail situation in the city of Calgary he would be just as shocked as he was at conditions 200 years ago, because they only have 19 beds and on many occasions they have 50 customers. Some arrangement should be worked out between the federal government and the province with regard to a penitentiary. I might also mention that Drum-heller is in the Bow River constituency, but the chamber of commerce is most anxious that if there is going to be a penitentiary built in Alberta it should be just outside of Drumheller.


Edmund Davie Fulton: I understand the question to be this: have there been discussions between my department, or the penitentiaries branch and the government of Alberta with regard to the construction of a penitentiary in that province. I think the answer must be that I have discussed this matter informally with the deputy attorney general of Alberta whom I met shortly after I was appointed Minister of Justice. I discussed with him some of our problems in connection with penitentiary construction and some of the problems arising out of the Fauteux report. The deputy attorney general indicated to me that they themselves had certain plans in contemplation for the construction of provincial jails, and said that it would be helpful if we could give an indication of whether or not we were prepared to accept the Fauteux committee recommendations regarding this government accepting responsibility for provincial sentences to terms of over six months, since this would help them to finalize their plans. I explained the difficulties we had in making a final decision, some of which I have referred to earlier, such as the physical and financial obligations we should have to assume if we accepted such a responsibility, and I explained our general plan of making a study in our own department after which we would communicate with provincial attorneys general and call a conference.
I know that the government of Alberta, together with governments of other provinces, is anxious to have this conference. We have now arranged for it to take place some time in the month of September of this year. But apart from this informal and personal discussion I am informed there has been no correspondence between this government and the government of Alberta on the subject.


Mr. McFarlane:: Mr. Chairman, with your indulgence and that of the committee I should like to first pose a problem and then suggest a remedy. In my riding in British Columbia there is a small city called Fernie.
57071-3-202
Supply-Justice
During the past year this city has been hard hit by the closure of the coal mines in that area. Fernie was a one-industry town. We are now seeking a means to bring back the stabilization of the economy of Fernie. One means by which this could be accomplished would be through the establishment there of a penitentiary. There are several points in connection with the establishing of a penitentiary in or near the city of Fernie which I should like to bring to the attention of the hon. minister.
The city of Fernie is an ideal location for a penitentiary. We have two roads, one east-bound and one westbound in the same location. Air, rail and bus transportation facilities are available. Not far from the bus transportation there is a plot of land consisting of 1,600 acres which could be available for the construction of a good-sized penitentiary in the area. I would respectfully request the hon. minister to give full consideration to the possibility of locating a penitentiary in this area.
It has been brought to my attention that there is a tendency on the part of the Department of Justice to centralize penitentiaries across the province. Hon. members will agree that many of the larger industrial concerns in Canada have found that it does not pay to centralize too many departments or plants in one area. I suggest that decentralization of penitentiaries should be taken under consideration by the hon. minister and his department.
I have heard it stated that a problem exists with respect to a lack of opportunities for the rehabilitation of prisoners after they have left a penitentiary. In the city of Fernie and in the Kootenay East area opportunities are available for the rehabilitation of released prisoners. I have been advised that the residents of the lower mainland of British Columbia do not wish to have a penitentiary constructed in that area. There is in Fernie a considerable amount of arable land which is potentially good farm land available in my area for the construction of a penitentiary. In several places the available land would amount to several hundreds of acres.
Although the city of Fernie would be close at hand to the site of any penitentiary that might be constructed in the area and would provide attractive homes for the employees of the institution there would be no danger of the city encroaching on the penitentiary area as has happened in many other areas where penitentiaries have been constructed. The city of Fernie offers every facility offered by a well-established community. It has a golf course, an ice skating rink with artificial ice, and has available ice curling

Supply-Justice
on artificial ice, swimming facilities, skiing facilities complete with tow rope and offers opportunities for hunting, fishing and other sports.


Harold Edward Winch: Is that part of the penitentiary area?


Murray Lincoln McFarlane: The establishment in
Fernie of a penitentiary would have the effect of bringing people into the area and providing the personnel of the penitentiary with an attractive community in which to reside. We have a modern gymnasium with badminton facilities, churches of all denominations, modern schools, a modern hospital and medical centre, a good library, theatres and closed circuit television. The establishment of a penitentiary in this area would also help to revitalize and stabilize the economy of the city of Fernie which has been damaged as a result of the closure of the mines and it would have an equally beneficial effect throughout the Kootenay East area. The proposal for the establishment of an institution in this area has been supported by the chamber of commerce, the service clubs and various organizations throughout the province of British Columbia.
. This morning I attended a meeting of the committee on external affairs where I observed that we were prepared to spend over $35 million under the Colombo plan. May I say to the minister that charity begins at home. Before closing my remarks may I also point out that in the area of Fernie we have water and power facilities and all the other things required to provide an ideal site for what could be one of the best penitentiaries in western Canada. I would urge upon the Minister of Justice consideration of the proposal to establish a penitentiary in the city of Fernie thus bringing about the revitalization of the economy of that area.


Edmund Davie Fulton: Mr. Chairman, I should like to say that I appreciate what has been said by the hon. member for Kootenay East and to assure him that I am well aware of the interest of the city of Fernie and the district surrounding it in the establishment of a penitentiary there. I wish to assure the committee that the hon. member for Kootenay East has been most assiduous and has left no stone unturned in bringing to my attention the desire of those in that area for such an establishment and the reasons which occurred to them why it would be a suitable area for the location of a penitentiary.
I have discussed the matter with the hon. member personally and, as he knows, I have had correspondence from the mayor of that community which I have also discussed with him. I can tell the hon. member now, not

having had an opportunity to do so before this, that earlier this morning I was in telephone communication with the chairman of the industrial development committee of the Fernie board of trade. The interest of the area in such an establishment there is well known to myself and to the officials of the department and particularly those of the penitentiaries branch.
I have tried to be as frank in the matter as I can. Knowing the economic situation in that area I felt it would be grossly unfair to hold out any hope or expectation which might not be possible of fulfilment. I have therefore had to explain some of the considerations which would have to be taken into account in determining where a penitentiary will be located. There are, of course, two aspects to this problem. The one is related to the establishment of a new penitentiary under our present responsibility in which case certain considerations would have to be borne in mind which I have communicated to the hon. member, particularly with respect to the desirability of having reasonably available and adjacent to such an institution the facilities for a rehabilitation training program. I have also pointed out that with respect to any new building program which may be dependent upon an agreement with the provinces for the assumption of the extra responsibility referred to in the Fauteux commission report, namely the assumption by us of responsibility for those receiving a sentence of more than six months, there may be some different types of institutions to be built or provided by the federal government. I assured them that with respect to both the extension of the existing and present penitentiary building program and the construction of new types of institutions which might be made necessary after the provincial conference and as a result of any agreement arrived at we will bear in mind to the fullest extent the interest of the Fernie area and I can repeat that assurance here.
However, I do not think it would be fair for me to go beyond that assurance because until we know just what it is we are going to have to provide we ourselves will not be able to determine what building program we will have to undertake and therefore it would not be sensible for me to indulge in speculation now as to what locality we will select to establish any new institution.
In addition, of course, I must in fairness to all the other municipalities and areas interested point out that ever since it has been indicated that we are eventually going to embark on the construction of new institutions in western Canada some 100 or more municipalities or areas have pressed upon the

department the peculiar suitability of their area for such an institution.
We will have to survey the whole available field and, in fairness, I think 1 must say that when we make a decision it will have to be made in accordance with what seems to be the best program of building that we can devise.
I close, however, by assuring the hon. gentleman that in making that decision we will bear the interests and the facilities of his area fully in mind.


Leon David Crestohl: Mr. Chairman, before we approve the final vote I wonder whether the minister would be good enough to let me put a question to him under vote 162. I understand that item has been agreed to. In putting my question to the minister it is not my aim to modify the vote. My question has to do with judges' salaries.


Edmund Davie Fulton: That takes us back to the departmental item. Vote 162 relates to the administration of justice in the Yukon Territory.


Leon David Crestohl: There is a "S" following it.


John Whitney Pickersgill: That is statutory.


Edmund Davie Fulton: That is a statutory item.


Leon David Crestohl: I know. My question is not aimed at modifying the vote. I want to ask whether recently any consideration has been given to the question of augmenting judges' stipends?


Edmund Davie Fulton: Yes, Mr. Chairman, that matter is before us at the present time and is under consideration but I indicated earlier in the house, I think, that we did not expect to be able to do anything about it at this session, but we have it under consideration for future action.


Mr. Herridge:: The minister has replied to the hon. member for Kootenay East with respect to his request and I listened to his reply with great interest. In view of the fact, I understand, the proposed sites in Kootenay West are not considered suitable for a penitentiary, of which I was advised some two years ago, I want to support the representations of the member for Kootenay East. We in the Kootenays must stick together. We have been very concerned about this for a long time and he knows the circumstances very well, both the geographic, the physical and the economic, and I am sure the minister does. Now, Mr. Chairman, it seems a bit ironic in this civilization that we have to propose the building of a penitentiary to provide employment for those outside the penitentiary looking after those who are inside. That is a fact. However, Mr. Chairman, if finally the government cannot see
57071-3-2021
Supply-Justice
its way clear to build a penitentiary in the location suggested by the member for Kootenay East I do hope, having by that time a full knowledge of the desperate circumstances which exist in Fernie owing to the closing down of the coal mine, it will bring in a national coal policy which will in another direction solve this economic problem.


Mr. McLennan:: Mr. Chairman, the hon. member for Kootenay East and the hon. member for Kootenay West are talking about a penitentiary which is now situated in the centre of the city of New Westminster. It is not often that a city wants to move an institution which has a payroll and a purchasing power such as that of the British Columbia penitentiary; but as far as the city of New Westminster is concerned, it will be very glad to get rid of it because it is situated in the centre of the city.
I predict that within 20 years it will be situated in the centre of the greater Vancouver area. We in the city of New Westminster feel that the penitentiary is located on a spot that is unsuitable for that purpose. It is situated in the centre of a growing district, one of the most populous districts in the province of British Columbia. I would ask the minister for assurance that within the next five or 10 years the penitentiary will be moved. I would support the request of the hon. member for Kootenay East to have the penitentiary moved to his riding or to his district of Fernie, if that is suitable, or to any other district that is more suitable for a penitentiary rather than leaving it in the centre of a great area like the greater Vancouver area.


John Whitney Pickersgill: Mr. Chairman, before the minister replies may I say I am sure that the hon. member for New Westminster is quite right in predicting a wonderful future for this area. I would hope that some thought would be given to the taxpayers who bought this land on which the penitentiary rests and that the land would not be sold but would be retained by the crown so that the rents would help to alleviate our taxes.


Edmund Davie Fulton: The hon. gentleman knows that he is speaking of policies which are beyond my responsibility; that is, the policy with regard to disposal of property if the penitentiary is moved from New Westminster. But I think we are all getting a bit beyond ourselves because no decision has been made in that regard. I can only say that I am fully aware of the interest of the city of New Westminster in the matter and that due account is being taken of it and will be taken

Supply-Justice
of it in connection with our building program as and when we are able to finalize that program.


[Stage Direction]
Item agreed to.
A-Department-
566. Departmental administration-further amount required, $50,800.
(Translation):
Mr. Pigeon:: Mr. Chairman, I do not want to delay unduly the passing of the estimates of the Department of Justice, but I should like to take advantage of this opportunity this evening to congratulate the Minister of Justice who, I know, is laying the groundwork of some kind of strategy for a more effective struggle against obscene literature by those who are responsible for public morality and order. I know that the minister realizes the seriousness of the problem and that he is prepared to solve it. It is more than ever urgent that some effective legislation be enacted as soon as possible. Let us hope that the following steps will be taken:
1.	Include in section 150 of the criminal code a "practical" definition of the word "obscene";
2.	Amend the criminal code to make it possible to serve a summons, as is now done in Great Britain, upon the newsdealer or bookseller who has been found in possession of publications considered obscene, so that he might put forward his objections, if any, to a court order for the destruction of the said publications;
3.	Prevent publishers from making "package" deals that is to say from forcing newsdealers or booksellers to take "all or nothing", as is currently done at the present time;
4.	Extend the charges under the act to the publishers of obscene literature.
As long as the above-mentioned steps are not taken, groups now campaigning against obscene literature will be hampered in their activity. I realize the difficulties of the problem. It is a matter of getting rid of obscene publications without interfering with the freedom of the press. This calls for a precise definition of the words "obscenity" and "freedom".
At the present time, our courts base their interpretation of "obscenity" upon a judgment rendered in 1868 by a British court and according to which "the criterion of obscenity consists in deciding whether the matter charged as obscene tends to deprave or corrupt those whose minds are open to such immoral influences and in whose hands such a publication might fall." That definition is not so bad. It would be a matter of deciding whether a publication is such as to cause moral prejudice. Mr. Raoul Mercier, crown

attorney for the county of Carleton has used that definition with some success already.
Nevertheless I will go along with the Minister of Justice when he states that it could well be more "practical". Personally, I would prefer a provision which would prohibit publication and distribution of any or all literature whose chief characteristic is the exploitation of one or several of the following subjects: sex, crime, immorality, horror, cruelty and violence.
With regard to the freedom of the press, it should be remembered that liberty is not synonymous with licence. The press is not "free" to corrupt and deprave morals, even under the guise of "information". That is the basic principle upon which the minister should guide himself if he wishes to amend the criminal code.
I would most heartily approve of any of the above amendments, especially those aimed at prohibiting "block sales" or "package deals". There are publishers now who require a dealer to buy objectionable publications if he wishes to buy the others. That is an intolerable practice. It is really deplorable that a certain number of publishers and newsmen should attempt to make money by the exploitation of the basest instincts of their readers. Some specialize in detailed description of crime. They plunge their readers in the blood of the victims and in the dark inner recesses of the murderer's heart. Others exploit sex for all it is worth. Finally, there is a third class of objectionable and nefarious publications. I have reference here to those committed to the spreading of rumours, to scandal-mongering, and muck-raking. They fling mud right and left, and especially up.
Most professions have boards which impose proper ethical standards upon their members. There should be such a disciplinary body among newspapermen, who could assume on their own behalf the defence of the genuine freedom of the press by the elimination of corrupting undertakings that are a menace to this fundamental social freedom.
How are we to deal with the widespread circulation of this large number of objectionable publications which corrupt the minds and hearts of our people?
1.	Amend the criminal code;
2.	Encourage people to refuse to buy filthy publications;
3.	Promote good reading by urging educators to encourage appreciation of good literature by young people.
Finally, I ask the hon. Minister of Justice to amend the Criminal Code as soon as possible so as to do away with unwholesome publications. It is urgent. Obscene literature is to

a great extent responsible for juvenile delinquency which is a burden for the state and costs huge sums to governments. A tide of juvenile delinquency is sweeping over our cities. It is the most accute problem of our age, next to atomic weapons.
I urge promoters of all morality campaigns to keep up their good work.
In the diocese of Joliette, there is, as at L'Assomption, a committee against bad literature. I congratulate these people and encourage them to continue their struggle in co-operation with municipal associations and authorities. I would be very happy if the hon. minister could in the near future, amend, if possible, the Criminal Code in that sense.


Jean-Thomas Richard: Mr. Chairman, allow me to say a few words in support of the remarks just made by the hon. member for Joliette-L'Assomption-Montcalm (Mr. Pigeon), about obscene literature.
I have no doubt that the minister has trouble finding ways to eradicate that cancer that has crept into our literature. I therefore believe that we should give him our support in his effort to find, as soon as possible, an appropriate definition of obscene literature either through an amendment to the criminal code of by some other way, so that our people might be saved from that scourge.


Edmund Davie Fulton: Mr. Chairman, I thank the hon. member for Joliette-L'Assomption-Montcalm (Mr. Pigeon) and the hon. member for Ottawa East (Mr. Richard) for their kind words.
I thank particularly the hon. member for Joliette-L'Assomption-Montcalm (Mr. Pigeon) for his constructive suggestions. This subject is being studied right now, and I can assure him that special consideration will be given his suggestions.
(Text):


Herbert Wilfred Herridge: Mr. Chairman, for over forty years the Kootenay country has suffered from lawlessness and various forms of violence which in recent days have been extended to the Okanagan. This matter is of most serious concern to the people residing in the interior of British Columbia, possibly of more concern than ever before in our history and, of course, of serious concern to all in Canada who are concerned with this social problem. In past years we have suffered the burning of schools, the burning of houses, the bombing of railroads, the bombing of power lines on repeated occasions, recently the bombing of a bus station and the bombing of a good number of other sites throughout the Kootenay district.
Supply-Justice
The latest apparent evidence of the continuance of this lawlessness is the number of forest fires lately which are considered by the forestry branch of the province of British Columbia as having been caused by persons who set them deliberately. Anyone who has lived in our district knows what it means in a dry period such as the last two months to fear the starting of forest fires by arson. So the situation is very serious indeed and in some respects tense.
I have refrained so far this session from making any comments on the matter because I was of the opinion that while discussions were going on between the representatives of the government of Canada and representatives of the government of British Columbia no good purpose would be served because this is far too serious a matter for anyone to attempt to make political capital out of it or take any political advantage. I was hopeful that the minister's visit to British Columbia, his discussions with certain persons there and his later correspondence with the premier of the province would result in some co-operation between the federal and provincial governments to formulate a program to deal with the problem in a constructive way not only in the immediate future but in the days farther ahead.
I am not underestimating the difficulty. Before proceeding, may I say that I have discussed the matter personally with the minister on a number of occasions and I am fully aware of his keen interest, his great concern and his willingness to co-operate with the province of British Columbia and with other persons who want to do something to remedy a situation that has existed for so many years. However, Mr. Chairman, time is flying. It is now some weeks since discussions first commenced and I understand that the government of British Columbia made representations to the federal government for assistance in this matter. Apparently no program has been established to date as the result of co-operation between the two governments and so violence and lawlessness continue.
You can well understand the attitude of the residents of the district, municipal officials and other authorities. They are becoming increasingly concerned about what appears to be the failure to design a constructive program as a result of federal-provincial cooperation, and I am of the opinion that it is going to take close co-operation between the federal and provincial governments as a result of agreement to meet this very serious situation effectively. The situation is such that the people of the district I have the honour to represent are demanding that

Supply-Justice
concrete evidence be given that there will soon be an adequate program to meet it.
I am not going to take the time to go into all the details. The minister is very well informed because he has kept in close touch with the situation through his officials in Ottawa, through the R.C.M.P. and no doubt through correspondence with the government of British Columbia. However, I want to ask the minister two questions. In view of the seriousness of the situation and the concern of the people directly affected, being the people of Kootenay West and at the present time the Okanagan-I trust this social disease will not spread any farther-will the minister inform the house of developments to date with respect to the government's response to the application from the government of British Columbia for assistance and with respect to any agreement that has been arrived at to date or that they expect to reach in the near future?
I want to ask another question. In spite of the fact that the Sons of Freedom have publicly stated only recently, in the most concrete form to date through Mr. Moljelsky their leader, that they are willing to emigrate to the Soviet union on certain terms- and I think the minister no doubt has read the dispatch-would the minister inform the house of this government's response to this latest, shall I say, official offer from the acknowledged leader of the Sons of Freedom for that body to emigrate to the Soviet union provided certain terms are met with respect to expenses, transportation and citizenship.


Murray Lincoln McFarlane: At this time I should also like to take the opportunity to support the hon. member for Kootenay West with respect to the situation in west Kootenay. This has been a problem to us in east Kootenay as well as west Kootenay for a number of years. I wish to bring to your attention, Mr. Chairman, the seriousness of the situation in that area.


Edmund Davie Fulton: With the concern of the hon. member for Kootenay West and the hon. member for Kootenay East over this problem there will be genuine understanding and agreement, Mr. Chairman, because those gentlemen reside in the areas most directly concerned. I appreciate the approach made to the problem by the hon. member for Kootenay West. I appreciate his statement that he knows I am concerned with it on behalf of the province from which I come and particularly on behalf of the residents of the province most affected. He has asked me two specific questions. The first one was would I inform the house of developments with regard to the response of the government of Canada to a request from
[Mr. Herridge.l
the government of British Columbia for assistance in dealing with the problem. The second one was, in view of the fact that the Sons of Freedom sect have recently made a statement indicating their willingness to return to Russia-in fact their wish to do so-on certain conditions, would I make a statement as to the position of this government. I think I must answer those two questions together.
I went to British Columbia in response to a request originating with the provincial secretary on June 9, taking with me the deputy minister of justice and the commissioner of the R.C.M.P. We met there with the premier of the province, the assistant commissioner of the R.C.M.P.-that is the officer in charge of the division of police in British Columbia-the deputy attorney general and the provincial secretary. We discussed in general the whole aspect of the Doukhobor problem.	Then
our discussion moved on to consider a specific proposal put forward by the province. I am not at liberty at the moment to divulge the nature of that proposal because discussions are still taking place, but I can say now by way of anticipation that I expect that a decision will be reached in the course of the next few days.
After we had these discussions and after my return I put the position of the British Columbia government, both generally and with respect to the specific proposal, before my colleagues here in cabinet and, as a result of our consideration of the request, I wrote to the premier of the province on June 21 indicating the view of this government with regard to the general situation and also the attitude of this government with respect to the specific proposal which had subsequently been discussed and indicated to the government of British Columbia how far we were prepared to go in co-operating and in adopting that proposal as a solution to the problem.
I received a letter from Premier Bennett dated July 3 discussing in part the general situation and then referring to the specific proposal and saying that this answer to our letter of June 21, indicating how far we were prepared to go and the co-operation we would extend, would be forthcoming in the near future. I did not have any further correspondence with or communication from the province on that matter until the evening before last when I received two telegrams from Premier Bennett dealing in detail with the specific proposal on which he had said on July 3 that he would let me know further. In other words, I received his further answer the night before last, which would be August 5. At the

same time, or about that same time the Sons of Freedom sect issued their statement with regard to their wish to migrate to Russia on condition that certain specific assistance would be given by the government of British Columbia and the government of Canada.
All I can say in addition, I think, is that I have had discussions, first of all with my departmental officials and the R.C.M. Police and then with my colleagues in cabinet here with regard to Premier Bennett's telegrams of August 5, and I had a telephone conversation yesterday with the attorney general of British Columbia in which I indicated to him that we expected within the matter of the next few days to be able to let the government of British Columbia have a definitive reply to their telegrams of August 5. The whole matter, of course, is being considered in the light of the statements made on behalf of the Sons of Freedom at about that time with regard to their possible movement to Russia.
With regard to the details of the discussions between ourselves and the government of British Columbia I cannot say more until the conclusion of our negotiations. As soon as any agreement is arrived at I expect that it would be embodied in a joint statement issued on behalf of the two governments. Until that time I think the discussions must remain confidential.
I am hopeful that an agreement can be arrived at which will represent a step forward in dealing with this problem or at any rate in isolating it so that constructive solutions may then be arrived at. I am sure that my hon. friend will appreciate that since these discussions are actually current and exchanges of telegrams and telephone conversations are continuing, I could not say more at the present time.


Herbert Wilfred Herridge: I appreciate that fact.


Edmund Davie Fulton: However, I can assure the hon. member that we are as aware of the urgency of the problem as he is. We hope that the current discussions will result in a statement and a joint approach by the two governments which will be useful and constructive in arriving at a solution.


John Whitney Pickersgill: I should just like to ask the minister one brief question about his statement. I would assume that if an agreement were reached between the government of Canada and the government of British Columbia in this matter before the session is concluded which would involve any expenditure of money, some provision would have to be made for that expenditure, and that procedure would give us an opportunity to discuss the matter here in the house. If, however, that result was not possible but the agreement was reached before the end of the
Supply-Justice
session I would hope that the government would endeavour to make it possible for us in some way to discuss any arrangement that is arrived at in a matter as important as is this one.


Edmund Davie Fulton: I, of course, cannot give the hon. gentleman any specific assurance at the present time because no agreement has been reached. However, I think I can meet him in the spirit in which he puts forward the proposal and say any solution which involves an expenditure of money by this government would properly have to be presented to parliament, and it would be our desire to do that during the current session if we could reach an agreement in time to make that possible.


Mr. Caron:: Can the minister tell us
exactly what are the duties of the Solicitor
General?


Edmund Davie Fulton: If my hon. friend will read the statutes which create the office and with statutory authority for the appointment of the minister who has the title of Solicitor General he will see the general basis for his position. In addition to that there is an order in council passed shortly after this government assumed office which sets out in detail the duties of the Solicitor General. I cannot recall from memory the provisions of that order in council or the duties embodied in the order in council, but it was duly reported in the Canada Gazette.


Alexis Pierre Caron: My reason for asking this question is that I have looked in the index to this new book issued by the Secretary of State entitled "The Organization of the Government of Canada", and there is nothing about the Solicitor General. A person of this importance in the government of Canada should at least appear in the index.


Edmund Davie Fulton: If there is an omission from the blue book, we will be glad to rectify it. As I say, if my hon. friend will consult the proper authorities, namely the statutes of Canada and the Canada Gazette, he will find there an official description of the position and duties of the Solicitor General.


John Whitney Pickersgill: I recognize, Mr. Chairman, that we should discuss this question on the first item of the estimates of the Secretary of State. However, this publication was brought into this house the other day by the Secretary of State as the latest official information on the government of Canada, published by the government of Canada. As the hon. member for Hull has pointed out, it seems to have a very glaring omission.


Mr. Balcer:: As I am the subject of this discussion, I just want to say a word to the

Supply-Justice
hon. member for Hull. If he will look under the Department of Justice he will see that the second name in the Department of Justice is that of the Solicitor General.


Alexis Pierre Caron: I accept the opinion of the Solicitor General that he is the helper of the Minister of Justice.


Edmund Davie Fulton: If my hon. friend will take the trouble and the courtesy to read the statute he will see that that is the position created by the statute and not by this government.


Alexis Pierre Caron: I read the French version of the statute, and in French it says-


Edmund Davie Fulton: Perhaps if my hon. friend
would read the blue book then he would present to the house the full picture rather than a partial picture he is now presenting.


Alexis Pierre Caron: The French version of the statute says:
(Translation):
An official appointed by the governor in council to assist the Minister of Justice in his functions.
(Text):
If this is the correct definition, then I accept what the Solicitor General said, that he should appear under the heading of the Department of Justice as the minister's helper.


John Whitney Pickersgill: I have one very brief question upon which I may wish to make some comments later. Has the minister considered any amendments to the Criminal Code or to any other statute in order to strengthen the law against sedition?


Edmund Davie Fulton: Certainly not at this session; I think the Prime Minister intimated yesterday, or possibly Monday, the additional legislation which was to be introduced in this session. The list did not include any further amendments to the Criminal Code.


John Whitney Pickersgill: Is the minister reasonably satisfied with the present state of the law in that regard?


Edmund Davie Fulton: The minister has this matter, along with other matters under his responsibility, constantly under review. At any time it occurs to him or is brought to his attention by his advisers that changes are necessary or advisable, he will take the matter under consideration.


John Whitney Pickersgill: The reason I ask the question is that I have in my hand three press clippings. The first one is from the Toronto Telegram of April 30, 1948 in which the present Prime Minister, then the member for Lake Centre, was quoted as having told the University of Toronto old boys at their annual
[Mr. Balcer.l
dinner at the Royal York, and this is in direct quotes:
We should consider amending the Criminal Code in respect to communists who shoot off their mouths against the state, and our way of life. I say those whose sole desire is to undermine should either go behind the iron curtain or be behind iron bars.
That is the end of that quotation. Then, in the Toronto Telegram of September 10, 1948, the Prime Minister was reported as having made a demand that "real teeth"- and that is in quotation marks-be put into the law so that communism can be effectively curbed.
Then as recently as March 19, 1954 the Prime Minister, speaking to the Ottawa public schoolteachers institute, said that a change should be made in Canadian laws of treason, and I quote, "To meet the changing conditions that the kremlin has brought about." It did seem to me, sir, in view of the very pressing nature of the problem as envisaged by the Prime Minister, that the government would perhaps by this time have given consideration to this matter.


Edmund Davie Fulton: I might point out that the hon. gentleman is so hard up for subject matter with which to delay the house he had to go back ten years, to 1948.


John Whitney Pickersgill: To 1954; that is not so long ago.


Mr. Maloney:: I am glad to have this opportunity, Mr. Chairman, to put forward for the consideration of the Minister of Justice, within whose jurisdiction these matters come, a few suggestions that would involve amendments to the Criminal Code-


Harold Edward Winch: Would the hon. member speak up? We cannot hear him.


Arthur Edward Martin Maloney: -to the Canada Evidence Act and to some other related federal statutes. I have no doubt that at the next session of parliament the Minister of Justice will be bringing forward some amendments to these statutes and I should like to think he would bear in mind the suggestions I am about to make, with a view perhaps to including these among any amendments he might then propose to introduce. I do not boast of any particular qualifications to discuss these matters other than the experience I have had in the process of law over a number of years, and particularly my connection as counsel for the defence in a number of criminal cases.
Arising out of that experience I think I have had an opportunity to see something of the need for the changes I am about to suggest to the minister and which I hope he will bear in mind. I want to speak very briefly first about our habitual offender legislation. With reference to the legislation now applicable to habitual offenders, section 660 of our Criminal

Code which provides for their preventive detention classifies a person as being a habitual criminal if:
(a)	he has previously, since attaining the age of eighteen years, on at least three separate and independent occasions been convicted of an indictable offence for which he was liable to imprisonment for five years or more and is leading persistently a criminal life, or
(b)	he has been previously sentenced to preventive detention.
The experiment with preventive detention for habitual criminals began in this country in 1947 and we, therefore, have the benefit of 11 years' experience with its operation. It had been recommended in 1938 by the royal commission on the penal system of Canada known as the Archambault commission.
The habitual offender in Canada is not treated very much differently from the ordinary penitentiary inmate and is not housed in a separate institution. The total number of persons presently undergoing preventive detention in Canada as habitual criminals is 53. The distribution of these individuals among provinces is as follows: British Columbia, 13; Alberta, 5; Saskatchewan, 5; Manitoba, 10; Quebec, 2; Ontario, 13; New Brunswick, 1; Nova Scotia, 4; Prince Edward Island and Newfoundland, none. The majority of individuals now undergoing preventive detention as habitual criminals were convicted of offences against the Opium and Narcotic Drug Act-in British Columbia, 7; Alberta, 4; Manitoba, 9; Ontario, 11 and Quebec, 1-making a total of 32.
Our Criminal Code provides for a review by the Minister of Justice of each case every three years, the idea being to determine whether or not the person undergoing preventive detention should be permitted to be at large on licence. It is open to the minister to conclude that he should not be released and it is, therefore, quite possible that such an individual would spend the rest of his life in prison.
Once an individual has been found to be an habitual criminal he is permanently removed from the jurisdiction of the courts. He has no right to be represented by counsel at the time of these periodic three-year reviews by the minister. The minister is not required to give any reasons for his refusal to grant a licence and there is no appeal from his judgment. If a man is released he can be rearrested and taken back into custody without resort to the courts or without the protection of a public trial. As I have already pointed out, the number of persons proceeded against as habitual criminals and found to be such since 1947 is 53.
It goes without saying that large numbers of individuals now at large and never proceeded against under this provision of the Criminal 57071-3-203
Supp ly-J ustice
Code could properly be found to be habitual criminals. The main reason why proceedings are not initiated against such persons is the perfectly understandable reticence of the majority of permanent crown officials to invoke proceedings the effect of which could be to doom a man to a possible lifetime in penitentiary. This is a reticence with which I have every sympathy and I do not wish to be taken as meaning that wholesale prosecution under this legislation should be instituted against everyone now at large who could be found guilty.
However, the fact remains that the legislation in its application has been inexcusably discriminatory. Only 53 persons have been selected out of a much larger number to be proceeded against in this way, to be removed forever from the jurisdiction of the court, to become subject to the whims and fancies of particular police officers, crown officials and others. All this strikes me as being alien' to some of the most ancient and sacred principles of our criminal law.
When this legislation was first introduced into parliament the then minister of justice, Mr. Ilsley, was far from being positive about it, for at page 4685, column 2 of Hansard for that year, he said:
While legislation of this kind was recommended by the Archambault commission, the government has no wish to be dogmatic about the necessity for it, and while recommending it, is prepared to give careful consideration to any views which may be expressed by members of the house regarding it.
It is interesting to read the contributions to the debate at that time of some of the hon. members of the house. I think that our experience over the last 11 years confirms the apprehensions that were voiced by some of them at that time. For example, the present Prime Minister, had this to say as recorded at page 5058 of Hansard for 1947:
Criminal law being what it is, it should be uniformly enforced in all parts of the dominion without regard to the wishes of individual attorneys general. In this section there is a marked departure from the uniformity which should be aimed at. This section means that for the first time in the history of our criminal law there will be a departure from uniformity of application in all parts of the dominion.
And further on, the present Prime Minister said in the same context:
I urge upon the minister that this introduces into our criminal law a lack of uniformity, in that a person in one province may be prosecuted as a habitual criminal, whereas if the same person committed a crime in another province he would not be subject to prosecution.
The hon. member for Cartier at that time, Mr. Hartt, put it rather aptly in my opinion when he said:
I am wondering whether we are not committing a crime against criminals.

Supply-Justice
It strikes me now in the light of our long experience with the law that the objections of the various members of that day were well taken and they showed a foresight which the subsequent administration of the law has tended to confirm.
There has been a complete and utter lack of uniformity in the application of the law. The frequency of prosecution has varied from province to province. Specially appointed federal prosecutors in cases under the Opium and Narcotic Drug Act have been far more prone to resort to the use of this legislation than have the ordinary crown attorneys of the various judicial districts. When one considers the crushing effect of an indeterminate sentence and stops to realize to what extent a man's freedom for the rest of his life is subject to the whims and fancies of a few police and prosecution officials, and when you further consider that the Criminal Code already provides adequate penalties for all of the offences contained in the Code, it seems to me that it is now time to consider that the experiment with this legislation has been a failure and that it should be abolished.
Dealing with the right of crown counsel to cross-examine a prisoner on his previous criminal record, the practice today as prescribed in section 12 of the Canada Evidence Act, permits crown counsel to cross-examine any witness-including an accused person who gives evidence on his own behalf-about any previous conviction for a criminal offence.
There is no limitation whatever on this right. When an accused person is tried by jury the law imposes upon the trial judge an obligation to caution the jurors where evidence of the criminal record of the accused has been adduced in cross-examination, that such evidence is relevant only to the credibility of the accused witness, and he must also admonish them against using it as evidence that he is the sort of person who would be likely to commit the offence for which he is on trial.
Speaking from a long experience I think I can safely say that the prejudice created by disclosure of a criminal record is overwhelming, and no amount of caution by the trial judge in conformity with the rule I have mentioned is adequate to disabuse the jury's mind of its harmful effects.
The prospect of being cross-examined on a criminal record has dissuaded many accused persons from giving evidence and in my opinion over the years large numbers of accused men have been convicted either because of the prejudice resulting from a disclosure of their criminal record or from their failure
to testify by reason of it. They might, if neither of these factors had existed, have been acquitted.
I recall so well in personal experience the case of an accused person whose criminal record consisted of eight previous convictions for serious offences. On the occasion on which I was acting in his defence he was charged with the murder of his brother. The account he gave to me of the circumstances, which was to some considerable extent confirmed by two other witnesses, ordinarily would have furnished him with a good defence of self-defence. If such a defence were to have prevailed he would have been acquitted but because of his criminal record it was unsafe for him to testify in his own defence because of the prejudicial effect that disclosure of his record on cross-examination would have had. A conviction for murder might well have been the result. He was duly convicted of manslaughter and notwithstanding the jury's recommendation for extreme leniency the trial judge imposed a sentence of fifteen years imprisonment.
I am in the fortunate position of being able to say that the recommendation that I am now putting forward received the unanimous endorsation of the Canadian bar association at its annual meeting held in Ottawa in September 1955. In that connection the bar association urged that section 12 of the Canada Evidence Act be amended so that as amended it would provide that while the right of cross-examination on the record of a person charged and called as a witness would not be abolished it would be greatly curtailed. For example, it could be brought out that a previous conviction had been registered against the accused witness if proof of that conviction were relevant to prove the guilt of the offence with which he was charged; and also if he personally or by his advocate asked questions of the witnesses for the prosecution with a view to establishing his own good character; or if he gave evidence of his own good character; or if the nature of the conduct of the defence were such as to involve imputations on the character of the prosecutor or the witnesses for the prosecution; or if he gave evidence at the same trial against any other person charged with the same offence; or if he had previously been convicted of perjury. The bar association recommended that this unlimited right as it now exists which I submit is an unfair right should be curtailed.
It will be observed that this change does not and is not intended to interefere with the present practice of proving the criminal record after a conviction has been registered for the purpose of assisting the magistrate

or judge to determine the appropriate sentence. It is my belief that this change is long overdue.
The next change for which I feel a serious need exists arises out of section 624 subsection 2(b) of the Criminal Code. This section reads as follows:
The time during which a convicted person
(a)	is at large on bail, or
(b)	is confined in a prison or other place of confinement pending the determination of an appeal by that person, does not count as part of any term of imprisonment imposed pursuant to his conviction, but paragraph (b) is subject to any directions that the court appealed to may give.
As you can see from the provisions of the section I have just read, where a convicted offender exercises his right to appeal his conviction, no part of the time that it takes to bring the appeal on for argument counts as part of his sentence in the event his appeal is unsuccessful unless a special order directing that it should count is made by the provincial court of appeal.
I can recall in Ontario that up until about eight years ago invariably the court of appeal, which had dismissed the appeal of a convicted offender, would direct that the time served in custody pending the appeal should count. It was only very, very rarely that such an order was refused. We grew to expect it as a matter of course. Then an abrupt change in this practice occurred for reasons that were really never made very clear and the exact reverse became the rule. Since then, in the great majority of cases where an appeal is unsuccessful the court will refuse to direct that the time served should count and the prisoner's sentence therefore does not commence to run until the date upon which the appeal has been disposed of.
. This certainly has had the effect-a highly undesirable effect in my opinion-of reducing to a very exceptional degree the number of criminal appeals brought before the court of appeal. The fear that there may be delay in prosecuting his appeal and that his appeal might fail has tended to dissuade many a convicted offender from going to the court of appeal to have his conviction and the trial proceedings that lead up to it reviewed.
I have often felt that if a practical method Could be worked out every conviction-certainly for a major crime-should be reviewed by an appellate court. I cannot help but think that if the conviction of everyone serving a sentence in our Canadian penal institutions were today reviewed the result would be to flush out of prison large numbers of inmates either by virtue of some irregularity at trial or for some other reason. In saying this I do not wish to be taken as meaning that our 57071-3-203i
Supply-Justice
prisons are filled with innocent persons. The point I am trying to make is that, in my opinion, there are many persons serving sentences as a result of trials which an appellate court would, on review, find had not been conducted according to law.
Delay in proceeding with an appeal is not ordinarily the fault of the accused man. The delay is usually occasioned by the delay in receiving from the court reporter the transcript of the notes of evidence taken at the trial. It will often be the fault of the counsel for the defence and sometimes the fault of counsel for the crown, and on occasions-especially when judgment is reserved for a lengthy period of time-the fault of the court of appeal itself. It does not seem right that a prisoner should be penalized by reason of a delay for which he was not responsible.
The present law works a hardship also in the case of convicted offenders who are unable to furnish bail pending the hearing of an appeal. In the case of a first offender whose crime has not been one of violence, or of exceptional gravity, it is usually possible to secure his release on bail. He suffers therefore no hardship by the present operation of the law, but the first offender, who is poor and is unable to furnish bail, is thereby discriminated against. As one who believes that the court should constantly be developing, applying and interpreting our law, I find a good deal of difficulty in accepting a policy such as the one that now prevails which in its application discourages appeals. I strongly urge, therefore, that the Criminal Code be amended so as to provide that time served in custody, pending the hearing of the appeal, should count as part of the sentence as a matter of course.
Finally, I would like to say a word in respect to minimum sentences. There are certain offences in respect to which the magistrate or judge has no discretion. He must impose a minimum mandatory penalty. For example, theft of anything from the post after it is deposited in the post office and before delivery is an offence under section 298 of the Criminal Code for which a term of imprisonment of not less than six months must be imposed. So also in the case of second and third convictions for driving while one's ability is impaired or for drunk driving and so also in the case of offences under the Opium and Narcotic Drug Act, and indeed for a number of offences under other federal statutes as well.
We all read in the Toronto press some months ago of the case of a young woman charged with theft from the post-theft of an ordinary letter-as a result of which she netted nothing except a few pennies and

Supply-Justice
the magistrate was reluctantly required to impose the minimum penalty of six months in a case in which it was apparent he felt suspended sentence would have been the proper dispositon. It is true she was quickly released on ticket-of-leave but all others are not so lucky.
In cases under the Opium and Narcotic Drug Act, any person in possession of a drug must be sentenced to a minimum mandatory period of imprisonment of at least six months. I have personally witnessed the application of this provision in the case of a helpless drug addict for whom suspended sentence and treatment would have been the answer. It was the case of a gentleman who, with the assistance of his wife, had over a period of about two years by the most enormous exertions of his will succeeded in overcoming his drug addiction. As a result of an altercation in which he had become involved he was rendered unconscious and brought to a hospital, whose authorities of course were unaware of the history of drug addiction and drugs were administered to him to ease the pain and in consequence the former appetite which he had succeeded in overcoming was revived. After a period of about six months he was arrested and charged with illegal possession of narcotics. Medical evidence that was called at his trial, where he pleaded guilty, established that he was capable of cure and that he had been responsive to treatment and that he should be permitted to continue this treatment. I can still recall-notwithstanding the eloquent efforts of crown counsel to obtain the severest possible penalty-how much anxiety the trial judge felt when he imposed that minimum sentence of six months. His personal desire was to place the accused man on suspended sentence and probation to enable the course of treatment to be followed but his hands were tied by a law which, in my respectful opinion, was and is iniquitous.
When they receive their appointments our judges and our magistrates are deemed to have common sense and good judgment and, in my opinion, they should be given the power to use this judgment unfettered by statutory rules concerning minimum sentences. I would ask the minister, Mr. Chairman, to bear in mind the suggestions I have just made. Thank you.


Edmund Davie Fulton: Mr. Chairman, I do not think that the remarks of so eminent and qualified an authority as the hon. member for Park-dale should be allowed to go unanswered or without an expression of appreciation and tribute. Very few members of this house are better qualified by background, experience or aptitude to speak on the subjects to

which the hon. member has just addressed himself and I assure him that I personally and the officials of my department both appreciate and will study closely the suggestions he has made.
With respect to two of them, I think I can dispose of the matter quite shortly by saying that we are fully prepared to-and to some extent may almost have anticipated the desire of the hon. gentleman-have those matters looked at.
With respect to habitual criminals, we are certainly prepared to admit the necessity and the desirability of having a look at the provisions to see what, if any, modifications should be made in those provisions.
With regard to the right to cross-examine an accused on his criminal record, the same thing applies. We are prepared to have a look at this, to study this in the light particularly of the recommendations of the Canadian bar association. It is my impression, based on recollection only, that at the present time the matter is before the commissioners on uniformity of the law, criminal section, for study.
With regard to the matter of time spent in confinement pending the hearing of an appeal, the hon. gentleman certainly makes a very powerful argument, although I am not quite certain I would accept every aspect of the case he has made. However, I respect his great knowledge of the subject, particularly in so far as appeals are concerned.


Harold Edward Winch: The man is in jail.


Edmund Davie Fulton: Yes, I know that, but I may say that not all aspects of the argument made by the hon. member should be accepted. I am not prepared to debate them at this time because, as I said, the hon. member has made a very powerful case and one which we are going to look into.
With regard to the question of minimum penalties, here again there is perhaps some room for difference of opinion and the difference of opinion can be maintained or retained with respect for the opposite point of view. There are, however, I believe only three sections of the Criminal Code which provide for minimum penalties at the present time although there are, it is true, other federal statutes which have minimum penalty provisions. I do point out to the hon. gentleman that if there is a clear example of a case where the minimum penalty results in a sentence which is in excess of that which is appropriate under the circumstances, then the provisions of the Ticket of Leave Act, administered by my colleague the Solicitor General, do afford in general a ready remedy for that situation and, as was the case of the

woman recently convicted in connection with theft from the mails, that course was followed and there was an almost immediate exercise of the prerogative under the Ticket of Leave Act. The reason I make this point with regard to minimum sentences is that I think there is a good deal to be said for the requirement of minimum sentences in some cases in order that necessary measures of rehabilitation, reform and training may be instituted.
I admit that those sentences could perhaps be left to the discretion of the court and if it appeared to the court that the circumstances of the particular offender necessitated or justified a longer sentence in order that reform or rehabilitation methods could be instituted, then the court should adjust the sentence accordingly. But, under the present state of the law and of the training of staff and in the absence of a system-we have to admit its absence-of pre-sentence reports; in the absence of a scientific and complete system of pre-sentence reports so that one can be certain that every aspect regarding the circumstances of the convicted man are drawn to the attention of the trial judge there is, I submit, an argument in certain cases for minimum sentences and justifiable, I think, only on the basis I have suggested, namely that it may be necessary in some cases in order to permit of necessary reform and rehabilitation training to be instituted.
But having said that, I still admit to the powerful argument made by my hon. friend. I do not say this to detract from his argument and I assure him that this matter also can and will be looked into in connection with the study which it is anticipated we shall have with the attorneys general arising out of the recommendation of the Fauteux committee with respect to this matter of the bringing about of uniformity in the sentencing practices of the court. This is one of the matters up for study. Therefore, it may well be found that once the uniform practice and the pre-sentence report system have been developed, this argument I have made in connection with minimum sentences will no longer be adequate. If that can be done, then I think it would be better to leave it to the discretion of the court. That whole matter will be studied and developed at the forthcoming conference.


[Stage Direction]
Item agreed to.
Joseph Pierre Albert Sévigny: That completes the estimates of the Department of Justice.



DEPARTMENT OF THE SECRETARY OF STATE

[Stage Direction]
383. Departmental administration, $282,666.
Jean-Thomas Richard: Has the minister any statement to make?
Supply-Secretary of State


Mr. Courtemanche:: No.


Jean-Thomas Richard: Mr. Chairman, at the outset may I take this opportunity on behalf of myself and my colleagues to offer my best wishes to the Secretary of State on his birthday. I know the position he is in this evening, this being the first time he has presented estimates to the House of Commons. I wish him well in his office, as I have done before on other occasions. This is the first opportunity I have had to say how relieved we were that in the recent accident in which he was involved he came off without injury and we hope that his very charming wife is having a rapid and happy recovery.
There is one thing that is unfortunate so far as discussion of these estimates is concerned. I refer to the fact that we do not have the reports of the different departments administered by the Secretary of State. They have not been printed and that makes our position a little difficult in questioning the minister if we have to take each item and ask for comparative figures corresponding to the report we have on hand, that up to March 31, 1957. Knowing that these reports are not at hand I trust that the minister will supply as much information as possible from his own records and will not have to be requested for details on each item from this side of the house.
The Secretary of State administers a great number of departments including, of course, one of the most important, the civil service commission. I hope that his tenure of administration will be long enough so that he may acquaint himself with the problems of the civil service and the commission. After all, the government of Canada is a very large employer and depends upon its employees to carry out the various functions of government. I hope that the minister will always consider himself the champion of his employees and be willing to answer at all times on behalf of the employees of the government. If at any time some hon. members feel inclined to deride or criticize some of the employees in the civil service, who have no opportunity to defend themselves, I hope he will rise in his place, ask for particulars and defend those who are responsible to him and the government.
I also hope that he will take great interest in the revision of the Civil Service Act. We have heard very little about the revision of the act but I understand from press reports and statements made by civil service commission officials that a study of the act has been going on for some time, something which is long overdue. Of course, the Civil Service Act was drafted many years ago at a time

Supply-Secretary of State when the relationship between the employees and the government and the number of employees were much different from today. I think the system has been established now that the appointment of servants of the crown should be done on a fair basis, should be done by examination, by merit, that promotions should be by merit and that all relationships between employer and employees should be the best and above the standard existing in ordinary industrial and commercial enterprises.
I think we all have reason to be proud of our civil service. I have said before, and I am sure all members agree, that the civil service of Canada is the best in the world. Our civil servants are efficient, loyal and as hard working as any other group of employees in commercial undertakings anywhere. If there is any fault involving a small number of employees it is just as negligible as in any other big business.
The problems, as I have outlined before, are mainly those relating to promotion, wages, appeals and working conditions. I hope that in drafting the new act the powers of the commission will be properly defined. In my opinion it is not clear in the minds of members of the house exactly what are the powers of the members of the civil service commission. There is always a doubt that there is some other power exercising a greater authority than the civil service commission in important matters relating to employees of the crown. Of course, I know that treasury board has to have that control which is necessary in approving expenditure and that the size of wage increases has to be subject to approval by the cabinet. But in any event I think the new act should make clear what are the powers of the civil service commission in selecting and promoting employees, hearing appeals from employees and suggesting wage scales. Once that has been established I think the government should insist that all matters within the powers of the civil service commission should be decided by the commission and that employees should have the right to appeal to the commission and be heard before a proper board with respect to any matters on which the commission grants leave to appeal.
I am not at all satisfied that at present the right of appeal with respect to promotion is satisfactory. I hope that the system will be revised. I am not satisfied either that when civil servants are dismissed with or without cause a proper appeal is provided that is satisfactory to both parties. I have had a great deal of experience in this city with civil servants and I must say, having in mind the rights granted to members of unions working in commercial establishments, that
[Mr. Richard (Ottawa East) .1
our civil servants have been very reasonable and I think they should be granted more privileges under any new act than they have been granted in the past.
I also think that the civil service commission should have the right to make more effective recommendations as to working conditions. Those of us who have lived in or around Ottawa for some time know that our establishments are not the most suitable and that, for example, objections involving ventilation, light, heat and cold are made with regard to almost all the buildings where civil servants work. I do not give credit to any former administration for having done any better but I hope that in the future the civil service commission will have the right to have a voice with respect to the new buildings which will be constructed for the government, and will have a say as to the type of equipment, ventilation, light, the size of offices et cetera so that our civil service will have working conditions which are suitable and, as I would hope, the best of any.
Sometime ago we heard that a study would be made with respect to wage increases in the civil service. I understand that at this time the civil service commission has completed its study and has transmitted it to the cabinet. I cannot hope that the minister will tell me that the wage rate has been set or that the wage increase has been granted or refused; however, I would hope that he could tell me that the civil service commission has completed its study and that it is now up to the government to decide whether any wage increases are to be granted or whether the matter is to be studied further.
(Translation):
And now, Mr. Chairman, I should like to say a few words to the Secretary of State about bilingualism. It is incumbent upon him in his new functions to see that bilingualism is respected in government documents and publications. It is also incumbent upon him to see to it that the civil service commission requires respect for bilingualism in appointments when such is required.
I should particularly like to remind him that a French-speaking candidate should not be called upon to fill only a position where the knowledge of French is required if, in addition, he can speak English. Not only should he be eligible for any position offered by the civil service commission but he should be given some preference in view of the fact that he speaks both languages fluently. The minister has expressed his opinion on this matter in the past and, now that he is a member of the cabinet, I hope that he will bring

the same attention to this problem and protect the interests of those candidates.
It is not my intention at this moment to go fully into the other branches of the Secretary of State Department. However, I should like to know if the minister will report to us on the commission under the Inquiries Act, to inquire into the working of the Patent Act, the Copyright Act, the Industrial Designs Act, and other related legislation, as well as on the trade mark service.
(Text):
As I said before, I only want to make a few remarks at this time and shall reserve other remarks on the items which will be called individually.
(Translation):


Alexis Pierre Caron: Mr. Chairman, at the outset, may I say to the Secretary of State (Mr. Courtemanche) that we are happy that though he is celebrating his birthday today this does not appear to have aged him in the least. We wish him very many happy returns of the day.


Mr. Denis:: But not as Secretary of State.


Alexis Pierre Caron: No, even though he is an extremely genial gentleman that we all like to meet. I would also like to extend to his wife my best wishes for a prompt recovery.
I have no intention of detaining the house for any length of time nor to create trouble for the Secretary of State in any way. He is a most genial gentleman, that we all appreciate. I was happy at his appointment and I know that this is the first time he is bringing down his departmental estimates, something which is always difficult and somewhat unpleasant. I hope that he will not get into that habit for too long before he is replaced and that he will make good use, on this side of the house, of the experience he has acquired where he is sitting now.
As the member for Ottawa East (Mr. Richard) said a moment ago, a very important feature of our life here in Canada is our civil service. Our civil service is made up of highly competent persons, appointed after examinations designed to determine their fitness for the particular job concerned, and with no political interference. I know that at this time there is some uneasiness within the ranks of civil servants. This uneasiness has been brought about by certain members who, having made some rather inconsiderate promises, have been attacking civil servants and accusing them of meddling in politics. These people are in a most uncomfortable position at this time. As far as the great majority of them
Supply-Secretary of State are concerned, they certainly do not deserve to be called by the names they have been called.


Some hon. Members:: Oh, oh.


Alexis Pierre Caron: I hear laughter. It must be the hon. member for Roberval (Mr. Tremblay) who wants to take the floor.


Azellus Denis: He is a nervous man.


Alexis Pierre Caron: I cannot speak as beautiful French as he does, but I am better aware than he will ever be of the civil service problem, and with his dull wit, his lack of serious learning, he will never be able-


Azellus Denis: Back home we call these people "smart Alecs".


Alexis Pierre Caron: Yes, "smart Alecs", but I know some of those "smart Alecs" which are much cleverer than that one.
I was speaking about the civil service, a matter which the hon. member for Roberval cannot grasp, because of his dull wit. I was saying that some members-and perhaps he is one of them, but I am not accusing him of being one of those who could do such things-have aroused some ill-feeling in the ranks of the civil service. I believe the Secretary of State should give some assurance to civil servants that they will not be molested without at least being given the opportunity to defend themselves. If the civil servants are guilty of meddling in politics or of any other activity inconsistent with their duties, I think they should be punished as anyone else, but I believe they are also entitled to be heard and to have their case defended.
I feel that the charges which were levelled against a federal civil servant without his being afforded an opportunity to defend himself constituted an act of dishonesty on the part of the person who preferred those charges. I feel that the Secretary of State, who is a serious and able person, should take the bull by the horns and act in this matter, even if cabinet colleagues of his be the ones who abuse their power to crush certain civil servants. He should say to them: "At least, if you have any charges to make against a civil servant, you will do so in such a manner that he will have an opportunity to defend himself, to be fairly tried, as any other person should be fairly tried". The Secretary of State knows this is no exaggeration. I suggest he do what is required so that such people may be heard and may, if necessary, have some one take up their defence.
I have no intention of detaining the house too long, but I wish to talk of another department which comes under the Secretary of State, the printing bureau.

Supply-Secretary of State
I said a moment ago that there was uneasiness in the civil service and I now say that there is also uneasiness in the printing bureau and that is due to the fact that one man, believing that ministers go but that he stays on, behaves in a high-handed way with the staff. I am referring to the queen's printer.
It is high time this man learned that even the humblest of his employees is entitled to some consideration. I have received several complaints from civil servants whose names I will not mention, for fear of reprisals. The employees are dissatisfied, but are afraid to say it openly, and I think the Secretary of State would act creditably in launching an impartial inquiry, where people could speak freely, knowing that their statements would not be repeated to the czar of that department, and I feel sure that this inquiry would uncover startling things.
I am even convinced that the Secretary of State has never been informed by the queen's printer of the many complaints made about the cafeteria. Yet, he was made aware of many complaints, which have remained in his files. Indeed, I believe that some doctors have said that the food there was unfit for consumption and that, if the employees want to stay alive, they should go and eat somewhere else.
I believe that an investigation should be made about that situation. It would be very important that such an inquiry be carried out in such a way that the complainants would not be identified. I always fear for them, since there are many ways of dismissing an employee, and if their names were known, they might not be dismissed for what they have said but some way would be found of laying them off later on for some insignificant slip. I would therefore suggest that the Secretary of State make this inquiry so that an understanding may be reached.
I know the Secretary of State means well and that he will consider the case of those employees with sympathy. If an employer or high official heading a department- because the employer is always the State- does not always act as he should towards his employees, he should be put in his place and told of his duties and responsibilities towards people under him.
(Text):


Frank Howard: I should like to make a few remarks on the same general subject as that dealt with by the two gentlemen who have preceded me. I have always abhorred the wording for the classification "civil servants". I do not care for the title. I think it is rather a degrading way of making reference to those people who work in the service of Canada. I rather hoped that we could find

some other classification or category for the people in the public service. However, inasmuch as there is no other category perhaps in my remarks I shall have to make reference to the people in the public service in an effort to avoid the use of the phrase which I do not care to use. I do not believe this phrase adds much to the stature of the individuals, those people collectively, who work in the public service of Canada in so far as their relationship with their employer, in this instance the crown or the government of Canada.
I hold the same ideas in this respect that I have held for quite a number of years and which were expressed in my own province with respect to the same group of people who work for the provincial government. We in the C.C.F. are somewhat of the same opinion as the hon. member for Ottawa East, who spoke earlier, in so far as the relationship of these people with their employer is concerned. We believe a channel should be provided, somewhat similar to that which exists for other groups of employees, by means of which grievances in connection with working conditions may be settled. Employees working for private companies, and for some crown companies in this nation, are provided with means whereby these grievances may be settled. Employees in the public service who have grievances arising out of what they may consider to be improper cause for discharge, questions of wages, hours and working conditions, should not have to adopt a cap in hand attitude to their employers. They should not have to say, please, we would like to have an adjustment in wages, or we think it is necessary for these reasons, or we would like to have a change in our working conditions, and these are our arguments for them. They should not have to say, we think that such an individual or group has been dealt with incorrectly and we think some redress should be given to them. These employees should not have to go on bended knee, as it were, and I am not being critical of the attitude of the government in this respect but merely of the relationship between employees and the crown or the government itself.
These people in the public service should be treated in the same manner as other groups of employees who come under federal labour jurisdiction. They should have the right, as some have now, not only to organize into unions representative of their type of work, but they should have the right to apply for and receive a certificate of bargaining authority. They should be in the same position in approaching their employers with respect to negotiation as are the employees of the Canadian National Railways, which is a publicly-owned corporation. They should be able to

sit down, within a certain time limit, and bargain with their employer, in this case the federal government, in connection with all matters which they consider to be subjects for negotiations.
On the other side, the government would be in precisely the same position of being able to negotiate with representatives of these employees with respect to matters that the federal government felt needed changing. May I call it ten o'clock?
Resolutions adopted in committee of supply this day reported and concurred in.



BUSINESS OF THE HOUSE

John Whitney Pickersgill: Is there any change in the program for the rest of the week?
Business of the House


Howard Charles Green: No, we shall take the estimates of the departments of national defence and defence production tomorrow.


John Whitney Pickersgill: And Saturday northern affairs?


Howard Charles Green: I am not sure whether or not they would be called first. We may go on with the estimates of the Secretary of State.


John Whitney Pickersgill: There would not be any
other department? I think it would affect the plans of some on this side of the house if there were any change.


Howard Charles Green: If we were to finish these estimates, we would then take the items under legislation.


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

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

Mr. Fisher: 1.	Are United States forces in Canada governed by the NATO status of forces agreement?
2.	If so, were any members of the United States forces in Canada charged in service courts in 1956 and in 1957, under paragraph seven, subsection 2a of the Visiting Forces (North Atlantic Treaty) Act, 1951?
3.	If so, how many?
4.	Were any members of the United States forces charged in the civil courts of Canada in 1956 and 1957? If so, how many?
Answer by: Hon. G. R. Pearkes (Minister of
National Defence):
1. Yes.
2 and 3. The disposition of all cases tried by United States service courts in Canada, where the right to exercise jurisdiction is concurrent, is reported to the attorneys general or their local representatives in the provinces in which these cases are heard. The United States forces do not maintain statistics of the reports made to the attorneys general of the provinces and the Department of National Defence has never requested the provincial authorities, who are responsible for the administration of criminal law in Canada, to keep the department informed on this matter or on the number of United States servicemen tried in civil courts in Canada.
4. Trials in civil courts are provincial matters and the federal government has not asked the provinces to provide returns.



INTERNATIONAL AIR TRANSPORT


Mr. Boivin: 1.	Has the international air transport association made regulations concerning the serving of sandwiches in lieu of meals to passengers on board aeroplanes flying to or from overseas countries?
2.	If so, when were such regulations made?
Answer by: Hon. George H. Hees (Minister of
Transport):
1.	The international air transport association made regulations which prohibited the serving of meals and, in lieu, permitted only the serving of sandwiches. These regulations were made to apply only in air transportation services across the north Atlantic and in "economy" class accommodations at "economy" fares.
2.	The regulations in question were adopted at the association's traffic conference meetings in November 1957 and became effective April 1, 1958, after having been approved by all the goverments concerned.
[The following Items were passed in committee of supply]:



DEPARTMENT OF JUSTICE

[Stage Direction]
158.	Remission service, including $50,000 for grants to recognized prisoners' aid societies as may be approved by treasury board, $319,194.
Supreme Court of Canada-
159.	Administration, $215,399.
Exchequer Court of Canada-
160.	Administration, $131,238.
Northwest Territories territorial court-
161.	Administration, including administration of justice-Northwest Territories, $112,730.
Yukon Territorial Court-
162.	Administration, including administration of Justice-Yukon Territory, $101,170.
Other Courts-
163.	Payments of gratuities to the widows or other dependants of judges who die while in office, $20,000.
Combines Investigation Act-
164.	Restrictive trade practices commission, $79,120.
165.	Office of investigation and research, $446,321.
166.	Bankruptcy act administration, $51,133.
B-Penitentiaries
[Stage Direction]
167.	Administration of the office of the commissioner of penitentiaries, including $60,000 for grants to recognized prisoners' aid societies, as may be approved by the treasury board, $518,701.
168.	Operation and maintenance of penitentiaries, including supplies and services relating thereto; administration, operation, repair and upkeep of buildings, works and equipment; maintenance, discharge and transfer of inmates; compensation to discharged inmates permanently disabled while in penitentiaries, $11,774,823.
169.	Construction, improvements and equipment $2,817,305.
A-Department-
566.	Departmental administration.-further amount required, $50,800.
567.	Northwest Territories Territorial Court-administration, including administration of justice 

Northwest Territories-further amount required, $5,280.
568.	Yukon Territorial Court-administration, including administration of justice-Yukon Territory -further amount required, $19,500.
B-Penitentiaries-
569.	Operation and maintenance of penitentiaries, including supplies and services relating thereto; administration, operation, repair and upkeep of buildings, works and equipment; maintenance, discharge and transfer of inmates; compensation to discharged inmates permanently disabled while in penitentiaries-further amount required, $143,845.
570.	Construction, improvements and equipment- further amount required, $1,559,105.
Office of the Commissioner of Penitentiaries-
657.	To extend the operation of the revolving fund established by vote 628 of the Appropriation Act No. 2, 1955, for the purpose of acquiring and managing any stores or materials required for penitentiary use; the amount to be charged to the revolving fund at any time not to exceed $600,000; additional amount required, $300,000.
658.	To increase to $55,000 the amount that may be charged at any time to the revolving fund established by vote 543 of the Appropriation Act No. 3, 1953, for the purpose of financing the operation of canteens in federal penitentiaries; additional amount required, $15,000.
[Stage Direction]
Friday, August 8, 1958