1958-08-27

Mr. Pickersgill: 1.	Were George P. LeBlanc and Alex P. Boudreau dismissed from the Cape Breton Highlands national park effective June 10, 1958?
2.	How long had each of these employees been employed by the national park?
3.	What was the reason for dismissal in each case?


An hon. Member:: Stand.


Mr. Pickersgill:: Mr. Speaker, I wonder whether some means can be found to get this question answered. It has been on the order paper since July 21. It was put there with a view to having it answered before the minister's estimates were brought up.


Mr. Green:: Mr. Speaker, in the absence of the minister I will have to ask that this question stand.


Mr. Speaker:: Stand.
Question stands.



QUESTIONS PASSED AS ORDERS FOR RETURNS


Mr. Roberge: 1.	Does the Canadian government import manufactured products, either for its own use or for the use of crown corporations?
2. If so, (a) what products; (b) which are for the use of the government; (c) which for the use of crown corporations?


WESTERN FLYER COACH LTD.  BUS CONTRACTS
Mr. Argue: 1.	Have any contracts been let by any department of the federal government for the purchase of buses or other equipment from Western Flyer Coach Limited, Winnipeg, at any time since January 1, 1955?
2.	If so, how many buses, or other items of equipment were ordered, what were the specified delivery dates, and what is the unit price of such buses or other items?


BEAR COVE SKIDWAY, HALIFAX COUNTY, N.S.
Mr. McWilliam: 1. What expenditures have been made annually for the fiscal years 1948 to 1958 inclusive, on the skidway at Bear Cove, Halifax county (west), Nova Scotia?
2.	How many fishing boats actively operate from this skidway?
3.	What has been the annual landed value each year for the years 1950 to 1957 inclusive, for each of the following species: (a) salmon; (b) cod; (c) haddock; (d) lobster; (e) halibut?
4.	How many boats will the facilities at Bear Cove accommodate?
5.	What is the average amount of fish cured and/or processed at Bear Cove?



MOTION FOR PAPERS


[Stage Direction]
Motion No. 38-Mr. Pickersgill:
For a copy of all correspondence exchanged between the Prime Minister and Mrs. A, E. Woodman of Jasper, Alberta, since March 31, 1958, regarding employment in the national park at Jasper, Alberta.
Motion agreed to.


[Stage Direction]
On the orders of the day:
Hon. Lionel Chevrier (Laurier):: Mr. Speaker, Le Droit carries a story datelined Winnipeg in its issue of August 26 to the effect that the defence department has ceased to pay a subsidy or grant in lieu of taxes to parochial or separate schools in Winnipeg, where some 100 children of members of the armed forces professing the Catholic faith have been in the habit of attending such schools. The article suggests that because of this the children may have to attend other schools.
The question I would like to ask the minister is this. Is this an accurate story, and would the minister comment on the article which I have sent to him together with a copy of my question?


Hon. G. R. Pearkes (Minister of National Defence):: I thank the hon. member for giving me notice of this question. I am informed that the Department of National Defence has not been paying a subsidy or grant in lieu of taxes to parochial or separate schools in the Winnipeg area. Until this year the municipality of St. James, in which is situated the R.C.A.F. station at Stevenson field, has not accepted the municipal grant in lieu of taxes from the federal government. Consequently my department has been paying non-resident school fees for the education of dependants of servicemen at this station. This year the

Inquiries of the Ministry municipality has accepted this grant, including that portion covering education.


Lionel Chevrier: May I ask a supplementary question. I have forgotten the expression the minister used, but have those subsidies ceased now?


Mr. Fleming (Eglinion):: He said there were not any.


Lionel Chevrier: Have those school fees
ceased to be paid?


George Randolph Pearkes: Non-resident school fees have been paid in the past, but this year the municipality of St. James accepted the full grant in lieu of taxes; therefore that portion of the grant which covers educational fees is paid to the municipality of St. James in which is located the R.C.A.F. station.



EXTERNAL AFFAIRS


[Stage Direction]
On the orders of the day:
Mr. Hazen Argue (Assiniboia):: I should like to direct a question to the Prime Minister. Would the Prime Minister comment on the press report of this morning that Canada will propose at the coming commonwealth conference a 50 per cent increase in our contribution under the Colombo plan? If this is the policy of the government, can the Prime Minister say whether a supplementary estimate will be brought in this session?


Righi Hon. J. G. Diefenbaker (Prime Minister):: Mr. Speaker, in so far as that article is concerned it is purely conjecture. The decisions as to what will be discussed at that conference are naturally in a state of fluidity. Various matters and phases of these matters receive constant consideration. I can go no further than to say that the article to which the hon. gentleman has made reference deals with a matter in respect of which there has been no final decision.
(Translation):


HEALTH AND WELFARE
[Stage Direction]
On the orders of the day:
Mr. J. A. Richard (St. Maurice-Lafleche):: Mr. Speaker, I would like to put a question to the Minister of National Health and Welfare.
I have been told that the general manager of the Diabetics Auxiliary, Mr. Beauchamp, has travelled on foot from Quebec to Ottawa, a distance of approximately 250 miles, to put the case of all those unfortunate people

afflicted with diabetes in this country before the Minister of National Health and Welfare.
Would the minister be so kind as to tell the house if he has given any consideration whatever to the request for assistance made by Mr. Beauchamp? Or is it that such a request should first be endorsed by the Quebec provincial minister of health to be considered in my province?
I would be very much interested to find out if these unfortunate people may rely on immediate assistance from the federal government, since there are several hundreds of them in my constituency.
(Text):


Hon. J. W. Monieiih (Minister of National Health and Welfare):: Mr. Speaker, first of all may I apologize for not being able to reply to the hon. member in French. I appreciate his having given me a copy of this question just as I came into the house. I did meet Mr. Beauchamp, and I would point out that I am sympathetic, the department is sympathetic and the government is sympathetic to all people suffering from all classes of diseases. I would also point out that a project of the nature suggested by Mr. Beauchamp would have to come to us through the province.


UNEMPLOYMENT INSURANCE
[Stage Direction]
On the orders of the day:
Hon. J. W. Pickersgill (Bonavista-Twillin
gate): Mr. Speaker, I wonder whether the Minister of Labour is now in a position to answer the question I asked him a day or two ago.
Hon. Michael Starr (Minister of Labour):: Yes, Mr. Speaker, I intended to rise earlier and reply to the question. Under section 90 of the act, relating to the unemployment insurance advisory committee, the report must be tabled within 30 days after it has been submitted to the governor in council. It was submitted to the governor in council on July 31 and was tabled on August 20.


John Whitney Pickersgill: In other words, am I correct in saying that the minister had this report before his estimates were considered in the house?


Michael Starr: That is right.


INQUIRY FOR RETURN
[Stage Direction]
On the orders of the day:
Hazen Robert Argue: I wonder whether I could ask the Minister of Finance when the return of correspondence relating

to the federal-provincial tax-sharing agreements will be tabled in the house pursuant to the order of the house passed on July 28?


Donald Methuen Fleming: I will look into the mattter. My recollection is that when the order was passed I indicated that I thought probably all the correspondence had already been tabled. However, I shall be glad to look into the matter now.


DOMINION-PROVINCIAL CONFERENCE INQUIRY AS TO DATE OF NEXT MEETING
[Stage Direction]
On the orders of the day:
John Whitney Pickersgill: In view of the fact that when the federal-provincial conference was adjourned last November it was adjourned until early in 1958, has the government any definite plans yet to reconvene the conference?


John George Diefenbaker: Mr. Speaker, so far as the first part of the question is concerned I do not accept the interpretation placed by the hon. gentleman on the understanding at that time. With respect to the second portion of his question, I may say that as soon as a decision has been reached it will be communicated to the house.



HOUSING


[Stage Direction]
On the orders of the day:
Mr. Maurice Bourgei (Levis):: May I ask
the Minister of Public Works if Central Mortgage and Housing Corporation is going to call new tenders for the first five buildings of the Dozois plan in Montreal?


Howard Charles Green: I am not yet in a position to say whether or not that course will be followed. There has been some difficulty in connection with these tenders. At the moment we are waiting for further word from the committee in Montreal.



BUSINESS OF THE HOUSE


[Stage Direction]
On the orders of the day:
Hazen Robert Argue: I should like to ask the Secretary of State to look into the status of question No. 184 on the order paper. It has been there for some time, and I hope an answer may be tabled soon.
Supply-National Revenue SUPPLY
The house in committee of supply, Mr. Rea in the chair.
DEPARTMENT OF NATIONAL REVENUE Customs and excise divisions-
259. General administration, $4,089,027.


Hon. George C. Nowlan (Minister of National Revenue):: Before this vote is discussed, Mr. Chairman, I presume the committee will expect a short statement from me. As the committee well knows, there are two divisions in the Department of National Revenue, customs and excise on the one hand and taxation on the other. We have now called one of the items with respect to customs and excise, and I shall speak briefly on that division at the moment. After the committee has seen fit to pass the votes in connection with that division I shall again speak briefly on the taxation division.
This division, customs and excise, administers not only the Customs Act, the Customs Tariff, the Excise Act and the Excise Tax Act, exclusive of part I, but also administers many other acts with which most hon. members, I am sure, are familiar. The division administers in whole or in part, for instance, the Immigration Act, Export and Import Permits Act, the contagious diseases act, and altogether there are over 40 statutes or acts in addition to the general ones in which this division of the department has to play some part at one time or another.
In so far as the organization of the customs and excise division is concerned, there are 24 branches here at headquarters in Ottawa.


The Deputy Chairman:: Order; I wonder whether hon. members would lower their voices, because we cannot hear the minister.


George Clyde Nowlan: Some of these, such as excise audit, investigation, drawbacks, inspection and personnel, have field offices throughout the country. Then, of course, there are the ports, the outports, vessel clearing stations, some 435 in all, which run one might say the length and breadth of this country and are situated at border crossing points, coastal and inland points, airports and so forth. Packages imported through the postal service, all alcoholic and tobacco products manufactured, are under the supervision of the officers of this division. All licensed manufacturers who have to pay either sales tax or excise tax are visited by our auditors and have their records checked and liabilities to the department determined.
I suppose the general public usually thinks of the customs officer as a man in uniform whom they see at the airport or at a particular port of entry. Of course there are also a substantial number in addition to

Supply-National Revenue those men who are employed by the department. If one takes the fiscal year 1953-54 as a basis of comparison to show the work that is done by this division, I would say the total number of import entries processed during the fiscal year 1957-58 increased over 1953-54 by 564,920 entries or 16.58 per cent, and the increase in revenues collected totalled $203,168,000 plus.


Mr. Mcllrailh:: What was the year?


George Clyde Nowlan: The year was 1953-54 as compared with 1957-58. That is an increase in revenue from that division of 11.7 per cent. During the same period revenue from the excise tax increased by $44 million plus or 19 per cent, and within the area of international travel the number of vehicles entering Canada carrying Canadians and Americans increased by over 4 million or 30 per cent.
It should be remembered that every person, vehicle, ship, aircraft, train, truck and automobile which crosses our borders or enters our harbours or airports is subject to customs control. Therefore as the country grows and prospers the work involved in collecting revenue and providing essential customs services increases, and of necessity the staff required to ^carry out these functions also increases.
At this point, and because salaries, wages and overtime together account for something like 92 per cent of the total estimates for customs and excise-$35,892,047, to be exact-I should like to say a word or two about the staffing policy of this division. To put it simply, it is a policy of maintaining strict control over all personnel establishments to ensure a flexible organization that combines economy of administration with operational efficiency. Toward this end, efficient establishment control procedures have been established on the basis of extensively developed work formulas and standards, and these are used in conjunction with a system of statistical reporting and the recommendations of our organization and methods unit from studies of work procedures and practices now in effect at the various ports throughout the country. In other words, in simple language, we study the record in order to know where increases and decreases are taking place.
This makes it possible for the establishment control unit at headquarters to keep in close touch with the work situation at every port in the country, and to maintain up to date information concerning any significant change in the normal business index of a port, information which can be translated immediately into terms of proper staffing needs.

It is from those ports which show a fairly well established decline in business that staff is transferred to fill a need elsewhere, whenever it is practicable to do so. On the other hand, positions which become vacant at a port where the trend of business is downward are also transferred, or earmarked "not to be filled" unless specifically authorized by the headquarters establishment control unit.
I presume that I will be saying something on the individual votes as they are called. I shall attempt to answer questions after we have had the questions and opinions of the members of the committee. At the moment I think this general statement is sufficient, and we will now deal with the individual matters.


George James McIlraith: I want to thank the minister for his statement. I must say that this is the first time he has been before the house on his estimates, though he has been minister for 14 months. While he is very familiar to the committee this week, I am sorry to say he was not before the committee last year with his estimates. I will not digress into that subject, but I am one of those who have very strong views about the action of the government last year in not bringing the estimates before the committee for approval in the usual way under the British parliamentary system, but rather choosing to deal with them by governor general's warrants in a way that I regard as wholly improper. However, I will not digress into a debate on that point here.
The minister has had 14 months in which to familiarize himself with the department. Bearing in mind the fact that he was not before the committee last year with his estimates, I hope today he will give us as full information as he can about the operation of the department. I think he will find that his department is a well manned department, and that generally speaking he has an excellent staff. I am sure that is what he found when he took office on June 21, 1957. It is sometimes rather difficult to separate the two divisions of this department, but I should like to ask the minister one or two rather general questions. I think perhaps this is the point at which to do so.
I am one of those who have always held the view that the headquarters of the department are quite inadequate, in relation to the important work it has to do and the volume of work it has to do and the number of members of the public who have to be interviewed. I should like to ask the minister if he cares to comment on this point, and in particular if he has taken any steps to

procure more adequate housing in Ottawa for the headquarters of his staff.


George Clyde Nowlan: There is no question but that the space occupied by the department is taxed to the very limit. Negotiations were going on before I became minister with respect to the acquisition of other property immediately adjoining the Connaught building, but these negotiations did not bring forth the result which the officials hoped they would. Representations have been made to the Minister of Public Works, however, and the hon. member is certainly perfectly correct when he says that additional room is required by the department and will have to be obtained within the very near future.


George James McIlraith: Not only is it a matter of the working efficiency of the staff being impaired as a result of the inadequacy of their quarters, but there is also the difficulty of persons coming to the department to discuss particular customs entries or items, particularly those under the excise tax, and having to carry on those discussions in a room occupied by as many as 40 or 50 persons and as close as six, eight or ten feet to other taxpayers who are discussing their problems with other officials.
I know the officials are very careful with respect to this point, and they do all they can in the circumstances; but in view of the difficulties faced by the taxpayers in these circumstances, particularly the danger of disclosing processes concerned with the manufacture of some items, disclosures which might easily arise when arguing about what item any particular entry should come under, this is a particularly difficult problem. I have in mind the danger of disclosing to a competitor information which is ordinarily regarded under our system as private information belonging only to the particular taxpayer, and as this difficulty is so great I hope the minister will continue to press the matter and that he will find a solution. I do know something about the proceedings in this regard before the minister took office, though I am not in the position of knowing anything about them since. However, I hope this very important subject will continue to receive his attention.
I have one or two specific questions which I would like to ask. Could the minister give us the comparative number of ports, out-ports and preventive stations for the last three years if he has those figures conveniently at hand. I would like to see if there is any material change one way or the other.


George Clyde Nowlan: I will have that for the hon. member in a moment, if he will proceed.
Supply-National Revenue


George James McIlraith: At the same time I would like to ask him to give us the information which he has available up to the latest possible date covering the entries of motor vehicles from other countries. I am not referring to imported vehicles but to tourist and business vehicles being driven into the country by citizens of other countries and then being returned. I would appreciate having any statistics he could give us on that matter covering the last three years.
I would also like him to give us the information he has for the last three years, and for as recently as he has it available, concerning the amount of excise tax collected on new automobiles manufactured.


George Clyde Nowlan: Mr. Chairman, I will answer those questions a little later on.


Mr. Creslohl:: Mr. Chairman, because I do not know under what heading I should ask these questions I should like to ask them now, and perhaps the minister would answer them at this time or on the appropriate items. Can the minister state whether there has been any increase in the activities of his appraisal staff with regard to dumping duty, and what has caused that increase? If there has been an increase, to what extent has the increase taken place? I might tell the minister I have had some dealings with that branch of his service and have found the service excellent and the officials highly co-operative and very much on their toes; but I also found the activities a little more intense than in the past, and I would appreciate it if the minister could tell us why that activity has been intensified and to what extent.


George Clyde Nowlan: Is the hon. member referring to dumping duty specifically, or the valuation and appraisal work of the appraisal department?


Leon David Crestohl: Generally there seems to be an increased tempo of activity in the valuations, which of course we will discuss under the item that will come up a little later. There has been some concern expressed as to why there has been increased activity.


George Clyde Nowlan: The increased activity has resulted because of investigations which have been made of importations coming in and specific inquiries referred to the department for investigation. The hon. member will know that during the early part of the war a great many of the senior members of the organization staff were absorbed in other branches of national service. At the end of the war through promotions many were absorbed elsewhere. There was a tremendous shortage of trained staff, particularly in the appraisal section. This was also caused by the great industrial development across the

Supply-National Revenue country and the full employment and boom that followed the war. Therefore it was some considerable time before it was possible to recruit the staff that was desirable.
As the hon. member knows, steps were taken toward that end some time ago, and when I came into office I saw that they were carried out. We have advertised, and as we shall show later in the discussion concerning the appraisal section 46 new appraisers have been authorized by the civil service commission. Some of those positions have been filled, and we are filling others as rapidly as possible to carry out the increased work load which has been put upon the department because of the development of the Canadian economy.


Leon David Crestohl: Another question, Mr. Chairman. I wonder whether the minister could put my mind, at least, at ease on this question. I was apprehensive that perhaps with the advent of a new government imports were perhaps being managed administratively rather than legislatively. I had some doubt about the matter and wondered if the desire to make imports a little more difficult was responsible for the increased activity. I should like to have the minister's comment on that point.


George Clyde Nowlan: Mr. Chairman, there has been no change in administration whatsoever except, as I said, that staff vacancies have been filled. There have been an increasing number of complaints from importers and Canadian businessmen with respect to what they alleged were violations of the Customs Act. After all, in the years following the war there was a field day so far as business was concerned. There was no trouble with the Customs Act or anything else. People were ready to buy. It was only during the last two or three years that complaints started to come in and the work load increased tremendously.
As I said, the staff was not there to meet the increased work load. My predecessor had started to increase the staff to take care of it, and we have been carrying on. There has been no change whatsoever in the administrative practice, but because of the increased staff we have perhaps been able- and I hope we have-to investigate the complaints and deal with them more efficiently than was possible before, not because we are more efficient but simply because we have the increased staff.


Mr. Pearson:: Mr. Chairman, may I ask the minister whether the operations of the United States customs simplification act and the

whole question of United States administrative protection are his concern, and do they come under his jurisdiction?


George Clyde Nowlan: That is a matter more for the officers of finance, but we also have communication and discuss these matters.


Lester Bowles Pearson: If so, could the minister state if the operation of the United States customs simplification act has removed, and to what extent, the complaints we used to have about administrative protection interfering with our exports to the United States?


Mr. Carter:: Mr. Chairman, while this item is before the committee I should like to bring to the minister's attention a matter which is of very great importance not only to my constituents, the majority of whom are fishermen, but to all the fishermen of Newfoundland. Coming from the maritime provinces, the minister will understand that shore fishermen are dependent entirely on a supply of bait. He will also understand what a cod jigger is. That is the particular kind of hook shore fishermen must employ to catch fish when no bait is available.
All through the history of Newfoundland, prior to confederation and since, fish hooks and jiggers of various kinds used for commercial fishing have entered the country duty free. A couple of years ago when there was no bait the people of the maritimes and Newfoundland learned about a new type of cod jigger which had been developed in Norway, and which had been tried out and found to be much more efficient in the catching of fish than the kind of jigger that is usually employed. Unfortunately this particular type of jigger is called by the Norwegians a lure. The only part of it that resembles a lure is a little piece of red plastic which is interspaced between the hook and the weight; but because of their being described as lures these jiggers have been subject to customs duty of 20 per cent plus sales tax of 10 per cent, which has served to make the cost practically prohibitive to the fishermen who require them so badly.
This may be only a matter of the interpretation of the act, or a matter of judgment on the part of the appraiser. I have an illustration of this device which I would like to pass to the minister so he will know what I am talking about. I do hope that he will take whatever steps are necessary to have this particular type of jigger reclassified so it can come into Newfoundland and the maritime provinces free of duty.


George Clyde Nowlan: I shall be very glad to look into it, Mr. Chairman, to see whether it is a matter of interpretation. From sad experience I find that everybody who writes me about

changing the tariffs says it is simply a matter of interpretation, and that I can wipe it out entirely. Unfortunately the Minister of Finance takes a far different view. As the committee well knows, the Minister of Finance, under the law of this country, is responsible for taxation policy. It is my unfortunate job to have to administer the act. After the longhaired boys of finance evolve their philosophical findings, then we do the work; but I shall look into this, of course, and if it is a matter of administration I do not have to tell the hon. member that my sympathies would be entirely with him and the maritime provinces.
The hon. member for Ottawa West asked about ports, outports, and so on. There are 435 ports and outports at present, and I am told there has been no significant change in the last three years. There might have been a change in one or two, but it is within that range within the last three-year period.
We have no figures giving the number of tourist cars or United States cars coming into Canada. We simply have cars coming in and, unfortunately for the purposes of the hon. member, these will include Canadians returning to Canada as well as United States residents coming in. For the calendar year 1956, 17,341,800 cars came in. That was a 30 per cent increase over 1953. In 1957, the last year for which we have the complete figures, 17,982,400 cars came in; in other words, an increase of about 500,000 motor vehicles between 1956 and 1957.


George James McIlraith: Has the minister any figure as to how it is running this year?


George Clyde Nowlan: We have not those figures available yet.
The Leader of the Opposition asked me a question with respect to the customs simplification practices of the United States government. I am advised that this has helped materially in alleviating difficulties between Canadian exporters and United States importers. Outside the scope of the act, in furtherance of the United States government's desire to help they sent to Ottawa a man specially delegated to meet Canadian exporters and try to deal with their problems and simplify them. That gentleman and his staff have done a tremendous job here, and have helped to solve any problems brought to his attention, that could be solved. Therefore the situation is much better than it was in the period to which the hon. member refers.


Mr.   Carier@: May I just thank the minister for his very fine reply to the problem I put before him. May I just inform him of one point which I forgot to mention when I was on my feet. This particular jigger is most
Supply-National Revenue efficient when used in conjunction with a special white line. The white line and the jigger itself comprise a single unit, and since I understand it is government policy that all fishing equipment be duty free I suggest that the line and the jigger be taken into consideration when he is dealing with this problem.


George Clyde Nowlan: Perhaps I had better go down and have you give me a demonstration of it.


John Whitney Pickersgill: I would like to support what has been said by the hon. member for Burin-Burgeo, and say very briefly that we count on the minister, not as the Minister of National Revenue but as a minister from the part of the country where these things are understood perhaps better than they are in Eglinton, to keep before the Minister of Finance the policy that fishermen are to be kept on a basis of equality with farmers in so far as taxation is concerned, and that all their gear should be duty free.


Mr. Smiih (Calgary South):: I wonder
whether I could ask the minister this question with respect to dumping. Since about 14 per cent of Canada's oil imports come from the United States as finished products, and after the Suez build-up in the United States there was a very strong suggestion that some of those products were being dumped, can the minister say whether his department is keeping a day to day check to be absolutely certain that those products are still not being dumped into Canada?


George Clyde Nowlan: Mr. Chairman, the department has received complaints on that score, as the hon. member has said. Those complaints have been and are being investigated. I can assure the hon. member that the department will continue its investigation of any specific matters that are brought before it.


Mr. Fisher:: I want to speak at some length on a fairly complicated matter that has been before the house a number of times, namely the Premium Iron Ore case. I believe the former member for Winnipeg North Centre-


George Clyde Nowlan: Mr. Chairman, I do not want to stop the hon. member-of course I could not

but if it is the same Premium Iron Ore case of which I have heard on numerous and divers occasions, it is really a matter of taxation rather than one of customs and excise. They are two separate divisions with two separate executive officers and deputy ministers, and the practice has been to deal with them separately. As I intimated when I spoke first, I spoke then only on customs and excise. When this committee gets through with this division we will immediately go into taxation, and I suggest that the hon.

Supply-National Revenue member defer his remarks to that time unless for some reason he cannot be here.


Douglas Mason Fisher: I can be here.


Mr. Houck:: Mr. Chairman, I have not any questions to ask the minister, but I think as the representative of the riding where we probably have more customs and immigration officials than any other ports in Canada I should say something on their behalf.
I want to congratulate the minister and through him his department for the splendid officials we have at the port of Niagara Falls and the port of Fort Erie. At those ports we have custom men and immigration men as well. As the minister knows, probably more cars enter the port of Niagara Falls and the port of Fort Erie than enter any other port in the Dominion of Canada. I have had many people say to me after they have passed through customs, "Well, we worried about going through customs and what restrictions we would have to go through". But each and every one would say, "The officer made us feel right at home. He was not only cordial but a perfect gentleman", or a perfect lady, if it happened to be a female officer. They said, "It was a pleasure to enter Canada and realize that although they had restrictions, the restrictions were fully explained to us and after the explanation we fully agreed with them".
I wish to say to the minister that all his officers are perfect gentlemen. We in the Niagara district are proud of them, because we believe the old saying that the first impression is the lasting impression is correct. When tourists entering Canada get the impression that we are really human beings here and that they are cordially invited to tour Canada, the impression lasts. When they get this impression after crossing the bridge and passing the officials it always remains with them when they tour the province of Ontario or elsewhere in the Dominion of Canada. Then when they go back they worry because they have to get their cards back which they left with the customs officials. They always say, "We leave with a smile on our faces; the officers always leave us with the old feeling that the first impression is a lasting impression".
The only thing I would like to see the minister do-and I know he will because he is so cordial; he agrees almost 100 per cent with everything I say-is this. Because of the fine work these officials are doing in those ports-and sometimes they are doing it under extreme hardship, especially on week ends and holidays when the crowds are dense-I think they are deserving of higher salaries. I hope the minister will take this


under consideration. I know they will continue to do a good job. I wish to say to the minister again that we are proud of his officials who are doing such a good job.


Lionel Chevrier: Mr. Chairman, as one from another part of the country I should like to say a word in support of what has just been said by my colleague from Niagara Falls. I represent a constituency in the city of Montreal, and I know that what I am about to say applies not only to Montreal and Toronto, where I have had some experience as well, but also, I am sure, to all parts of Canada. It is a fact, as the hon. member for Niagara Falls has said, that the Department of National Revenue is fortunate in the kind and calibre of men it has at the border ports from one end of Canada to the other. These are most difficult positions to fulfil, and I have no doubt that they are being fulfilled in accordance with the best traditions of the department.
I speak particularly of the officers in Montreal with whom I have come in contact from time to time. I know something of their courtesy and diplomacy. As the hon. member who spoke earlier said, it is so important for people entering Canada to have a lasting and good impression of our country, and no one can help to create that good impression more than the officers who carry out important functions at these various ports. I can speak particularly about the airport at Dorval and the airport at Malton, because in my former capacities I had occasion to use these two airports many times. I know with what seriousness and courtesy the officers of the Department of National Revenue fulfil their duties.
There are, of course, exceptions; there are bound to be. If there were not exceptions I think it would perhaps not be normal. It only goes to show that on the whole these exceptions prove the rule. I want to join the hon. member for Niagara Falls and support the demand he has made, to which I am sure the minister will give careful consideration, for the betterment financially and otherwise of the conditions under which these officers work.


Mr. Batten:: Could the minister give me the following information. I should like to know the number of employees in all divisions of the Department of National Revenue in the province of Newfoundland as of March 31, 1957 and as of March 31, 1958. I should also like to have the same information for the province of Nova Scotia.


Mr. Deschatelets:: Mr. Chairman, my remarks have to do with a particular matter concerning the customs and excise officers of the Department of National Revenue at the

harbour of Montreal. I am informed that as of July 1, 1958 these officers of the department were notified that all overtime work would be compensated for by time off, and that section 86 of the civil service regulations would be applied to them by the minister. Section 86 makes that provision. I believe it is also the common practice in all departments of the government for the officer in charge to decide whether or not to apply the rules strictly. In any event, I am not suggesting now that cash should be paid for all overtime work at all levels of government employment and that section 86 of the civil service regulations should be repealed, though I would think that in due time we should give serious consideration to the matter.
But I think the government is making a great mistake in compensating for overtime work by allowing time off in departments where it was the accepted practice to pay employees in cash for such work. Because of the nature of his duties the employee has to incur expenses for meal and transportation charges which are increasing all over the country at the present time. Yet he is not paid in cash, though it has been the practice to do so for over a decade. I think such a change in policy kills the incentive of the employee, and the minister will agree that it is not a morale booster for the staff especially at this time, in view of the fact that since June 1, 1957 the cost of the most essential items of shelter, clothing and food, has increased.
At the harbour of Montreal this change in policy affects at least 110 employees. I think the minister will agree that companies are charged for the extra work done by the officers of the department, and that these revenues come to the department. Therefore I think it is only fair that we should continue to pay the employees in cash.
The minister will appreciate that no recognized union in this country would tolerate a private industry paying its union members for overtime work by allowing time off. Instead of getting rid of this antiquated rule, why does the government now try to extend this bad system of paying employees with time off? The employees generally disapprove of such a system, and I think they are on very firm ground in criticizing the change in policy.
When the minister was on this side of the house he advocated that in our relations with our civil service employees we should try to treat them as much as possible along the same lines as private industry treats its employees. The minister is now getting far away from the common rule in private industry, where employees are paid in cash
Supply-National Revenue for extra work. We know the minister is administering a very important department, that he needs revenue and that his officials are always on the job to see that duties are paid to the last cent. This is sound and good administration. If the minister, for example, were claiming an amount owing by a farmer, surely he would not like to be paid with a bag of potatoes. The same rule applies to his employees. The department asks them to do extra work and instead of paying them in cash gives them a piece of paper entitling them to a holiday. Let us not forget that when we pay our employees in cash their families and their communities benefit, and their increased purchasing power helps to avoid a recession.
I should like to ask the minister two questions. Is there anywhere in his estimates an additional amount to pay for such overtime work in cash? Second, are the additional revenues earned by the extra work of his employees at the harbour of Montreal put to the account of the department? Finally, and this is not a question but more a prayer, would the minister reconsider the decision already taken, so that the policy effective in Montreal harbour for over a decade will be resumed to the satisfaction of all employees concerned?


Lionel Chevrier: I should like to support the remarks made by the hon. member for Maisonneuve-Rosemont, Mr. Chairman. I find myself this morning commending the minister, as I did earlier, upon the excellence of the officers in his department. My friend the hon. member for Ottawa West says, "and rightly so; they were inherited". I find myself now somewhat critical in what I am about to say because of the decision which I understand, from the remarks made by the hon. member for Maisonneuve-Rosemont, has been taken with reference to overtime pay in connection with certain of these employees. The hon. member who has just taken his seat can speak far more effectively and with greater authority than I can on the subject because most of these employees, or certainly a large number of them, come from his constituency. There are some who live in my own constituency of Laurier, and the minister will pardon me if I take just a moment or two to preface what I have to ask of him by stating the case.
It appears that by reason of a decision of the Department of National Revenue these port employees were notified that as of July 1, 1958 all overtime work would in future be compensated for in accordance with civil service regulations and not paid for in cash as was the case prior thereto. There are, I am

Supply-National Revenue informed, 110 employees at the port of Montreal who are affected by this decision. They have made representations to the hon. member for Maisonneuve-Rosemont and to me. These representations are made, let me assure the minister, in a most respectful manner, asking him to reconsider the case because of the conditions which have been outlined by the previous speaker.
It has been pointed out that the decision taken by the department is one which is going to have a demoralizing effect upon the officers, in view of the hardships they will suffer because of the fact that instead of receiving cash which has been an incentive for overtime work they will now be in receipt of compensatory leave for work done. They believe that an officer who, because of his duties, has incurred extra expenses such as meals, transportation costs and the like as a result of overtime work, may have a feeling of resentment which is understandable. In their opinion this method is unfair and unjust, since the officer is being penalized when he has to work under these more difficult circumstances because he is no longer in receipt of cash but time off as compensation in lieu thereof.
It is brought to my attention also that if such compensatory time is accumulated in the winter months, it is not much use. If they are paid such overtime in cash, their families and the communities in which they live benefit; their purchasing power is increased, and they are able to meet conditions of life more advantageously than they otherwise would. It is pointed out to me that the effect of this decision is that it cuts by one-sixth, in some cases, the purchasing power they have hitherto possessed. It is my understanding also that the cost of this extra work is, in most cases, charged against the companies accommodated and therefore brings revenue to the department. They feel this is a point which should be given consideration when the question of cash for overtime is under study.
I realize that for years, as has been stated so clearly here, the practice of the administration has been to pay for overtime in cash only when the work load has been so heavy that overtime could not be compensated for in leave. In the port of Montreal, because of the circumstances which exist there, particularly in the eight months of navigation where the work load is not of an ordinary nature but of an extraordinary nature, it seems as if it were a deterrent to the increased efficiency in the national revenue staff. I know, too, that the administrator of the port has a certain discretion in a matter such as this, but I am wondering if I could not be so bold as to say [Mr. Chevrier.l

that perhaps that officer has exercised his discretion in a manner which may in effect be detrimental to the efficient operation of the department.
Without saying more, I wonder if I could not prevail upon the minister and his officers, efficient as they may be, who are before him now to give consideration to this case. It is working a hardship on these 110 employees. The withdrawal of this cash allowance which has been in existence for the last 10 years, as has been stated so well by the hon. member for Maisonneuve-Rosemont, seems to me a bit severe. Will the minister, therefore, under the circumstances and having regard to what is happening in the port of Montreal and the overwork that exists there, not reconsider this matter so these men may be placed in the same position as they were prior to this decree coming into effect?


George Clyde Nowlan: Perhaps I should deal now with this matter to which reference has been made by the hon. member for Maisonneuve-Rosemont and the hon. member for Laurier. They suggested that we should provide remuneration for overtime by virtue of section 86 of the Civil Service Act, and that is exactly what has been done. I am advised that section 86 of the Civil Service Act makes it mandatory that overtime should be paid for by compensatory time, if that is available, and only if it is not available should cash be paid.
Now, there was a very wide departure from the provisions of section 86. The hon. member for Laurier referred to the discretion of the port administrator. He has a discretion, and he also has a responsibility.
I am sure that hon. members will not argue that there is more business being done at that port than there was last year, but the overtime in the month of May of this year amounted to $16,000. This was twice as much as was paid a year ago. As the result of a port audit by the headquarters staff, they compared the figures and found they were going up steadily, so they suggested there should be a stricter enforcement of section 86 of the Civil Service Act. As a result, in the month of June the amount was reduced to $8,800 for overtime, although business had increased somewhat in the month of June over the month of May.
This is a problem which has caused great concern to all the officers. One wants to use discretion and one appreciates the arguments about hardship, but I do think there are some cases in which overtime has been paid. I am not speaking now of Montreal at all; I am speaking of a port of which I have knowledge much nearer my own home, where a practice has grown up of paying cash for overtime.

We find year after year more and more overtime being paid and no compensatory time being allowed. If the act is to be changed, that is a matter for the government and for parliament, I suppose; but that is the law as it stands at the moment.
I certainly will take a look at this particular case, and naturally will give it every consideration. However, I think those are the basic facts, particularly respecting that month of May in which there was such a startling increase of $5,000 more than any other month last year. That was something the auditing authorities thought should be brought forcibly to the attention of the responsible officers in Montreal, and that they should be asked to see how section 86 would work. As I said, overtime then was reduced to $8,000, and still gave compensatory time for the balance.
I was also asked about the amount in the estimates, if any, for this overtime. There is $900,000 included in the estimates this year for overtime, which is $200,000 more than it has ever been before. It can therefore be seen that this is a problem. I think all hon. members can realize the difficulties in connection with its administration. It varies with collectors, ports, personal relationships and so on. You get problems of administration which are not the easiest to deal with. However, we must do it in the best way we can. Certainly we might pay more overtime and reduce staff.
It must be remembered that in the winter time many of these people have very little to do, but nevertheless they are carried. There was a time when you paid overtime in the summer and let them go in the winter. However, that policy was found to be unsound and was changed by the preceding administration, and I think properly so. But that is the crux of the problem. Those are the facts in so far as Montreal is concerned. It is a problem which affects not every port but a good many of them in this country, and is one which is receiving careful attention.


Lionel Chevrier: May I say just one word. I thank the minister for the statement he has made, and particularly for the fact that he says he will study this matter in order to ascertain whether something cannot be done to rectify the situation. I realize the difficulty in which he finds himself with growing overtime payments. I think that tendency obtains in every department. It would seem to me that it would be a pity if, because of the increase in overtime, it should be cut altogether. I think it would be better to re-examine the position from one end of the country to the other, obtaining advice from the administrator in each locality, in order to ascertain whether or not there is a good reason for paying it.
Supply-National Revenue
That is why I am grateful to the minister for the decision he has made to review the matter. I would think it would be most unfortunate if, in the Montreal case, overtime were cut out altogether. I am sure the administrator will report that there is occasion for a good deal of it, or a substantial amount of it, under present circumstances.


George Clyde Nowlan: We paid $8,500 in June. I have not the figure for July, but it was substantial.


Lionel Chevrier: I hope the minister will find it possible to continue the policy which existed in the past.


George Clyde Nowlan: The hon. member for Humber-St. George's asked me about employees in Newfoundland and Nova Scotia. I am sorry to say that I cannot give him those figures at the moment. I am advised by the officers that we do not have them. We never keep them on a provincial basis, although the figures can be determined. I have asked the officials to get the figures, and I will supply them to the hon. member. However, I am not sure that I can do so today; in fact, I am quite sure I cannot. They are kept on the basis of ports in the nation as a whole rather than on a provincial basis.


Herman Maxwell Batten: That is quite satisfactory.


Mr. Herridge:: Before making a few representations on behalf of my constituents I wish to thank the minister for his courtesy and his close attention to any complaints I have brought to his attention. I appreciate that very much indeed. Even when the minister is unable to do anything to correct the complaint, I may say that after a visit with him you feel as though you had had a visit with Santa Claus who is going to remember you at Christmas.


John Whitney Pickersgill: He is quite a tax collector.


Herbert Wilfred Herridge: I also want to say how much I appreciate the prompt replies I received to correspondence with the senior officials in Ottawa, and their going into detail to explain situations that are not too clear to constituents who have complained on various grounds. I also want to say this as to the staff of the minister's department in my constituency, situated at Paterson, Trail, Nelson, Waneta and Nelway. Their courtesy and attention to their duties are recognized not only by citizens of our country, but on numerous occasions I have had favourable comments by visitors from the United States who have expressed to me how much they were impressed by the courtesy of the officials of the department of customs and also of the officials of the immigration department.

Supply-National Revenue
Traffic between the United States and my constituency, in fact the whole of southeastern British Columbia, is increasing very rapidly in recent years. On that account, from various organizations, municipalities, representative groups, chambers of commerce and trade unions there has been a continuing demand for the stations to be kept open 24 hours a day, or for giving 24-hour service, particularly at Paterson and at Nelway. That is because of the fact that many of the men at Trail take their four days off in the United States, go on short holidays, work on a sort of 10 days on and 4 days off basis, and also take their longer holidays there. On account of the desire to attend sporting and other events in the state south of us there are hundreds and hundreds going to attend hockey games and other sporting events that are held in the United States or in the Kootenays on the Canadian side of the border.
Because of that increased traffic coming and going, and the fact that many of these people returning from the United States wish to return after midnight and vice versa, there has been this continuing demand for 24-hour service, particularly at Paterson and Melway.
I am not going to take the time of the house to go into this matter in any detail, but in order to present my argument as cogently as possible, as logically as possible and as soundly as possible from the minister's point of view, I want to quote an editorial from the Trail Times, which is a Progressive Conservative paper owned by a cousin of the Minister of Public Works. The editorial is written by the public relations officer of the West Kootenay Progressive Conservative association. I am sure, Mr. Chairman, that I could not use a stronger argument on the minister in this case.


George Clyde Nowlan: It is well documented.


Herbert Wilfred Herridge: I want to read just briefly from the editorial. It is headed, "Keep Border Open all Night". This gentleman's name is Denis Williams, and he will be pleased to know that I brought his views to the attention of the minister. After his reply to the representations made by two hon. members who spoke previously I enter this arena with considerable hope. He writes as follows:
Attempts to persuade the national revenue department to maintain a 24-hour service at the Paterson border crossing have been in progress for years, and Ottawa's uncompromising attitude is disclosed in the following letter we received from Kootenay West member H. W. Herridge at the week-end.
I took the opportunity to send him a letter, knowing of course that he was a supporter of the government. He goes on to say this:
We think that Mr. Sim is missing the point. He is mistaken if he believes there is no value

in keeping the Paterson customs office open just because the U.S. authorities decline to maintain a 24-hour service at Northport.
It is not southbound traffic that we are concerned about. We are interested primarily in the plight of Canadians who want to return to Canada and cannot do so if they arrive at Paterson after midnight.
At present, West Kootenaians visiting Spokane, for instance, must time their departure in the evening in order to arrive at Paterson before the witching-hour. If they fail, they are put to the inconvenience and expense of spending the night in the U.S. Similiarly, Trail citizens week-ending at Christina lake must leave Laurier by 10.30 at the latest if they expect to spend the night in their own beds.
Most of them do so in our constituency.
Then there are dozens of travellers who head east through Osoyoos and the Sherman pass rather than endure the discomforts of the Greenwood to Rossland section of highway 3; and they too must plan their schedules to bring them to Paterson before midnight.
The operation of Paterson on a 24-hour basis would prove of the utmost advantage to hundreds of Canadians-wanting to get back into Canada. To these people, the hours of business of the U.S. customs and immigration office at Northport are of no consequence, since no clearance is required by the U.S. authorities in order for a Canadian to leave Washington.
Mr. Sim says that his department's observations indicate that the increase in hours beyond midnight could not be justified "by the amount of traffic operating through the port during these hours."
Here the deputy minister is on shaky ground-
I must say, Mr. Chairman, that I very seldom find the deputy minister on shaky ground.
-to say the least. How can he possibly calculate the amount of traffic that would enter Canada after midnight when he refuses to keep the border post open? The fact is, of course, that a large number of drivers who now either spend the night in the U.S. or time their arrival at Paterson before midnight, would use all-night facilities if they existed. One cannot tell what the volume of traffic through Paterson might be once it was generally known that one could enter Canada at any hour, but we believe it would be heavy.
The deputy minister's letter to Mr. Herridge rather indicates that departmental thinking in this issue is faulty. There is no relationship, as far as we are concerned, between the hours of operation of the Paterson post and the Northport U.S. office- except for people entering the United States. We think Mr. Sim might study the plight of those who use U.S. highways to avoid bad Canadian roads and who want to get back into Canada to suit their own convenience.
I just read that because I do think it points up some of the reasons for the argument very well, and I would urge the minister to take another look into this question because of the rapidly growing traffic between the United States and that part of British Columbia which I have the honour to represent.


Mr. Lamberi:: I would like to ask the minister a question in connection with information which has reached me and which

I communicated to his department some months ago, suggesting that there might be dumping in this country of certain types of glass fibre products used for the wrapping and insulation of oil and gas pipe lines in connection with their installation. I was wondering whether any evidence of such dumping had been discovered, and whether a study is being made at the present time in connection with this particular material.


Mr. Caron:: There is one matter which has been discussed year after year and which I raise again this year and demand an answer thereto. With respect to almost every federal department, the city of Hull and the western part of Quebec has until now been attached to the Ottawa office, more especially in respect of the income tax department. I think since the city of Hull is known as the metropolis of western Quebec, we should have an office established on our side which would cover the provincial part for Pontiac, Gatineau, Hull and Papineau, and even includes Grenville. I say this because I think the present arrangement detracts from the importance of the city of Hull.
I have previously made complaints based upon statistics which are produced from time to time and which generally include the overall picture of Hull and Ottawa combined, so we cannot know exactly what is going on on our side of the river. Hull is equal in importance to Sherbrooke, where there is an office; to Three Rivers, where there is also an office; and it is the centre of a large area which, as I have said, covers Pontiac, Gatineau, Papineau and the whole of the county of Hull. I think we therefore have the right to expect that we should get service on our side so that people do not have to come to Ottawa every time they must deal with the income tax department.
I know the minister cannot make a decision today or even, having in mind the presentation of his estimates, this year, but I want the minister to look over the whole question and try to satisfy the demands of the people of the western part of Quebec.


George Clyde Nowlan: I think the hon. member
should perhaps repeat his argument this afternoon-at least I hope it will be this afternoon-when the income tax officials are here, because I am sure his appeal will have some effect upon them. It will at least be given careful consideration; I can assure him of that.
The hon. member knows, of course, that taxation is divided into districts and it is very rarely that one would have a city which would be a district in itself. In so far as the income tax department is concerned, with which we are dealing at the moment, they do have their 57071-3-264
Supply-National Revenue own collector in Hull and in so far as the customs house office is concerned, the Hull office operates in the same way as those offices in any other parts of Canada. It is true that for income tax purposes we have the various districts, and we will certainly take a look at the whole organization of those districts as soon as we have the time. I do not think I need to emphasize the fact that since June of 1957 there has not been very much time to take an over-all look at anything, but I am looking forward to the cooperation of hon. gentlemen opposite so that we will have some free time, I hope before the end of September and during the ensuing two or three months, in which we can make new surveys, which I realize are badly needed.
While I am on my feet I will deal with the question asked by the hon. member for Edmonton West, who asked about fibre glass. It is true that he made representations to the department some time ago with respect to the suggestion of dumping. These matters are being investigated at this moment by departmental officers but no final report has been received; in fact no report has been received which would indicate that the fact of such dumping has been established. The matter is, however, being investigated and we will see what is shown by the final report.
The hon. member for Kootenay West has made a moving appeal for an all-night service at Paterson in his constituency. I think the only difference between that port and 500 others in this country is that he presents its claims more eloquently than perhaps the claims of some of the others could be presented. This is obviously a very difficult problem, and I can promise that consideration will be given to it. However, that consideration has to be taken in view of the over-all picture and one must realize that if we were to open up one such service then we would be under immediate pressure for others and others and yet others. Although it is perhaps true that there is no direct connection between the United States port authorities and the Canadian authorities, obviously once such a service is opened on one side pressures are immediately created on the other side, and there has to be a certain co-ordination between the services of the two countries if we are to have efficient co-operation and service regulations.
I would have thought that in the constituency from which the hon. member comes the air would be so salubrious that the people there would like to get to sleep early and stay in bed, and really I would not think very many of them would be travelling after midnight, unless perhaps it was the hon. member himself. I would advise him further that he will get a letter from me as well as
4174	HOUSE OF
Supply-National Revenue a letter from the deputy minister, which he can again send to the local paper and which will perhaps be ensconced on the editorial page of that journal.


George James McIlraith: I had some difficulty in hearing the minister's opening remarks because of the conversation being carried on in the chamber. He may have given this information, and if he has I would ask his indulgence and request him to repeat it. If he has not, I would ask him if he would now give it. Could the minister give us the total number of customs entries for each of the last three years?


George Clyde Nowlan: I gave this on a five-year basis, though I do not know if that is exactly what the hon. member needs. Taking 1953-54 as the basis of comparison, during the past fiscal year entries increased by 564,920 or 16.5 per cent. I have the figures for excise tax.


George James McIlraith: I would like that later. Have you any more information?


George Clyde Nowlan: I can give you specific figures.


George James McIlraith: For what period of years?


George Clyde Nowlan: I have them before me. I will go back to 1954-55. Do you want it in round figures?


George James McIlraith: No.


George Clyde Nowlan: There were 3,475,400 in round figures, we will say. In 1955-56 there were 3,824,200. In 1956-57 there were 4,099,500. In 1957-58 there were 3,922,000 exactly. Those are the import figures for those years.


George James McIlraith: You were going to give the excise figures.


George Clyde Nowlan: Yes. Starting with 1954-55 there were 335,500, again in round figures dropping the digits. Next year there were 331,300. The next year, 1956-57, there were 336,100. In 1957-58 there were 334,800.


George James McIlraith: I presume the excise figures would be more sensitive to changes in the excise tax legislation from year to year than would the import entries under the customs tariff, because of the fact that the customs tariff contains such a great number of items and has a relatively small number of changes compared with the excise tax legislation. Can the minister give us the number of entries, or are statistics kept concerning the number of entries, in which dumping has been found during those years?


George Clyde Nowlan: I am told we do not have those figures. I am informed they are not kept.


George James McIlraith: Is any data kept in a statistical way concerning dumping?


George Clyde Nowlan: I do not think there is any information that has been accumulated in respect to this. Obviously there is information in the department with respect to dumping matters that have been brought to our attention and so on, but I understand there has been no compilation of figures with respect to that. I can try to assemble whatever there may be so it would be available on the discussion of the customs bill, whenever it comes up, but I do not think the hon. member will find it too satisfactory because it is not on a comparative basis or compiled in the way the normal statistics of the department have been.


George James McIlraith: What I am concerned about is this. I know that during a period of slowing up of business the number of complaints about dumping inevitably increases. I am quite aware of that. That is fairly elementary. But I am wondering if in fact there has been found any dumping increase and, if so, what information the minister has on that point. Of course there would be a tendency to increase dumping from other countries if in those other countries there was a decrease in their volume of business.


George Clyde Nowlan: As I said, Mr. Chairman, we have no figures available. There have been more complaints undoubtedly, as the hon. member knows. We have regulations governing the matter of the fixing of samples and the general appraisal practices that are carried on which have pretty well eliminated what might in the past have been an increase in dumping. I do not believe there has been any substantial increase in dumping. The hon. member knows about the practices which have been developed with respect to the tariff. There have been revaluations under the Customs Act from time to time, and I have had to sign an order once in a while changing a valuation on a weighted average basis, but such occurrences have not been frequent by any means. It happens once a month or something like that.


Lester Bowles Pearson: Mr. Chairman, may I ask the minister if he feels that the present antidumping provisions of the law and the regulations on this matter are now working reasonably satisfactorily?


George Clyde Nowlan: I would not want to say they are working satisfactorily, Mr. Chairman. As I said, we have been strengthening and enlarging the staff. If we can judge by the number of complaints received, then certainly there is some area of doubt as to whether or not they are working satisfactorily. The trouble is that all these investigations take a long while, as hon. members associated with them know, and with the

gradual increase in staff we have been attempting to cope with the large backlog of complaints which require investigation. I certainly would not want to say they are working satisfactorily, yet I do not want to be too definitive about saying they are working unsatisfactorily. Therefore I would say there is an area that obviously requires much more careful investigation than we have been able to give in the past, but which we hope to give in the coming years.


Lester Bowles Pearson: The minister feels there is really not sufficient staff to deal with the complaints that are now being made under the anti-dumping legislation?


George Clyde Nowlan: We have authority for 46 additional appraisers and have taken on 40. These are well trained; they go through an intensive course of training. The salaries are better now, and we have attracted 26 university graduates to go into the field. We are also getting trained men with business and manufacturing experience. They have passed the civil service examinations and will fill out the complement, although we still have some shortage.


Lester Bowles Pearson: So the increase in staff is not really anticipating future difficulties but is dealing with difficulties accumulated in the past?


George Clyde Nowlan: Yes.


George James McIlraith: Is any statistical information kept on the number of complaints about dumping?


George Clyde Nowlan: We will have to check on that, Mr. Chairman. Our statistical information is a little deficient in that area. The assistant deputy advises that he is not aware of such statistics being kept, but we will check and see what information can be compiled immediately on that score.


George James McIlraith: If that is available perhaps it could be brought in later this afternoon on another item, if we reach another one.


George Clyde Nowlan: It is not available in compiled form, but by going through files and checking records probably some approach to it could be made.


George James McIlraith: I believe the minister will understand my concern with this problem. There is frequently a great deal of pressure put on the staff to find dumping because of some difficulty in a particular industry in Canada. At best it is an exceedingly difficult subject.


George Clyde Nowlan: I have seen many examples of it.


George James McIlraith: It requires a great deal of skill and delicacy in handling, and for that
57071-3-264i
Supply-National Revenue reason I would be very glad to get any information on the point that is available. If I may make a personal reference, I remember in a time of business depression a considerable number of years ago the pressures that were put on the department to find dumping in the case of practically all imports. I quite understand the difficulty and the harm that dumping can do when there is in fact dumping, but it is a term that is difficult of definition at best, and there can be abuses under that guise. Perhaps I am more sensitive to the subject than some because of my early experience in my own professional life when an attempt was made to find dumping in cases which I think most Canadians, and gentlemen on all sides of the house, would now regard as normal imports.


Mr. Nesbitt:: I do not wish to take up much of the time of the committee, but in view of what has been said in the last few moments I should like to give a concrete example of why some people now and in the future would like the question of dumping looked into. The example I have in mind concerns a company called the Golden Gate Equipment Company of San Francisco, California. Apparently, this company obtains heavy equipment such as cars, diesel engines, trucks, tractors and the like from the United States government. Apparently this equipment is used in Japan and elsewhere. The equipment is refurbished and rebuilt. Sometimes it is brand new equipment which has not been used but has been declared surplus by the United States government. It is turned over to the Golden Gate Equipment Company. I would just like to read from the bulletin sent to one or two firms in this country, which has been put out by the Golden Gate Equipment Company and which is completely self-explanatory. I quote:
The following equipment just arrived from Yokohama, Japan, and is for sale for export only-
This is in large letters.
to Canada, Mexico or any foreign country (not territories of the United States).
This equipment is new or rebuilt by the government. A large portion of this equipment is still sealed and cosmolened. There is no rust or deterioration. It is our opinion that most of this equipment is new or near new. The prices are far below the market here in the United States. All prices shown are net to dealers-quantity purchases will be considered for discount.
This is the kind of thing that is going on, and it has to be checked into very carefully, Mr. Chairman. A number of companies in this country make these types of heavy equipment. I hold in my hand actual advertisements of this company. Here we have a situation where some large equipment company in the United States is getting surplus United States government equipment on the

Supply-National Revenue condition that it be sold only abroad, and Canada is put first on the list. The prices are far below market prices. Here is a good example of a matter which should be looked into, and why the minister will certainly need extra help.


Lester Bowles Pearson: On this particular and very interesting illustration, may I ask the minister before he deals with it whether it is not possible under the present provisions, either section 35 or section 36, to deal with this kind of transaction, which is obviously dumping because it is a product sold in Canada at below the fair market value of the same product in the United States. Therefore it could be dealt with under the existing provisions of the law which have to do with prices below the fair market value.


George Clyde Nowlan: On that score, Mr. Chairman, if there is a fair market value in the United States, then of course it would come under dumping, as the Leader of the Opposition says. But a lot of this stuff has no home market value established, and you have to fix a value for duty on it. I can assure the hon. member that this is receiving the very closest attention of the staff. We have issued instructions to the ports that any importations of this surplus United States equipment have to be held at the port, and when the appraisals have been submitted to Ottawa they are to be reappraised, if necessary, and very often they are. A large shipment came in from Japan the other day. I forget the exact figures, but we will say it came in at a value of around $25,000. It was very expensive brand new equipment from Japan. When it was reappraised the value was put at over $100,000.
This is a matter which is causing us concern. I suppose we have representations from pretty nearly every firm in Canada with respect to it, and I have written to each of them pointing out the procedure we have adopted. If we can get those values for duty established and get the machinery speeded up in that regard, then I think we can do a reasonably good job in controlling those imports.


Lester Bowles Pearson: Mr. Chairman, I ask the minister whether it is not true that where you cannot establish fair market value for duty or dumping duty purposes, there are provisions in the present law which enable the government to establish a valuation for that purpose; that is, when the fair market value cannot be established?


George Clyde Nowlan: There are provisions in the law which are designed for that purpose, yes.


George James McIlraith: I should think, Mr. Chairman, that the example given by the hon. member for Oxford is one that comes squarely under section 35 of the present Customs Act.

Section 35, subsection 2, admirably covers that sort of dumping. It is adequately dealt with, surely, in the present legislation, but it is hard to prejudge these things on the little information we have here.


George Clyde Nowlan: That is right.


George James McIlraith: Perhaps there is no more statistical information that we can get on dumping. I do not want to debate the subject, but there is one other matter I should like to ask the minister about. Can he tell us how many decisions of the appraisers have been appealed to the tariff board with respect to evaluation or classification?


George Clyde Nowlan: I would have to get that information for the hon. gentleman; we have not it available.


Douglas Mason Fisher: Can the minister tell us what happened to the particular cargo in question that came into Vancouver from Japan?


George Clyde Nowlan: I have forgotten; I think they had to pay the duty on the valuation which was fixed. I am not quite sure about that. It is held there and if the duty is not paid then, of course, the usual machinery of the department is invoked for its disposal. I have not the information on that; it happened three or four weeks ago. I am not sure whether the matter has been concluded; probably it has not.
The hon. member for Ottawa West spoke about decisions of appraisers. I think the position is this. The decision of the appraiser is taken to the deputy minister, and the appeal takes place on the decision of the deputy minister.


George James McIlraith: That is what I meant; it is an appeal from the deputy minister's decision to the tariff board?


George Clyde Nowlan: Yes.


Douglas Mason Fisher: I should like to say something on the customs section in relation to books; what amounts, I would say, to censorship of books. The Minister of Justice has suggested that he is working on a new bill which will differentiate between literature and what is not literature. I want to find out whether the minister has had any discussion with the Minister of Justice on this matter. Are there any figures that we can obtain which would indicate how much time is spent per year by the customs department on this particular chore? I would like to get an idea how many books a year on the average they have refused.


George Clyde Nowlan: Mr. Chairman, there have
been numerous discussions between the Minister of Justice and myself with respect to this rather difficult and nasty task, one of

which I was unaware until I came in and I found on my desk one morning a heterogeneous collection of what might be called books -at least they were books; I would not say there was any resemblance to literature- and then I realized what a minor task there was in this department. I said I would have nothing to do with it, as I thought there was a better way to deal with it. Out of that arose those discussions with the Minister of Justice.
No final decision has been taken. Various alternatives have been discussed. As the hon. member points out, the Minister of Justice can take action with respect to domestic matters in this country, but I am afraid there is still going to be responsibility on the customs authorities in so far as importation is concerned, because all imports have to go through our offices. It is impossible to give any suggestion as to the time spent on this matter. The procedure, as the hon. member knows, is for a book or a box of books, or whatever it may be, to come into a port, and the collector there, the customs officer or whoever it may be, has to examine them. If in his opinion they offend that section as being treasonable, seditious, immoral or salacious and so on, then he sends them to his next senior officer, the collector. If he still thinks they are in that category they are then sent to the head office in Ottawa and the assistant deputy minister and the executive assistant take a look at them. I do not know when they do this reading. I imagine most of these books are such that they would not want to read them at all. If they decide that they are in that category they then go to the desk of the deputy minister, and if he feels that they fall within that category they finally arrive on my desk. A decision has been made on the way up the line, and I have to concur in it or otherwise.
It is impossible to say how much time is spent. I certainly have not spent a great deal of time on it. There have not been very many crossing my desk. During the last few months I have seen very few, but that is the way the machinery works. It is unsatisfactory, and it does not guarantee any great control. The officer may happen to be busy or he may be the type of man who has a very liberal outlook. If so, he will say, "This book is all right; I will pass it". Another officer may have a different view of these things.
Perhaps I should not say this, but I can think of one example to show how it works. Last year I had submitted to me six lithographs for inclusion in this year's calendars. They were six nudes. They had been passed on by all these officers. Three of the nudes were absolutely nude and three had some sort of diaphanous wrapping around their
Supply

National Revenue bodies. One of the senior officers said the three which had the diaphanous clothing could be admitted because they were semi-clothed. Another officer said their posture was indecent and they should not be admitted, but the nudes could be admitted because their posture was not indecent.
That is an example of the judgment that has to be exercised and the kind of artistic skill that has to be passed upon by customs officers. I really think that we are much better qualified to deal with increasing the seasonal tariff on cabbages and cucumbers than to pass moral judgment on literature coming into the country. Heretofore any decision made could be appealed to the tariff board, but very few appeals were taken. We are all aware of one rather famous appeal a short time ago, as the result of which a certain book was admitted on a split decision of the tariff board after the department had refused it admission.
The tariff board certainly does not want to be shouldered with this task. I do not think that the tariff board is necessarily the best judge of impurity in books and literature. Perhaps I could say that the courts are not either, but someone has to take the responsibility. There will be a provision in the bill which will be before the house shortly, and I think it is a step in the right direction, providing that in future appeals from decisions of the department, if there are any, will go to a court rather than to the tariff board.


Lester Bowles Pearson: May I say I am glad to hear the minister say that this procedure is highly unsatisfactory. I agree with him as one who has to take his own share of responsibility as a member of a government that did nothing about it over the years. I also agree with him that while it is an invidious responsibility, somebody has to take it, and that really the courts are better qualified for this purpose than officials of the customs department, who are better qualified for other duties. I am glad this change is being made.
Just before we adjourn may I return to a statement the minister made a few moments ago about a shipment from Japan, I think he said, with respect to which the valuation had to be increased from $25,000 to $100,000 for customs purposes.


George Clyde Nowlan: Roughly.


Lester Bowles Pearson: May I ask him under what provision of the law that increase in valuation was made?


George Clyde Nowlan: I do not have the file in front of me, but I know exactly what the hon. member has in mind. It would be under one of the subsections of section 35; I am quite
4178	HOUSE OF
Supply-National Revenue positive of that. I cannot tell him which subsection it was, but it would have to be under section 35.


Douglas Mason Fisher: I want to thank the minister for his statement on books. It is a matter which has exercised us for some time. We have always felt that the situation was unfair to the customs department, especially when you have such inconsistencies as are evidenced by the fact that Joyce's "Ulysses", Faulkner's "Sanctuary" and Wilson's "Memoirs of Hecate County" which at one time were banned have since become rather standard works and recognized as very good literature.
How do the customs officials handle the matter of recordings? I think most members will be aware that there are a number of lewd and lascivious recordings available which can be obtained from United States sources, and I am wondering what resources the customs department has to check on this particular phase of the censorship problem.


George Clyde Nowlan: The procedure with respect to recordings would be exactly the same as with respect to books.


Douglas Mason Fisher: Are the records put on the minister's desk?


George Clyde Nowlan: Since I came into office no such record has reached my desk in that way, so I would judge that the recordings are of exceptionally high quality or else none of them have come through customs.


Mr. McMillan:: I should like to ask the minister a question in connection with the importation from Japan to which he referred. What would be the penalty for dumping?


George Clyde Nowlan: It was not a question of dumping. It was a question of fixing the value for duty. I am speaking from memory and subject to correction, but I believe these were United States goods which had been sent to Japan by the military authorities and then re-exported from there. Therefore there would be no home market value established in Japan, and the department would have to establish the value for duty. In other words our appraisal section wouid have to go to work and reappraise the goods. The hon. member knows, of course, that dumping only occurs when you establish the value on the home market and the goods are being sold below that value under such conditions as affect your own producers.


William Hector McMillan: There would be no penalty at all?


George Clyde Nowlan: There would be the greater duty. I think it ran into tens of thousands of dollars.


Douglas Mason Fisher: Can the minister tell me
whether the border crossing point at Pigeon River south of Fort William has enough staff at the present time to handle any increase in its work in connection with the fair valuation of United States farm produce which has been coming in and which may be affected by future legislation? I raise the point because we are an isolated market area, and there does not seem to be enough business to rate a full time Department of Agriculture inspector. I have had requests from two farm groups in the area to check on this point so that if the agricultural legislation is stiffened there will be enough staff on the customs side to check such imports.


George Clyde Nowlan: I am advised that it would appear as if there is sufficient staff, but I will take a personal look at the situation and advise the hon. member.


The Chairman:: Shall item 259 carry?


William Hector McMillan: May I call it one o'clock? I have two or three more questions.
At one o'clock the committee took recess.


[Stage Direction]
AFTER RECESS

The committee resumed at 2.30 p.m.
William Hector McMillan: I should like to ask the minister a question about imports from the United Kingdom. This government provided that people who travel to the United Kingdom might bring in more goods duty free. I wondered if the minister had anything to report on the amount of goods that had been entered by Canadians returning from the United Kingdom.


George Clyde Nowlan: Does the hon. member mean as a result of the change?


William Hector McMillan: Yes.


George Clyde Nowlan: No, there are no statistics available on that score yet because the practice has not been in vogue long enough to enable us to compile any.


William Hector McMillan: I notice that in 1956, during the consideration of this item, some members of the then opposition, notably the Minister of Finance, the Minister of Public Works and the Minister of Justice, referred to the fact that the item covering the operation and maintenance of ports which then stood at $24.6 million was too high. This year that item stands at something around $30 million. I believe the present Minister of National Revenue entered into that discussion, too, and said that the expenditure was too high. Some members of the opposition then referred to the fact that we had too many employees in

the Department of National Revenue. They blamed the government for waste and extravagance because of the increased number of civil servants in that department. I notice that this year there is an increase in the department as a whole, but not in the customs and excise division alone. I would like to ask the minister if this increase of some 54 over the number employed by the former minister was necessary? If it was necessary, does he still think there was waste and extravagance under the previous administration in connection with that department?


George Clyde Nowlan: This item does not come under this division we are discussing at all, it comes under the port administration. I shall be glad to deal with it when we come to that particular matter. It does not come under the general administration.


[Stage Direction]
Item agreed to.
260. Inspection, investigation and audit services, $4,212,190.
George James McIlraith: I presume this is the item under which these inspectors come. Is the salary for these additional personnel provided for in these estimates or is it going to require a supplementary estimate?


George Clyde Nowlan: It is provided in this estimate.


George James McIlraith: Will the minister tell us how many prosecutions there have been under this item?


George Clyde Nowlan: What does the hon. member mean?


George James McIlraith: Prosecutions in the customs and excise division; I presume the place to ask about them would be this item.


George Clyde Nowlan: I have the figures here for the prosecutions in connection with cigarette seizures and motor vehicles seized and sold, if those are the prosecutions to which the hon. gentleman refers. We have a series of them. These are the cigarette seizures; in 1950, 254; 1951, 558; 1952, 813; 1953, 378;
1954,	175; 1955, the same figure, 175; 1956, 134; 1957, 76. Now, the number of prosecutions does not always follow exactly the number of seizures. It is slightly less. The prosecutions, for instance, in 1950 were 242; in 1951, 535; 1952, 779; 1953, 350; 1954, 167;
1955,	165; 1956, 127; 1957, 72.
Motor vehicles seized and forfeited for the same years are as follows: 52, 184, 260, 78, 50, 26, 22 and 19.


[Stage Direction]
Item agreed to.
262. Construction or acquisition of buildings, works, land and equipment, $848,400.
George James McIlraith: I wonder if the minister could give us a bit more detail than is
Supply-National Revenue shown in the estimates covering item 262? What are the main buildings covered by this expenditure?


George Clyde Nowlan: This, as the hon. member knows, covers the constructions which this department does of smaller residences and offices in places which are more or less remote and in which the Department of Public Works has not the facilities or equipment or organization to do this work. In those cases, this department goes ahead and does it on its own. The record is being looked up now. I think we have two, as I recall, on the Maine-New Brunswick border, some on the Saskatchewan and Manitoba borders with the United States and two or three in the north country. There were seven combination offices and houses that I have authorized within the last few months, which will be coming under that vote for this year. That is the type of building which goes on in so far as buildings and works are concerned.


George James McIlraith: While he is getting the details, perhaps the minister can tell us whether there is any one really large item in it.


George Clyde Nowlan: No; there is not. If there was any one large item, it would be under public works. There are no large items here but there are a series of smaller buildings which combine office and residence. It runs usually about $25,000 and sometimes much more, depending on whether it is in the north country where building material has to be transported either by plane or under the usual conditions that prevail in that country.


William Limburg Houck: As the minister well knows, truck traffic especially at the port of Fort Erie is picking up tremendously. I am wondering whether the minister or his department has been making any plans for increasing the warehouse facilities for the proper handling of trucks at the Peace bridge at Fort Erie.


George Clyde Nowlan: That warehouse is under the Peace bridge authority and is not directly under the department. However, we know that there is need for additional facilities and negotiations have been going on in an attempt to get them.


John Whitney Pickersgill: I was rather astonished at the announcement made by the minister with regard to the Department of Public Works not having facilities in Manitoba and New Brunswick. I believe that in every province the Department of Public Works has a district architect and staff, and I should be immensely surprised if the minister's department had any district architects throughout

Supply-National Revenue the country. It seems to me that this is one of those cases which we used to hear criticized so frequently by the present house leader when he was sitting over here on the opposition side, namely building branches in all sorts of departments. Surely this is something that ought to be transferred completely to the Department of Public Works.


[Stage Direction]
Item agreed to.
Taxation Division-
263. General administration, $3,183,910.
Mr. Regier:: I wonder whether the minister can give us the approximate relationship between the number of wage earners who, at the end of the income tax year, owe money to his department as compared with the number who are entitled to a refund at the end of the year. I ask for only a rough estimate. What I should like to know is this. Are there more wage earners who have a refund coming to them than there are those who owe money and are obliged to pay a balance?


George Clyde Nowlan: I will answer that question in a moment. I should like to make a general statement on the income tax division before we deal with the detailed questions and answers, and while the officers from that division are coming down to the floor.
By any standards, the taxation division operates a large-scale business. Last year collections in this division exceeded $3 billion. Individuals paid about one-half of that amount and corporations roughly the balance, with succession duties of about $65 million being thrown in as a sort of balancing item.
The detail work is tremendous. For instance, in 1957 returns were received from 5J million taxpayers. That figure included about 100,000 corporations.
Ledger accounts are maintained for about 130,000 instalment payers and 200,000 employers remitting tax deductions. In addition, accounting action has to be taken or was taken last year in about 700,000 cases where taxpayers declare tax owing and find that additional sums have to be assessed. Really, when one considers these figures, he gets some idea of the detail work which has to be done by the officers of this division.
The division employs 6,200 regular personnel in its 29 district offices and its head office. These figures are rather interesting. In 1937 the division had 1,214 employees and it handled 439,000 returns or an average of 362 returns for each employee. In 1947, the division had gone up to 7,400 employees and it handled 3,338,000 returns or about 450 per employee. By 1957 the number of employees was reduced, came down to 6,195 with an increase in work load, with 5,428,000 returns


or an average of 876 per employee as compared with 362 to which I referred 20 years previously. Of course, accounting machinery and improvements procedures accounted to a substantial degree for those changes.
I want to give full credit to the taxation officers for their continuing efforts to reduce expenditures and for the efficiency of this department. If time permitted I could give the figures. I put them on the record once before, showing the cost today of collecting $100 as compared with the cost a few years ago. A comparison is really amazing.
I have one qualification to make on this question of efficiency. I think it is fairly well known-it is no secret-that I have been very critical of the public relations of this department. I was critical when I sat on the opposite side of the house and I have been critical since I came over to this side of the house. When I say "of this department" I am speaking specifically of this division. It was my feeling and it is my feeling that in their zeal for efficiency they have tended sometimes to lose sight of the individual and I think there is a natural pressure to look upon the taxpayers en masse impersonally, not as people. Perhaps it is difficult or impossible to look upon them as persons, but I still think that something in that direction can be accomplished. As a result, as is well known to the officials here in front of me and the senior officials in the department, we have had many conferences on this score. Some very frank talking has been done and much thought has been given to this matter. I have received much co-operation from the officials and I think that real progress has been made, or at least I hope so. Reports would indicate that at least some progress has been made in that direction. I have at least told my officials that progress should be made in it and I know that they are attempting to make and I believe have made effective changes in that direction.
Having said that by way of criticism, I think this also should be said about the efficiency of the department. I do not know but I suppose every employee may feel this, whether he is an employee of a bank or what position he may hold. I do not know of any employees who have greater pressure brought to bear on them than have the employees of the Department of National Revenue generally and perhaps particularly the taxation division where they have to go out to people's homes, go to people's offices, interview them, conduct investigations and often are in a position in which, if they wanted to take advantage of it or of the opportunities which are presented to them, there could be a marked impairment of the efficiency of the department and a reflection on the character of the officers

themselves. I think it is a real source of satisfaction-it certainly is to me as minister, and I am sure it must be to members of parliament and of Canadians generally-that so little has ever happened which would indicate in any way any derelection of duty or any impairment of efficiency on the part of the thousands of officials who are, as I say, conducting these onerous, responsible and unpleasant tasks, often under conditions which present difficulties in connection with efficient operation.
Canada can be very proud of the calibre of its public servants, their integrity and their efficiency. There have been minor derelictions of duty in the past, as is well known, but these have usually been publicized and have been rigorously dealt with. If, as and when any occur in the future the same thing will happen, but they are so insignificant in number and in frequency compared with the operations which are carried on that I think it is worthy of comment and should be put on the record.


Some hon. Members:: Hear, hear.


George Clyde Nowlan: Supply-National Revenue these reclassifications have been offset by the elimination of 308 full-time positions. This is the result of a three-year program which has now reached its completion. In these estimates the increase in salary costs of seasonal employees is $510,000, which increase covers higher rates of pay plus longer retention. The total payroll provided by these estimates is $28,659,010. The regular staff as of April 1 this year was 6,172 and the seasonals numbered 1,434. Last year at the same time we had a regular staff of 6,195 and 1,303 casuals.
Others types of expenditure show a net increase amounting to $162,000. The major
increases are as follows:
Travelling expenses	 $60,000
Telephone and telegrams		$40,000
Public forms which have to be printed	 $72,000
In regard to the income tax appeal board, there is an increase of $14,220 in the appropriation for administration purposes. The increase in the volume of work which must be handled by the board is indicated by the following statistics:
1956	1957
Number of appeals filed .... 373	486
Number of appeals disposed
of	 312	371
The number of appeals outstanding as of March 31, 1957 was 306, and the number outstanding as of March 31, 1958, 446.
In considering these main estimates of the taxation division and the income tax appeal board it is important to note that the volume of business which we are being required to transact is increasing at an accelerated rate. This is principally substantiated by the increase in the number of income tax returns being processed. The number of returns during the last four calendar years was as follows: In 1954, 4,940,000; in 1955, 5,058,000, or an increase of 2.4 per cent; in 1956, 5,243,000 or an increase of 3.4 per cent and in 1957, 5,542,000, or an increase of 5.7 per cent. That roughly gives a picture of what has been done by this division and the kind of business that has been transacted, together with an indication of the expenditures and the reasons for the increases.


George James McIlraith: I wish to thank the minister for his statement on this item. I was particularly pleased with his remarks as to the efficiency of the personnel and staff of the division. I am one of those who has held the view for some time that this department deserves credit. Bearing in mind the suddenness of increased taxation burdens thrown on the taxpayers during the war years at a time when personnel to perform this work


were not available due to the shortage that existed in the war and immediate post-war years, I felt it did not get sufficient credit. In any system of taxation where taxes are as high as ours of necessity are in this country it is important that the public have confidence in the absolute fairness and integrity of the department charged with the responsibility of collecting taxes. If we ever reach a state where that confidence is lost or impaired then there develops a bit of a struggle between the taxpayer and the tax collector and there is a breakdown in the whole system. I believe it is important that this confidence be maintained and I believe the personnel of this branch of government deserves the confidence it holds.
While I could if I wanted make some sharp comments about some of the remarks made by the minister and some of his colleagues when they were in the opposition concerning this subject I will not do that. I do not think it is a fair thing to do and I am sure no one realizes better than the minister that some of the criticism may have been slightly excessive or misdirected.
I believe the minister is correct in emphasizing the importance of the need for good public relations for this department. It is important not only that the department perform its duties in an efficient and fair way, in a way that will lead all citizens to believe there is absolute fairness in the administration of the tax law as between individuals, but it is also important that the public feel that is being done. For that reason I can only encourage the minister in any attention he will give to appropriate improvements in the public relations of the department.
I also could not help but feel appreciative of the work that has been done in reorganizing the staff in the program announced some years ago by the minister's predecessor in office. I was quite happy to observe that the minister did not seek to give the impression that this was something he had undertaken in the last month or two and he recognized it was a three-year program and had been carried out over that period of time. I am afraid that all too often in the last few months we have had the opposite type of treatment of some of these subjects on the part of various of the minister's colleagues. I can only commend him for not falling into that error and doing something which I believe is not proper for a minister to do and that is to mislead the committee. There is nothing more I wish to add on the general administration and perhaps I should now yield the floor to other hon. members who may have questions to ask.


John Whitney Pickersgill: Mr. Chairman, I am going to be very brief. I should like to echo what the hon. member for Ottawa West has said. I wish to echo his words for the special reason that I am going to refer to a specific case. I do not wish to have the minister think I am suggesting anything should be done to weaken the integrity of the department. It seems to me that is even more important than any other consideration including efficiency, public relations or anything else. I believe that practically all Canadians are convinced that the income tax branch is completely honestly run and that unhappily is not true in many countries. It would obviously have been impossible for us to collect the huge amounts of revenue that have been collected in this country in the last 20 years, and especially since 1940 since Mr. Ralston's budget of that year if there had not been the feeling of confidence that there was almost 100 per cent integrity in the income tax branch. What the hon. member for Ottawa West said about that is something all of us should bear in mind, including the minister who I know does bear it in mind as the first consideration and first duty because of necessity income tax is one of those things that has to be administered in secret. I will not use the word the minister does not like but it has to be done that way. Therefore in that field more than in any other it is incumbent upon the officials to preserve integrity and if public relations may occasionally suffer thereby I think it is better that public relations should suffer than that integrity should suffer.
I wish to say a word about a matter which I have already brought to the attention of the minister. I would not be trespassing upon the time of the committee now if I had not received a little encouragement from the minister to do so. I have in my hand a letter from one of my constituents. I will not read the letter but in it the gentleman relates that he was summonsed and convicted in the courts for failure to submit an income tax return. This constituent, according to his own story which I think the tax department believes to be correct, is a married man who is crippled and who has three children. He was employed only for six months of the year. Apparently he was charged on the wrong assumption that he was a single person. This is a case of a person who did not know the law very well. I do not question that the law was properly carried out. I am sure it was. But what I question is whether there was perhaps a little excess of zeal in bringing the charge in the magistrate's court before someone had investigated all the circumstances. Even if there 57071-3-265J
Supply-National Revenue was a technical infraction, since this man was so clearly and obviously not liable for tax, he should not have been charged and fined $25. This man has a very small amount of income on which to support himself, his wife and his children. A fine of $25 means a great deal to this man and his family. I must say I have not had any other case like this in my recollection since I became a member of parliament, but the minister told me that, from time to time, cases of this sort arise and that he did not think there would be any harm caused to anyone in having the matter raised in the house. I think the minister hoped that by my raising it he might be able to say something which would perhaps improve public relations a little in this respect.
I do not want to suggest to any hon. member that there is any private treaty between the minister and myself. I believe the last few days will have convinced most hon. members that the minister and I are dealing at arm's length. However, cases like this do result in those dubious public relations about which the minister spoke. In bringing this up I do not wish it to be thought that I want anything but the most utter integrity in the administraion of the income tax law.


George Clyde Nowlan: Mr. Chairman, perhaps I can deal directly with this point. I think the hon. member has something else he wants to attend to shortly and perhaps I should reply while he is still here. I certainly appreciate the problem he has raised. It is by no means unique. We have quite a few similar cases. As a matter of fact, I have a breakdown before me. We had something like 80,000 requests which we had to send out for the filing of income tax returns. Just to keep the records straight, I think it should be made clear here that the hon. gentleman implied that there was perhaps no justification for the filing of the return. That is true as it developed, but the situation in short was that this man was employed.


John Whitney Pickersgill: If I did that I did not mean to.


George Clyde Nowlan: This man was employed. He filed, or had filed for him, I presume by his employer, a T-4 slip which showed his income as something over $1,000 a year, we will not say how much, and somebody had erroneously completed a form showing him with an exemption of $1,000. Therefore, obviously, on the return filed he was taxable, and it was on that basis that he was prosecuted and fined. When he was prosecuted that is what we discovered. His employer had sent in this slip showing that he had received over $1,000 a year and was entitled to an exemption of only $1,000. In accordance with the practice

Supply-National Revenue of the department he was sent the first letter pointing out that he should have filed an income tax return and asking him to file one. He did not reply to that letter for reasons which apparently were good and sufficient. Anyway, the circumstances were such that he did not reply to the letter. Later on, after 30 days, the department sent him a registered letter asking him in firmer terms-you might call it a demand-that he file and warning him that if he did not file he would be prosecuted. There was no reply received to that letter and then, after a considerable lapse of time, the matter was turned over to the R.C.M.P. Prosecution was started and when the facts were developed-of course, he was guilty of not filing-he was fined $25, as the hon. member says. Obviously, on the facts and the information we received, he was not taxable because he was a married man with three dependents, when the form which was filed with the department indicated an exemption of only $1,000. That is how this happened. It is regrettable. I understand that they were probably in difficult circumstances. Usually those people who are prosecuted are in difficult circumstances. The ones who are not and who avoid income tax do it through media other than failing to file, at least most of them do. They file incorrect returns. Those who fail to file are very often those people in the most difficult circumstances possible.
As I said, we sent out 88,000 requests for filing. Then, the demands were cut in half; half of them replied. Forty-seven thousand demands had to be issued and there were 5,400 for prosecutions across Canada and we discontinued 2,200 of them. As the facts developed, 2,200 were dropped but 3,157 were taken to court. My officers feel that by a more careful analysis of this procedure in the future we can reduce the number of prosecutions started, at any rate, and bring it down to a substantially lower number than we have today.


Douglas Mason Fisher: Mr. Chairman, any diffidence that I may feel about bringing up the Premium Iron Ore case again is really dissipated by my recalling that in the house the minister told me that some of my arguments on a previous occasion could be easily corrected or, as I recall it, he said that they had no legal basis. Therefore, I am glad to be back at it again to give the minister an opportunity of clearing up once and for all any misunderstanding there may be on this case from the point of view of this department. I suppose the matter is relevant to the Minister of Finance and also to the Secretary of State for External Affairs.
A complete review of the case is hardly necessary but there are several points in question that might very well be settled now.

I might begin to make this point by reading two editorials, one from the Winnipeg Tribune of Friday, July 25, 1958, and the other from the News-Chronicle of Saturday, August 2, 1958. The editorial in the Winnipeg Tribune is entitled:
These questions should be answered.
One of the questions mentioned in chats between Prime Minister Diefenbaker and President Eisenhower during the Ottawa visit was the Premium Iron Ores case. Mr. Diefenbaker confirmed this in reply to a question in the commons.
Ordinarily the court case between Cyrus Eaton of Pugwash and the United States tax collectors would be a private fight and no particular concern of Canadians or the Ottawa government. But some of the circumstances about the case make it very much the concern of Canadians.
In the first place, the tax treaty between Ottawa and Washington seems to be jeopardized by the persistence of the United States revenue department in trying to collect taxes from Premium Iron Ores.
Washington tax collectors insist that there has been no official protest from Ottawa against the raid on Premium. Members of the Ottawa government insist that protests have been lodged repeatedly during the past several years.
To end any doubt on this question the dates and nature of the series of protests should be officially tabled in the House of Commons.
In the second place, there have been persistent reports that bureaucrats in the Ottawa revenue department have encouraged their counterparts in Washington to ignore Canadian government protests and to press the suit against Premium in the United States courts. The name of J. G. McEntyre, deputy minister of national revenue, has been repeatedly mentioned in these reports.
These questions should be asked and answered:
Has McEntyre encouraged Washington tax collectors to make a dead set on a Canadian company in spite of Ottawa government policy and the tax treaty?
Is this encouragement still going on?
If so, what does the Diefenbaker government intend to do about it?
Are United States tax officials still being supplied with information from tax files by Canadian revenue officials to help them in their case against Premium?
I would like to move from this editorial to what is perhaps a stronger editorial and at this time I am not identifying myself with either of these particular views. This is from the paper in my home town of Port Arthur, the News-Chronicle of August 2, 1958. The editorial is headed:
Matter of tax policy.
The plight of Premium Iron Ores Limited, which faces a multi-million tax suit in the United States, has been set out in these columns several times in recent months. The company, operating in Canada, and subject to Canadian taxation laws, is seeking immunity from taxation by the United States government on the basis of an agreement between Canada and the United States that was designed to prevent double taxation.
The strange feature of the case is that the heads of government appear agreed that there should be no double taxation. Official protests have gone to Washington from the previous and the present Canadian governments. Prime Minister Diefenbaker

mentioned the case to President Eisenhower during the latter's recent visit to Ottawa, and the president apparently agreed Premium was being subjected to double taxation. Why then, does the United States internal revenue department persist with the case?
The only logical answer is that high-ranking civil servants are handling the case in defiance of their superiors. It has been charged that Canada's deputy minister of national revenue and the acting head of United States revenue department have exchanged letters on the Premium case. If statements attributed to the Canadian civil servant are correct, then it is high time the government stepped in and cut him down to size.
What is involved in the Premium case is not routine business between Canadian and United States revenue departments. It is strictly a matter of policy. And policy should be made by the federal cabinet not by deputy ministers.
Prime Minister Diefenbaker should call an investigation into the Premium case to determine exactly what has gone on, and how many other cases there may be which have been decided by civil servants. It should be unnecessary to spell out duties and limitations of authority to such responsible people as deputy ministers, but the investigation may reveal such action is necessary.
Certainly it is desirable that this case, once dismissed by a United States court and now before the United States court of appeal, should be settled. If the settlement is anything other than dismissal, the position of American investment in Canada is in grave danger, and therefore so is the future of Canada.
These two editorials, I think, probably place the case much too strongly and they stem from part of the pressure campaign that has been organized by Mr. Eaton. I have no comments, pro or con, against Mr. Eaton's pressure campaign.
I think he may tend to practice it more because the American environment he has been in for so many years is more open to that and I think he may not be aware that this is rather unusual in Canada. But there is nothing to stop him from mounting such a campaign and when one considers that in a sense his own company and his own fortune are in jeopardy

I would not say his whole fortune, of course-one can understand his particular reason for being worked up about it. I have a letter from Mr. Eaton dated July 15, 1958 referring to the correspondence which has excited these newspapers. That correspondence can be found in sessional paper No. 204 containing a copy of all correspondence and other documents exchanged between the Minister of National Revenue or any officials of the department and officials of the United States concerning Consolidated Premium Iron Ores limited from January 1, 1948 to May 12, 1958. I want to read the pertinent part of Mr. Eaton's letter into the record. I do so in order that we may be able to see the situation in the opinion of one of the persons involved, a person who has been organizing his case in every possible way. He says:
Supply-National Revenue The McEntyre correspondence discloses the shocking situation of a deputy minister making confidential commitments with a foreign government in defiance of his own Prime Minister and cabinet. Some of the letters written in 1958 are self-serving documents for the record that probably were arranged by telephone calls or conferences between the writers.
I might interpolate that Mr. Eaton seems to have a suspicious mind. He goes on:
We will produce the statements from Americans to verify every line written by Judith Robinson.
This is a reference to item No. 5 in the sessional paper which was a letter to Mr. McEntyre dated April 2, 1958 from the United States treasury department over the signature of O. Gordon Delk, acting commissioner. In this letter Mr. Delk says:
The statements made in the letter of February 15, 1958, apparently have their genesis in the same source which inspired certain articles by Judith Robinson appearing in the Toronto Telegram under dates of February 18 and 20, 1958. The article of February 20 attributes the statements in question to Mr. Harry Swanson, our director of international operations, in alleged testimony on February 14, 1958, before the committee on foreign affairs of the United States house of representatives. It is assumed, therefore, that Mr. Swanson is the individual referred to in the letter which came to your attention.
Then this letter goes on to dynamite the substance of the points made by Miss Robinson in her column. Mr. Eaton says in his letter:
We will produce the statements from Americans to verify every line written by Judith Robinson. The senate and house in Washington would promptly put an end to this clear cut case of circumvention of the tax treaty between Canada and the United States, if it were not for the fact that the U.S. revenue agents continually emphasize that Canada has never protested but that on the contrary the U.S. agents have had the continued co-operation and support of the Department of National Revenue in Ottawa.
Before I put on record my own interpretation of what we might call the McEntyre correspondence I should like to put on the record the point of view expressed by the United States ambassador to Canada on April 8, 1958. In a press release issued from the United States embassy he said:
The United States department of justice has taken an appeal to the United States court of appeal against the decision, handed down last April, of the United States tax court in the tax case against Consolidated Premium Iron Ores Limited. Because of a crowded docket, it is understood that the case will not be argued until after the court's summer recess.
I understand, by the way, that the case is going to be heard in September.
The department of justice stresses that an appeal is available as a matter of right to either litigant in such cases. If either party is still dissatisfied after the court of appeals hands down its decision, either will be able to apply for certiorari to the United States supreme court. Appropriate legal remedies are similarly open to litigants in Canada.
4186	HOUSE OF
Supply-National Revenue
It is also the position of the department of justice that a reversal of the tax court decision by the court of appeals would have no effect on the standing or validity of the convention between the United States and Canada for the avoidance of double taxation and the prevention of fiscal evasion in the case of income tax.
It seems to me that is the key point and that the minister might clear it up. I refer to the point made here that even if the decision does go to the United States tax authorities it is not a contravention of the double taxation treaty. The release goes on:
The tribunals of both the United States and Canada will from time to time be required to decide what the facts are in a given case and then apply pertinent provisions of the tax convention.
In all such cases it may be confidently expected that the nationals of each country will be afforded the fullest protection of the law. The United States government is vitally interested in the double taxation convention. There are no grounds for allegations that abrogations, derogation or circumvention of the convention can result from full and open consideration of the convention in the course of the Consolidated Premium Iron Ores case.
The minister is aware that as a result of this press release Mr. Merchant was taken over the hurdles by a subcommittee of the United States senate. Very severe criticism was meted out to him for issuing this statement in which he said that no matter what happened in this case the double taxation convention was not in question. If that is so, I certainly think we need a statement on the matter because I have here the brief of the respondent to the United States court of appeals and I should like to read a section of it. On page 71 there is the following:
As we have discussed, the present appeal in the Eaton and Daley cases and the Premium case is essentially a challenge to the careful, detailed factual findings and conclusions of the tax court, based upon a voluminous record of testimony and documentary evidence.
The events with which this case is concerned involved a Canadian enterprise. It concerned the production of iron ore badly needed for war purposes. The physical difficulties in exposing the ore under Steep Rock lake were enormous. The accomplishment of the engineering task, the financing and the arrangements for marketing the ore-located, as it was, in a remote wilderness-was a feat of tremendous proportions.
The transactions in these eases have at all times been subject to the taxing power of Canada, and the taxes levied by Canadian law have been and are being paid.
The effort of the internal revenue service also to subject Premium, a Canadian corporation, to United States taxes, and, as a result of a belated afterthought and an involved, elaborate, novel and devious theory, to tax United States stockholders of Premium for certain alleged profits of the Canadian corporation, is directly contrary to the treaty and to the applicable statutes, judicial decisions and ruling of the treasury department itself, and to the facts.
That, of course, is a biased point of view. It is the point of view of the respondent, but it does make the point again, as a result of


what went on before in the tax court, that despite what the United States ambassador has stated, there is a question of the double taxation convention being abrogated, and I certainly think anyone reading the last protest made by this government to the United States government would also get that impression. I should like to ask the minister to make a statement that will clear up once and for all the position of his department and the government with relation to this case, to try to give us an assessment of the protests made to the United States authorities and some indication why no action has been taken to cancel this appeal.
On the matter of the strictures upon the deputy minister that have been made by the press with regard to this particular case I think that perhaps they have been most unfair to the deputy minister and in assessing this correspondence I certainly have difficulty in deciding whether to criticize or to praise him or to be able to say whether or not he has taken the right course. I know there are some statements in there that surprise me as coming from the deputy minister, but I do not know whether or not this is normal. I have somehow the feeling that this correspondence reveals that civil servants, in their relationships with other countries, tend to behave somewhat like Chinese mandarins in one of the older dynasties, where everything was very formal, and there seems to be a feeling that the emperors, in this case the politicians, do not really know what they are about.
I would appreciate it very much, and I think we could avoid a lot of this voluminous editorial writing, I might call it, that has been going on all across Canada if the minister would make a statement to clear up these questions.


George Clyde Nowlan: I believe, Mr. Chairman, it would be highly inappropriate for me to make a statement in detail on a matter which is presently before the United States courts. Some of the material which the hon. member has read to us this afternoon and which, as he says, is prejudiced material, suggests that this company was doing business only in Canada. Well, of course that is the crux of the case, and that is the point that has been referred to the United States courts. If the company was only doing business in Canada, then it should not be taxed in the United States. The tax authorities in the United States say it was doing business there. They took the case before the tax courts, and they lost it. For some reason, which I regret, they saw fit to take this case farther, and so far as I can tell now, may have the intention of proceeding with it. If that is their intention, there is nothing the

government of Canada can do to stop it. It is the right of their government to take matters before their courts which arise within their country. When a decision is evolved it will be a matter of very careful consideration by this government, by our officials, and then a course of action that may be necessary can be determined. Nothing more can be done in connection with this matter than has been done.
The preceding government sent an aide-memoire to the state department in Washington. Then, as the hon. member well knows, there were whispers going on, or so it was said, to disregard it; that it was not forcibly presented to the United States government. The present government sent another note to the United States government because there were many factors involved in this case as well as the tax convention itself. This government felt, for reasons which were known to the United States authorities as well as our own, that the matter should be dropped. To reinforce that, the Secretary of States for External Affairs, when he was in Washington, was instructed by this government to inform the officials of our position. I was advised that this had been done verbally to the secretary of state, the United States treasury officials and the attorney general of the United States.
When the President of the United States and the secretary of state were here a few weeks ago there were conversations with the cabinet. After the cabinet meeting, the President, the Prime Minister and I had a discussion on this matter. I am not suggesting that the hon. gentleman was misleading in any way, but it is not correct to say that the President or the secretary of state expressed an opinion on this matter. They did not say that they felt the thing was being wrongly handled or that they should not proceed with the case. I raised this, and said it was a matter of concern to the Canadian government. This time, I can vouch personally for the fact that there is no validity in the statement that this has not been communicated to the United States officials, definitely and firmly. It was done in a personal conversation in this building, in fact in room 16 right off this chamber. The President and secretary of state made inquiries about it, and said they would inquire further into it on their return to the United States to see what the situation was. Neither the President nor the secretary of state expressed any opinion whatever on the action. However, I was advised afterwards that even that afternoon they were making telephone calls with respect to it and making inquiries. That is the situation
Supply-National Revenue so far as the President of the United States and the secretary of state are concerned.
A great deal has been said, and a lot of misinformation has been spread around, which is not justified in any way, shape or form by the facts, about civil servants communicating information from one country to the other. If any one of the persons who made this charge ever looked at the tax convention between the United States and Canada he would find that the tax convention requires the officers of one tax department to communicate to the officers of the other tax department information which is requested about the affairs of a taxpayer whom they are investigating. In other words, if information was communicated, and I believe it was in the earlier days at least by officials of national revenue, either through Mr. McEntyre or his predecessor as deputy minister or some assessor in Toronto where the file was kept, to the United States officials, that was proper. The United States officials had a right to ask for that under the terms of the tax convention and we could not have refused to give them the information, even if we had wanted to do so. Therefore, there was certain information requested and certain information given.
There was an allegation also that Mr. McEntyre had encouraged these proceedings, but the hon. member for Port Arthur had the file produced and tabled in the house, and he says quite frankly, having read the file, he cannot see any justification for these charges which have been made against Mr. McEntyre. Neither can I. I am satisfied that nothing has been done by Mr. McEntyre or by any of the other senior officials of the department, except what has been done in compliance with the terms of the convention.
I might say the hon. member asked if any information is being given by the department now. There has been no communication with the United States authorities for a long while. I presume the reason is that they have completed their investigations and do not require any further information. At any rate, they have not asked for any more information and there have been no communications from Mr. McEntyre or any other official of the department for some time. Many allegations have been made, but I am not going to stop to discuss them all now, and I certainly do not want to discuss the case itself. I do think there has been an over-emphasis, and I express it that way, of the distortion by bureaucrats and matters such as that. Whatever the facts may be, they are presently before the courts in the United States and this government has to leave it to the United States government to decide whether they

Supply-National Revenue should proceed with that action. Every possible approach has been made to them on that score. If the United States government decides not to interfere but to allow the action to proceed, naturally we will await the judgment which will be given by the court in the United States. Then, having got that, we will be in a position to discuss the matter if such a discussion is necessary.


Douglas Mason Fisher: There is one more question, Mr. Chairman. The case which is before the United States court of appeals has three aspects. First, there are two persons involved, Mr. Daly and Mr. Eaton, and then there is Consolidated Premium Iron Ores Limited. L was just wondering, if the case did go against Premium Iron Ores or against the persons, or against both, what would be the position so far as the tax treaty is concerned, in Canada's view? Surely, the minister can make a comment on that without prejudicing what may be before the courts.


George Clyde Nowlan: I cannot make any more comment than I have. This matter is within the competence, shall I say of the United States taxing officials, to assess someone for taxation. Whether or not they are right in that, as is the case in this country, must be left to the courts to determine and that is what is going on in the United States at the moment. There has been an assessment made on the company and on individuals, and whether or not the facts warrant that there may be grave differences of opinion and grave doubts. There is nothing that one can do about it. The matter has to be left to the United States courts to determine. This is not a one-way street. There are scores of cases on the other side of the street where Americans assert that we are taxing them wrongly and are obliged to take recourse to the Canadian courts in order to get those matters determined. That is what the tax convention is for. It is to avoid double taxation. Of course there is no double taxation practice in one sense because, as far as Premium Iron Ore is concerned, the company was not taxed in the years in question.


Jean-Paul Deschatelets: Mr. Chairman, I should like to submit again a suggestion that I made in 1957 to the minister's predecessor in the estimates committee. It has to do with the way in which the income tax inspectors are making their investigations. I understand that the income tax inspector would go to a taxpayer and ask him all kinds of questions in order to get information and facts to which these inspectors no doubt are entitled. The point I have in mind is to put the taxpayer on the same level as the department when a case reaches the court. What often happens 

is this, and it has even happened to the minister who practised for many years. When a client who was sued by the department went to his office and the minister asked his client the question "Have you discussed the matter with or were you interviewed by an inspector of the department", his client would answer "yes". Then when the client was asked the question "What did you say?" it turns out that he does not remember. The point I have in mind is this. We are not interested in winning cases. In this department we are interested-and I think the minister will agree with me-in gathering facts and in having justice done in such a way that both parties will be on the same level. We should avoid a situation in which a taxpayer may be taken by surprise in court. Hence the suggestion I make again is this. When the income tax inspector goes to interview the taxpayer, he gets the facts which the taxpayers usually gives very willingly. What is the reason why he does not, at the end of the interview, deliver to the taxpayer a copy of the statement of the facts he is presenting to the minister? This investigation has but one purpose, namely to get the facts. If the evidence is well established, a prosecution will follow. What I have in mind is that we should try, as best we can, to ensure that the taxpayer is not taken by surprise in court and that he is given every possible opportunity to defend himself. I believe the minister will see some merit in this suggestion, and I would hope that he would examine the possibility of adopting it.


George Clyde Nowlan: I will have to tell the hon. member, as he has reminded me, that I sat on the other side of the desk for a good many years and I think I know something of the problems involved. I have great sympathy. I can assure him that this suggestion and others will be given most careful consideration by the administration.


George James McIlraith: There is one matter I want to raise, Mr. Chairman. The minister will recall that, when the estimates of this department were last before the committee of supply some 26 months ago the present Minister of National Health and Welfare who was then a member of the opposition made a rather strong criticism of the department. It was really an attack on the department. Among other things he said this, as found at page 5018 of Hansard of June 13, 1956:
It was clear in the evidence that the collecting department of the Department of National Revenue is not clear in its own mind as to how to determine the laws that exist,-

Then coming more particularly to the point he went on to say this:
I should like to say a few words on the iniquitous net worth system of collecting taxes, and it applies to all people, not only to farmers.
Then the minister himself followed in somewhat less strong language-


George Clyde Nowlan: I was hoping you would spare me that.


George James McIlraith: -but nonetheless forceful language. In any event I want to quote one portion of his remarks in order to make my point. I am quoting from page 5048 of Hansard of June 14, 1956:
What is the situation? A farmer is confronted with a net worth statement. He is told, "If you can prove we are wrong, we will accept it. You prove that we are wrong". How can that be done by a farmer whose records are usually somewhat incomplete-at least I am speaking for the farmers whom I know, namely those in Nova Scotia-and who does not purport to keep records over a long period of years?
The point I want to get at is this. Bearing in mind the debate on that occasion with which he is very familiar because of his own participation in it and the attention he undoubtedly gives to his present colleague the Minister of National Health and Welfare, what administrative changes, if any, has he made with respect to the net worth statements as they apply generally and then as they apply particularly to farmers?


George Clyde Nowlan: As far as the practice as such is concerned, I do not think I can honestly say that there have been changes in the practice which ultimately may have to be carried out. Numerous discussions have been held with the head office officials, with assessors and with chief assessors and it has been decided that by following every source of information and pursuing records we could avoid the number of net worth statements which heretofore were taken. We have therefore, reduced the proportion, relative to the over-all number, of net worth statements.
We take a net worth statement only when it is obvious that the records are so incomplete and so impossible to reconcile that that would be the only way in which a fair appreciation of income could be obtained. Then having made up the net worth statement, a copy is sent to the taxpayer before an assessment is made; and he may be asked to come in and review it with the officials. Every care is taken to make sure that when that assessment is finally made on that net worth statement it is as accurate as it is possible to get it. I think that has been done. As I said, it is perhaps not a matter of administrative change. When you have to make up a net worth statement you
Supply-National Revenue have to make it up on the same principles. It is a matter of emphasis, one should probably say, rather than one of administrative change.


George James McIlraith: Perhaps I will not press the minister on the matter. I assume he went rather far in 1956.


George Clyde Nowlan: I still think it is a system which obviously has to be handled with great care by the officials.


William Hector McMillan: I know that the duties of the tax collector are not very popular ones.
_ I want to agree with the minister that he has a very efficient and loyal staff which is noted for its integrity. I have always found the officials very reasonable to get along with here in Ottawa and in the district offices. However, I think the minister should at all times strive for better public relations. We sometimes hear complaints. As members of parliament knowing their problems I think we should help the minister in that respect. I was glad to hear the minister say what he did about net worth. That always troubled the farmers of my particular part of the country and I suspect the same applies to farmers in the minister's part of the country, because I remember in 1956 he said that some inspector had seen a lady there with a new fur coat and had immediately moved in on her husband, or something to that effect.
In connection with prescriptions for drugs, I find they will be exempt as far as income tax is concerned, and would like to know whether or not in submitting the income tax return it will be necessary for the druggist to send a copy of the prescription as well as a receipt for the drug. I think this will be of some concern to some people.
I would also like to know if the department is getting any closer to a definition of capital gains. I know that capital gains are not taxed but a lot of people do not know the difference between earnings and capital gains. In previous years the department was criticized because its estimates exceeded actual expenditures by about 3 per cent, and I am just wondering if that will be the case this year.
I had another question which I asked the minister previously, but I understood him to say it should be asked on item 260. Item 260 went by and I did not repeat it.


George Clyde Nowlan: On the matter of drugs, of course drugs are not exempt as the hon. member well knows, and this rule can only be applied if the medical expenses exceed 3 per cent of the income. In other words, drugs bought on prescription will now be applied as medical expenses rather than as

Supply-National Revenue the specific drugs which heretofore had to be named in what was always rather a cumbersome procedure.
I am not certain myself at the moment as to what procedure will be followed. It is a matter of administration. I would think you would have to have a receipt for medical expenses, anyway, you would have to have a receipt for your doctor's bill and you would have to have a receipt for drugs, so that it would be a matter of assessment and administration. I do not think there is a rule which requires the druggist to attach a copy of the prescription.
It may be that we will find abuses of this procedure and that some such action will have to be taken, but I am sure that the druggists' profession, as in the case of the medical profession, will make sure there are no abuses and that when we see a receipt attached to an income tax return in respect of drugs that may be accepted as proof of the expenditure. Of course there may be individual cases during the years where suspicions may develop and further investigations will have to take place, but certainly this will not have to be done as a matter of practice.


Mr. Mitchell:: There are one or two points I would like to bring to the attention of the minister and his officers with respect to abuses in prescription medicine already taking place. I think the minister will remember that when we discussed the bill on committee stage I spoke two or three times and suggested that a certain amount of inspection may be necessary on the part of his department to overcome such abuses. I happen to know that certain abuses are already taking place and I have just returned from the Canadian pharmaceutical association convention in Edmonton, of which association I am an officer, and I would like particularly to draw the attention of the department to what I might call the "over the counter type of preparation", which in this case is a dietary supplement for infants and children. Due to, shall we say, the integrity of the manufacturer, he is now supplying a printed prescription form to the medical practitioner and all that that practitioner has to do is to sign the form which to all intents and purposes makes it a medical prescription. This in turn is deductible for income tax purposes by the taxpayer presenting it and this particular item happens to be the largest size of the product manufactured. The patient is entitled to a receipt from the pharmacist and it can be used as a deduction for taxation purposes. In view
[Mr. Nowlan.l
of the fact that infants and children are involved such a prescription can be re-applied a number of times.
The point I am trying to make is that if this practice should be followed by other wellmeaning Canadian pharmaceutical houses of repute this could defeat the purpose of the bill and could certainly add to the budget of the minister who brought this legislation into being. We wrote letters to the company concerned, to the minister's department and to the Canadian pharmaceutical manufacturers' association in the hope that they would warn their members that they should not continue in respect of the organizations under their control, but I am afraid that such a practice may create a good deal of abuse.


George Clyde Nowlan: I should perhaps say a further word on this matter. Of course the hon. member knows that the section of the act requires the pharmacist himself to register the prescription and to have it readily available if investigation is necessary. I have said before and I repeat that we are in general prepared to accept the integrity of both the medical and druggist professions but if abuses do creep in, as apparently may be the case in some respects today, they will not go undetected because when this department starts to investigate they usually make such a complete investigation that the facts of the matter are very definitely established. If people abuse this practice I can assure you, Mr. Chairman, that they will be prosecuted under the terms of the Income Tax Act as rigorously as possible, because this is something which is being done for the benefit of the people as a whole. We trust and have confidence in both professions and also in the general public, but if a few people, particularly a few professional people, attempt as a practice to take advantage of this legislation-and of course there is always an isolated example which can very often avoid detection-it will be detected, it will be investigated and it will be established and the people who are perpetrating it will be very, very sorry they ever did so.


William Hector McMillan: I hope that such abuses do not creep in. I do not know whether in professional men the minister included lawyers.
However, when prescriptions are given, for instance for narcotics, if the Department of National Revenue demands copies of such prescriptions two prescriptions would need to be issued. There would have to be a duplicate because the druggist would have to keep on record the prescription for examination by the officials of the Department of

National Health and Welfare and he would have to send one copy to the Department of National Revenue.


George Clyde Nowlan: I am told by my officials that we do not ask for the second copy of the prescription.


Mr. Howard:: I would like to pose two questions to the minister and, following upon his answers, to expand upon a particular case. I will have to put my first question in a general hypothetical way. I wonder if the minister could explain the attitude or the policy of the department with respect to this legislation in regard to Canadian companies which are wholly owned subsidiaries of United States companies and where the Canadian company is taking the raw material product and shipping it to its parent company in the United States for manufacture. What system is available to set a value on the unit of the raw material for income tax purposes if it is suspected that the Canadian company which is a subsidiary of a United States company is, for bookkeeping purposes, selling to the parent company at a greatly reduced rate to escape the payment of income tax. Is there any provision for that sort of thing?


George Clyde Nowlan: I am not sure if there is any specific section dealing with it. There is the general provision under the law relating to companies dealing at arm's length. In the instance mentioned it would not be an arm's length transaction. The burden is very heavily on the taxpayer to establish the bona tides of any transaction entered into between two companies of that kind. I do not recall at the moment a specific section on that. There is one, of course, dealing with inadequate considerations which does not deal with United States subsidiaries specifically. I refer to section 17 of the Income Tax Act which reads as follows:
17 (1) Where a taxpayer carrying on business in Canada has purchased anything from a person with whom he was not dealing at arm's length at a price in excess of the fair market value,-
You are raising the case of selling it for less money. I continue:
-the fair market value thereof shall, for the purpose of computing the taxpayer's income from the business, be deemed to have been paid or to be payable therefor.
(2) Where a taxpayer carrying on business in Canada has sold anything to a person with whom he was not dealing at arm's length at a price less than the fair market value, the fair market value thereof shall, for the purpose of computing the taxpayer's income from the business, be deemed to have been received or to be receivable therefor.
Then this is a matter of assessment and valuation to determine what the fair market value would have been.
Supply-National Revenue


Charles Benjamin Howard: I appreciate the clarification the minister has given. I had it in the back of my mind that something of that nature did exist because I recall a case in British Columbia a few years ago where that question did arise.
Following upon that, what steps would one take if he were of the opinion that such an arrangement was being entered into to escape the payment of income tax? What material would an individual have to submit to the department to set the wheels in motion to have the matter looked into?


George Clyde Nowlan: If a person interested in this were living near a district office he could go and call on the head of that office or the chief assessor and give him the facts and if the assessor or the head of the office realized that this was not obviously some prejudiced person or someone who was simply trying to make trouble but was a person who wanted to have something dealt with it could be handled from that office, he would consider the matter. Or a letter could be written to the minister, the deputy minister, the assistant deputy minister, the chief assessor or any of the officials and the matter could be investigated. I receive letters but not too frequently some of which are anonymous. I know in the case the hon. member refers to there would be no question of an anonymous letter. When I receive an anonymous letter every once in a while giving me alleged information with respect to tax evasion I simply send it over to the departmental office and an investigation is conducted. I am sure when a letter comes in from someone who signs his name and substantiates it and when it looks like a material case and not one involving $5 or $10 where the investigation costs would exceed the amount involved it is efficiently dealt with by the department.


Charles Benjamin Howard: I wonder what sort of corroborative evidence would be necessary? I have in mind a particular company to which I should like to refer later. What sort of evidence would be necessary? How would the individual, for instance, be able to determine whether the company was trying to escape the law when the information is in the hands of the Department of National Revenue and he does not have access to it? Would just a general supposition be accepted? Would that cause an investigation to be made of a particular company?


George Clyde Nowlan: Yes. If information were in the files it would cause the officials to look closely at the files. There is no question but that if there were a substantial complaint made on matters which warranted an investigation an inquiry would be conducted.

Supply-National Revenue The hon. member does not have to worry about not having facts to substantiate a complaint. He will find that the investigating officers of this department and the assessors will develop the facts if they are there. The only question is that of having the matter brought to the attention of the department.


Charles Benjamin Howard: Yes. 1 have no doubt from my personal experience that the officers of this department will leave no stone unturned. In fact, there is one way in which the minister himself could assist in a public relations job. If he could explain to the committee all the various ways that people use to attempt to dodge the payment of tax I am sure many people throughout the country would thank him very much and probably test them.
I have a particular case I should like to deal with in this fashion rather than by writing a formal letter to the minister. This question may have been brought to the attention of the departmental officials or the minister before. In dealing with it I feel it might be necessary to relate some of the past attitudes and policies of this company not as they are specifically related to the payment of taxes but as they are related to other fields and attempt to draw a parallel there.
I am making reference to the Canadian Gypsum Company in the province of Nova Scotia which, as the minister is probably well aware, is a wholly owned subsidiary of United States Gypsum. I have looked in the Financial Post survey of industrials for the last two or three years and have inquired from other sources as to whether or not there is an annual report or financial statement available from Canadian Gypsum Company to determine what their financial picture is. From the sources of information available to me I have learned of no reference to this company.
As the minister may also be well aware there has been a work stoppage in progress at this company's quarry for some ten months now. If the policies as evidenced by this company in its relationships with its employees over the past years is any indication, I am sure we can expect that company would attempt to use whatever methods it could to get out from under the responsibility of paying the necessary amount of income tax to the Canadian government.
I would point out that the work stoppage that is in effect at the moment revolves around the question of the acceptance by the company of the employees and of the union they have selected which, incidentally, is a nationally organized union and has no ties outside of Canada. The question which the
[Mr. Nowlan.l
company is now objecting to, which incidentally was recommended by a Nova Scotia industrial inquiry commission, is the question of union security. After this Canadian Gypsum Company installed its own company union and had signed a contract with it for a closed shop, which is the ultimate in union security, they adopted the attitude that they did not want to have anything whatsoever to do with union security.
We have also a trend on the part of this company, which attempted to dodge its responsibility of dealing with a recognized and certified union, to go so far as to use the legal technicality that the Nova Scotia quarry workers union, which is now affiliated with the Canadian Labour Congress, was formerly an affiliate of the Canadian congress of labour, in dealing with this particuliar union. I raise this question only to point out that on occasions companies have used whatever means they could to overcome their obligations, whether it be to workmen or to municipalities. Therefore, we can expect they will use other dodges or other technicalities to overcome their obligations to other sections of society. I merely make reference to this union to point out that there is-


Joseph Pierre Albert Sévigny: Order. I regret to point out to the hon. member that he cannot, by establishing a parallel between various actions of companies in their relationships with various unions, say that because they are wrong in one particular field they are necessarily wrong in another field. At the present time we are discussing the items of the Department of National Revenue. I would ask the hon. member to keep as close to the item under discussion as possible.


Charles Benjamin Howard: I appreciate your allowing me to go so far afield, Mr. Chairman. I was wondering how far I could go. I realize that probably I was out of order in that instance but I do hope that the minister or his departmental officials will undertake an investigation of this particular Canadian Gypsum Company to determine whether or not it is paying the full amount of taxes that it should pay in accordance with the law. I do hope my remarks will be sufficient-I know the people in Nova Scotia have a great deal more information with respect to this company than I have-to get the wheels in motion. I realize that the minister cannot give a specific answer at the moment with respect to this company. He may not be able to give me a specific answer at any time with regard to a particular company or a particuliar individual. If he can, I would appreciate it very much. If he would communicate the findings with respect to this company to me I would appreciate it.


George Clyde Nowlan: Obviously, I cannot discuss the affairs of an individual taxpayer at any time. It is not proper to do so and it would be contrary to the act, and one accepts that.
I do not want to be construed as accepting the proposition that every firm which have labour difficulties may also have differences with the Department of National Revenue. That does not follow at all. Very often the firms which may have, shall we say, difficulty :n labour relations, in wages or in something of that kind, may also be most efficient in keeping up their records and may be very, very careful in dealing with the department. In any event, all matters, of course, are considered by the department, and particularly those affecting taxpayers. I can assure the hon. gentleman that the matters to which he has referred are matters which are always under the consideration of the department, and they will continue to receive the attention they deserve.
(Translation):


Mr. Rouleau:: Mr. Chairman, I wish to make a few remarks on item 263, taxation division. I also wish to put forward a suggestion whose implementation would, I am sure, be of very great service to those taxpayers in the medium income bracket.
Before the last world war, Canadians crowded into large metropolitan centres where they expected to find work more easily.
During the war our industries developed at a very rapid rate. The population of our cities and towns increased. Then a change came over the living habits of town dwellers, who sought to quit large urban centres to establish homes in the suburbs, at distances which, at times, reached 15 or 20 miles from the cities.
It followed that those fellow citizens of ours who live on the outskirts of cities must travel considerable distances in the morning and the evening, at great expense.
If that expense is a small matter on a daily basis, the fact that it is a daily occurrence makes it very heavy to bear. People travel by bus, train or private car.
Let us take the case of a working man who lives approximately 20 miles away from his place of work and who uses a car as a means of transportation. This means that he has 40 miles to travel every day. It will be understood that, only for gas, he will have to spend at least $1.00 a day. If he works 50 six-day weeks, he will spend annually, on gas alone, $300. Add to this the wear and tear of the tires, minor repairs, insurance and depreciation. A very conservative estimate-and of course in my mind
Supply-National Revenue the word conservative is not that which is applied to the hon. gentlemen opposite- would put that expense at $600 or $700 per annum.
In my opinion it would be only fair if, for income tax purposes, the working man could deduct all his travelling expenses to and from his place of work, whatever his means of transportation.
In fact, the Income Tax Act should be amended so as to grant a tax exemption to every taxpayer for expenses incurred by the use of automobiles or other means of transportation in the performance of his work or for travelling to or from his place of work.
Workers, professionals, businessmen and manufacturers should benefit from such exemptions on the same basis as directors of large corporations.
Indeed, I am sure that directors of large corporations, in many cases, register their automobiles in the name of their company and the expenses involved are charged to the company, thus reducing profits and taxes at the same time. If a corporation director, whose annual income is substantial, is glad to be able to save a few hundred dollars on income tax, how much more the ordinary worker and, generally speaking, any Canadian who gets an average income, would appreciate an exemption for his travelling expenses by any means of transportation for the purposes of his work.
It would be mere justice to all Canadians, and I respectfully submit to the minister that he should take this suggestion under serious consideration.
While being fair to everyone, this would at the same time provide an additional means of checking the recession which we are now facing, since it would leave several millions of dollars in the hands of Canadians thereby increasing their purchasing power.
I therefore respectfully submit this suggestion to the minister in the hope that he and his colleague, the Minister of Finance (Mr. Fleming), will think it proper to consider it favourably. The same applies to their travelling expenses, airplane, train and ship tickets, and hotel accommodation, etc., which are all put on the company expense account.
I admit that, considering the profit of those corporations, the savings so achieved,-if I may use this expression,-are negligible, but to my mind, there is a principle involved.
If this principle is valid for the directors of large corporations, in all fairness, the government of Canada should grant similar advantages to all Canadians, without exception.

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We frequently proclaim the principle that, in a democracy, all citizens are equal before the law, and, if all are equal with regard to sacrifice, I respectfully submit that they should also be equal in the sharing of benefits.
The exemption from which the director of a corporation may indirectly benefit with regard to his travelling expenses may, in many cases, represent only a few hundred dollars a year.
(Text):
For the benefit of the minister I should like to sum up my remarks in English. I submit to the minister that he should give consideration to the advisability of amending the Income Tax Act so as to provide tax exemption to persons for expenses incurred in the Ifce of motor cars or other means of transportation in connection with their work.


George Clyde Nowlan: I want to remind the hon. member that, as he well knows, matters respecting changes in the taxation law, as I pointed out this morning, come within the ambit of my colleague, the Minister of Finance, and that the Minister of National Revenue is not responsible for initiating changes in policy. It is true that discussions take place between us and there is a closeness of co-operation between the two departments because where policy stops and administration begins is sometimes a rather difficult line to draw. There is some merit in the suggestion that travelling expenses and other matters perhaps have to be considered in a different light from what they were a few years ago, but there will be no change in the taxation law at least during the balance of this session and this recommendation will be considered by the Minister of Finance and by myself and the officials before the new taxation law comes down at the next session of the house.


Guy Rouleau: I am sure that the Minister of National Revenue is in a much better position than I am to convey the message to his colleague, the Minister of Finance.


John Whitney Pickersgill: I thought that the Minister of National Revenue would suggest that the hon. member for Dollard should repeat his speech on the estimates of the Minister of Finance. I think that would be a very good idea.


Leon David Crestohl: In the opening remarks of the minister under this section I think he stated that over 5,000 prosecutions were launched against delinquent taxpayers or taxpayers who had failed to file returns. As a member


of parliament I regard that statement as rather alarming and I think that parliament should give some consideration to the statement. I do not know the exact figure but it was over 5,000.


George Clyde Nowlan: That is for failure to file.


Leon David Crestohl: For failure to file.


George Clyde Nowlan: I will give my hon. friend the actual figures now. There were 5,000 plus prosecutions commenced but 2,200 were dropped. I suppose by "commenced" is meant the laying of the information. There were 2,200 dropped and 3,157 were actually taken to court.


Leon David Crestohl: Perhaps the situation is not quite as alarming as I thought at first. I feel that as members of parliament we should be concerned about the fact that 5,000 Canadians were summoned before the courts for being delinquent in making their returns. I do not know how that figure compares with past years.


George Clyde Nowlan: I only have the figure for the immediately preceding year in front of me. In 1956-57 there were 6,100 prosecutions started and 3,126 were taken to court, or almost exactly the same number. Roughly 600 more were started the year before than last year.


Leon David Crestohl: I have had some experience with the department in dealing with these matters and I have found great anxiety on the part of the officials to do everything possible before a prosecution is instituted. I think the officials of the department should receive credit for that. They exhaust all possibilities, grant all the interviews that are necessary, receive all possible explanations and even grant terms for the payment of arrears of taxes. Nevertheless I feel that further study should be given to the matter not only because of the cost to the country of lodging 5,000 criminal complaints but also because of the great inconvenience and time lost. I suggest to the minister that some kind of study of the situation be instituted and perhaps we can reduce the numbers still further in the years to come.


[Stage Direction]
Item agreed to.
Income tax appeal board-
265. Administration expenses, $107,130.
Herbert Wilfred Herridge: I want to say a word about the income tax appeal board. I have written the minister on this matter with particular regard to one special case. I want to bring the minister's attention to the fact that sometimes the income tax appeal board only sits in the larger centres and there are persons living in more isolated places who want to make appeals and who, in my opinion, are

occasioned unnecessary expense and inconvenience. I urge that every consideration be given to persons living in the smaller centres who wish to lodge appeals and who have to go to considerable expense in order to go to Vancouver or some larger centre.


George Clyde Nowlan: I think the hon. member will remember that some change was made in his constituency or at least in his province. I sent a letter to the acting chairman of the board and arrangements were made for an additional sitting at another place. Wherever that can be done conveniently and efficiently I am always willing to give it consideration and try to work it out although obviously it involves additional expense. Sometimes matters have gone too far in that arrangements have been made, staffs have been moved in and papers brought in with the result that it cannot be done, but it will be done wherever it is practical.


Herbert Wilfred Herridge: I appreciate the minister's consideration but unfortunately when the board was supposed to go to Nelson the railroad was blown up, the cloud ceiling was too low for planes to fly and the bus did not get there in time for the case to be heard.


[Stage Direction]
Item agreed to.

[Stage Direction]
53. Grant towards the anticipated operating deficit of the radio and television services, $39,135,000.
Douglas Mason Fisher: Is the minister going to make a statement?


George Clyde Nowlan: No. I thought I had made enough statements about the C.B.C. during this session, particularly during the last two days, and that I might be forgiven for not making a preliminary statement at this time.


Douglas Mason Fisher: The question I want to ask has to do with one I placed on the order paper some time ago with relation to radio relay stations. I happen to have more of them in my constituency than there are in any other place in Canada and we would like a few more. There are a number of communities of the necessary size to justify it. One of them is larger than some of those that now have such stations. It is very difficult to get a satisfactory statement from the C.B.C. with regard to when they are going to introduce them. I thought by asking a specific question I might be able to get a useful answer. In the estimates now before us is there an item for a radio relay station in the town of Manitouwadge?


George Clyde Nowlan: I would rather deal with such questions when the officials are here but I am afraid I have to give the hon. member
Supply-C.B.C.
a negative answer to his question. Perhaps we could let it stand for a few minutes.


George James McIlraith: In view of the fact that we have already had two days' discussion-


George Clyde Nowlan: And two nights.


George James McIlraith: -on radio and television broadcasting in Canada and in view of the minister's commitment that we will have a committee on the subject in the early stages of the next session of parliament, which it is beginning to look may not be too far distant, we can forgo general remarks.
There are some questions of a particular nature that we would like to ask, and perhaps the best way is to take the questions one by one. I wanted to ask the minister, first of all, about accommodation in Ottawa for the headquarters of the present Canadian Broadcasting Corporation. He will recall that some months ago there was a great deal of publicity in this city, including some photographs, of a proposed new building on a site on the Bowesville road. I wonder if the minister would tell us exactly what the situation is with respect to headquarters accommodation in Ottawa?


George Clyde Nowlan: Has the hon. member other questions at the moment?


George James McIlraith: Well, we could take them one at a time.


George Clyde Nowlan: The situation in connection with the headquarters building in Ottawa, Mr. Chairman, is that the moneys are included in the estimates for that building. Plans have been prepared, so I am told, and have been completed for the construction of that building. By plans I mean architect's plans and specifications. All that work has been done, and it is just a question of deciding when the building itself should be started. I think the feeling has been that in view of the other pressures on the C.B.C. there has not been too much attention given to that in the last month or two, and also with the employment situation, that it might be well to defer until later this fall the actual commencement of the construction of the building. I cannot commit the corporation definitely to that, but it is my expectation that the work of construction will be started within the next few weeks.


George James McIlraith: Has a site been chosen as yet, and if so what is the site?


George Clyde Nowlan: Riverside drive; I think there is a big sign there saying that this is going to be the location.


George James McIlraith: There has been a good deal of controversy and a great deal of conjecture

Supply-C.B.C.
about it, so I think it is perhaps well to clear it up in an authoritative way.
The other point is this: Will supervision of the building be under the public works department or will it be under the control of the corporation itself?


George Clyde Nowlan: The corporation has had
architects retained and plans prepared. It has been the policy of the corporation in the past to superintend its own buildings, and I would expect that practice would be followed in this case.


Lester Bowles Pearson: I should like to ask the minister about implementing some of the recommendations of the Fowler commission in regard to centralizing T.V. and radio broadcasting facilities in Toronto. I understand that there are now a dozen or so separate buildings and installations in Toronto, and that in the interests both of economy and efficiency it would be better to have them centralized in one building. I should like to ask the minister whether there has been any progress in regard to that matter and, specifically, whether the government has taken an option on a property in Don Mills, and whether that option has lapsed? What is the present position in regard to this matter?


George Clyde Nowlan: It was expected that the corporation would be buying land at or near Toronto this year and provision has been made to that end in the capital budget. Investigations have been going on with respect to various properties in and near Toronto, and in view of the operating position of the corporation with the large number of properties we are leasing, something over 20, and with the very high annual rental, I would hope that the investigations would be completed and that the property could be acquired in the very near future. Then we could proceed with the construction of a central property. At any rate, we think we have sufficient money available this year in our capital budget to buy the land, if such land is available.


Lester Bowles Pearson: I had a specific point, and I asked whether the option which was taken on a particular property at Don Mills was taken with the approval of the government, and if so whether it has been taken up or whether it has been allowed to lapse? If so, what was the cost of the option?


George Clyde Nowlan: Does the hon. member mean the capital cost of the land which was included in the option or the cost of getting the option?


Lester Bowles Pearson: If I could get the information on both, I should like it. How much would

this land have been on which the option was taken out? What was the cost of allowing the option to lapse if it, in fact, did lapse?


George Clyde Nowlan: There was more than one parcel of land included in this property to which my hon. friend referred as the Don Mills property. There was a definite option taken on two properties, one owned by the Don Mills Development Limited or corporation, and the other by Famous Players Corporation. Roughly, the properties were about the same area, I think both slightly over 15 acres each, making around 31 acres in all. I have not the figures in front of me concerning the division of the option price between the two, but I can get that information if the hon. gentleman requires it. The total option, I think, although I am not certain, was $710,000 for the two properties, and the division between the two was roughly the same.


Lester Bowles Pearson: Has that option been allowed to lapse?


George Clyde Nowlan: That option has lapsed.


Lester Bowles Pearson: Can the minister explain to the committee why that was done, when an option was taken? Is it true that the government had decided this was a reasonable proposition and had made a decision to take up the option and build on the property?


George Clyde Nowlan: The government had taken no decision whatever, as I recall it. There was a submission and recommendation made to the minister to authorize the payment of the money to these two firms. This matter got as far as treasury board, I think, and then from there, because of the amount involved and because of the varying appraisals, I asked for additional appraisals. We had one appraisal, and frankly I was not satisfied. We got other appraisals and they varied substantially in amounts, some being over the option price and some being under the option price, and in view of the amount involved and the fact we were not going to preceed with construction just now, the option was allowed to lapse. An investigation is being carried on with respect to any possible alternative sites in the general area of Toronto.


Herbert Wilfred Herridge: The minister is well aware of the fact, owing to his near residence to me in this house over a period of some 11 years, that I have repeatedly urged the necessity of some low power relay stations to serve the requirements of some 3,000 people in the northern part of my constituency who, up to date, have been denied adequate radio facilities. I will say since the minister took office his department has secured estimates of the cost of providing low power relay

stations at points on the Arrow lakes near Nakusp, places on the Slocan lakes and Balfour. Can the minister inform the house if provision has been made in these estimates for the building of these low power relay stations?


George Clyde Nowlan: There is no specific amount allocated in the estimates this year for the relay radio stations to which the hon. member refers. The C.B.C. is giving consideration, of course, to the extension of this service. In various parts of the country, as many hon. members know, there is constant pressure on the corporation to build these stations, to increase their number. It would depend upon the other expenditures which the corporation feel must be made this year under their budget as to how far they can continue to expand these relay stations. However, it is a matter which technically has developed a great deal during the last few years, and is one in which the corporation plans on extending service within the relatively immediate future.


Mr. Forgie:: May I ask the minister whether he has made any decision with regard to a satellite station in the Ottawa valley about which I spoke to him yesterday? He said that he might answer today.


George Clyde Nowlan: Is that with regard to the Pembroke station?


James Moffat Forgie: Yes.


George Clyde Nowlan: I should like to be able to tell everyone that all these stations are going to be built this year or at least not later than next year. However, I am not in a position to do that. With regard to that particular station which he has mentioned, I can assure the hon. member that the challenge there, shall I say, or the problem there is receiving careful consideration by the corporation. They have made a fairly intensive study of it and there is more work to be done. I hope that in the not very distant future the hon. member will be able to see the evidence of that work which is now being done.


Mr. Badanai:: I should like to ask the minister whether he has any statement to make in connection with the standards of television programs originating in the studios of the Canadian Broadcasting Corporation. The other day I intimated that some programs were not satisfactory to and did not meet with the approval of some of my constituents. I attempted to read an editorial which had a particular program in mind and I was prevented from doing so because apparently I was out of order. Will the minister now permit me to read the editorial? If there is no objection I wish to read the editorial in
Supply-C.B.C.
full. This editorial appeared in the Fort William Times Journal and reads as follows:
Last week the World President of Rotary visited Fort William. He is an American from Milwaukee, an idealist who heads an international organization devoted to the cause of building goodwill between peoples of all nations. Warmly received here, the distinguished gentleman radiated friendship.
At the same time he was being welcomed in the city, laborers in the vineyard of the Canadian Broadcasting Corporation at Toronto were putting the finishing touches on a production which was waved into the living rooms of Canadians from coast to coast on Saturday evening.
In the name of comedy Duffy and his supporting actors staged a scene in which a cigar-smoking, "smart" American from Milwaukee browbeats an innocent Canadian. The latter comes out of a supermarket, arms loaded with parcels, to discover that the Milwaukee man has crashed into his parked car. The American, abetted by a brassy wife, is shown bribing a witness, feeding the poor Canadian shopper with whiskey from a flask before the police arrive and generally making comments that would make the average American shudder.
Behind the direction of C.B.C. productions there seems to lie an inordinate dislike of the United States and Americans. Saturday night's exhibition was no isolated example. Digs at our neighbours have been sprinkled liberally through the programs of the last year.
It is one thing for the Canadian government to take issue with the government of the United States on a specific problem, or for Canadian spokesmen outside the ranks of government to speak their piece. It is quite something else for a government-sponsored agency such as the Canadian Broadcasting Corporation to stir up antipathy against a host of American citizens who do not deserve any kind of a spanking from tin-pot, irresponsible "artists".
That is the substance of the whole thing on which I attempted to make a statement the other day. I wonder whether the minister has in mind something of a regulatory nature that will prevent such productions from being viewed by the people of Canada. That is something that we should like to know. Our people are very much interested in what comes out of the television sets in their own living rooms. Television can be a wonderful thing for the promotion of goodwill, education and entertainment. It can also be something else. It can be a definite detriment if it is not handled and controlled properly. I should like to know what action, if any, the government intends to take.


George Clyde Nowlan: It is rather hard to answer specifically a question like that. Certainly the government is proposing to take no action whatsoever with respect to it. What action the board of broadcast governors will take on matters of regulation is something we shall leave for them to determine. It is a matter for experience and judgment.
It is perhaps an unfortunate matter that this little skit happened to take place when prominent American people were in town. I can quite understand that the hon. gentleman is somewhat exercised about it. But

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after he raised the question the other day, or tried to do so, I checked on the matter. This program was on a national network, and I thought that if this thing was so bad we should see just what the audience reaction was. It must be remembered also that there would probably be more Americans than Canadians or at least just as many Americans as Canadians listening to the national television network. Naturally one would assume that there would have been many injured feelings.
We have checked in all the offices where our national television stations are located. In Halifax there was no reaction; not one came in. In Toronto we had three telephone calls, two saying it was wonderful and one saying that it stank. In Winnipeg we had no audience reaction. In Vancouver none whatsoever. In Montreal, none. That was the reaction across Canada. We had three telephone calls and one letter; and as I said, two were saying it was wonderful and two were critical of it. When you have a situation such as that, reaction can be critical but I do not think that by regulation of any kind you could control or define a situation where a show did not evoke any more reaction than that, I do not think it would be one that could be dealt with even if a board wanted to. I do not think this is an area in which boards can deal in any event.


Lester Bowles Pearson: On this point, Mr. Chairman, I suggest there is no accounting for tastes and that there never will be agreement on matters of taste. It is true, of course, that television programs not only have an important effect on public opinion within the country but they can be an important factor in relations between countries. We all appreciate that importance. I am one of those who get a great deal of pleasure out of the C.B.C. television programs. I also get much pleasure out of some of the programs we bring in from the United States. We discussed this matter at some length yesterday, namely the Canadian content of programs and the importance of that kind of thing. Since that discussion took place I have had the pleasure of reading an article by the Minister of Trade and Commerce dated July 6 for the Boston Sunday Herald. As it bears on this point perhaps I might quote just two sentences from this article by my hon. friend's colleague. Regarding our relations with the United States he says this:
We have drawn closer together in cultural matters, with Canadians sharing many of the tastes and interests of their American friends.
Canadians are reading more American magazines and seeing more American films and television programs than ever before.

And then he goes on:
The Canadian government's policy has been directed towards giving Americans the same opportunities in Canada as are given to Canadians.
I hope my hon. friend is not going to apply that particular principle to television.


George Clyde Nowlan: I am afraid I did not catch that remark.


Lester Bowles Pearson: In so far as the Minister of Trade and Commerce is concerned, he said that the Canadian government's policy has been directed towards giving Americans the same opportunities in Canada as are given to Canadians and that was said within the context of television programs, films and magazines. I express the hope that it will not be applied to television in Canada.


George Clyde Nowlan: It will not.


Mr. Cardin:: I am reliably informed that shortly before March 31 the hon. Minister of Transport-and he is in the house and is able to confirm whether my information is correct-promised to provide immediate television service at Flin Flon, Manitoba. I am just wondering whether the minister can tell the committee whether this service has been provided or whether it is the intention of the department to provide it in the relatively near future.


George Clyde Nowlan: No, this television service has not been rendered, Mr. Chairman, and with all due respect to the hon. gentleman I do not think the Minister of Transport promised that it would be. I happen to know something about this matter, not from the Minister of Transport but because this problem has again arisen in the last few weeks. There were promoters from the United States who-


John Whitney Pickersgill: Surely the Minister of Transport is not going to leave the committee when we are discussing what he said.


George Clyde Nowlan: -were telecasters using a substitute for microwave on the telephone lines and who wished to do this in Manitoba, as I recall it. They wanted a chance to prove whether this system could be substituted for the microwave and asked to be allowed to develop the system in Manitoba. I have seen the correspondence in this matter and the Minister of Transport at that time told them that if this could be developed it would be a very cheap way to establish television in Flin Flon and in many other areas. They were asked to go ahead by the government of Manitoba and they went ahead and just before the election, as some hon. members here may know, the government of Manitoba entered into an arrangement with them for that very purpose,

but I am told that when they attempted to carry out this proposal it did not work out satisfactorily at all. I believe, however, that the former government of Manitoba was intending to carry on experimental work in that direction. Whether or not the present government so intends I do not know but I believe that is the matter to which my hon. friend refers.


Douglas Mason Fisher: I want to ask the minister, in connection with the programming of the C.B.C., what plans have been made with respect to the program "The Nation's Business" and whether the introduction of two C.B.C. correspondents into the gallery of this house is a preliminary to the establishment by the C.B.C. of its own television correspondents in Ottawa rather than handling the matter, as at the present time, by farming the work out to various members of the press?


Mr. Simpson:: I had thought that possibly when we were discussing item 54 I would like to bring certain matters to the attention of the committee and of course of the minister responsible for the providing of funds to the C.B.C. from this parliament. I now wish to raise a situation which is becoming of increasing concern to the people whom I represent in the constituency of Churchill.
The hon. member who has just sat down mentioned the situation at Flin Flon. I do not now intend to launch into a throne speech, because I know I would be called out of order if I did so at this stage of the session. However, there are certain aspects I must mention about my constituency in order to bring out my point. My constituency comprises roughly 180,000 square miles, taking up almost three-fifths of the province of Manitoba. The matter which is of greatest concern to my people with respect to television is that at the present time there is not one single square mile of that area which is serviced by C.B.C. television. There are many other matters which are of interest and which have been discussed with C.B.C. officials, but when representations have been made to the C.B.C. respecting the possibility of servicing this area, we have often been told that we are too far removed from existing C.B.C. network facilities. This is not quite so, because the more largely populated areas of my riding, particularly those of Swan River, Flin Flon and The Pas, are not so very distant from existing facilities. When one speaks of the far north it is a different proposition altogether, but in regard to Swan River, for instance, which is a large agricultural area, it is only a matter of possibly 175 air miles from Winnipeg and less from Brandon. Extensions to the populated areas of
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Flin Flon and The Pas would probably necessitate covering some 375 miles, so it will be seen that it is not right for the C.B.C. to continually say that Churchill is too far removed from present facilities. The people of the area believe, and I think justly so, that as they are being taxed in the same way as anyone else in Canada, therefore they should share in the benefits provided by such facilities as the C.B.C.
As a result of recent correspondence and discussions, the C.B.C. informs me that until the present time no private applications have been received for television station licences in the area. Undoubtedly that is correct, but I do know of one or two private concerns who are interested in going into this area but before setting up stations they would like some idea as to just when the C.B.C. network would be available to them. The area in which I live, namely, Flin Flon, as well as other Manitoba areas, are to a large extent sports minded and, as in the case of the rest of Canada, are interested in seeing such live network programs televised by the C.B.C. as the world series, the Grey cup, the Saturday night hockey games and so on. They would also like to receive the national news service.
Some of these station operators feel that if they were to go in on a private licence and to operate with kine recordings this might just serve as a deterrent to the C.B.C. ever coming in and giving them a network.
These are the problems facing people interested in applying for private station licences, and I would like to suggest to the C.B.C. that the mere fact in itself that we have an area from which we have as yet not received applications for television licences, is a direct challenge to the C.B.C. to give serious consideration to servicing such areas in order that it may become a truly national body. In areas already serviced by private stations there is not the same degree of need but in areas where there are no private stations and where no applications have been forthcoming I believe there is a direct obligation on the C.B.C. to give this question full consideration.


Douglas Mason Fisher: Mr. Chairman, would the minister answer my questions at this time?


George Clyde Nowlan: Would the hon. member repeat his questions? I believe he was asking a question about a specific station.


Douglas Mason Fisher: I asked about the situation with respect to "The Nation's Business". I also asked if the C.B.C. has any plans to in-stal a permanent C.B.C. correspondent who will appear somewhat in the way Stanley Burke does at the United Nations. The other question related to the prospect of installing

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low power relay stations at Manitouwadge and Armstrong. In both cases I made representations. In one case I sent a lengthy petition to the chairman of the C.B.C.


George Clyde Nowlan: At the moment there is no thought of arranging for a correspondent here. I think that is a matter to which consideration will be given but there is no immediate decision forthcoming on it.
As far as "The Nation's Business" is concerned plans have been finalized to start that next month, I believe, or at least in the immediate future. It will come into being again in the fall and winter months.
The hon. gentleman can rest assured that the problem to which he referred is well along in the planning stage. I would not want to suggest he could expect developments there this year in the construction line at any rate but I would be hopeful that in another year real progress could be made in helping to solve the problem which I know is a difficult one. The C.B.C. is faced with a tremendous problem. It has moneys which though large in total amount are small when one thinks of the number of requests that come to it from all over Canada for the construction of power relays, new stations and things of that kind. It has had to try to deal with the problem on the basis of the funds available, on the basis of need and on the basis of the investigations of the officials of the Department of Transport and the C.B.C. I can assure the hon. member that the problem of the area to which he refers is receiving careful and detailed study at the moment and I believe he will be reasonably well satisfied with the progress that will be made there in the not too distant future.


Douglas Mason Fisher: Thank you, very much. One of the recommendations of the Fowler commission which the minister mentioned in the house was that the dominion network be allowed to lapse. I wonder if that is the intention? I hope it is not. If the two networks continue I wonder if it would be possible for the C.B.C. to give a fairly hard figure as to what it would cost to annually pipe through dominion programs to small communities now receiving trans-Canada programs so they would have both. In other words they would be provided with a choice of program.


George Clyde Nowlan: I am advised the cost would be very high indeed. I can also tell the hon. member that no immediate consideration is being given to the question. That is not just an euphemistic term. No consideration is being given at the moment nor will any be given in the immediate future to the abandonment of the dominion network. Certainly

no decision will be taken on that at least until after the new directors of the C.B.C. have been appointed and have had an opportunity of surveying the whole situation and obtaining the advice of their technicians and also, I presume, the board of broadcast governors. If any decision of that nature were contemplated it will be a long while in the future and certainly the house would have ample notice of it before it materialized.
The hon. member for Churchill raised the question of television service in his constituency and also referred to the inadequacy of the radio service which they are presently enjoying. He has pressed me on this matter on various occasions and I have had to give him the same answer I have had to give other hon. members of the committee to the effect that this is a matter within the control of the C.B.C. and within the limits of its funds the C.B.C. is attempting to achieve the best possible distribution.
I am pleased to tell the hon. member that in so far as radio is concerned at any rate immediate developments are taking place with respect to the northern service. We are very hopeful that the radio need will be met in the immediate future. Progress has been made, it is past the planning stage and work is being done. I hope and expect that the hon. member will be reasonably well satisfied with what transpires so far as radio is concerned.
But television is another proposition. It is easy to say that all Canadians should be treated equally and we sympathize and agree with that view but distance certainly makes a vast difference in cost. The cost of extending a microwave system to that area would be prohibitive at the moment and to do it in other ways would also be an expensive proposition. Probably the reason why no private television station has been established there is because it would require an undertaking from the C.B.C. to extend its program service and at the moment the C.B.C. is not financially in a position to deal with the problem. However, we have solved the radio problem, I think. Next winter, after the board has been appointed and the C.B.C. has been reconstituted, I am sure whoever happens to be the minister responsible for the C.B.C. at that time will have pressure brought to bear on him again by the hon. member for Churchill to do something for his area which is badly in need of television service as every one realizes.
I wish to be perfectly frank with the hon. member and tell him there are no immediate plans. I would almost go further and say there is no immediate hope of solving the television problem at this time in that area.


Guy Rouleau: Mr. Chairman, there has been much talk recently about the construction of a new building in Montreal which will house all the services of the C.B.C. in that city and also as to the site of that new building. I wonder if the minister is in a position to tell the committee if he is contemplating the construction of such a building and, if so, if an agreement has been reached as to the site of that building?


George Clyde Nowlan: Mr. Chairman, the minister has a very voluminous mail at all times and one of the matters which has added to the volume has been the number of people in and around Montreal who have written the minister advising him that they have the only available land for the C.B.C. and that it is an excellent buy and should be bought at once. But seriously, there has been no agreement entered into with respect to the purchase of land though, as I have said, many sites have been offered. The C.B.C. has investigated and will continue to investigate any lands offered for sale but no decision has been made. The need is known to the C.B.C., to me and to the government and there is included in these capital estimates, we hope, sufficient moneys with which to purchase the land during the coming year if the committee sees fit to pass these estimates and if the C.B.C. is satisfied as to the availability and price of the land.


Guy Rouleau: I should like to tell the minister there is still much land available in the constituency of Dollard not too far from the national film board and we would welcome such a building.


Douglas Mason Fisher: I hate to come back to the question of low power relay stations but I feel I must. I think we have nine in my constituency and we hope to make it eleven. The cost figure given by the C.B.C. for these low power relay transmitters ranged between $800 and $1,300. The installation costs range between $3,500 and $6,500. I have talked with telegraph men in several communities involved and they say all that is necessary to allow them to broadcast is a simple turn of the switch. I am prepared to accept the explanation.
Let us get to this other request that I have had from the nine communities involved. They want to know why they cannot have the dominion network programs rather than the trans-Canada programs. It is a matter of opinion, but generally the dominion network programs are lighter and more popular with the people. Several times the man in charge of the relay has thrown the switch and sent out the dominion network programs. He has
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been checked up for it later. Those switches have won a great deal of popular support in the community.
One of the other points I would like to bring up is in connection with the low-power relay stations. I have had requests from two communities which would like to know whether they can use the low-power relay transmitter to make local announcements when the station is not broadcasting or at the end of its schedule or before the schedule begins. They would like to know whether they can make public announcements in relation to things going on in the community; they wondered whether some sort of regulations could be worked out that would allow this and perhaps they could even pay for the time.


George Clyde Nowlan: Perhaps I have to revise my statement about giving consideration to putting another station in there in the immediate future. The hon. member tells me he has nine in his constituency, which I think is more than any other member in the house has. Perhaps he has too many now. We may have to give consideration to changing some and putting them in other places.
As far as changing from the trans-Canada to the dominion is concerned, I am told by the corporation officials that this is impossible. We have a national network. The trans-Canada facilities are there. To make a change such as the hon. member suggests would involve an expenditure of money such as- well, we would have to sell those nine low-power stations he has there to find money to pay for it, and I am sure he would not want that.
It is true the cost of installing those low-power stations is not great. I was bothered about that. I understand the cost of installing is, as he said, from $800 to several thousand dollars. I would say that what he and some of his friends have overlooked is that it is no good to instal them unless you get the programs. When we get programs that are under contract with the communications system we have to pay so much a mile for the programs, and the farther away the relay station is the more the corporation has to pay, and that is where the cost comes in. It is not the installing of the low-power relay but the operation of it afterwards, under the contract that we have with the communications system which is carrying the program at the time. If it is, say, 10 miles away, that is one thing. If it is 50 miles or 100 miles away, the cost goes up proportionately, and the cost is given in the contract for each one of those low-power relays. You cannot say you can carry it in this way, and so on. That

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is the cost of the operation and that is why it is more difficult. The more we have to instal the more costly it is.


Mr. McGrath:: In view of the fact that the province of Newfoundland is not included in the microwave network-I understand it is the only province in Canada not included in the network-will the minister tell the committee at this time when this handicap of our province will be overcome and when the microwave network will be put through to Newfoundland? In St. John's we have one of the finest independent television stations in Canada. However, it is operating under a handicap in so far as it is not connected with the national network because the microwave does not reach Newfoundland.
One other question; perhaps the minister can advise the house as to the capital expenditure the corporation has planned for the province of Newfoundland in the ensuing year?


George Clyde Nowlan: Mr. Chairman, I can tell the hon. member for St. John's East, as he knows, that the television microwave expenditure is being proceeded with. Unfortunately there have been delays in the acquisition of material. I had thought that the whole thing would be completed within the next few months but there have been substantial delays owing to material shortages. As a result, I do not think he can expect to see the completion of that microwave system until sometime early next summer. It may be that late. It certainly will not be, as I expected it would be, early in the winter, but it is going ahead. All the troubles are now settled and the material is ordered, and he can confidently look forward to the microwave sometime during the next summer months, and I hope early in the summer.
In so far as the capital budget is concerned, we have the cost of the microwave station and I think that is all that is really included in the capital budget. It depends, of course, on many things. The general budget for the country as a whole is not earmarked, and it will depend on expenditures in different places and how much money is available as to what is done.


Herman Maxwell Batten: Mr. Chairman, once again I would like to bring to the attention of the minister a problem concerning a radio station that exists in my riding. I am referring to the C.B.C. station known as CBY, which operates on 790 kilocycles in the city of Corner Brook in the province of Newfoundland. This radio station, now operated by C.B.C., was formerly operated on the west coast of Newfoundland long before Newfoundland came into confederation, and its programs, both local and otherwise, were broadcast all along the

west coast of Newfoundland. In an area where communications leave a lot to be desired, radio services become much more important under such circumstances. The result is that this radio station has become very important to the people on the west coast of Newfoundland in so far as local news bulletins, news about fishing boats up and down the coast, and so forth, are concerned.
This section of the coast is about 300 miles long. The station is situated approximately 100 miles from the southern end and 200 miles from the northern end. Over the years this station has given very fine service to the area. Of late, however, in the southern part and in the northern part interference from station CKEC at Newcastle, New Brunswick has been experienced. The trouble appears to be that the station at Newcastle is on exactly the same frequency as the station at Corner Brook.
I must make myself clear to the minister. I am not making any complaints about the station at Newcastle and I wish to say right now that as far as I know the interference to which I am referring does not exist within the protected area of CKEC at Newcastle and neither, I think, does it appear within the protected area of CBY. The northern part of the west coast of Newfoundland and the southern part are both outside the protected area but at the same time they are areas that have been served for a number of years by this station at Corner Brook. This interference from CKEC is such that the local station at Corner Brook cannot be heard.
As I said before, over the years this station has given a very fine contribution. It is operated by a very efficient manager, supported by a very capable staff. I say that because of the fact they have been able to play a great part in the local programs in the area and today the people look to it a good deal. When I think of the people in the northern part of the northern peninsula and in the southern part where they are no longer able to get the programs that are broadcast from the station I begin to wonder just what can be done about it. I think the frequency which has been allocated to CKEC is quite within the legal authority of the international code for assigning frequencies, and I have no doubt that from a legal point of view those two stations are quite within their rights. I believe, too, that from an engineering point of view those two stations are perfectly all right.
I agree that the thing may be right legally and I agree that it may be right mechanically but there is something wrong if the people of an area have been able to enjoy these programs from the station over a long period of

years and now can no longer do so. What can be done about it, of course, is a matter for an engineer. It may be a question of increasing the power or of changing the frequency. It may be a problem of changing the antennae or ground patterns. Whatever the problem is, I suggest to the minister that he would be doing a service to these people in the northern part of Newfoundland if something could be done to solve it. I might also ask the minister to give any information he can when he is replying about what is happening in the city of Corner Brook as far as television coverage is concerned.


George Clyde Nowlan: With respect to the frequency problem to which the hon. member has referred, it is a most unfortunate circumstance that an area which enjoyed radio reception for many years has now apparently had its reception severely prejudiced or has practically lost it entirely due to the allocation of a wavelength somewhere else. Of course, that has happened in other places. As the hon. member says, there is no question about the legality of it. These frequencies were allocated by the Department of Transport in accordance with the international agreement. As the hon. member knows, something happened and although, as he says, the areas directly concerned are clear, you have these other areas which have enjoyed radio reception for years and are now being severely interfered with. The departmental officials tell me that they have been attempting to cope with the situation. Studies have been going on and investigations are being made. Frankly, no solution has yet been reached but I can assure the hon. member that I will urge the C.B.C. to pursue the matter and I am sure they will take every step possible to attain a solution of this nasty and difficult problem with which he is confronted.
So far as the question of television in Corner Brook is concerned, I am not sure what the exact status is at the moment. It is expected, I am told, that there will be sufficient moneys in the capital vote this year to provide for that area.


Herbert Wilfred Herridge: On June 25 the minister
announced in the house proposals for surveys of the possibilities of the establishment of six satellite television stations in Canada, including one in Trail. Can the minister inform the house how far the surveys have proceeded with respect to the establishment of the one in Trail?


Mr. Regnier:: Mr. Chairman, I know that last June the minister announced that there would be a French language satellite station in Winnipeg to serve the French population in the west. Will the change in the set-up and the creation of a new board delay the
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project? I know that the people of Manitoba and particularly of my riding of St. Boniface are much interested in a French station in Manitoba. I believe that there are now about two hours a week in French on the Winnipeg station and although many English speaking people enjoy French programs there are always a few who prefer to have all the programs in English. If there were a French station they would not be deprived of all English programs by the two hours in French on the local station. I also understand that many of the students taking French at the university would be interested in listening to French programs over a French station. I would appreciate it very much if the minister would assure the people of Manitoba that this project will not be delayed because of the new board being set up.


George Clyde Nowlan: I can give the assurance that it is not going to be delayed because of the proposed changes in the broadcasting bill we passed yesterday. The situation with respect to Trail and the situation with respect to St. Boniface are practically identical. Surveys are being made and are virtually completed. Engineering designs are going ahead for the locations and in both cases work will be started this year. It will not be completed this year but I am quite sure it will be fairly early next year. Some time next year in any event the stations at Trail and St. Boniface will be completed and in operation.


Charles Edward Rea: Shall vote 56 carry?


John Whitney Pickersgill: Before the item carries, Mr. Chairman, I cannot refrain from pointing out that the debate this afternoon, and I am not seeking to criticize anyone on either side of the house for it, is the best possible illustration of the unwisdom of the decision made yesterday. We have listened all afternoon to members getting up and urging the government to do something about a system that we thought and still think should be independent of the government. This business of having annual appropriations, which is what we are talking about now, for the C.B.C. instead of having the C.B.C. discussed in a committee in the way the C.N.R. is discussed is, it seems to me, a very retrograde step indeed.


George Clyde Nowlan: I do not want to get into another altercation with the hon. gentleman. I know that at one time he was busy running a department and probably like other cabinet ministers then and cabinet ministers today did not spend as much time in the house as he does now as a private member. However, I sat in the house for 10 years as a private member and the practice that has been going on this afternoon has gone on every time the C.B.C. vote has come up in the past

Supply-Citizenship and Immigration 10 years. There is no difference whatsoever. Members of the house who had requests to make made them and the situation has not changed. Of course, any reference to the debate on the bill passed yesterday is completely out of order.


John Whitney Pickersgill: I might point out-


George Clyde Nowlan: I knew you would.


John Whitney Pickersgill: -that there have not been annual appropriations except for the last two or three years so that the minister's statement about the last 10 years is not correct.


George Clyde Nowlan: It does not make any difference. Requests were made just the same.


John Whitney Pickersgill: There used to be debates on setting up radio committees when hon. members expressed their views about what they would like the C.B.C. to do and that is as it should be, but this business of having to appeal to the government is what we find objectionable.


Douglas Mason Fisher: Mr. Chairman, I simply wish to say that I do not want to have us identified with the views expressed by the very partisan member for Bonavista-Twillingate.


[Stage Direction]
Item agreed to.
Charles Edward Rea: This completes the estimates of the Department of National Revenue.



DEPARTMENT OF CITIZENSHIP AND IMMIGRATION

[Stage Direction]
65. To provide, subject to the approval of treasury board, for trans-oceanic and inland transportation and other assistance for immigrants and settlers, including care en route and while awaiting employment; and to provide further for payments to the provinces pursuant to agreements entered1 into, with the approval of the governor in council, in respect of expenses incurred by the provinces for indigent immigrants, $8,180,000.
Mrs. Fairclough:: Mr. Chairman, when we were last in committee on these estimates we were considering vote No. 65 and I did not have the opportunity on that occasion to make some reference to this vote and to the size of it. Since the estimates were prepared some time last autumn there have been changes in circumstances which make it possible now to reduce the amount of this vote. Accordingly, I would ask my colleague, the Minister of National Revenue, to move this reduction. I should like to have the amount of the vote reduced by $500,000.


George Clyde Nowlan: I move:
That vote 65, immigration branch, to provide subject to the approval of treasury board, for trans-oceanic and inland transportation and other assistance for immigrants and settlers, including care en route and while awaiting employment, etc., be reduced by $500,000.


John Whitney Pickersgill: I wonder if the hon. lady would explain to us how she came to make this shockingly bad estimate?


Ellen Louks Fairclough: At the time that the estimates were drawn up we had expected we would have a great many more people on subsistence than now appears to be the case. We have been able to procure employment for so many refugees and others who were formerly on assistance that it is now possible to make this reduction in the estimates.


John Whitney Pickersgill: That is a very encouraging statement indeed, by the hon. lady. The other day I meant to ask, but I did not think of it, how many people are on subsistence at the present time? I shall put two or three related questions because it will be easier to answer them that way. How many persons are receiving subsistence? How many of those persons are seeking employment? How much has been spent in total on subsistence by the department so far in the present fiscal year or, if the hon. lady has not an up-to-date figure for the calendar year, whatever would be a convenient recent date?


Charles Edward Rea: Would the committee be prepared to accept the amendment at this stage?


John Whitney Pickersgill: Agreed.


[Stage Direction]
Amendment agreed to.
Ellen Louks Fairclough: As of August 15, Mr. Chairman, the total number of immigrants receiving subsistence was 1,033; the total number of workers yet unplaced or the total number seeking work was 323.


John Whitney Pickersgill: That includes Hungarians?


Ellen Louks Fairclough: Yes; as a matter of fact, of that number 98 are Hungarians and 225 are others. The amount to the end of July, for which the hon. member asked, is $2,140,713.97.


John Whitney Pickersgill: From what date?


Ellen Louks Fairclough: For the fiscal year.


John Whitney Pickersgill: Since April 1?


Ellen Louks Fairclough: Oh yes.


John Whitney Pickersgill: I must say that I think what the minister has just told us is quite a tribute to the efficiency of the staff who look after these matters in the immigration branch. I am sure the hon. lady would today agree with me in that.
The other question I wanted to ask concerns the assisted passage loans. I would be interested to know whether or not assisted passage loans are still being made, to what classes of persons they are being made at the present time, and also what the latest balance sheet shows on the assisted passage fund?

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Ellen Louks Fairclough: The total number admitted in the first six months of the calendar year, to the end of June, was 4,962. On their behalf there was paid $1,329,874. In the same period, we received repayment or there were collections amounting to $1,797,665. The hon. gentleman asked about the condition of the fund, I think, and also the classes of persons.


John Whitney Pickersgill: Yes, that is right. Perhaps I could make it a little more precise. I should like to know the total amount of loans since this scheme was started, the total amount repaid and the total amount outstanding as of the latest convenient date?


Ellen Louks Fairclough: Assistance has been given to 107,092 since February 1, 1951, and the total amount paid amounted to $17,181,040. Collections have amounted to $10,963,616. A rapid calculation would indicate that there is something over $6 million outstanding.


John Whitney Pickersgill: No, I will not ask the hon. lady to do the subtraction. Can she give the categories of persons receiving the loans?


Ellen Louks Fairclough: Roughly speaking, Mr. Chairman, there are those who are coming to take occupations and those who are in need of assistance, not sponsored by relatives, but those who are coming here to take employment and who have indicated that they are unable to pay their own passage.


John Whitney Pickersgill: I am not going to detain the committee, but I have tried several devices to find out from the hon. lady what categories of persons are admitted to take employment in this country. She tabled a very complicated chart which I never quite understood when I was minister, and I frankly confess I do not understand now. Perhaps some day she would have some one of the officials in her department translate it into either English or French as a list of occupations, in any kind of order at all, but in plain, ordinary words that we could understand, and lay it on the table. I shall not detain her now.


Ellen Louks Fairclough: In the same spirit of good will, may I say that I agree it is a complicated document. On the other hand, as the hon. member knows, an occupation in which there may be no vacancies in one part of the country may show unfilled vacancies in another part of the country, and when you try to signify by area and also by occupation precisely what classes are open, it does become complicated.


John Whitney Pickersgill: I will let the hon. lady off if she will just give a list of all the occupations to which immigrants are admitted in any part of the country?
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Ellen Louks Fairclough: Does the hon. member mean right now?


John Whitney Pickersgill: Oh, no, by no means, but before the end of the session.


Ellen Louks Fairclough: All right, I will.


Leon David Crestohl: Could the minister tell the committee, of those immigrants who are receiving assistance, how many were admitted to Canada without jobs waiting or guaranteed for them?


Ellen Louks Fairclough: I do not believe we would have that information without tracing down every single one of these persons and finding out what the circumstances were under which they entered the country. It is conceivable that a person would come in to take employment, and then within the first year have that employment disappear. He might come in as a person destined for a specific job, and still receive subsistence later on.


Leon David Crestohl: Could the minister tell us whether there is any priority or any special consideration given to immigrants who apply to enter Canada and who have a job guaranteed to them on arrival?


Ellen Louks Fairclough: I doubt whether we can guarantee jobs, or whether we can indicate to immigrants the possibility of securing employment in certain places or at certain times. The possible exception might be if one comes out to take a job on a specific farm or in a specific household as a domestic. I am not sure that I understand the hon. member's question.


Leon David Crestohl: I think the minister misunderstood my question. My question was this. Is there any priority or special consideration given to an applicant to migrate to Canada who has already a job assured to him on arrival by his relatives or some other people?


Ellen Louks Fairclough: If I understand the hon. member's question now, what he means is this. Suppose he is assured of employment here in a specific position but has not the necessary funds to come out, will he be assisted in passage?


Leon David Crestohl: I am not speaking of assistance in passage. I am speaking of an immigrant who applies to migrate to Canada and who has a job assured to him on arrival. He may come on his own steam, but he has a job assured him on arrival. I am asking whether any preference or special consideration is given to such an immigrant over one who has no job waiting for him on arrival and who subsequently requires the assistance of the government.
4206	HOUSE OF
Supply-Citizenship and Immigration


Ellen Louks Fairclough: The hon. member gets me confused by adding at the end of his question the words "assistance of the government".


Leon David Crestohl: I do not mean to confuse the minister, Mr. Chairman. If I may repeat my question, I shall do so. Suppose a person applies to migrate to Canada, has a job assured him on arrival either by relatives or friends and pays his own expenses. Is there any priority or special consideration given to such an applicant over one who has no job waiting for him and who may become a charge to the government?


Ellen Louks Fairclough: The answer to that question would be that, if the position to which he is destined is one for which there are no applicants in Canada and it has been cleared as such through the national employment service, his entry would be expedited; yes.


Herbert Wilfred Herridge: May I ask the minister this question. Does that apply to relatives of Chinese citizens who make application for their relatives to come here and who in every case have assured employment, who never come on the community for care or are never any expense to the Canadian people or the Canadian government?


Ellen Louks Fairclough: No. That does not apply to sponsored cases.


Erhart Regier: First I should like to compliment the minister on being willing to make and in fact arranging for an amendment reducing an estimate. That is quite a favourable action in comparison to that of a minister who some days ago insisted on an estimate for parliamentary assistants remaining, even though the possibility of the estimate being used had been exhausted by the passage of the months. However, I wonder whether the minister could give us a breakdown as between the various purposes for which the estimate of, I now take it, $7,680,000 is expected to be used? I notice that in the details even less information is given than is given at page 12 of the blue book. What I should like to know is this. What is the estimate that will be needed for trans-oceanic transportation assistance; what is the estimate that will be needed for inland transportation assistance; what is the estimate for other assistance for immigrants and settlers; and what is the estimate for maintenance of immigrants who have not the wherewithal to look after themselves once they are in Canada?


Ellen Louks Fairclough: I think I can give the hon. member the broad breakdown. Inland transportation is estimated at $640,000; transoceanic transportation, $720,000; food, shelter and incidental expenses, $3,800,000. That is


the one that will be reduced by half a million dollars. Then there is family assistance for immigrants and settlers, $2,800,000; and federal-provincial agreement, $220,000.


Erhart Regier: The other day I noticed a news item about Canada accepting another limited number of refugees of the revolt in Hungary. Might I ask the minister this question. Have all these refugees now been placed somewhere in the world or are there large camps of refugees remaining in Austria or Yugoslavia or elsewhere? I believe there were some in the other western European countries.


Ellen Louks Fairclough: It is hoped that this movement will clear up the Hungarian refugees who have been in camps in various places.


Erhart Regier: The minister says that she expects that this large admission to Canada-


Ellen Louks Fairclough: And to other countries.


Erhart Regier: -is likely to end the matter as far as Canada is concerned. I have one other question. Even with the reduction of the minister's estimates, I notice that it still leaves $7 J million compared to the $12,911,000 for the fiscal year ended last March 31. I noticed a news report the other day that we were expecting to Canada this year only in the neighbourhood of 70,000 immigrants which figure I believe is only roughly 35 per cent of what it was a year ago.


Ellen Louks Fairclough: There were that many in the first six months, practically.


John Whitney Pickersgill: I wonder whether I could ask the hon. lady a question. How many settlers who were not immigrants received assistance since the item was changed to include settlers? Perhaps the hon. lady does not know what a settler is. I may say that a settler is a Canadian citizen who left Canada a long time ago and came back. We changed the law a couple of years ago so that for this purpose they could be treated as immigrants. This question is asked perhaps just out of idle curiosity. If the figure is not readily available, I would not press the matter.


Ellen Louks Fairclough: I do not have it right here but I shall be glad to get it for the hon. gentleman.
While I am on my feet may I correct a statement I made a few moments ago. Amongst those for whom assisted passages are available are wives and minor children. I said no sponsored relatives were eligible but wives and minor children in Europe sponsored by residents of Canada are also eligible for assisted passage.


John Whitney Pickersgill: There is just one other question that I should like to ask the hon. lady. In response to a question I asked earlier in the session she gave me a categorical assurance that a settlement made with the government of Ontario with respect to Hungarian refugees was in no respect whatsoever more favourable than the settlement made with Saskatchewan. I should* like to be quite sure that was the case.


Ellen Louks Fairclough: If my memory serves me well, I did not put it in quite that way. I think I said that the one was based on the same general principle as the other. I would not be able to answer the hon. gentleman if he is asking me if there was any particular in which the one is more favourable than the other. I would have to inquire.


John Whitney Pickersgill: If the hon. lady has examined the file at all carefully she will recall that there was a good deal of negotiation that went on about this point before she became minister and before the government changed, and that I took the view that we could not possibly give more favourable treatment to a wealthy province like Ontario than we were giving to Saskatchewan. It was because I took that attitude that the negotiation broke down and no settlement was ever reached with the government of Ontario. I think we really ought to be assured in the committee before the estimates are passed that all provinces-and of course Ontario and Saskatchewan were the ones that performed the widest services in this field-were treated on a basis of absolute equality.


Ellen Louks Fairclough: I will try to get that information for the hon. member.


John Whitney Pickersgill: If the hon. lady would undertake to give her reply tomorrow I will not hold up the item on that account.


Ellen Louks Fairclough: Very well. With respect to the question asked about settlers, as of July 31, 89 settlers received transportation assistance in order to return to Canada.


Mr. Garland:: Would the minister say if any preference whatsoever is given to applicants when the sponsor is prepared to post a bond or give a guarantee that the immigrant will never become a public charge?


Ellen Louks Fairclough: I think I am correct in saying that we do not ask for a bond except where there may be health conditions indicating that the person could be a public charge. These cases are handled so carefully and individually that I do not think I could give a general answer to that question.


Leon David Crestohl: I wish to make a few general observations. My views on the urgency of 57071-3-2661
Supply-Citizenship and Immigration increasing immigration to Canada have been stated in this house over the years since I have been sitting here and those views have been supported in large measure by eminent members of the house. If I might mention the Hon. George Drew, the present Minister of Finance, the Prime Minister himself; all those gentlemen have taken views similar to my own and have stressed the importance of admitting immigrants and expanding our population. I do not wish to go over the ground again but there is one phase of it which I would like to draw to the attention of the minister and that is the expediting of immigration into Canada of the close relatives of people already here.
This is a very delicate subject and I think merits all the sympathetic consideration of the minister. I know that in the past I have found great sympathy on the part of the former minister and the officials of the department when dealing with the cases of close relatives, and I wonder if since immigration has been stopped, generally speaking, this has not influenced the immigration of close relatives, although I understand such immigration has not been stopped by the present government.
I personally know of a great many people who have close relatives abroad and who were delighted by the fact that a lady had been appointed as Minister of Citizenship and Immigration for the first time in Canada's history. They felt, quite rightly, that this lady would understand with more sympathy the close ties of family life and the great urgency of having relatives close at hand. I would like to address myself to the minister with a simple plea that she could perhaps avoid being influenced by the men around her who are also sympathetic, but who are more inclined to adhere to the strict interpretation of the regulations. These are men whose judgment I have always respected and by whose decisions I have always abided, but yet I feel that sometimes as supporting officials to the minister, without the authority or the right enjoyed by the minister, they cannot extend sympathetic consideration to these cases. I therefore appeal to the minister as warmly and as urgently as I can to extend every possible human sympathy to these cases concerning close relatives and to even go a little beyond the strict interpretation of the letter of the law and to apply the sympathy which should come from a minister of this department,, especially from a lady whose sympathy and kindness is known.


Ellen Louks Fairclough: I thank the hon. gentleman for his kind remarks. The policy of the department is of course to keep family groups together, but when the hon. gentleman speaks about immigration having been curtailed this

Supply-Citizenship and Immigration year I must say that the vast majority of those who have come to Canada have been people sponsored by their relatives in this country.
I think 1 am correct in saying that this department has always lent a sympathetic ear to those persons who find themselves parted from their immediate relatives by reason of their migration to Canada or for other reasons beyond their control. It is our hope that we can bring these family groups together, but when I say that I cannot guarantee that this would be a blanket policy applied to all parts of the globe because, as the hon. member knows, different conditions prevail in different countries and different areas.
In so far as possible we do hope to bring family groups together, although we cannot always do this as quickly as we would like, for many reasons. I can assure the hon. member that the policy is undergoing close scrutiny at the present time and we hope to have an announcement to make in that respect in the not too distant future, bearing in mind just such circumstances as those he has described.


Erhart Regier: I am a little hard of hearing sometimes but did I hear the minister correctly to the effect that of this roughly $7 million, $3,800,000 was for incidentals? Would she clarify what she said. I know there were other matters, but I was not quite clear in that respect.


Ellen Louks Fairclough: That was for food, shelter and incidental expenses. Incidentals would be just a very small portion of that.


Erhart Regier: Would the minister explain how this is a separate item from the next item-family assistance of $2,800,000? This was the sum of money paid by agreement with the provinces. Exactly how does the item for food come under $3,800,000 and the family assistance under $2,800,000?


Ellen Louks Fairclough: Mr. Chairman, family
assistance is the term given to family allowances when paid to immigrants who would not, by reason of their short term of residence in this country, qualify for family allowances. There might be, and in my opinion there is, some room for argument as to whether this might not properly be paid by the Department of National Health and Welfare, but that is a matter of conjecture. Nevertheless, that is what it is, family allowances paid on behalf of the children of immigrants.


Erhart Regier: May I make a general remark on this item. I believe the basic responsibility of the department should be to find proper immigrants for Canada and I say

that when over $7 million out of $18 million is used for the bringing of immigrants to Canada and the maintenance of those immigrants, that is a fairly high proportion. Relatively more money should be spent in finding ways and means to let Canada have those people who so badly want to come here and who will not be a burden to the Canadian taxpayers.


Herbert Wilfred Herridge: Mr. Chairman, as I wish to make somewhat extended remarks on this item, may I call it six o'clock?
Resolutions adopted in committee of supply this day reported and concurred in.



PRIVILEGE


[Stage Direction]
(Translation) :
Mr. Romuald Bourque (Outremoni-St.
Jean): Mr. Speaker, I rise on a question of privilege. I have before me a copy of this evening's Journal, which reads as follows:
(Text):
Mr. Speaker:: Order. I wonder if the hon. member would raise his question of privilege in the morning. It is now six o'clock and according to the rules the house rises at this time.


Lionel Chevrier: May I ask leave of the house for the hon. member to continue? It is a small matter which appears in this evening's paper and it will take less than a minute.


Mr. Speaker:: Does the house give unanimous consent to the hon. member continuing?


Some hon. Members:: No.


Mr. McGee:: Mr. Speaker, I have an objection. May I be heard on it?


Mr. Speaker:: As unanimous consent has not been given, I do not feel that the rules of the house should be broken.


John Whitney Pickersgill: It is interesting to see who does not want corrections made.


Mr. Churchill:: What is wrong with
tomorrow?



BUSINESS OF THE HOUSE

Lionel Chevrier: Mr. Speaker, may I ask the government leader what the business will be tomorrow?


Howard Charles Green: Mr. Speaker, tomorrow we hope to deal with three or four of the items on the order paper which are not contentious; item No. 2, a minor amendment from the other place to the Excise Tax Act; item No. 9, the resolution preceding a bill to provide for additional judges; item No. 5, second reading of a bill to authorize the construction of

Supply-Items Passed
a bridge from Campobello island to Lubec, Maine, and possibly item No. 1, the house in committee on a bill to amend the Railway Act. Then we shall take the estimates of the Department of Citizenship and Immigration followed by three or four items which remain under trade and commerce and then transport and finance.


Lionel Chevrier: Can the minister indicate what the business will be on Friday and Saturday?


Howard Charles Green: We are hoping, Mr. Speaker, to finish up the estimates.


[Stage Direction]
It being five minutes after six o'clock the house adjourned, without question put, pursuant to the order of the house passed on August 4.
[The following items were passed in committee of supply]:
DEPARTMENT OF NATIONAL REVENUE Customs and excise divisions-
259.	General administration, $4,089,027.
260.	Inspection, investigation and audit services, $4,212,190.
261.	Operation and maintenance, $30,061,430.
262.	Construction or acquisition of buildings, works, land and equipment, $848,400.
Taxation division-
263.	General administration, $3,183,910.
264.	District offices, $29,297,654.
Income tax appeal board-
265.	Administration expenses, $107,130.
Canadian Broadcasting Corporation
53.	Grant towards the anticipated operating deficit of the radio and television services, $39,135,000.
54.	Grant for the capital expenditures of the radio and television services, $8,414,000.
International shortwave broadcasting service-
55.	Maintenance and operation including authority to credit to the appropriation revenue from the rental of facilities in Radio-Canada building and at Sackville, N.B., to an amount of $331,500 and to reexpend these moneys for the purposes of the international service, $1,777,845.
56.	Construction or acquisition of buildings, works, land and equipment, including supervision, $31,290.
534.	Grant towards the anticipated operating deficit of the radio and television services-further amount required, $356,000.
535.	Grant for the capital expenditures of the radio and television services-further amount required, $235,000.
536.	Construction or acquisition of buildings, works, land and equipment, including supervision-further amount required, $14,905.
[Stage Direction]
Thursday, August 28, 1958